3.2. The events related to potentially material information must always be examined by taking into account: (i) their relative importance in the context of the Company’s activities and dimension, (ii) the presence of elements creating the measurable impacts described in item 3.1 above, (iii) the past pattern of announcements of material Company information as opposed to examining the acts and facts on an abstract basis and reducing the effectiveness of the announcements of Material Information, consequently detracting from the quality of the market analysis as to the Company’s prospects.


SECTION IV
THE TREATMENT OF MATERIAL INFORMATION
4.1. The Controlling Shareholders, Management, the Company’s employees, as well as all those that enjoy a commercial or professional relationship or one of trust with the Company must maintain confidential Material Information of which they are privy due to their post, position or relationship with the Company, until its announcement to the market. They should also ensure similar behavior on the part of subordinates and third parties with whom they maintain a position of trust.

4.2. None of the aforementioned persons in item 4.1 is permitted to use confidential, undisclosed Material Information in order to obtain undue advantage by trading the Company’s Securities either directly or indirectly.


SECTION V
DISCLOSURE OF MATERIAL INFORMATION
5.1. The Investor Relations Officer must:

5.1.1. disclose Material Information of which he has knowledge, simultaneously to the CVM, SEC and the Stock Exchanges, immediately following the occurrence of such a Material Event;

5.1.2. ensure the wide and immediate dissemination of such Material Information in all markets where the Company’s Securities are authorized to trade; and

5.1.3. render all additional clarifications as to such Material Information, when so requested do so by the appropriate authorities or by any Stock Markets.

5.2. The Controlling Shareholders and Management must communicate any Material Information of which they are aware to the Investor Relations Officer, who will ensure that it is duly disclosed.

5.3. The general rule with respect to the treatment of Material Information is that it should be immediately disclosed. In exceptional cases in which the public disclosure of Material Information could put at risk the Company’s legitimate interests, the question of whether or not to disclose the information must be duly examined.

5.3.1. In these circumstances, unless the CVM rules to the contrary, the decision not to disclose Material Information related to the Company will be the decision of the Management or the Controlling Shareholders once they have been informed of its contents.

5.3.2. Should there be an unusual oscillation in the price or trading volume of the Company’s Securities due to information with respect to a Material Information as yet undisclosed, announcement will be made immediately.

5.4. Should there be an unusual oscillation in the price or trading volume of the Company’s Securities, the Investor Relations Officer must question the persons with access to material facts or events in order to establish whether they are aware of any information still to be disclosed to the market.

5.5. The procedures to be adopted for disclosing Material Information must comply with Attachment I of this Policy as well as with the applicable legal provisions, notably those pursuant to CVM Instruction 358.

SECTION VI
COMPANY TRADING IN ITS OWN SHARES WHILE MATERIAL INFORMATION IS PENDING DISCLOSURE
6.1. The Company is forbidden to trade in its own securities:

6.1.1 While Material Information is pending disclosure pursuant with the provisions of this Policy;

6.1.2 In the 15 (fifteen)-day period prior to the disclosure of the Company’s quarterly (ITR) and annual (DFP and IAN) results; or

6.1.3 Whenever there is the intention of carrying out the incorporation, the total or partial spinning off, transformation or corporate reorganization of the Company.

6.2. With the exception of the prohibition in item 6.1.2 above, the prohibitions cited in item 6.1 and its sub-items will cease to be effective as soon as the Company announces the relevant Material Information to the market unless trading in the shares might interfere in the conditions of the above mentioned transactions, subjecting the Company’s shareholders or the Company itself to losses.

6.3. The prohibition in item 6.1 does not apply to the acquisition of shares held as treasury stock through extra-market trading or acquisition via a primary acquisition of shares issued due to the exercising of a share call option in the context of a stock option plan approved by the general shareholders’ meeting.

6.4. The Company’s Board of Directors is not permitted to take any decision on the buy-back or the sale of shares issued by the Company itself should it already have entered into an agreement or contract to transfer the controlling shareholding (directly or indirectly) of the Company, or if an option or mandate to sell has already been granted. This prohibition will also apply where there is an unequivocal intention to execute an incorporation, total or partial spinning off, merger, corporate modification or reorganization of the Company, and while the transaction has not been made public through the disclosure of relevant Material Information.

SECTION VII
FINAL PROVISIONS
7.1. This Policy will become effective on the date of its approval by the Company’s Board of Directors for an indeterminate period and may only be changed through the decision of the Company’s Board of Directors, any alteration being forbidden while the disclosure of the relevant Material Information remains pending.

7.2. Once this Policy has been approved by the Board of Directors, its terms must be formally communicated to the current: (i) Controlling Shareholders, (ii) Management, (iii) all the employees, who in virtue of their post, function or position in the Company or in its controlling, controlled or affiliate companies, have access to Material Information before its announcement to the market, (iv) the Company’s auditors and (v) all those who have a commercial and professional relationship or one of trust with the Company and who may have access to Material Information before its announcement to the market.

7.3. The above-mentioned communication must be made through a specific instrument, the adhesion to which shall be expressed in the terms of this Policy, according to Attachment II of this Policy, to be filed at the Company’s head office for a term of at least five years following the loss of the controlling shareholding in the Company, from the end of the term of office, from the date the employee leaves the Company or his/her contract terminates, which ever is the case.

7.3.1. The Investor Relations Officer must prepare a list containing the name, identification, post, function or relation with the Company, address, General Taxpayer’s Register number (CPF) of the persons who adhere to the Policy, this to be maintained permanently updated in the light of any changes.

7.3.2. The list mentioned in item 7.3.1 above must be filed with the Company’s head office and must be made available to the CVM as required.

7.4. Following (i) the investiture of new Management in their posts, (ii) the acquisition of Company control by new Controlling Shareholders, (iii) the hiring of a new employee in categories classified under item 7.2 or (iv) the conclusion of a contract with a third party falling into the category described in 7.2, all the relevant individuals in each case must be formally made aware of the terms of the Policy through the term of adhesion contained in this Policy Paper, according to Attachment II. The latter must be filed at the Company’s head office for a minimum of five years following the loss of shareholding control of the Company, from the end of the term of office, from the date the employee leaves the Company or his/her contract terminates, where applicable.

7.5. This Policy is available on the Company Intranet

7.6. The approval or alteration to this Policy must be reported to the CVM and where appropriate, the Stock Exchanges.

7.7. It is incumbent on the Investor Relations Officer, as the responsible officer in the company, for the implementation and monitoring of this Policy.

7.8. The prohibitions and the obligations for the disclosure of Material Information as established in this Policy and pursuant to the prevailing regulations:

7.9. The following are not classified as indirect transactions: those executed by investment funds in which the persons mentioned in this Instruction are quota holders, as long a such funds are neither exclusive nor in situations where the fund manager’s trading decisions can be influenced by the quota holders.

Last update on December 10, 2004.