CHAPTER I
Corporate Name, Head Offices, Purpose and Duration

Art. 1 Saraiva S.A. Livreiros Editores is an open corporation, governed by this Bylaws and by the laws in force in the country.

§1 The Company, that originally adopted the name of “Saraiva & Cia.”, was organized by means of an instrument filed with the Trade Board of the State of São Paulo, under No. 41.411, in session of 01/24/1933, having become into a corporation, on 10/15/1947, by means of a public deed filed with the Trade Board of the State of São Paulo, under No. 34.497, in session of 10/21/1947.

§2 With the company’s admission in the special Level-2 List of Corporative Governance of BM&FBOVESPA S.A. – Stock Exchange, Commodities an Futures  (“BM&FBOVESPA”), the Company, its shareholders, administrators and members of the Fiscal Council, whenever installed, shall be subject to the provisions contained in the Level-2 Regulation.

§3 The provisions contained in the Level-2 Regulation of Corporative Governance of BM&FBOVESPA (“Level-2 Regulation”) shall prevail over the statutory provisions in the event of violation to the rights held by receivers of the public offerings set forth herein.

Art. 2 The Company’s head office and venue is located at Rua Henrique Schaumann, No. 270, [10th Floor], Cerqueira César, CEP[Zip Code] , in the City of São Paulo - SP, Federative Republic of Brazil.

Sole Paragraph. Within the authorized capital limit, the Company may, by resolution of the Board of Directors, increase the capital by issuing new shares for subscription.  In this case, the Board of Directors shall establish the conditions for issuance and subscription, including price and payment term and term for the exercise of the preemptive right by the shareholders, which shall not be less than thirty (30) days from the publication of corresponding notice.

Art. 3 The purpose of the Company is the following.

I. The edition, industry and commerce of books and publications in general;

II. Education system activities, including education support services;

III. The purchase and sale of stationary, utensils and office materials, school materials, toys and similar products, CD-ROMs, video and audio recorder, electronic equipment, computer and its programs, photograph articles and equipment, as well as photograph material processing service, in addition to cafeteria services;

IV. The organization, systematization, reception and transmission, and filing of data, information and texts, and the commercialization thereof, in the country and abroad, overall upon transmission by electric, electronic, optical and magnetic means, as well as the commerce of equipment, accessories and components necessary to use these products, in addition to the creation of other related programs;

V. The import and export of the products and services included in the corporate purpose, registering them, for such, at the competent bodies, Central Bank of Brazil and other Foreign Trade controlling authorities;

Art 4. The Company shall exist for an undetermined term.

CHAPTER II
Capital Stock

Art. 5 The capital stock is of R$229,901,000.00 (two hundred twenty-nine million, nine hundred and one thousand Brazilian Reais), fully paid and divided into 28.596.123 (twenty-eight million, five hundred ninety-six thousand, one hundred and twenty three) stocks, without pair value, out of which 9.622.313 (nine million, six hundred twenty-two thousand, three hundred and thirteen) are common stocks and 18.973.810 (eighteen million, nine hundred seventy three thousand eight hundred and ten) are preferred stocks.

§1 The shareholders having the Company’s preferred stocks shall have the following rights and advantages:

a) Right to restricted voting, as described in article 6 below;

b) Right to transfer preferred stocks upon Assignment of the Company’s Control Power, under the terms of Chapter VI hereof;

c) Dividends equal to the ones attributed to common stocks;

d) Interest in the distribution of bonus shares resulting from the capitalization of funds, accumulated profits and any other funds, in the same conditions as the shareholders holding common stocks;

e) Right to be included in the public offering to acquire stocks as a result of the Transference of the Company’s Control, observing the provisions contained in article 24 of these Bylaws.

§2 Common stocks cannot be converted into preferred stocks, and vice-versa.

Art. 6 The Company’s preferred stocks, whose number may correspond, under the terms of article 8, § 1, III, of Law No. 10.303/01, to up to two thirds (2/3) of the total number of issued stocks, grant to its holders the right to restricted voting, exclusively in relation to the following matters.

