Chapter I

Article 1. The capital of a corporation or joint stock company shall be divided into shares, and the liability of the partners or shareholders shall be limited to the issue price of the shares subscribed to or acquired.

Article 2. The corporate purpose of a corporation may be any profit-making undertaking not contrary to law, public order or decency.

Paragraph 1. Whatever its corporate purposes, a corporation shall be deemed to be a commercial entity and shall be governed by commercial laws and practices.

Paragraph 2. The bylaws of a corporation shall define its corporate purposes in a precise and complete manner.

Paragraph 3. The purposes of a corporation may be the participation in other corporations; such participation is permitted, even if not provided for in its bylaws, as a means of accomplishing its corporate purposes or to benefit from tax incentives.

Article 3. A corporation shall be designated by a corporate name accompanied by the expression "companhia" or "sociedade anônima", either in full or abbreviated. "Companhia" may not be used at the end of a corporate name.

Paragraph 1. The name of a founder, shareholder, or person who in any other way may have contributed to the success of a corporation may appear in its corporate name.

Paragraph 2. Should a corporate name be identical or similar to that of a corporation already in existence, the aggrieved corporation may petition for an appropriate alteration by either administrative proceedings (article 97) or court action and may sue for consequential loss and damages.

Article 4. For the purposes of this Law, the corporation shall be publicly-held or closely-held depending on whether its securities are accepted for trading in the securities market. (Text as determined by Law n. 10.194, of February 14, 2001)

Paragraph 1. Only securities issued by a corporation registered in the Brazilian Securities Commission may be traded in the securities market. (Former sole paragraph turned into paragraph 1 by Law n. 10.303, of October 31, 2001)

Sole Paragraph. Only the securities of a corporation registered with the Comissão de Valores Mobiliários may be publicly available and traded on a stock exchange or the over-the-counter market.

§ 2. No securities may be publicly distributed in the market without previous registration with the Brazilian Securities Commission. (Text added by Law n. 10.303, of October 31, 2001)

§ 3. The Brazilian Securities Commission may classify publicly-held companies in categories according to the types and classes of securities issued by it and traded in the market, and shall specify the regulations for publicly-held companies applicable to each category. (Text added by Law n. 10.303, of October 31, 2001)

§ 4. The registration of a publicly-held corporation for shares to be traded in the market may only be canceled if the corporation that issued the shares, the majority shareholder or the controlling corporation directly or indirectly makes a public offering to acquire the entirety of outstanding shares for a fair price, at least equal to the appraised worth of the corporation, calculated based on one or more of the following criteria: net assets appraised at market value, discounted cash flow, comparison by multiples, share quotation in the securities market, or another criteria adopted by the Brazilian Securities Commission. The review of the offered amount shall be assured according to the provisions of Article 4-A. (Text added by Law n. 10.303, of October 31, 2001)

§ 5. If less than five percent (5%) of all shares issued by the corporation are outstanding after the expiration of the term for public offering established by the regulation issued by the Brazilian Securities Commission, the general meeting may decide to redeem these shares for the amount of the offer provided for in § 4, as long as it deposits the redemption amount at a bank authorized by the Brazilian Securities Commission, in which case the provisions of § 6 of Section 44 shall not apply. (Text added by Law n. 10.303, of October 31, 2001)

§ 6. If the majority shareholder or the controlling corporation acquires shares of a publicly-held corporation under its control, and these shares directly or indirectly increase their interest in a certain class of shares in a way that hinders the market liquidity of the remaining shares, they shall be required to make a public offering for a price determined as per § 4 for the acquisition of all shares remaining in the market, according to the general rules issued by The Brazilian Securities Commission. (Text added by Law n. 10.303, of October 31, 2001)

Section 4-A. Shareholders holding at least ten per cent (10%) of outstanding shares of a publicly-held corporation may request the officers to call a special general meeting with holders of outstanding shares in order to determine a new appraisal, based on the same on or different criteria from those originally adopted, for purposes of determining the valuation of the company as provided for in § 4 of Section 4. (Text added by Law n. 10.303, of October 31, 2001)

§ 1. The request shall be delivered within fifteen (15) days from the announcement of the price attributed to the public offer, accompanied by a justification and evidence of inadequacy or misuse of the calculation methodology or the valuation criteria. The shareholders specified in this Section 4-A (first part) may call the applicable meeting if the officers fail to do so within eight (8) days the date of the request. (Text added by Law n. 10.303, of October 31, 2001)

§ 2. Outstanding shares include all issued shares of a publicly-held corporation less the shares held by controlling shareholders, officers and directors, and treasury shares. (Text added by Law n. 10.303, of October 31, 2001)

§ 3. Those shareholders who request a new valuation and those shareholders who vote in favor of the new valuation shall reimburse the company of all costs incurred with the new valuation if the new valuation amount is lower than or equal to the initial amount of the public offer. (Text added by Law n. 10.303, of October 31, 2001)

§ 4. The Brazilian Securities Commission shall regulate the provisions of Section 4 and of this Section, and shall establish the periods for the effectiveness of the review stipulated herein. (Text added by Law n. 10.303, of October 31, 2001)

Chapter II

Section I

Article 5. The bylaws of the corporation shall state the amount of the capital, which shall be expressed in Brazilian currency.

Sole Paragraph. The monetary expression of the amount of paid-up capital shall be adjusted annually (article 167).

Article 6. The share capital may only be changed as provided for in this Law and in the bylaws (articles 166 to 174).

Article 7. The capital may comprise contributions of cash or any other kind of property which may be valued in monetary terms.

Article 8. The property shall be valued by three experts or by a specialist firm appointed at a general meeting of the subscribers called pursuant to notice in the press and presided over by a founder member. The presence of subscribers representing at least half of the capital shall constitute the minimum quorum on a first call and any number shall on a second call.

Paragraph 1. The experts or evaluation firm shall submit a report which shall indicate the evaluation criteria and the basis of comparison used, and these shall be supported by documentary evidence as to the property valued. The experts or evaluation firm shall be present at the meeting at which the report is read to supply any information requested of them.

Paragraph 2. Provided the subscriber accepts the value approved in the general meeting, the property shall be incorporated into the corporation assets, and the first directors shall be responsible for carrying out formalities necessary to effect the transfer.

Paragraph 3. The articles of incorporation shall be void if the evaluation is not approved at the general meeting or if the subscriber does not accept the approved evaluation.

Paragraph 4. The property may not be transferred to the corporation at a value higher than that attributed to them by the subscriber.

Paragraph 5. The provisions of paragraphs 1 and 2 of article 115 shall apply to the general meeting mentioned in this article.

Paragraph 6. Notwithstanding any criminal liability, the valuers and the subscriber shall be liable for any damage caused to the corporation, shareholders and third parties, by their negligence or fraud in valuing the property. Subscribers shall be jointly liable in the event such properties are jointly owned.

Article 9. The transfer of property to the corporation shall constitute a change of ownership rights to the property, unless there is express provision to the contrary.

Article 10. The civil liability of a subscriber or shareholder who contributes property to the formation of the capital shall be identical to that of a seller.

Sole Paragraph. A subscriber or shareholder, whose contribution consists of credits, shall be liable for the solvency of the debtor.

Chapter III

Article 11. The bylaws shall establish the number of shares into which the capital shall be divided and shall establish whether or not the shares shall have a par value.

Paragraph 1. The bylaws may create one or more classes of preferred shares with par value for a corporation whose shares have no par value.

Paragraph 2. The par value shall be the same for all shares of a corporation.

Paragraph 3. The par value of the shares of a publicly held corporation shall not be less than the minimum value established by the Comissão de Valores Mobiliários.

Article 12. The number and par value of shares may only be modified in the event of a change in the amount of the capital or the monetary expression thereof, by shares division or consolidation or by cancellation of shares authorized by this Law.

Article 13. The issue of any share at a price below its par value is prohibited.

Paragraph 1. Notwithstanding any criminal sanction, the infringement of the provisions of this article shall render the act or operation void and those responsible for the infringement shall be liable.

Paragraph 2. Any subscribed contribution which exceeds par value shall constitute a capital reserve (article 182, paragraphs 1).

Article 14. The issue price of shares of no par value shall be established by the founders when a corporation is incorporated, and at an annual shareholder’s meeting or by the administrative council when the capital is increased (articles 166 and 170, paragraph 2).

Sole Paragraph. An issue price may be established in such a manner that a portion thereof shall be used to form a capital reserve. When preferred shares with priority to a capital refund is issued, only that portion which exceeds their refund value may be so designated.

Article 15. A share may be common, preferred or fruition, depending on the nature of the rights or advantages which it confers upon the shareholder.

