CHAPTER II – Capital Stock and Shares

Article 5. The capital stock is three hundred eighty-one million, fifty thousand, one hundred four reais and seven centavos (R$381,050,104.07), fully subscribed and paid-up, divided into five hundred fifty-eight million, six hundred ninety-nine thousand and eighty (558,699,080) non-par registered, book-entry common shares.

Paragraph 1. Each share issued by the Company entitles to one vote at the General Meetings.

Paragraph 2. All the Company’s shares are book-entry, held in deposit accounts, at a financial institution, on behalf of its holders, without the issuance of certificates.

Paragraph 3. The costs related to the deposit of book-entry shares at a financial institution, including those related to the transfer and registration may be directly charged from trustee to shareholder.

Article 6. The Company is authorized to increase its capital stock up to the limit of four billion reais (R$ 4,000,000,000.00), regardless of amendment to Bylaws, by resolution of the Board of Directors, which shall establish the issuance price and other conditions to issue, subscribe and pay for these shares.

Paragraph 1. Except for the cases provided for in the following paragraphs, at the proportion of the number of shares held, the shareholders shall have preemptive right in the capital increase subscription, and thirty (30) consecutive days is the term to exercise this right, as of the publication date of the Board of Directors Meeting to resolve on the Company’s capital stock increase.

Paragraph 2. Provided the authorized capital is respected, the Board of Directors may also: (i) deliberate on the issue of subscription warrants and convertible debentures; (ii) as per the plan approved by the general meeting, deliberate on granting call options or subscription rights to its managers, employees or individuals rendering services to the Company or its subsidiaries, pursuant to the plan approved by the general meeting, with exclusion of preemptive rights of shareholders in the grant or exercise of call options or subscription rights; and (iii) approve the capital increase through capitalization of profits or reserves, with or without bonus shares.

Paragraph 3. The issue of new shares, convertible debentures or subscription warrants, whose placement is conducted through sale on stock exchanges, public subscription or stock swap in a public tender offer, in accordance with articles 257 to 263 of Law 6,404, of December 15, 1976, as amended (“Brazilian Corporation Law”), or in accordance with special laws on tax incentives, may occur without granting shareholders the preemptive right in subscription or with the reduction of the minimum period set forth in law for their exercise.

Paragraph 4.

Paragraph 4. The Company is forbidden to issue founder’s shares.

Paragraph 5. The Board of Directors shall resolve on the unsold shares not subscribed in a capital increase during the term stipulated for exercising the preemptive right, determining, before such shares are sold on the stock exchange, to the Company’s benefit, the apportionment of subscribed amounts, among shareholders who have expressed their interest in subscribing eventual unsold shares in the subscription list.

Article 7. The direct or indirect sale of the Company’s controlling power, both by means of a single operation and by means of successive operations, shall be contracted under the condition, that the buyer of the controlling power assumes to bring into effect a public tender offer for the shares of other shareholders, under the terms and conditions provided for by prevailing laws and “Novo Mercado” Rules, so that to ensure them an equal treatment to that given to the selling controlling shareholder.

Paragraph 1. The term, documentation and offering procedure mentioned in this Article shall be those required by Brazilian Securities and Exchange Commission (CVM) Rules applicable to public tender offers due to the sale of control effective on the date of referred Sale and “Novo Mercado” Rules.