I.transformation, merger, consolidation or spin-off of the Company;

II.approval of contracts between the Company and the Controlling Shareholder (as defined in paragraph one of section 22 hereof), directly of by means of third parties, as well as other companies in which the Controlling Shareholder holds an interest, whenever, by operation of any legal or statutory provision, it is so decided in the General Meeting;

III.assessment of the assets destined to increase the Company’s equity;

IV. choice of institution or specialized company to determine the Company’s Economic Value, in the event set forth in section 28 and 29 of these Bylaws;

V. change, modification or revocation of statutory provisions changing or modifying any of the following provisions:

a) compliance with the provisions contained in Chapter VI of these Bylaws;

b) compliance, upon election of the Board of Directors, with a unified term of office of, at the most, two (2) years, and the other provisions related to the Board of Directors and Fiscal Council contained in the Level-2 Regulation;

c) cmpliance with the provisions contained in Chapter VIII hereof;

d) any of the rights established in article 5, §1, and article 6, I to IV, hereof; and

e) other requirements set forth in item 4.1 of the Level-2 Regulation.

Sole Paragraph. The right to restricted voting set forth in item V of this article shall prevail while the Corporative Governance Level 2 participation contract signed between the Company and BM&FBOVESPA (“Level 2 Participation Contract”) is in force.

Art.  7 It is authorized the capital increase resulting in increase in the number of preferred stocks not proportionally to the class of the then existing stocks.

Art.  8 The Company is authorized to increase its capital stock by issuing new stocks for subscription, by resolution of the Board of Directors, and regardless of any statutory reforms, up to four million (4,000,000 stocks), even if not proportionally to the various types or classes of stocks, provided that, out of this total, up to 500,000 (five hundred thousand) stocks may be used to grant stock options pursuant to § 3 below.

§1 The Board of Directors shall determine the issuance and subscription conditions, including the price and deadline for the full payment thereof, as well as deadline and conditions to exercise the shareholders’ preemptive rights.

§2 The Company may, by resolution of the Board of Directors, issue, within the limits of the authorized capital, stocks to be placed on sale through public subscription or the stock exchange, or by exchange of stocks, in public offerings for acquisition of control, under the terms of articles 257 to 263 of Law No. 6.404/76, without attributing preemptive right to the former shareholders or establishing a deadline to exercise such right, inferior to the one mentioned in article 171, § 4, of Law No. 6.404/76.

§3 The Company may, within the authorized capital limits, grant stock options to its administrators or employees, or natural persons who provide services to it or to the controlled company, according to the plan approved by the General Meeting.

§4 The resolutions adopted by the Board of Directors referred to in this article shall observe the quorum set forth in the final part of § 4 of article 14 below.

Art. 9 The Company’s stocks shall be registered stocks and shall remain in deposit accounts, in the name of their holders, in a financial institution chosen by the Board of Directors.  

§1 The financial institution depositary of the stocks may charge the shareholders, under the terms of § 3 of article 35 of Law No. 6.404/76, the cost for the transference of ownership of the registered stocks. 

§2 The Company may, by the Board of Directors resolution and upon a notice sent to the stock exchanges in which its stocks are traded, suspend, for periods that do not exceed, each one, fifteen days, nor the total of ninety days during the year, the stock transference services.

Art. 10 With the exception for the hypothesis of the article 8, §§ 2 and 3 hereof, the shareholders shall have preemptive right to subscribe the stocks issued as a result of the capital increase, proportionally to the number of stocks they hold.

Sole Paragraph. The term for the exercise of the preemptive right is always preclusive and shall be of thirty (30) days, except:

a) if established by the General Meeting or by the Board of Directors, as the case may be, a longer term; or

b) if the event set forth in article 8, § 2, in fine, hereof.

Art. 11 Every common stock corresponds to one vote in the resolutions of the General Meetings.

Art. 12 The Company shall be administered both by Board of Directors and Executive Committee.  

§1 The remuneration of Officers and Directors shall be established at the General Meeting, which may establish only the global limit or individualize it to one or more administrators.

§2 It is attributed to the administrators, observed the statutory provisions and article 152 of Law No. 6.404/76, an interest of up to ten per cent (10%) in the profits of the fiscal year.

 § 3 The global interest value in each fiscal year shall be approved by the Ordinary General Meeting in the voting for profit destination, observing, in the distribution among administration bodies and individualization per administrator, the provisions set forth in articles 15, IX, and 18, I, hereof.

§4 For take office, the members of the Board of Directors and Executive Committee shall previously sign the Administrators’ Instrument of consent, under the terms of Level-2 Regulation, as well as comply with the applicable legal provisions.

Art. 13 The Board of Directors is a collegiate decision-making body and shall be comprised of at least five (5) and at the most seven (7) members, appointed as Directors, all shareholders, resident in the Country, elected and destituted by General Meeting, with a unified term of office of one (1) year, provided that successive reelections are permitted.  