Paragraph 1. Common shares of a closely held corporation and preferred shares of closely and publicly held corporations may be of one or more classes.

Article 16. There may be different classes of common shares of a closely held corporation, depending on:

I - their convertibility into preferred shares; (Text as determined by Law no. 9.457 of May 5, 1997)

II - a requirement that the shareholder be a Brazilian citizen; or

III - the right to vote separately to fill certain positions in administrative bodies.

Sole Paragraph. Unless expressly provided for, an amendment to that part of the bylaws which regulates the different classes of shares shall require the approval of the shareholders of all shares thereby affected.

Section 17. Preferences or advantages of preferred shares may include: (Text as determined by Law n. 10.303, of October 31, 2001)

I – priority in the distribution of fixed or minimum dividends; (Text as determined by Law n. 10.303, of October 31, 2001)

II – priority in the reimbursement of capital, with or without premium; or (Text as determined by Law n. 10.303, of October 31, 2001)

III – the accumulation of the preferences and advantages provided for in items I and II. (Text as determined by Law n. 10.303, of October 31, 2001)

§ 1. Regardless of having priority rights in the reimbursement of capital, with or without premium, preferred shares will only be accepted for trading in the securities market if they are afforded at least one of the following preferences or advantages. (Text as determined by Law n. 10.303, of October 31, 2001)

I – the right to have an interest in the dividend to be distributed, corresponding to at least twenty-five percent (25%) of the net income for the year, calculated as set forth in Section 202, according to the following criteria: (Text added by Law n. 10.303, of October 31, 2001)

a) a priority in the receipt of dividends mentioned in this item, corresponding to at least three percent (3%) of the share’s net worth; and (Text added by Law n. 10.303, of October 31, 2001)

b) the right to have interest in the profit distributed in conditions equal to the common shares, after a dividend equal to the minimum priority as set forth in item a is assured; or (Text added by Law n. 10.303, of October 31, 2001)

II – the right to receive dividend, for each preferred share, at least ten percent (10%) higher than the dividend assigned to each common share; or (Text added by Law n. 10.303, of October 31, 2001)

III – the right to be included in the public offering for alienation of control, in the conditions set forth in Section 254-A, in addition to the right to receive dividends at least equal to the common shares dividend. (Text added by Law n. 10.303, of October 31, 2001)

§ 2. In addition to those set forth in this Section, the bylaws must precisely indicate preferences or advantages assigned to the shareholders without voting rights, or with restricted voting rights. (Text as determined by Law n. 10.303, of October 31, 2001)

§ 3. Dividends, even when fixed or cumulative, shall not be distributed to the detriment of the share capital, unless the corporation is liquidated and this advantage has been expressly afforded. (Former paragraph 1 turned into paragraph 3 by Law n. 10.303, of October 31, 2001)

§ 4. Unless the bylaws provide otherwise, the priority dividend is non-cumulative, the share with fixed dividend has no interest in the remaining profits and the share with minimum dividend has interest in the profits distributed in conditions equal to the common shares after a dividend equal to the minimum is paid to such shares. (Former paragraph 2 turned into paragraph 4 by Law n. 10.303, of October 31, 2001)

§ 5. The bylaws may not exclude or restrict the right of preferred shares to participate in capital increases resulting from the capitalization of reserves or profits (Section 169), except with respect to shares with fixed dividends. (Text as determined by Law n. 10.303, of October 31, 2001)

§ 6. The bylaws may confer upon the preferred shares with priority in the distribution of cumulative dividends the right to, in such years where earned profits were insufficient, receive such dividend to the account of the capital reserves provided for in § 1 of Section 182. (Former paragraph 5 turned into paragraph 6 by Law n. 10.303, of October 31, 2001)

§ 7. In corporations object of privatization, a special class of preferred shares exclusively owned by the privatizing entity may be created. The bylaws may confer specific powers upon such shares, including the power to veto resolutions of the general meeting in certain matters. (Text added by Law n. 10.303, of October 31, 2001)

Sole Paragraph. The bylaws may require that specific statutory amendments be approved at a special shareholders' meeting by the shareholders of one or more classes of preferred shares.

Article 19. The bylaws of a corporation having preferred shares shall state the advantages attributed to each class of such shares and the restrictions to which they shall be subject, and may provide for redemption, amortization or conversion of shares from one class into another and into common shares, and of the latter into preferred shares, and shall establish the respective conditions for each of the foregoing.

Article 20. The shares may be nominative. (Text as determined by Law no. 8.021 of April 12, 1990)

Article 21. Revoked by Law no. 8.021 of April 12, 1990.

Article 22. The Bylaws shall state the form of the shares. (Text as determined by Law no. 8.021 of April 12, 1990)

Sole Paragraph. Revoked by Law no. 8.021 of April 12, 1990.

Article 23. A share certificate may only be issued after the corporation complies with due formalities to legally initiate its operation.

Paragraph 1. Failure to comply with the provision of this article shall invalidate the certificate and those responsible for the failure will be liable therefor.

Paragraph 2. Share Certificates may only be issued after the requirements for the transfer of property have been met, or credits have been payed up, in case of contributions other than cash.

Paragraph 3. The corporation may charge the shareholder for the cost of a duplicate certificate requested by him.

Article 24. The share certificates shall be written in Portuguese and shall contain the following declarations:

I - the corporate name , its head office and the duration of the corporation;

II - the amount of capital, the date when it was established, the number of shares into which it is divided and the par value of the shares or a statement that the shares have no par value;

III - for corporations with authorized capital, the authorized limit by number of shares or by amount of capital;

IV - the number of common and preferred shares of different classes, if any, the privileges or advantages conferred upon each class and the limitations or restrictions to which the shares may be subject;

V - the share certificate and the share serial numbers, and the type and class to which it belongs;

VI - the rights conferred upon founders’ shares, if any;

VII - the time and place of the annual general meeting;

VIII - the dates of incorporation and of registration and publication of the articles of incorporation;

IX - the name of the shareholder; (Text as determined by Law no. 9.457 of May 5, 1997)

X - if the share is not fully paid up, the amount the shareholder owes and the time and place it should be paid; (Text as determined by Law no. 9.457 of May 5, 1997)

XI - the date of issue of the certificate and the signatures of two directors or of the certificate issuing agent (article 27). (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 1. The omission of any of such information shall entitle the shareholder to an indemnity for consequential loss and damages incurred against the corporation and the directors during whose term of office the certificate was issued.

Paragraph 2. The certificates for shares issued by publicly-held corporations may be signed by two attorneys-in-fact with special powers, or by mechanical authentication, with observance of the regulations issued by the Brazilian Securities Commission (Text as determined by Law n. 10.303, of October 31, 2001)

Article 25. After compliance with the requirements of article 24, the corporation may issue multiple share certificates and provisional share certificates for the shares.

Sole paragraph. The multiple share certificates of a publicly held corporation shall be subject to standardization of number of shares as determined by theComissão de Valores Mobiliários.

Article 26. Revoked by Law no. 8.021 of April 12, 1990.

Article 27. The corporation may contract with a financial institution authorized by the Comissão de Valores Mobiliários for it to render the service of keeping and custody of its share register books, share transfer books and the issue of its share certificates.

Paragraph 1. Once the service has been placed under contract, only the issuing agent may perform acts relating to the registration of shares and the issue of share certificates.

Paragraph 2. The name of the issuing agent shall appear on the corporation’s publications and public securities offerings .

Paragraph 3. The share certificates issued by the issuing agent of the corporation shall be numbered in sequence, but the numbering of the shares shall be optional.

Article 28. The share is indivisible in relation to the corporation.

Sole Paragraph. When a share belongs to more than one person, the rights conferred by it shall be exercised by the representative of the co-holders.

Article 29. A share of a publicly held corporation may only be traded after thirty per cent of its issue price has been paid.

Sole Paragraph. Non-compliance with this article shall render the act void.

Article 30. A corporation may not trade in its own shares.

Paragraph 1. This prohibition does not apply to:

a) redemption, refund or amortization operations provided for by law;

b) shares acquired to be held in the corporation treasury or canceled, limited to the amount of the balance of profits or reserves, except the legal reserve, and which may not reduce the corporate capital, or by donation;

c) the sale of shares acquired under sub-paragraph (b) above, and held in the corporation treasury.

d) the acquisition of shares when, it being resolved that the capital will be reduced through a cash refund of part of the value of the shares, their stock exchange price is less than or equal to the amount to be refunded.

Paragraph 2. Under risk of annulment, the acquisition of its own shares by a publicly held corporation shall comply with the rules established by the Comissão de Valores Mobiliários, which may submit such acquisition to its prior authorization in each case.

