RESTATED PRE-EXPORT FINANCE AGREEMENT as restated on 27 September, 2006 pursuant to a Restatement Agreement dated 27 September, 2006 for VOTORANTIM CELULOSE E PAPEL S.A. arranged by ABN AMRO BANK N.V. with ABN AMRO BANK N.V. as Agent and Trustee

1.

Definitions and Interpretation

  5

2.

Loan Amounts

22

3.

Purpose

23

4.

Repayment

23

5.

Prepayment

24

6.

Interest

25

7.

Interest Periods

27

8.

Changes to the Calculation of Interest

28

9.

Not Used

29

10.

Tax Gross-Up and Indemnities

29

11.

Increased Costs

30

12.

Other Indemnities

31

13.

Mitigation by the Lenders

33

14.

Costs and Expenses

33

15.

Guarantee and Indemnity

34

16.

Representations

36

17.

Information Undertakings

42

18.

Financial Covenants

45

19.

General Undertakings

45

20.

Debt Service Undertakings

52

21.

Events of ▇▇▇▇▇▇▇

▇▇

▇▇.

Changes to the Lenders

58

23.

Changes to the Obligors

62

24.

Role of the Agent and the Arranger

62

25.

Role of Trustee

68

26.

Conduct of Business by the Finance Parties

75

27.

Sharing among the Finance Parties

75

28.

Payment Mechanics

77

29.

Set-Off

79

30.

Application of Proceeds

79

31.

Notices

81

32.

Calculations and Certificates

83

33.

Partial Invalidity

83

34.

Remedies and Waivers

83

35.

Amendments and Waivers

84

36.

Counterparts

84

37.

Governing Law

85

38.

Enforcement

85

Schedule 1

The Existing Lenders

86

Schedule 2

Form of Transfer Certificate

87

Schedule 3

Form of Compliance Certificate

89

Schedule 4

Payment Dates

90

Schedule 5

Initial Buyers

91

Schedule 6

Form of Irrevocable Payment Instructions

92

Schedule 7

Form of Sales Contract Designation Notice

93

(1)

VOTORANTIM CELULOSE E PAPEL S.A., a company incorporated under the laws of the Federative Republic of Brazil, having its principal place of business located at Alameda Santos, 1357 – 7, São Paulo – SP, enrolled with the CNPJ/MF under number 60.643.228/0001-21, as borrower (the “Borrower”);

(2)

VCP OVERSEAS HOLDING LTD. BUDAPEST, BAAR BRANCH, a branch of VCP Overseas Holding KFT (a company organised under the laws of Hungary), licensed in the commercial register of the canton of Zug, Switzerland, as guarantor (the “Guarantor”);

(3)

ABN AMRO BANK N.V., as arranger (the “Arranger”);

(4)

THE FINANCIAL INSTITUTIONS listed in Schedule 1 as Lenders (the “Existing Lenders”);

(5)

ABN AMRO BANK N.V., as agent of the other Finance Parties (the “Agent”); and

(6)

ABN AMRO BANK N.V. as trustee for the Secured Parties (the “Trustee”).

BACKGROUND:

(A)

The ABN Loans (as defined below) are outstanding from the Borrower to the Existing Lenders.

(B)

The parties hereto wished to restate the terms and conditions upon which the ABN Loans (as defined below) are outstanding in relation to, in particular (but without limitation), pricing and tenor.

(C)

The Borrower has entered or will enter into one or more purchase agreements with the Guarantor, pursuant to which the Borrower will sell or cause to sell goods from Brazil to the Gurantor.

(D)

The Guarantor has entered into or will enter into one or more sales agreements with third party buyers, pursuant to which the Guarantor will sell or cause to sell goods supplied by the Borrower to such third party buyers, the proceeds of which sales are intended to be used to repay the ABN Loans (as defined below).

(E)

The Guarantor will provide a guarantee with respect to the liabilities and obligations of the Borrower in the form contained in Clause 15 (Guarantee and Indemnity) of this Agreement.

(F)

The Guarantor has agreed to assign to the Trustee, for the benefit of the Secured Parties (as defined below) certain deposits and sales receivables pursuant to the Security Documents (as defined below).