§1 At least twenty per cent (20%) of the Board of Directors shall be comprised of Independent Directors, and expressly declared as such in the minutes of the General Meeting electing them. “Independent Directors” characterized by: (i) having no connection with the Company, except interest in the capital stock; (ii) not being a Controller Shareholder, spouse or relative up to the second degree, or have no, or have had no, association with the company or entity related to the Controlling Shareholder, in the last three (03) years (people associated to teaching and/or research public entities are excluded from this restriction); (iii) not have been, in the last three (3) years, an employee or director of the Company, Controlling Shareholder or company controlled by the Company; (iv) not to be a supplier or purchaser, whether direct or indirect, of services and/or products of the Company, to the extent it implies independence loss; (v) not to be an employee or administrator of a company or entity offering to or demanding from the Company services and/or products, to the extent it implies independence loss; (vi) not to be a spouse or relative up to the second degree of any of the Company’s administrator; and (vii) not to receive any other remuneration from the Company, in addition to the remuneration as Director (cash resulting from interest in the capital stock are excluded from this restriction). It shall also be considered as independent the directors elected under article 141, §§ 4 and 5 of Law 6.404/76.

§ 2 When, as a result of the above-mentioned percentage, a fractional number of Directors in obtained, such number shall be rounded to the integer (i) immediately superior, when the fraction is equal or higher than five tenths (0.5); or (ii) immediately inferior, when the fraction is lower than five tenths (0.5).

§ 3 The Directors shall hold office upon the execution of an agreement drawn up in the proper book. The members of the Board of Directors shall remain in their position and in the exercise their duties until their substitutes are elected, except if otherwise resolved by the General Meeting.

Art. 14 The President and Vice-President of the Board of Directors shall be chosen by General Meeting.

§1 The office of Chairman of the Board of Directors office, shall not accumulate functions as the CEO and/or executive officer of the Company.

§2 The Chairman of the Board of Directors shall be responsible for call and preside the meetings held by this body, and the Vice President shall replace him, if occasionally absent or impeded.  

§3 In case of vacancy of position or temporary impediment of a Director, the substitute shall be appointed by the remaining Directors until the first General Meeting, which shall resolve on such matter.

§4 The Board of Directors shall meet as many times as necessary, with the presence of at least three (3) of its members, resolving by majority of votes, except for the issues discussed in article 8 hereof, when the Board of Directors may only adopt resolutions with the favorable vote of at least four (4) Directors, among them, the Chairman of the Board of Directors.

§5 If the Board of Directors’ voting ends in a draw, the vote cast by the Chairman or Vice-President in such occasional replacing the Chairman shall prevail, except for the provisions set forth in the prior paragraph. §6 Out of such meetings, minutes shall be drawn up, by one of the Directors appointed by the Chairman, which shall be included in the proper book and signed by everybody present, being published if required by law.

Art. 15 The Board of Directors shall be responsible for : 

I. establish a general guidance for the Company’s businesses;

II. manifest favorably or against any public offer for the acquisition of stocks, whose object is the stocks issued by the Company, by means of a grounded prior opinion, disclosed within fifteen (15) days after the publication of the notice informing about the public offer for the acquisition of stocks, which shall include, at least, (i) the convenience and opportunity for the acquisition of stocks through public offering in relation to the shareholders’ joint interest and in relation to the liquidity of the real estate values owned by it; (ii) the consequences of the stock acquisition though public offering for the interests of the Company; (iii) the strategic plan disclosed by the offerer in relation to the Company; (iv) other topics considered relevant by the Board of Directors, as well as information required by the applicable rules established by the Brazilian Securities and Exchange Commission (“CVM”).  

III. Elect and destitute the Company’s officers, giving them attributions, respecting the rules established in article 17 hereof;  

IV. Inspect the management of directors, periodically analyzing the books and papers of the Company, requiring information on contracts and other acts related to the corporate businesses;  

V. Call the General Meetings, observing the legal and statutory rules;  

VI. Authorize the Executive Committee to transfer the goods part of the permanent assets, constitute liens on such goods and provide guarantees over third parties’ obligations, being unnecessary such authorization in the events set forth in article 17, § 1, “f”, § 2, “b” e “g”, and § 3, “e” and “f”, hereof;

VII. Authorize the acquisition, transference, cancelling or custody in the treasury of the stocks issued by the Company;  

VIII. Choose and destitute independent auditors;

IX. define, when the General Meeting globally establishes the administrators’ remuneration, the parcel corresponding to the Executive Committee and corresponding to the Board of Directors, as well as individualize it in relation to the members of the Board of Directors;

X. define this triple list of companies specialized in the economic assessment of companies for the preparation of an appraisal report in relation to the Company’s stocks, in case of public offering to cancel the registry as an open company or to lease the Corporate Governance Level 2.