Paragraph 3. A corporation may not receive its own shares as a guarantee, except to ensure proper management by its officers.

Paragraph 4. While held in the corporation treasury, the shares acquired in accordance with paragraph 1 (b)above, shall have the right to neither a dividend nor to a vote.

Paragraph 5. In the case of paragraph 1 (d) above, the shares acquired shall be permanently withdrawn from circulation.

Article 31. The ownership of registered shares is evidenced by the name of the shareholder written in the "Registered Shares Book" or by the certificate supplied by the custody agent acting as fiduciary owner of the shares. (Text as determined by Law n. 10.303, of October 31, 2001)

Paragraph 1. Registered shares shall be transferred by an entry in the Registered Shares Transfer book, dated and signed by the assignor and assignee or their legal representatives.

Paragraph 2. The transfer of registered shares by inheritance, legacy, award, court order or other judicial act or by any other means, shall require a notation in the Registered Shares Register book against the presentation of an appropriate document which shall remain in the possession of the corporation.

Paragraph 3. In the case of transfer of registered shares acquired on a stock exchange, the assignee shall be represented by the brokerage corporation or stock exchange liquidation department, which may act without a procuration.

Article 32. Revoked by Law no. 8.021 of April 12, 1990.

Article 33. Revoked by Law no. 8.021 of April 12, 1990.

Article 34. The bylaws of the corporation may require all the corporation shares, or one or more classes thereof, to be kept in deposit accounts in the name of their holders at an institution designated by the corporation, without issuing certificates.

Paragraph 1. In the event of an amendment to the bylaws, conversion into book entry shares shall depend on the presentation and cancellation of the corresponding share certificate in circulation.

Paragraph 2. Only financial institutions authorized by the Comissão de Valores Mobiliários may maintain book entry share services.

Paragraph 3. The corporation shall be liable for consequential loss and damages caused to interested parties by errors or irregularities in book entry share services, notwithstanding any liability of the depositary.

Article 35. Book entry share ownership is presumed from the registration in the share deposit account opened in the name of the shareholder in the books of the depositary.

Paragraph 1. The transfer of a book entry share is effected by an entry made by the depositary in its books, debiting the share account of the assignor and crediting the share account of the assignee, against presentation of a written order by the assignor, or a court authorization or order, in an appropriate document which shall remain in the possession of the depositary.

Paragraph 2. The depositary shall furnish the shareholder with a statement of the book share deposit account on request, at the end of each month during which the account is used and, even if not used, at least once a year.

Paragraph 3. The bylaws may authorize the depositary to charge the shareholder for the cost of the service of transferring the ownership of book entry shares, subject to maximum limits established by the Comissão de Valores Mobiliários.

Article 36. The bylaws of a closely held corporation may impose restrictions on the transfer of registered shares, provided that such restrictions are defined in detail and do not preclude their negotiability nor subject the shareholder to the arbitrary decision of the administrative bodies of the corporation or of the majority of shareholders.

Sole Paragraph. A restriction on the transfer of shares created by an amendment to the bylaws shall only be applied to shares whose holders have expressly agreed to such a restriction, by requesting its notation in the Registered Shares Register.

Article 37. By notice to the stock exchanges on which its shares are dealt with and by publication of a notice, a publicly held corporation may suspend the transfer, conversion and division of its shares for periods not exceeding fifteen days each or a total of ninety days during the year.

Sole Paragraph. The provisions of this article shall not affect the registration of share transfers negotiated on a stock exchange prior to the beginning of the suspension period.

Article 38. Revoked by Law no. 8.021 of April 12, 1990.

Article 39. A pledge or a bond of a share is effected by registering the respective instrument in the Registered Shares Register book. (Text as determined by Law no. 9457 of May 5, 1997)

I - Revoked by Law no. 8.021 of April 12, 1990.

II - Revoked by Law no. 8.021 of April 12, 1990.

III - Revoked by Law no. 8.021 of April 12, 1990.

Paragraph 1. A pledge of book entry shares shall be effected by registration of the respective instrument on the books of the financial institution, which registration shall be noted on the deposit account statement furnished to the shareholder.

Paragraph 2. In all circumstances, the corporation or the financial institution shall be entitled to request a copy of the pledge instrument for its files.

Article 40. Any usufruct, trust, fiduciary alienation in guarantee or any other clause or charge encumbering a share must be registered:

I - in the case of a registered share, in the Registered Shares Register Book;

II - in the case of a book entry share, in the books of the financial institution, with notation on the deposit account statement furnished to the shareholder (Text as determined by Law no. 9.457 of May 5, 1997)

III - Revoked by Law no. 8.021 of April 12, 1990.

Sole Paragraph. A contract to sell a share and the right of first refusal to acquire it may be enforced against third parties by registration under this article.

Section 41. Institutions authorized by the Brazilian Securities Commission to act as custodians of fungible shares may agree to hold shares in custody where shares of each type and class of the corporation’s shares shall be kept as fungible shares,and the custodian shall act as fiduciary owner of the shares. (Text as determined by Law n. 10.303, of October 31, 2001)

§ 1. The depositary institution may not sell the shares, being required to return the amount of shares received, with the modifications resulting from alterations in the share capital or in the number of shares in the issuing corporation, regardless of the order number of the shares or their respective certificates. (Former sole paragraph turned into paragraph 1 by Law n. 10.303, of October 31, 2001)

§ 2. The provisions of this Section shall apply to other types of securities whenever applicable. (Text added by Law n. 10.303, of October 31, 2001)

§ 3. The depositary institution is required to inform to the issuing corporation: (Text added by Law n. 10.303, of October 31, 2001)

I – immediately, the name of the final beneficiary of the shares if there is any corporate event in which his identification is required; and (Text added by Law n. 10.303, of October 31, 2001)

II – in up to ten (10) days, any custody agreement or the creation of liens or encumbrances upon the shares. (Text added by Law n. 10.303, of October 31, 2001)

§ 4. The ownership of shares that are held in fungible custody shall be evidenced through the agreement executed between the owner of the shares and the depositary institution. (Text added by Law n. 10.303, of October 31, 2001)

§ 5. The institution has the obligations of a depositary, and it is liable to the shareholder and third parties for any breaches of its obligations. (Text added by Law n. 10.303, of October 31, 2001)

Paragraph 1. Whenever a dividend or bonus share is distributed and, in any case, at least once a year, the financial institution shall furnish the corporation with a list of the depositors of shares received under this article, as well as the number of shares held by each depositor. (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 2. The depositor may at any time terminate the custody and request the returnof the share certificates.

Paragraph 3. The corporation shall not be liable to its shareholders nor to third parties for the acts performed by the institution with which the shares were deposited.

Article 43. A financial institution authorized to operate as an agent for the issue of share certificates (article 27) may issue certificates to represent the shares received for deposit, and the certificates shall state: (Text as determined by Law no. 9.457 of May 5, 1997)

I - the place and date of issue;

II - the name of the issuing institution and the signatures of its representatives;

III - the title "Share Deposit Certificate";

IV - the specification of the shares deposited;

V - a statement that the deposited shares, the earnings therefrom and any sum received in the event of redemption or amortization shall only be delivered to the owner of the deposit certificate against presentation of the same;

VI - the name and identification of the depositor;

VII - the deposit fee charged by the bank, if due upon delivery of the deposited shares;

VIII - the place of delivery of the subject of the deposit.

Paragraph 1. The financial institution is liable for the origination and the authenticity of the share deposit certificates.

Paragraph 2. After the share deposit certificate has been issued, the deposited shares, their earnings and their redemption or amortization value may not be subjected to pledge, seizure, confiscation, search or attachment, or any other encumbrance which impedes their delivery to the owner of the certificate, but the certificate itself may be the subject of an attachment or provisional remedy due to a liability of the owner.

Paragraph 3. A share deposit certificate shall be a registered certificate, which may be kept in the book entry system. (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 4. Share deposit certificates may be divided or consolidated at the request and at the expense of their owner.

Paragraph 5. Revoked by Law no. 8.021 of April 12, 1990.

Article 44. The bylaws or an extraordinary general meeting may authorize the allocation of profits or reserves to the redemption or amortization of shares, and shall prescribe the conditions and the procedure for this purpose.

Paragraph 1. Redemption comprises paying the value of share to withdraw it permanently from circulation, whether or not the share capital is reduced. If the share capital is not reduced, a new par value shall be attributed to the remaining shares, as the case may be.

Paragraph 2. Amortization comprises the distribution to the shareholders of an advance payment, without reduction of the share capital, in the amount to which they would be entitled in the event of liquidation of the corporation.