(G)

Accordingly, the parties have entered into the Restatement Agreement (as defined below) in order to restate the terms and conditions upon which the ABN Loans (as defined below) are outstanding on the terms and conditions of this Agreement and to give effect to the wishes described in paragraphs (B), (C), (D), (E) and (F) above as of the Restatement Date (as defined below).

IT IS AGREED as follows:

1.

DEFINITIONS AND INTERPRETATION

1.1

Definitions

In this Agreement:

“A Loan” means the A1 Loan, the A2 Loan or the A3 Loan.

“A1 Loan” means the term loan being the aggregate of the principal amounts outstanding to each Existing Lender set opposite its name in the column headed “A1 Loan” in Schedule 1 (The Existing Lenders) or the principal amount outstanding for the time being of that loan.

“A2 Loan” means the term loan being the aggregate of the principal amounts outstanding to each Existing Lender set opposite its name in the column headed “A2 Loan” in Schedule 1 (The Existing Lenders) or the principal amount outstanding for the time being of that loan.

“A3 Loan” means the term loan being the aggregate of the principal amounts outstanding to each Existing Lender set opposite its name in the column headed “A3 Loan” in Schedule 1 (The Existing Lenders) or the principal amount outstanding for the time being of that loan.

“A1 Loan Interest Payment Date” means 13 November 2006, the Consolidation Date and each of the dates specified in Schedule 4 (Payment Dates) as an Interest Payment Date.

“A2 Loan Interest Payment Date” means the Consolidation Date and each of the dates specified in Schedule 4 (Payment Dates) as an Interest Payment Date.

“A3 Loan Interest Payment Date” means the Consolidation Date and each of the dates specified in Schedule 4 (Payment Dates) as an Interest Payment Date.

“A Loan Repayment Date” means each of the Interest Payment Dates set out in Schedule 4 (Payment Dates) on which an amount of principal specified in the column headed “A Loan Principal Payment Amount” is to be repaid on the A Loan.

“ABN Facility Agreement No. 1” means the $50,000,000 Export Prepayment Agreement No. G-3605/03 dated December 3, 2003 between VCP Exportadora e Participações S.A. (now Votorantim Celulose e Papel S.A.), as Borrower and ABN AMRO Bank N.V. as Bank.

“ABN Facility Agreement No. 2” means the $50,000,000 Export Prepayment Agreement No. G-0852/05 dated March 29, 2005 between Votorantim Celulose e Papel S.A. as Borrower and ABN AMRO Bank N.V. as Bank.

“ABN Facility Agreements” means the ABN Facility Agreement No.1 and the ABN Facility Agreement No. 2.

“ABN Loan No. 1” means the $50,000,000 principal amount outstanding from the Borrower to ABN AMRO Bank N.V. with respect to the loan made available to the Borrower under the ABN Facility Agreement No. 1 and originally registered with ROF number TA300227.

“ABN Loan No. 1 Accrued Interest Amount” means the amount of interest accrued but unpaid with respect to the ABN Loan No. 1 as of the Restatement Date, being $1,075,072.92.

“ABN Loan No. 2” means the $50,000,000 principal amount outstanding from the Borrower to ABN AMRO Bank N.V. with respect to the loan made available to the Borrower under the ABN Facility Agreement No. 2 and originally registered with ROF number TA331696.

“ABN Loan No. 2 Accrued Interest Amount” means the amount of interest accrued but unpaid with respect to the ABN Loan No. 2 as of the Restatement Date, being $56,729.17.

“ABN Loan No. 3” means the $123,000,000 principal amount outstanding from the Borrower to ABN AMRO Bank N.V. with respect to the loan made available by ABN AMRO Bank N.V to the Borrower on 27 June 2006 and registered with ROF numbers TA383445, TA383447 and TA383450.

“ABN Loan No. 3 Accrued Interest Amount” means the amount of interest accrued but unpaid with respect to the ABN Loan No. 3 as of the Restatement Date, being $722,548.74.

“ABN Loans” means the ABN Loan No.1, the ABN Loan No. 2 and the ABN Loan No. 3.