Art. 16 The Executive Committee shall have general powers to manage, represent and administer the Company, which are necessary to fully comply with the corporate purpose, observing, in order, the rules contained in article 17 and the attributions granted by the Board of Directors under the terms of article 15 hereof.

§1 The Executive Committee shall be comprised of seven (7) members, shareholders or not, resident in the country, including: CEO, CFO, Sales Officer, Legal Editorial Officer, Human Resources Officer, Education System Officer and Officer without specific designation, all of them elected by the Board of Directors, with the term of office of one (1) year, being allowed successive reelections.

§2 Upon absence or temporary impediment of officers, the Board of Directors may distribute the functions of the absent or impeded officer to the other officers, maintaining, however, compliance with the determinations of article 17.

§3 In case of vacancy or definite impediment of any officer, the Board of Directors shall decide upon it, indicating a substitute to complete the term of office or maintain the position vacant, distributing, in this case, the functions of the impeded or absent officer among the other officers, observing the determinations of article 17. 

§4 The Board of Directors shall appoint one of the officers to cumulatively exercise the function of Investor’s Relations Officer.

Art. 17 The Executive Committee shall be, in the exercise of its management, representation and administration powers, always subject to the conditions set forth in the paragraphs below.

§ 1 Individually, any acting officer may:

a) withdraw, endorse for bank collection and pay trade notes;

b) endorse checks and payment orders, to be deposited in the Company’s bank current accounts;

c) sign relations for discount bonds, deposit and collection;

d) sign mails, tax and social contribution payment forms, applications and petitions addressed to Federal, State and Municipal Autarchies and Departments, banks and institutions, in proceedings to collect taxes, fees and social contributions or administrative proceedings of any nature;

e) hire and fire employees, sellers, representatives and business agents;

f) acquire, transfer or encumber goods of the fixed asset, including real estates, provided that its individual value does not exceed one per cent (1%) of the Company’s net equity, contained in the last published Financial Statements;

g) receive service of process in relation to legal or administrative proceedings.

§2 Together, any two (2) acting officers may:

a) issue checks, authorize debts in bank accounts, sign credit facility agreements with bank entities and lease agreement with companies organized for such purpose;

b) issue, accept or transfer promissory notes and bills of exchange, for bank discount or guarantee of the obligations assumed in credit facility and lease agreements, as well as appoint attorneys-in-fact specifically for such purpose;

c) endorse any credit instrument, including trade notes, promissory notes, bills of exchange and custody certificates, except for checks;

d) place under custody and remove from custody of titles and other real estates;

e) appoint attorneys, granting powers of the ad-judicia and extra clause, as well as be served notice, confess, compromise, desist, give and receive release;

f) sign contracts, including edition, sale contracts and partnership agreements with private and public agencies, and real estate or personal property lease agreements, or service agreements;

g) give guarantees to direct or indirectly controlled companies and guarantees over the bonds under these companies’ responsibility;

h) acquire, subscribe, transfer and recover variable and fixed income securities, including stocks and debentures, provided that they are not issued by the Company or any other company directly or indirectly controlled by it, also respecting the provisions contained in § 4, item “e”.

§3 Together with the CEO, any of the acting officers may:

a) endorse checks;

b) appoint attorneys, granting the powers that have been vested upon such officers ;

c) represent the Company, together with controlled companies;

d) acquire, transfer or create liens over fixed asset, including real estates, provided that its individual value does not exceed twenty per cent (20%) over the Company’s net equity, contained in the last published Financial Statements;

e) sign contracts whose object is to create liens over the company's assets, whose value may not exceed twenty per cent (20%) of the Company’s net equity, contained in the last published Financial Statements;

f) provide guarantee to natural persons when destined to guarantee the lease of a residential real estate destined to host the Company’s manager, or company controlled by it, in a city different from his domicile, in which the establishment for whose management he had been appointed is located.