Paragraph 3. Amortization may be in full or in part, and may cover only one or all classes of shares.

Paragraph 4. A redemption and an amortization which do not cover all shares of the same class shall be carried out by drawing lots. Should shares in custody under article 41 be sorted out, the financial institution shall specify the redeemed or amortized shares by apportionment, if not otherwise established in the custody contract.

Paragraph 5. Fully amortized shares may be substituted by fruition shares, subject to the restrictions stated in the bylaws or by the general meeting approving the amortization. In any case, should the corporation be liquidated, the amortized shares may only participate in the net assets after each non-amortized share is guaranteed a sum equal to that of the amortization, subject to monetary adjustment.

§ 6. Unless the bylaws provide otherwise, the redemption of shares of one or more classes can only be effected if, in a general meeting called to resolve this specific matter, the redemption is approved by shareholders who represent at least half of the shares of the affected classes. (Text added by Law n. 10.303. of October 31, 2001)

Article 45. Refund is an operation whereby, in the cases provided for by law, a corporation pays a shareholder the value of his shares, if he dissents from a decision of a general meeting.

Paragraph 1. The bylaws may establish rules to determine the amount of a refund, which may be less than the net worth of the shares stated in the last balance sheet approved by the general meeting, only if, subject to the provisions of paragraph 2, below, the refund value is calculated in accordance with the economic value of the corporation, which shall be determined by proceeding to its evaluation (paragraphs 3 and 4). (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 2. If the decision of the general meeting is taken more than sixty days after the date of the last approved balance sheet, the dissenting shareholder may demand, together with the refund, that a special balance sheet be prepared as of a date within such sixty-day period. In such a case, the corporation shall forthwith pay eighty per cent of the refund amount calculated according to the last balance sheet and, after the special balance sheet is ready, it shall pay the balance within one hundred and twenty days from the date of the resolution of the general meting.

Paragraph 3. If the bylaws has established the evaluation criteria for the purpose of refund, the refund value shall be determined by three experts or evaluation corporation, in a report elaborated in accordance with paragraph 1 of article 8, and subject to the liability provided for in paragraph 6 of the same article. (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 4. The experts or evaluation firm shall be indicated in a list containing six or three names, respectively, produced by the administrative council or, in its absence, by the board of directors. The experts or evaluation firm shall be elected in a general meeting, by the absolute majority of votes, not counting shareholders’ abstentions, being each share entitled to one vote, regardless of its class or type. (Text added by Law no. 9.457 of May 5, 1997)

Paragraph 5. A refund may be paid from profits or reserves, except the legal reserve, in which case refunded shares shall be held in the corporation treasury. (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 6. If within one hundred and twenty days from the publication of the minutes of the general meeting, the shareholders whose shares were refunded from the capital have not been substituted, the capital shall be deemed to have been reduced by a corresponding amount and the administrative bodies shall call a general meeting within five days to inform the shareholders of the reduction. (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 7. If the corporation is declared bankrupt, a dissenting shareholder who is a creditor for the refund of his shares shall be classified in a separate list as an unsecured creditor. The apportionment made to the unsecured creditors shall be used to pay the established claims prior to the date of publication of the minutes of the general meeting. The sums so attributed to earlier claims shall not be deducted from the claim of the former shareholder, which shall continue in full force for payment from the assets of the bankrupt estate after satisfaction of the former claims. (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 8. If, in the event of bankruptcy, the former shareholders who have already been refunded from the capital have not yet been substituted and the estate is not sufficient to pay the earlier claims, a revocatory action may be brought to demand restitution of the refund paid with the reduction of the capital, limited to the remainder of this portion of the liabilities. Restitution shall be demanded in equal proportions from all the shareholders whose shares have been refunded. (Text as determined by Law no. 9.457 of May 5, 1997)

Chpater IV

Article 46. A corporation may at any time create negotiable securities of no par value and unrelated to the capital of the corporation, called "Founders’ Shares".

Paragraph 1. Founders’ Shares shall confer on its owner the right of credit to a possible participation in the annual profits of the corporation (article 190).

Paragraph 2. The participation attributed to the Founders’ Shares, including the right to form a redemption reserve, if any, shall not exceed one-tenth of the corporation’s profits.

Paragraph 3. The founders’ shares may not carry any exclusive shareholder rights, except to inspect the actions of the corporation’s officers, as provided in this Law.

Paragraph 4. The issue of more than one class or series of founders’ shares is prohibited.

Article 47. The founders’ shares may be disposed of by the corporation on the conditions stated in the bylaws or by a general meeting, or may be issued to a founder, a shareholder or a third party as remuneration for services rendered to the corporation.

Sole Sub-section. Publicly-held corporations are not allowed to issue founders’ shares (Text as determined by Law n. 10.303, of October 31, 2001)

Paragraph 1. The period of gratuitously issued founders’ shares shall not exceed ten years, except those issued to corporation employees' welfare associations or foundations.

Paragraph 2. The bylaws may provide for the conversion of founders’ shares into capital shares by capitalization of a reserve created for such purpose.

Paragraph 3. In the event of liquidation of the corporation, after the current liabilities have been discharged, the holders of founders’ shares shall have a preferred claim to the remaining assets up to the amount of the respective redemption or conversion reserve.

Article 49. The founders’ share shall contain:

I - the title "Founders’ Share"

II - the name of the corporation, its headoff ice and its period of duration;

III - the amount of the capital, the date when it was established and the numberof shares into which it is divided;

IV - the number of founders’ shares created by the corporation and its respective serial numbers;

V - the rights attributed to them by the bylaws, the period of duration and the conditions for its redemption, if any;

VI - the date of incorporation, and of the registration and publication of its articles of incorporation;

VII - the name of the beneficiary; (Text as determined by Law no. 9.457 of May 5, 1997)

VIII - Revoked by Law no. 8.021 of April 12, 1990.

VIII - the date of issue of the certificate and the signatures of two directors. (Text as determined by Law no. 9.457 of May 5, 1997)

Article 50. Founders’ shares may be registeredand so far as applicable, shall be subject to the provisions of Sections V to VII of Chapter III. (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 1. The registered founders’ shares shall be registered in appropriate books maintained by the corporation. (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 2. The founders’ shares may be deposited against the issue of a certificate as provided for in article 43.

Article 51. An amendment to the bylaws which changes or reduces the privileges conferred on the founders’ shares shall only be valid when approved by at least one-half of their holders convened at a special general meeting.

Paragraph 1. The general meeting shall be called by publication of a notice in a newspaper at least one month in advance, pursuant to the requirements for calling general meetings. If after two calls no meeting can be held for the lack of quorum, another meeting may only be called six months later.

Paragraph 2. Each founder shares is entitled to one vote and the corporation may not vote in respect of the certificates which it holds in its treasury.

Chapter V

Article 52. The corporation may issue debentures that will confer upon its holders credit rights against the company, under the conditions specified in the respective indenture and certificates, if any. (Text as determined by Law n. 10.303, of October 31, 2001)

Article 53. The corporation may issue debentures more than once, and each issue may be divided into series.

Sole Paragraph. Debentures of the same series shall have equal par value and shall confer equal rights on their holders.

Article 54. The par value of a debenture shall be expressed in Brazilian currency, except in the case of obligations which under current legislation may receive payment in a foreign currency.

§ 1. The debenture may include a monetary correction clause, based on the coefficient established for the correction of government bonds, based on the foreign exchange rate variation or based on other indices not expressly forbidden by law. (Former sole paragraph turned into paragraph 1 by Law n. 10.303, of October 31, 2001)

§ 2. The debenture indenture may grant to the debenture holder the option to receive principal and interest at the expiration, amortization or redemption, in cash or in assets valued pursuant to Section 8. (Text added by Law n. 10.303, of October 31, 2001)

Article 55. The maturity date of the debenture shall be indicated in its deed of issue and its certificate. The corporation may establish partial amortizations for each series, create amortization funds and retain the right to either partial or total prior redemption of debentures of the same series.

Paragraph 1. The amortization of debentures of the same series which do not have different maturity dates, as well as partial redemption, shall be effected by drawing lots or by acquisition on stock exchange if the debentures are quoted at a price below their par value.

Paragraph 2. The corporation may acquire its own debentures at a price equal to or below the par value, and the acquisition shall be referred to in its management report and financial statements.

Paragraph 3. The corporation may issue debentures which mature only in the event of non-compliance with an obligation to pay interest or on the liquidation of the corporation or on other conditions provided in the debenture itself.

Article 56. A debenture may entitle its owner to a fixed or variable rate of interest, a participation in the profits of the corporation and a refund premium.