§4 Together with the CEO, and with the prior and express authorization of the Board of Directors, any of the acting officers may:

a) acquire, transfer or create liens over the stocks and quotas issued by direct or indirectly controlled companies;

b) acquire, transfer or create liens over fixed assets, including real estates, when its individual value exceeds twenty per cent (20%) over the Company’s net equity, contained in the last published Financial Statements;

c) sign contracts creating leans over the company’s assets, in a value superior to twenty per cent (20%) of the Company’s net equity, contained in the last published Financial Statements, without prejudice to the other provisions contained in this article;

d) provide guarantee to natural persons, except for the cases set forth in item “g” of § 3 of this article, or legal entities, other than companies direct or indirectly controlled, and guarantee the bonds under such persons’ responsibility, provided that the Company is interested in such acts;

e) attribute the Company’s interest, aiming at individual or joint control, to any other company, upon acquisition or subscription of quotas or stocks, as well as remove the Company from such companies;

f) appoint attorneys, granting the powers that have been vested upon such officers;

g) issue and accept the other credit instruments, including promissory notes and bills of exchange, observing the exception contained in letter “b” of § 2 above.  

Art. 18 The Executive Committee shall be responsible for :
I. individualize the remuneration of officers, whenever the General Meeting globally establishes the administrators' remuneration and after the Board of Directors exercise the competence mentioned in article 15, IX, hereof;

II. resolve on the opening, maintenance, transference and extinction of branches;

III. resolve on administrative matters, observing, if any, the determinations of the General Meeting and Board of Directors.

Art. 19 The Executive Committee shall always meet with the presence of at least three (3) officers and since called by the CEO, which shall establish the agenda, direct the works and designate the Secretary.

§1 The minutes of the meetingshall be drawn up in the proper book.

§2 The resolutions shall be adopted by the majority of votes cast by the officers present at the meeting, prevailing, if the voting ends in a draw, the vote of the CEO.

 CHAPTER IV
Fiscal Council

Art. 20 The Company’s Fiscal Council is comprised of at least three (3) and, at the most, five (5) members, and respective substitutes, shall operate whenever installed by resolution of the General Meeting, in the cases set forth by law. 

§1 The General Meeting resolving on the installation of the Fiscal Council shall establish the number of its members, elect and establish their compensation.

§2 The members of the Fiscal Council shall hold office upon the signature of an agreement drawn up in the proper book. The members of the Fiscal Council shall hold office depending on the prior signature of the Approval Statement by the Fiscal Council under the terms of the Level-2 Regulation, as well as compliance with the applicable legal requirements.

§3 The Internal Regulation of the Fiscal Council shall be approved by the General Meeting.

CHAPTER V
General Meeting

Art. 21 The General Meeting shall ordinarily meet in the first four months after the end of the fiscal year and extraordinarily, whenever the company's interests so require, upon a notice sent under the law.  

§1º The General Meeting shall be presided by the Chairman of the Board of Directors, by the Vice-President acting as the Chairman of the Board of Directors or, in their absence, by the shareholder appointed by it. The Chairman of the General Meeting shall choose one of its participants to act as the secretary.  

§2º The people present at the Meeting shall prove to be shareholders, provided that the holders of registered stocks or stocks under custody, under the terms of article 41 of Law No. 6.404/76, shall file with the Company, for such purpose, a receipt issued by the depositary financial institution, under the terms established in the notice, except if the Chairman of the Meeting deems any other verification mean sufficient.

CHAPTER VI
Transference of Shareholding Control, Cancelation of Open Corporation Registry and Discontinuance of Level 2 Corporative Governance Differentiated Practices

Art. 22 The Transference of the Company’s Shareholding Control, by means of a single transaction or successive transactions, shall be contracted under precedent or subsequent conditions, and the acquirer of shareholding control shall agree to make a public offer for the acquisition of stocks to the other shareholders of the Company, observing the conditions and terms set forth by law and Level-2 Regulation and monetary correction under the applicable regulation, in a way to guarantee equal treatment to the Assignor Controlling Shareholder, observing the provisions contained in article 24.

§1 For the purpose of these Bylaws, the following terms initiated in capital letters shall have the following meanings:
“Controlling Shareholder” mean the shareholder(s) or Group of Shareholders exercising the power to control the Company.

“Assignor Controlling Shareholder” means the Controlling Shareholder transferring the power to control the Company.
“Controlling Stocks” means the group of stocks guaranteeing, direct or indirectly, to its holders, the individual and/or shared exercise of the Company’s Control Power.

“Outstanding Stocks” means all stocks issued by the Company, except for the stocks held by the Controlling Shareholder, by associated people, administrators of the Company and those in the treasury.

“Transference of the Company’s Control” means the transference to a third party, on valuable consideration, the Controlling Stocks.

“Group of Shareholders” means the group of people: (i) associated by contract or voting agreements of any nature, whether directly or by means of controlling companies, controlled companies or companies under common control; or (ii) among whom there is a relation of control; or (iii) under common control.

“Shareholding Control” means the power actually used to direct the corporate activities and guide the operation of the Company’s bodies, direct or indirectly, in fact or under the law, regardless of the shareholding control actually held. There is a relative assumption of control in relation to the person or Group of Shareholders holding stocks ensuring the absolute majority of votes of the shareholders present in the last three General Meetings of the Company, even if not holding the stocks ensuring the absolute majority of the voting capital.

“Economic Value” means the value of the Company and its stocks that may be determined by a specialized company, upon the use of a recognized methodology or based on other criteria that may be defined by the CVM.

§2 Thenegotiation of Controlling Stocks between the Controlling Shareholder identified in the Level 2 Participation Agreement and his necessary heirs and, also, among these heirs, provided that they exercise the Company’s shareholding control, even if it implies in the consolidation of the shareholding control in only one shareholder, does not constitute Transference of Shareholding Control, not giving cause, therefore, to the obligation to perform a public offering under the terms of the caput of this article and the caput of article 24.

Art. 23 The public offering referred to in the previous article shall also be performed:

I. upon costly assignment of stock subscription rights and other instruments or rights related to securities convertible into stocks, which may result in the transference of the Company’s control; and

II. in case of transference of Company’s control by the Controlling Shareholder, provided that, in this case, the Transferor Controlling Shareholder shall have to declare to BM&FBOVESPA the value attributed to the Company in such transference and attach documents evidencing it.

Art. 24 Public offerings to the holders of common stocks shall be made at a value of one hundred per cent (100%) of the value paid by the Controlling Stocks and public offering to the holders of preferred stocks shall be made at a minimum value of ninety per cent (90%) over the value paid by the Controlling Stocks.

Sole Paragraph. The modification of this statutory clause, in regards to the public offering made to the holders of preferred stocks, may only be resolved by the General Meeting with the prior approval of the shareholders holding more than half of the preferred stocks, gathered in a special meeting.

Art. 25 He who acquiresShareholding Control, in view of a private stock purchase agreement entered into with the Controlling Shareholder, involving any number of stocks, shall be required to:

I. make the public offering referred to in article 22 hereof; and

II. pay, under the terms indicated below, a amount equivalent to the difference between the public offering price and the value paid per stock actually acquired in the stock exchange in the six (6) months before the date Shareholding Control is acquired, duly updated until the payment date. Such amount shall be distributed among all people that sell the Company’s stocks in biddings in which the Acquirer has made the acquisitions, proportionally to the daily sale net balance of each one, and BM&FBOVESPA shall perform the distribution, under its regulations.

Art. 26 The Company shall not register any transference of stocks to the acquirer of Shareholding Control or to the shareholder(s) that may hold the Shareholding Control, while they do not sign the Controllers’ Instrument of consent, under the terms set forth in Level-2 Regulation, which shall be immediately sent to BM&FBOVESPA.

Art. 27 No shareholders’ agreement providing for the exercise of the Power Control may be registered at the headquarters of the Company, without its signatories have signed the Controllers’ Instrument of Consent referred to the Level-2 Regulation, which will be immediately sent to BM&FBOVESPA.

Art. 28 In the public offering for the acquisition of stocks to be performed by the Controlling Shareholder or by the Company to cancel the registry as open  corporation, the minimum price to be offered shall correspond to the Economic Value determined in the appraisal report, subject the laws and regulations.

Art. 29 If a resolution is adopted approving the removal of the Company frm the Corporative Governance Level 2 so that the securities issued by it can be traded outside the Corporative Governance Level 2 or, in view of corporate reorganization in which the resulting company does not have its securities admitted to trading at Corporative Governance Level 2 within 120 (one hundred and twenty) days from the date of the General Meeting which approved the transaction, the Controlling Shareholder Shall make a public offering for the acquisition of stocks held by the Other shareholders of the Company, whose minimum price to be offered shall correspond to the Economic Value determined in the appraisal report, subject to the laws and regulations.

§1 The Controlling Shareholder shall be release from the obligation to make the public offering for the acquisition of stocks mentioned in the caput of this article IF the Company leaves the Corporative Governance Level 2 in view of the of the conclusion of the Company's participation in special segment of the BM&FBOVESPA called New Market ("New Market") or if the resulting company  obtains authorization to trade securities in the New Market within 120 (one hundred and twenty) days from the date of the General Meeting approving such transaction.