Article 57. A debenture may be converted into a share under the conditions contained in its deed of issue, which shall specify:

I - the basis of conversion, whether that is the number of shares into which each debenture can be converted or the relation between the par value of a debenture and the issue price of a share;

II - the type and class of shares into which a debenture may be converted;

III - the term or time within which the conversion right may be exercised;

IV - the other conditions to which the conversion may be subject.

Paragraph 1. The shareholders shall have a right of first refusal to subscribe to the issue of debentures convertible into shares, subject to the provisions of articles 171 and 172.

Paragraph 2. During the period in which the conversion right may be exercised, the prior approval of the debentureholders at a special general meeting or of their trustee shall be required to amend the bylaws:

(a) to change the corporate purposes; or

(b) to create preferred shares or to alter the privileges of existing preferred shares to the detriment of the shares into which the debentures may be converted.

Article 58. In conformity with the provisions of the deed of issue, a debenture may be guaranteed by a guarantee in rem or by a floating charge, and may, or may not, enjoy preference, or be subordinated to other creditors of the corporation.

Paragraph 1. The floating charge shall entitle the debenture to a general right to the corporation’s assets, but shall not prevent transactions relating to the property composing such assets.

Paragraph 2. The guarantees may be cumulative.

Paragraph 3. Newly-issued debentures with a floating charge shall be subordinate to those of an earlier issue or issues, the priority to be established according to the date of inscription of the deed of issue. However, all debentures of one series shall be treated equally.

Paragraph 4. A debenture which has no guarantee may contain a clause which subordinates it to unsecured creditors in which case it shall only have priority over the shareholders with regard to the residual assets, if any, in the event of liquidation of the corporation.

Paragraph 5. A commitment not to alienate or encumber real property, or other kind of property subject to registration of ownership, assumed by the corporation in the deed of issue, is enforceable against third parties, provided it is registered at the appropriate registry.

Paragraph 6. The debentures issued by a corporation forming part of a group of corporations (article 265) may be guaranteed by a floating charge on the assets of two or more corporations of the group.

Article 59. A general meeting shall have the exclusive competence to decide whether to issue debentures. In accordance with the bylaws, it shall state:

I - the amount of the issue or the criteria to establish its limit, and its division into series, if any;

II - the number and par value of the debentures;

III - the guarantees in rem or floating charge, if any;

IV - the monetary adjustment conditions, if any;

V - whether or not the debentures are convertible into shares and the conditions of such conversion;

VI - the time and conditions of maturity, amortization or redemption;

VII - the time and conditions of payment of interest, participation in profits and refund premiums, if any;

VIII - the method of subscription or placement and the type of debentures.

Paragraph 1. In publicly-held corporations, the board of directors may decide on the issuance of non-convertible debentures and unsecured debentures, and the general meeting may delegate to the board of directors the power to decide on the conditions specified in items VI to VIII hereof and on the time of issuance (Text as determined by Law n. 10.303, of October 31, 2001)

Paragraph 2. A general meeting may determine that the amount and number of series of an issue will be indeterminate, within the limits established by it in accordance with the provisions of article 60.

Paragraph 3. A corporation may not issue new debentures before placing all the debentures of previously issued series or canceling the unplaced series, and may not negotiate a new series of the same issue before placing the previous series or canceling the unplaced balance.

Article 60. Except as provided by special legislation, the total amount of debenture issues may not exceed the corporation’s capital.

Paragraph 1. This limit may be exceeded until it reaches:

(a) in the case of debentures with guarantees in rem, eighty per cent of the value of the encumbered property of either the corporation itself or of third parties;

(b) in the case of debentures with a floating charge, seventy per cent of the book value of the corporation’s assets reduced by the sum of its debts guaranteed by rights in rem.

Paragraph 2. The limit prescribed in paragraph 1 (a), above, may be established by reference to the corporation’s assets after the income from the issue has been invested; in such a case, the funds shall be kept under the control of the trustee of the debentureholders and shall be delivered to the corporation , according to the limits laid down in paragraph 1, above, in proportion to the increases in the amount of the guarantees.

Paragraph 3. The Comissão de Valores Mobiliários may establish other limits for issues of debentures to be traded on a stock exchange or in the over-the-counter market, or to be distributed in the market.

Paragraph 4. The limits prescribed in this article shall not be applicable to the issue of subordinate debentures.

Article 61. In the deed of issue the corporation shall state the rights conferred by the debentures, their guarantees and any further conditions.

Paragraph 1. A public or private deed of issue of debentures distributed or accepted for trading in the market shall also be signed by the trustee of the debentureholders (articles 66 to 70 inclusive).

Paragraph 2. Each new series of the same issue shall be the subject of an amendment to the corresponding deed.

Paragraph 3. The Comissão de Valores Mobiliários may approve standard clauses and conditions to be adopted in deeds of issue of debentures to he traded on a stock exchange or in the over-the-counter market and may refuse to admit to the market any issue which does not abide by such standard clauses and conditions.

Article 62. No debentures shall be issued unless the following requirements are met: (Text as determined by Law n. 10.303, of October 31, 2001)

I – filing with the commercial register and publication of the minutes of the shareholder meeting or the board of directors meeting that resolved on the issuance; (Text as determined by Law n. 10.303, of October 31, 2001)

II – registration of the indenture with the commercial register; (Text as determined by Law n. 10.303, of October 31, 2001)

III - the guarantees in rem, if any, have been drawn up.

Paragraph 1. The officers of the corporation shall be liable for the cosequential loss and damages caused to the corporation or to third parties by any failure to comply with this article.

Paragraph 2. The trustee and any debentureholders may effect any registration required by this article and remedy any omission or irregularity which may exist in the registrations effected by the corporation’s officers. In such an event, an officer of the registry shall require the corporation to supply him with the necessary information and documents.

Paragraph 3. Any amendment to the deed of issue shall be registered at the same registry.

Paragraph 4. The commercial registers shall hold a special book for the registration of the issuance of debentures, in which the essential conditions of each issuance shall be written. (Text as determined by Law n. 10.303, of October 31, 2001)

Article 63. Debentures shall be registered, and the provisions of Sections V to VII of Chapter III, above, so far as appropriate, shall be applicable. (Text as determined by Law no. 9.457 of May 5, 1997)

§ 1. The debentures may be the object of deposit with the issuance of a certificate under the terms of Section 43. (Primary sole paragraph turned into paragraph 1 by Law n. 10.303, of October 31, 2001)

Article 64. The debenture certificates shall contain:

I - the name, head office, duration and purposes of the corporation;

II - the dates of incorporation and of filing and publication of the articles of incorporation;

III - the date of publication of the minutes of the general meeting which passed the necessary resolution;

IV - the date on which and Real Estate Registry at which the issue was registered;

V - the title "Debenture" and an indication of its category by the words "with guarantee in rem", "with floating charge'', "without preference" or "subordinate";

VI - the designation of the issue and series;

VII - the serial number;

VIII - the par value, the monetary adjustment clause, if any, the conditions governing maturity, amortization, redemption, interest, participation in profits or refund premium and when the same shall be due;

IX - the conditions for conversion into shares, if any;

X - the name of the debentureholder; (Text as determined by Law no. 9.457 of May 5, 1997)

XI - the name of the trustee of the debentureholders, if any;

XII - the date of issued of the certificate and the signatures of two directors of the corporation;

XIII - authentication by the trustee, if any.

Article 65. Subject to the requirements of article 64, the corporation may issue multiple debenture certificates and may temporarily issue provisional certificates representing the debentures.

Paragraph 1. The multiple debenture certificates of publicly held corporations shall comply with the quantity standards of the Comissão de Valores Mobiliários.

Paragraph 2. The certificates may be substituted, divided or consolidated, as stipulated in the deed of issue with appointment of a trustee.

Article 66. The trustee shall be appointed and shall accept the duties under the deed of issue of the debentures.

Paragraph 1. Only individuals who satisfy the requirements of holding office in a corporation administrative body and the financial institutions which have been specially authorized by the Central Bank of Brazil for the purpose of the administration or custody of third party assets may be appointed trustee.

Paragraph 2. The Comissão de Valores Mobiliários may require that the trustee or one of the trustees for an issue of debentures traded in the market be a financial institution.

Paragraph 3. The following may not be trustees:

(a) any person already performing such a task for another issue of the same corporation;

(b) any financial institution connected with the issuing corporation or with the underwriting institution, or any corporation controlled by them;

(c) any creditor of any kind of the issuing corporation or any corporation controlled by such a creditor;

(d) any financial institution whose managers have an interest in the issuing corporation;

(e) any person who may otherwise be in a conflict of interest situation by performing such a task.

Paragraph 4. Any trustee who, due to circumstances occurring after an issue, becomes prohibited to exercise the task shall immediately communicate this fact to the debentureholders and request his replacement.

Article 67. The deed of issue shall lay down the conditions for the replacement and remuneration of the trustee, in accordance with the rules issued by the Comissão de Valores Mobiliários.

Sole Paragraph. The Comissão de Valores Mobiliários shall control the performance of the trustee of issues offered to the public or of debentures traded on a stock exchange or in the over-the-counter market and may:

(a) appoint a provisional replacement in the event of a vacancy;

(b) suspend a trustee from his task and replace him, should he fail to perform his duties.

Article 68. In accordance with this Law and the deed of issue, the trustee shall represent the joint interest of the debentureholders vis-à-vis the issuing corporation.

Paragraph 1. The duties of the trustee are:

(a) to protect the rights and interests of the debentureholders, employing in the performance of his duties the care and diligence that every diligent and honest man habitually employs in the administration of his own property;

(b) to prepare an annual report and make it available to the debentureholders within four months from the end of the corporation’s fiscal year, drawing attention to all relevant facts occurred during the year relating to the corporation’s liabilities, the security of the debentures and the constitution and application of the amortization fund, if any; the report shall also contain a statement by the trustee regarding his ability to continue performing his task;

(c) in the maximum term of sixty (60) days, give notice to the debenture holders of any default by the corporation in the obligations undertaken in the indenture. (Text as dtermined by Law n. 10.303, of October 31, 2001)

Paragraph 2. The deed of issue shall lay down the manner in which the duties referred to in paragraph (b) and (c), above, shall be complied with.

Paragraph 3. The trustee may take any action to protect the rights or defend the interests of the debentureholders and, in the event of default by the corporation, he may in particular:

(a) subject to the conditions of the deed of issue, declare the debentures to have matured in advance and collect the principal sum and interest;

(b) execute guarantees in rem, receive the income and apply the same in the full or proportional payment to the debentureholders;

(c) if there are no guarantees in rem, petition for the bankruptcy of the issuing corporation;

(d) represent the debentureholders in bankruptcy proceedings, "concordata", intervention or administrative procedure of liquidation of the issuing corporation, except as otherwise decided at a general meeting of debentureholders;

(e) take all steps necessary for the debentureholders to collect their debts.

Paragraph 4. The trustee is liable to the debentureholders for the losses they suffer as a consequence of his fault or fraud in performing his duties.

Paragraph 5. The expenses of the trustee which he may have incurred in protecting the rights and interests or in collecting the debts of the debentureholders shall be added to the debts of the issuing corporation, shall enjoy the same guarantees as the debentures and shall have priority over the debentures in order of payment.

Paragraph 6. Any provision in the deed of issue which purports to restrict the duties, responsibilities and liabilities of the trustee as provided in this article shall be void and of no effect.

Article 69. The deed of issue may also impose on the trustee the authentication of debenture certificates, the administration of the amortization fund, the custody of the property given in guarantee and the payment of interest, amortization and redemption moneys.

Article 70. The substitution of the property offered in guarantee, when authorized in the deed of issue, shall require the approval of the trustee.

Sole Paragraph. The trustee shall not have the power to agree to amendments to the clauses and conditions of the issue.

Article 71. The holders of debentures of the same issue or series may at any time hold a general meeting to resolve matters of joint interest to all the debentureholders.

Paragraph 1. A general meeting of debentureholders may be called by the trustee, by the issuing corporation, by debentureholders representing at least ten per cent of the debentures in circulation, and by the Comissão de Valores Mobiliários.

Paragraph 2. The provisions of this Law governing general meetings of shareholders shall be applicable, so far as appropriate, to general meetings of debentureholders.

Paragraph 3. A general meeting shall be held on the first call with the presence of debentureholders representing at least one-half of the debentures in circulation and on the second call with any number.

Paragraph 4. The trustee shall be present at the general meeting and shall give the debentureholders all the information requested from him.

Paragraph 5. The deed of issue shall state the quorum required to approve amendments to the conditions of the debentures, which shall not be less than one-half of the debentures in circulation.

Paragraph 6. Each debenture shall have the right to one vote in the decisions of the general meeting.

Article 72. A financial institution authorized by the Central Bank of Brazil to carry out such an operation may issue certificates of coupons guaranteed by debentures, which shall confer upon their holders creditors’ rights against the issuer for the respective par value and the interest stipulated thereon. (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 1. The certificate shall be registered, whether or not it is a book entry certificate. (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 2. The certificate shall contain the following information:

(a) the name of the issuing financial institution and the signatures of its representative;

(b) its serial number and the place and date of issue;

(c) the title "Debentures Coupon"; (Text as determined by Law no. 9.457 of May 5, 1997)

(d) the par value and the maturity date;

(e) the interest, which may be fixed or variable, and the date it shall be paid;

(f) the place of payment of the principal;

(g) the identification of the debentures given as guarantee, its value and the type of guarantee set up; (Text as determined by Law no. 9.457 of May 5, 1997)

(h) the name of the debentureholders' trustee:

(i) the monetary adjustment clause, if any;

(j) the name of the coupon-holder. (Text as determined by Law no. 9.457 of May 5, 1997)

(k) Revoked by Law no. 8.021 of April 12, 1990.

Article 73. A Brazilian corporation may issue debentures abroad with a guarantee in rem or floating charge on assets located in Brazil only with the prior approval of the Central Bank of Brazil.

Paragraph 1. The creditor in respect of a debt located in Brazil shall have priority over the creditor of a debenture issued abroad by a foreign corporation authorized to operate in Brazil, unless the issue of the debenture was previously approved by the Central Bank of Brazil and its income applied in a business located in Brazil.

Paragraph 2. In any circumstances, only the principal and charges of debentures registered with the Central Bank of Brazil may be remitted abroad.

Paragraph 3. In addition to being subject to the requirements of article 62, an issue of debentures abroad shall require the registration, at the Real Estate Registry of the location of the head office or place of business of the corporation, of the other documents required by the laws of the place of issue, authenticated as provided for by the relevant legislation, legalized by the Brazilian Consulate abroad and accompanied by a translation into Portuguese prepared by a public translator on oath; and in the case of a foreign corporation, the registration at the Commercial Registry and the publication of the resolution which authorized the issue in accordance with the corporation’s bylaws and the laws of the place of the head office.

Paragraph 4. Trading on a Brazilian stock market of debentures issued abroad shall require the prior authorization of the Comissão de Valores Mobiliários.

Article 74. The issuing corporation shall enter notations in the appropriate books with regard to the cancellation of debentures and shall keep the canceled certificates or the receipts of the holders of book debenture accounts for a period of five years, together with the cancellation documents.

Paragraph 1. In the event of the issue having a trustee, he shall supervise the cancellation of the certificates.

Paragraph 2. The officers of the corporation shall be bound under joint and several liability for any loss resulting from non-compliance with the provisions of this article.

Chapter VI

Article 75. A corporation may issue a negotiable security called a "Subscription Bonus", within the capital increase limit authorized in its bylaws (article 168).

Sole Paragraph. Subject to the conditions contained in the certificate, the subscription bonus shall confer upon its owner the right to subscribe to shares of the capital, and such right shall be exercised by the presentation of the security to the corporation and the payment of the share issue price.

Article 76. A general meeting shall have authority to resolve to issue subscription bonuses when the bylaws do not empower the administrative council to do so.

Article 77. Subscription bonuses shall be disposed of by the corporation or shall be issued by the corporation as an additional privilege to the subscribers of its shares or debentures issues.

Sole Paragraph. The corporation’s shareholders shall have preference to subscribe to bonus issues, as provided in articles 171 and 172.

Article 78. A subscription bonus shall be registered. (Text as determined by Law no. 9.457 of May 5, 1997)

Sole Paragraph. So far as applicable, subscription bonuses shall be subject to the provisions of Sections V to VII of Chapter III.

Article 79. A subscription bonus certificate shall contain the following information:

I - the information set forth in items I to IV of article 24;

II - the title "Subscription Bonus'';

III - the serial number;

IV - the number, type and class of shares which may be subscribed and their issue price or the criteria for establishing it;

V - the time within which the subscription right may be exercised and the termination date of the period for exercising such right;

VI - the name of the subscription bonus holder; (Text as determined by Law no. 9.457 of May 5, 1997)

VII - the date of issue of the certificate and the signatures of two directors. (Text as determined by Law no. 9.457 of May 5, 1997)

Chapter VII

Article 80. The following requirements must be met before a corporation can be incorporated:

I - the subscription by at least two persons of all the shares into which the capital is divided in accordance with the bylaws;

II - the initial payment of at least ten per cent of the issue price of the shares subscribed in cash;

III - the deposit at the Banco do Brasil S.A., or at another banking establishment authorized by the Comissão de Valores Mobiliários, of the portion of the capital paid in cash.