Art. 30 The appraisal report provided for in articles 28 and 29 hereof shall be prepared by a specialized institution or company with proven expertise and independence of the power of decision of the Company, its administrators and/or Controlling Shareholder(s), in addition to satisfying the requirements contained in §1 of article 8 of Law No. 6.404/76, and include the liability provided for in § 6 of that article.

§1 The choice of the institution or company that is responsible for determining the Economic Value of the Company is the exclusive responsibility of the General Meeting, based on the presentation, by the Board of Directors, of a triple list, and the respective resolution, not counting the votes in blank, and each stock, regardless of the type or class, shall give the right to one vote, to be adopted by majority vote of shareholders representing the Outstanding Shares present at the Meeting, which is installed on first call must have the presence of shareholders representing at least 20% (twenty percent) of total of Outstanding Shares, or, if installed on the second call may be attended by any number of shareholders representing the Outstanding Shares.

§2º The costs for preparing the required appraisal report  shall be fully borne by the offerer.

Art. 31 If there is no Controlling Shareholder, if approved the removal of the Company from the Corporative Governance Level 2 so that the securities issued by it can be registered for trading outside the Corporative Governance Level 2, or due to corporate reorganization in which the resulting company does not have its securities admitted to trading on Corporative Governance Level 2 or New Market within 120 (one hundred and twenty) days from the date of the General Meeting which approved the transaction, the output will be conditional on the public offering for the acquisition of stocks in the same conditions set forth in the above articles.

§1 Such General Meeting shall define the responsible person(s) for conducting the public offer for the acquisition of stocks, who, if present in the meeting, shall expressly assume the obligation to make such offer.

§2 Upon failure to define the people responsible for conducting the public offering for the acquisition of stocks, in the case of corporate reorganization in which the resulting company does not have its securities admitted to trading on Corporative Governance Level 2, the shareholders who voted favorably for the corporate reorganization shall make such offer.

Art. 32 The Company’s removal from Corporative Governance Level 2 in view of any failure to compliance with the obligations contained in the Level-2 Regulation is conditional upon the execution of the public offering for the acquisition of stocks, at least the Economic Value of the stocks, to be determined in the appraisal report and referred to in articles 28, 29 and 30 hereof, subject to the applicable rules and regulations.

§1 The Controlling Shareholder shall conduct a public offering for the acquisition of stock under the caput of this article.

§2 If there is no Controlling Shareholder and if the removal of the Company from the Corporative Governance Level 2 mentioned in the caput result from the resolution of General Meeting, the shareholders who voted in favor of the resolution which led to such non-compliance will make the public offering for the acquisition of stocks set forth in the caput.

§3 If there is no Controlling Shareholder and if the removal of the Company from the Corporative Governance Level 2 mentioned in the caput results from a fact or act performed by the administration, the Company’s administrators shall call the General Meeting of shareholders whose agenda will be how to remedy the failure to comply with the obligations contained in the Level-2 Regulation or, where appropriate, decide on the Company’s removal from the Corporative Governance Level 2.

§4 If the General Meeting referred to in § 2 above resolves to remove the Company from Corporative Governance Level 2, such General Meeting shall define the person(s) responsible for conducting the public offering for the acquisition of stocks set forth in the caput, who, present in the meeting, shall expressly assume the obligation to make the offer.

CHAPTER VII
Fiscal Year, Profits, Reserves and Dividends

Art. 33 The fiscal year shall end on December 31st of each year, date on which it shall be prepared the financial statements required under law or regulation.

 Art. 34 The accumulated losses and provision for income tax and social contribution shall be deduced from the profits obtained in the fiscal year, and, out of the resulting value, up to ten per cent (10%) shall be destined to the administrators’ profit sharing, provided that it is attributed, in such fiscal year, to the shareholders, at least the mandatory dividend referred to in article 34, “a”, hereof.

Art. 35 Out of thenet profit obtained in the fiscal year, corresponding to the result after the deductions and interests set forth in article 34 hereof, five per cent (5%) shall be destined to the legal reserve, while the legal limit is not reached.

Art. 36 Except under the terms of article 202, § 4, of Law No. 6.404/76, it is guaranteed to the shareholders the mandatory dividend corresponding to:

I. 25% over the net profit of the fiscal year, adjusted under the terms of article 202 of Law No. 6.404/76, with the wording given by Law No. 10.303/01; plus

II. the net profit balance of the fiscal year, if any, remaining after the destinations mentioned in articles. 193 to 197 of Law No. 6.404/76, with the wording given by Law No. 10.303/01, observing articles 35 and 36 hereof.