Sole Paragraph. The provisions of item II, above, shall not apply to corporations for which the law requires the initial payment of a larger portion of the capital.

Article 81. The deposit referred to in item III of article 80 shall be made by the founder within five days from the date of receipt of the amounts, on behalf of the subscribers and in favor of the corporation being incorporated, which may only withdraw the deposit after having acquired corporate entity status.

Sole Paragraph. If the corporation is not incorporated within six months from the date of the deposit, the bank shall return the deposits direct to the subscribers.

Article 82. The incorporation of a corporation by public subscription shall be subject to prior registration of the issue with the Comissão de Valores Mobiliários, and the subscription may only be effected with a financial institution acting as an intermediary.

Paragraph 1. A request for registration of an issue shall comply with the rules issued by the Comissão de Valores Mobiliários and shall be accompanied by:

(a) the economic and financial feasibility study of the enterprise;

(b) a draft of the bylaws;

(c) a prospectus prepared and signed by the founders and by the intermediary financial institution.

Paragraph 2. The Comissão de Valores Mobiliários may require that amendments be made to the bylaws or to the prospectus as a condition for registration and may deny the same on the grounds of lack of feasibility or risk of the enterprise or of lack of fitness of the founders.

Article 83. The draft of the bylaws shall comply with all the requirements for contracts of commercial companies in general and those specially established for corporations, and shall contain the rules by which the corporation will be governed.

Article 84. The prospectus shall indicate precisely and clearly the basis of the corporation and the motives justifying the expectation of success of the enterprise, and specially:

I - the amount of capital to be subscribed, the manner in which it is to be paid up and whether or not a future increase has been authorized;

II - the extent of capital to be composed of property, a description of such property and the value attributed to such property by the founders;

III - the number, types and classes of shares into which the capital shall be divided; the par value of the shares and the issue price of the shares;

IV - the amount of the initial payment to be made upon subscription;

V - the obligations assumed by the founders, the contracts signed in the interest of the future corporation and the amounts already spent or to be spent;

VI - the special privileges to which the founders or third parties will be entitled and the article of the draft bylaws which regulates them;

VII - the government authorization for the incorporation, if necessary;

VIII - the date of the opening and closing of the subscription and the institutions authorized to receive the initial payments;

IX - the provision in case of surplus resulting from the subscription;

X - the period of time within which the general meeting of incorporation is to be held, or the preliminary meeting for the appraisal of the property, if any;

XI - the name, nationality, civil status, profession and residence of the founders, or, if a corporate entity, the firm or corporate name, nationality and head office, as well as the number and type of shares to which each one has subscribed;

XII - the financial institution acting as intermediary in the placement, which shall keep the original copy of the prospectus and of the draft of the bylaws, together with the documents mentioned therein, for examination by any interested party.

Article 85. Upon subscription to shares to be paid up in cash, the subscriber shall make an initial payment and sign the list or individual bulletin authenticated by the financial institution authorized to receive the initial payments, and shall declare his name, nationality, residence, civil status, profession and identity card number, or, if a legal entity, its corporate name, nationality and head office, and shall also specify the number of shares subscribed, their type and class, if more than one, and the total initial payment.

Sole Paragraph. Under the conditions set forth in the prospectus, subscription may be made by a letter to the institution with the statements required by this article and the initial payment.

Article 86. When the subscription is closed and the capital has been fully subscribed, the founders shall call a general meeting which shall:

I - provide for the evaluation of the property, if any (article 8);

II - resolve on the incorporation.

Sole Paragraph. The notices calling the meeting shall specify the time, date and place of the meeting and shall be published in the same newspapers in which the subscription offer was published.

Article 87. The first general meeting, or general meeting of incorporation, shall be held on the first call with the presence of subscribers representing at least half of the capital, and on the second call with any number.

Paragraph 1. At the meeting, which shall be presided over by one of the founders and shall have a subscriber acting as secretary, the receipt of the deposit mentioned in item III of article 80 shall be read and the draft of the bylaws discussed and voted upon.

Paragraph 2. Regardless of its type or class, each share shall have the right to one vote; a majority shall not have the right to modify the draft of the bylaws.

Paragraph 3. Upon satisfying himself that all legal formalities have been observed and that there is no opposition from subscribers representing more than half of the capital, the chairman shall declare the corporation incorporated, and thereupon the election of the officers and members of the audit committee shall be held.

Paragraph 4. The minutes of the meeting, drawn up in duplicate, after being read and approved by the meeting, shall be signed by all subscriber present or by as many as are required to validate a decision; one copy shall remain in the possession of the corporation and the other shall be used for registration at the Commercial Registry.

Article 88. The incorporation of a corporation by private subscription of its capital may be effected by a resolution of the subscribers in a general meeting or by a public deed, all subscribers being considered founders.

Paragraph 1. If the form selected is that of a general meeting, it shall be subject to the provisions of articles 86 and 87 and the draft of the bylaws, signed in duplicate by all the subscribers to the capital, shall be presented at the meeting, as well as the lists or offerings of subscription to all the shares.

Paragraph 2. Should a public deed be preferred, it shall be signed by all the subscribers and shall contain:

(a) the description of the subscribers as required by article 85;

(b) the corporation’s bylaws;

(c) a list of the shares taken up by the subscribers and the amount of the initial payments made;

(d) a copy of the receipt of the deposit referred to in item III of article 80;

(e) in the event of subscription of the capital with property, a copy of the expert's evaluation report (article 8);

(f) the appointment of the first officers and, if any, of the audit committee members.

Article 89. The appropriation of real property to the capital shall not require a public deed.

Article 90. A subscriber may be represented at the general meeting or in the public deed by a proxy vested with special powers.

Article 91. In all documents and publications relating to the corporation being incorporated, the clause "under incorporation" shall be added to its corporate name.

Article 92. Within the scope of their respective responsibilities, the founders and financial institutions participating in an incorporation by public subscription shall be liable for any loss resulting from the failure to comply with legal requirements.

Sole Paragraph. The founders shall be jointly and severally liable for the losses caused by their negligence or fraud in acts or transactions prior to the incorporation.

Article 93. The founders shall surrender to the first elected officers all documents, books or papers referring to the incorporation or belonging to the corporation.

Chapter VIII

Article 94. No corporation may operate unless its incorporation documents have been registered and published.

Article 95. If the corporation was incorporated by resolution at a general meeting, the following documents shall be registered at the Commercial Registry of the place where its head office is located:

I - one copy of its bylaws, signed by all subscribers (article 88, paragraph 1), or, if the subscription was public, the original copies of the bylaws and the prospectus, signed by the founders, in addition to one copy of the newspaper in which these documents were published;

II - a complete list, authenticated by the founders or by the chairman of the general meeting, of the subscribers to the capital, giving their personal descriptions, the number of shares and the total initial amount paid up by each subscriber (article 85);

III - the receipt of the deposit referred to in item III of article 80;

IV - a duplicate copy of the minutes of the general meetings held to value property, if any (article 8);

V - a duplicate copy of the minutes of the general meeting of subscribers which passed the resolution to incorporate the corporation (article 87).

Article 96. If the corporation was incorporated by a public deed, it will be sufficient to register a certified copy of the deed.

Article 97. The Commercial Registry shall determine whether the incorporation complied with the legal requirements and whether the bylaws contain clauses contrary to the law, public order or decency.

Paragraph 1. Should registration be denied on the grounds of failure to comply with any legal requirement or an irregularity found in the incorporation, the first officers shall immediately call a general meeting to correct the omission or irregularity, or to authorize such steps as may be necessary. This general meeting shall be convened and held subject to the provisions of article 87, and resolutions shall be passed by shareholders representing at least one-half of the capital. If the bylaws are defective, they may be corrected at the same general meeting, which shall also decide whether the corporation should hold the founders liable in law (article 92).

Paragraph 2. On receipt of a duplicate copy of the minutes of the general meeting and proof that the omission or irregularity has been remedied, the Commercial Registry shall register the documents of incorporation.

Paragraph 3. Subject to the provisions of the bylaws, the establishment of branches, offices or agencies shall be registered at the Commercial Registry.

Article 98. Once the documents relating to the incorporation have been registered, within the following thirty days its officers shall publish such documents and a certified copy of the registration document in an official newspaper of the place of the head office of the corporation.

Paragraph 1. One copy of the official newspaper shall be filed with the Commercial Registry.

Paragraph 2. A certified copy of the documents of incorporation, issued by the Commercial Registry at which they were registered, shall be sufficient for the transfer of the property which a subscriber may have contributed to the capital (article 8, paragraph 2), by registration at the appropriate public registry.

Paragraph 3. The minutes of the general meeting which approves the incorporation shall identify each asset in precise terms, but may describe it briefly, provided that it is supplemented by a statement signed by the subscriber containing all the information necessary to effect the registration at the public registry office.

Article 99. The first officers shall be jointly and severally liable to the corporation for any losses caused by delay in complying with the supplementary incorporation formalities.

Sole Paragraph. Subject to any resolution by the general meeting to the contrary, the corporation shall not be liable for any action by the first officers before the formalities of incorporation have been complied with.

Chapter IX

Article 100. In addition to the books required of all commercial firms and subject to the same legal formalities, a corporation shall keep the following books:

I - a Registered Shares Register book, for recording, noting or registering: (Text as determined by Law no. 9.457 of May 5, 1997)

(a) shareholders' names and the number of their shares;

(b) initial payments or installments to pay up capital;

(c) conversions of shares from onetype or class to another; (Text as determined by Law no. 9.457 of May 5, 1997)

(d) redemptions, refunds and amortizations of shares, or their acquisition by the corporation;

(e) changes resulting from the disposal of or transfer of shares; and

(f) pledges, usufructs, trusts, fiduciary alienations in guarantee, or any charge which encumbers the shares or prevents their sale;

II - a Registered Shares Transfer book for recording transfers, which must be signed by the assignor and the assignee, or their authorized representatives;

III - a Registered Founder Shares Register and a Registered Founder Shares Transfer book, should such certificates have been issued, subject, in both cases, where applicable, to the provisions of items I and II of this article;

IV - a Minutes of General Meetings book;

V - a Shareholders' Attendance book;

VI - a Minutes of Administrative Council Meetings book, if any, and a Minutes of Board of Directors Meetings book;

VII - a Minutes and Opinions of the Audit Committee book.

Paragraph 1. Any person may obtain certified copies of the entries made in the books mentioned in items I to III, as long as it be necessary to the defense of his rights or the elucidation of his personal interest or the interest of any shareholder or the capital market, being the corporation authorized to make a charge for the cost of such copies; the denial of such request shall be subject to appeal to the Comissão de Valores Mobiliários. (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 2. In publicly held corporations, the books referred to in items I to III of this article may be substituted by mechanical or electronic records, subject to the rules issued by the Comissão de Valores Mobiliários. (Text as determined by Law no. 9.457 of May 5, 1997)

Article 101. The issuing agent of share certificates (article 27) may substitute the books referred to in items I to III of article 100 for his own records and maintain, through adequate systems approved by the Comissão de Valores Mobiliários, records of ownership of shares, founders’ shares, debentures and subscription bonuses; once a year, the agent shall prepare a list of the holders with the number of securities held by each, such list to be bound, authenticated at the Commercial Registry and filed with the corporation. (Text as determined by Law no. 9.457 of May 5, 1997)

Paragraph 1. The entries of transfer of nominative shares signed in the presence of an issuing agent may be made on loose pages, upon the presentation of the share certificate, on which the transfer and the name and the personal description of the assignee shall be entered.

Paragraph 2. Entries of transfer made on loose paper shall be bound in chronological order in books authenticated at the Commercial Registry and kept on file by the issuing agent.

Article 102. The financial institution with which book entry shares are deposited shall furnish the corporation, at least once a year, with copies of the statements of the share deposit accounts and a list of the shareholders with the number of their respective shares, and the copies and lists shall be bound into books to be authenticated at the Commercial Registry and kept on file by the financial institution.

Article 103. The corporation shall verify of the adequacy of the transfers and of the encumbrances constituted on securities which it issued; in the cases under articles 27 and 34, such responsibility shall be supported by the issuing agent of share certificates and the financial institution with which book entry shares are deposited, respectively.

Sole Paragraph. Disputes arising between a shareholder or any interested party and the corporation, the agent issuing share certificates or the financial institution with which book entry shares are deposited, with regard to the registrations required by this Law or with regard to notations, entries or transfers of shares, founders’ shares, debentures or subscription bonuses in the register or transfer books, shall be settled by the judge competent to resolve doubts raised by public registry officials, except for questions relating to the substance of the right itself.

Article 104. The corporation shall be liable for any loss caused to interested parties by errors or irregularities found in the books mentioned in items I to III of article 100. (Text as determined by Law no. 9.457 of May 5, 1997)

Sole Paragraph. The corporation shall provide for the issue and substitution of certificates and for the transfer and registration in corporate books to be performed within the shortest time possible, not to exceed the period determined by the Comissão de Valores Mobiliários, and shall be liable to shareholders and third parties for any loss caused by culpable delay.

Article 105. At the request of shareholders representing at least five per cent of the capital, a complete inspection of the books of the corporation may be ordered by the court, whenever acts contrary to the law or to the bylaws occur, or there are grounds to suspect that serious irregularities have been committed by the corporation.

Chapter X

Article 106. The shareholders shall pay up the shares underwritten or acquired, in accordance with the conditions stated in the bylaws or the subscription offer.

Paragraph 1. If the bylaws and the subscription offer do not prescribe the amount and the term or date of payment, the administrative bodies shall issue calls through notices published in the press at least three times prescribing the period for payment which shall not be less than thirty days.

Paragraph 2. The shareholder who fails to make the payment under the conditions stated in the bylaws, subscription offer or call shall be deemed to be in arrears and may be required to pay any interest, monetary adjustment and penalty prescribed in the bylaws; any penalty may not exceed ten per cent of the total payment.

Article 107. Once a shareholder is deemed in arrears, the corporation may at its option:

I - bring proceedings to levy execution against the shareholder and those jointly liable with him (article 108) for the collection of the amounts due; the subscription offer and the notice of call being accepted as extra-judicial instruments as required by the Code of Civil Procedure; or

II - order that the shares be sold on a stock exchange for the account of, and at the risk of, the shareholder.

Paragraph 1. Any provision in the bylaws or in the subscription offer which excludes or limits the exercise of the option provided by this article shall be deemed to be void in relation to the corporation, but a subscriber in good faith shall be entitled, apart from any criminal sanction which may be available, to sue the persons responsible for such provision to recover any loss and damages suffered.

Paragraph 2. The sale shall be effected at a special auction at the stock exchange of the place of the head office, or, if no stock exchange exists there, then at the nearest one, after publication of notice on three occasions at least three days in advance. The expenses incurred in the transaction, and, if so authorized by the bylaws, the interest, monetary adjustment and penalty, shall be deducted from the proceeds of the sale, the balance being recoverable by the ex-shareholder at the head office of the corporation.

Paragraph 3. Even after proceedings to levy execution have been initiated, the corporation may order the sale of the share on a stock exchange; the corporation may also proceed to levy execution if the shares offered in the stock exchange find no buyer or if the price obtained is not sufficient to pay the debts of the shareholder.

Paragraph 4. If the corporation is unable to obtain payment in full in respect of any share through any of the procedures provided by this article, it may declare the share to be forfeit and appropriate all payments made, paying them up from profits or reserve accounts, other than the legal reserve; if the corporation has insufficient profits or reserves, it shall have a period of one year in which to place the forfeited shares, at the end of which, if no buyer has been found, a general meeting shall consider a resolution to reduce the capital by a corresponding amount.

Article 108. Even after an agreement to sell shares has been negotiated, the assignors shall be jointly liable with the acquirers for the payment of any amounts required to pay up the transferred shares.

Sole Paragraph. Such liability shall cease with respect to each assignor at the end of two years from the date of transfer of the shares.

Article 109. Neither the bylaws nor a general meeting may deprive a shareholder of the right:

I - to participate in the corporate profits;

II - to participate in the assets of the corporation in the case of liquidation;

III - to supervise the management of the corporate business as provided for in this Law;

IV - of first refusal in the subscription of shares, founders’ shares convertible into shares, debentures convertible into shares and subscription bonuses, according to articles 171 and 172;

V - to withdraw from the corporation in the cases provided for in this Law.

Paragraph 1. The shares of each class shall confer equal rights upon their holders.

Paragraph 2. The means provided by law to shareholders to enforce their rights cannot be overridden either by the bylaws or by any general meeting.

Paragraph 3. The corporation’s bylaws may establish that any disputes between the shareholders and the corporation, or between the majority shareholders and the minority shareholders may be resolved by arbitration under the terms specified by it.

Article 110. Each common share shall carry the right to one vot