Art. 37 After guaranteeing to theshareholders the mandatory dividend mentioned in article 36, “a”, hereof, the net profit balance of such fiscal year, if any, may be destined by the General Meeting to the following reserves:

I. reserve for future capital increase, destined to guarantee the Company’s capitalization, which shall not exceed, in any fiscal year, the realized capital stock;

II. contingency reserve, under the terms of article 195 of Law No. 6.404/76;

III. profit retention reserve, according to the budget approved in the General Meeting, which may not exceed, in any fiscal year, the realized capital stock;

IV. realizable profit reserve, under the terms of article 197 of Law No. 6.404/76, with wording given by Law No. 10.303/01.

Art. 38 At the Board of Directors’ discretion, the Company may pay or credit to the shareholders, in whole or in part, interest on equity, calculated according to the laws in force, up to the value that would result from the application of the Long-Term Interest Rate – TJLP, pro rata die, for the corresponding period.

Sole Paragraph. Interest on equity, whenever paid or credited to the shareholders, shall be applicable, at the income tax net value, to the mandatory dividends.

Art. 39 The dividends and interest on equity shall be paid upon deposit in the current account in the name of the shareholder and indicated by him, except if he has required in writing, with ten (10) business days in advance, that they be paid in the Company's treasury, by nominal check.

 Art. 40 The Company may not, except if authorized by the majority of votes cast in the special Meeting held by the shareholders holding preferred stocks, retain, for over four successive quarters, a financial funds  of over twenty-five per cent (25%) of its total assets, provided that so permitted by its financial and economic situation.  

§1 For the purpose of applying this provision: a) it shall be considered the values corresponding to the last day of each quarter, according to the balance sheet prepared on such dates; and b) the financial funds  shall correspond to the sum of the values accounted for under “cash and banks” and “financial application” subtracting the sum of the values accounted for under “loans and financings” of the current liability and “loans and financings” of the long-term liabilities. 

§2 Out of the values that, in each quarter, exceed the percentage of withheld financial funds set forth in this article, it shall be distributed as dividend, or paid as interest on equity, the value corresponding to the quarter with the lower excessive retention, deducing from such excess the dividends or interest on equity already declared and not paid yet. 

§3 If verified the hypothesis set forth in the prior paragraph, the statutory clause expressed in this article shall only be applied after the four quarters following the last quarter involved in the calculation of the withholding excess.  

§4 The distribution of dividends, or payment of interest on equity, shall be made in the fiscal year following the last quarter involved in the calculation of the withholding excess.  

§5 The Company may not, except if authorized by more than half of the shareholders holding preferred stocks, constitute a subsidiary with the exclusive purpose to administer its own resources.  

§6 The modification of this statutory clause may only be resolved by General meeting with the prior approval of the shareholders holding more than half of the preferred stocks, gathered in a special meeting.

CHAPTER VIII
Arbitration

Art. 41 The Company, its shareholders, administrators and members of the Fiscal Council agrees to decide, by means of arbitration, through assistance of the Market Arbitration Chamber, any and all dispute or controversy that may arise between them, related to or resulting from the application, validity, efficacy, interpretation, violation and effects of the provisions contained in Law No. 6.404/76, in these Bylaws, in the rules issued by the Monetary National Council, by the Central Bank of Brazil and by the CVM, as well as the other rules applicable to the operation of capital markets in general, in addition to those contained in Level-2 Regulation, of the Sanctions Regulation (as defined in Level-2 Regulation), of the Corporative Governance Level 2 Participation Agreement and Arbitration Regulation.

§1. The Brazilian law shall be the only one applicable to the merits of any and all dispute, as well as execution, interpretation and validity of this compromissory clause. The arbitral proceeding shall be carried out in the City of São Paulo, State of São Paulo, place where the arbitral award shall be rendered. The arbitration shall be administered by the Market Arbitration Chamber, being carried out and judged according to the provisions related to the Market Arbitration Chamber Regulations (“Arbitration Regulations”).

§2 The regulations applicable to arbitration shall be the Arbitration Regulation in force on the date the arbitral proceeding is initiated, binding the parties and arbitrators.

CHAPTER VIII
Miscellaneous

Art. 42 The Company may be dissolved and wound up as set forth by law.

Art. 43 The cases omitted in this Bylaws shall be regulated by the applicable legal provisions in force, observing the Level-2 Regulation.

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