“Aggregate Sales Value” means, with respect to any Coverage Period, the amount which is the aggregate of the Sales Value of each Sales Contract for that Coverage Period.

“Affiliate” means, in relation to any Person, a Subsidiary of that Person or a Holding Company of that Person or any other Subsidiary of that Holding Company.

“Applicable Law” means any applicable statute, law, regulation, ordinance, rule, judgment, rule of common law, order, decree, approval (including any Governmental Approval), concession, grant, franchise, license, agreement, directive, guideline, policy, requirement or other governmental restriction or any similar form of decision of, or determination by (or any interpretation or administration of any of the foregoing by), any Governmental Authority, whether in effect as of the date hereof or hereafter.

“Assignment Agreement” means the assignment agreement dated the Restatement Date between the Guarantor as assignor and the Trustee as assignee.

“Authorisation” means an authorisation, consent, approval, resolution, licence, exemption, filing, notarisation or registration.

“B Loan” means the B1 Loan, the B2 Loan or the B3 Loan.

“B1 Loan” means the term loan being the aggregate of the principal amounts outstanding to each Existing Lender set opposite its name in the column headed “B1 Loan” in Schedule 1 (The Existing Lenders) or the principal amount outstanding for the time being of that loan.

“B2 Loan” means the term loan being the aggregate of the principal amounts outstanding to each Existing Lender set opposite its name in the column headed “B2 Loan” in Schedule 1 (The Existing Lenders) or the principal amount outstanding for the time being of that loan.

“B3 Loan” means the term loan being the aggregate of the principal amounts outstanding to each Existing Lender set opposite its name in the column headed “B3 Loan” in Schedule 1 (The Existing Lenders) or the principal amount outstanding for the time being of that loan.

“B1 Loan Interest Payment Date” means 13 November 2006, the Consolidation Date and each of the dates specified in Schedule 4 (Payment Dates) as an Interest Payment Date.

“B2 Loan Interest Payment Date” means the Consolidation Date and each of the dates specified in Schedule 4 (Payment Dates) as an Interest Payment Date.

“B3 Loan Interest Payment Date” means the Consolidation Date and each of the dates specified in Schedule 4 (Payment Dates) as an Interest Payment Date.

“B Loan Repayment Date” means each of the Interest Payment Dates set out in Schedule 4 (Payment Dates) on which an amount of principal specified in the column headed “B Loan Principal Payment Amount” is to be repaid on the B Loan.

“Brazil” means the Federative Republic of Brazil.

“Break Costs” means the amount (if any) by which:

(a)

the interest which a Lender should have received for the period from the date of receipt of all or any part of a Loan or Unpaid Sum to the last day of the current Interest Period in respect of that Loan or Unpaid Sum, had the principal amount or Unpaid Sum received been paid on the last day of that Interest Period;

exceeds:

(b)

the amount which that Lender would be able to obtain by placing an amount equal to the principal amount or Unpaid Sum received by it on deposit with a leading bank in the Relevant Interbank Market for a period starting on the Business Day following receipt or recovery and ending on the last day of the current Interest Period,

provided that for the purpose of paragraph (a) above, the interest which a Lender should have received for any period shall be calculated on the basis that the relevant Lender should not have received the Margin element of such interest for such period.

“Business Day” means a day (other than a Saturday or Sunday) on which banks are open for general business in Amsterdam, New York and São Paulo.

“Buyer” means each of:

(a)

the Persons listed in Schedule 5 (Initial Buyers);

(b)

any Covered Buyer;

(c)

any Payment Pre-shipment Buyer; and

(d)

any other Person or Persons agreed between the Borrower and the Agent to be a “Buyer”.

“C Loan” means the C1 Loan, the C2 Loan or the C3 Loan.

“C1 Loan” means the term loan being the aggregate of the principal amounts outstanding to each Existing Lender set opposite its name in the column headed “C1 Loan” in Schedule 1 (The Existing Lenders) or the principal amount outstanding for the time being of that loan.

“C2 Loan” means the term loan being the aggregate of the principal amounts outstanding to each Existing Lender set opposite its name in the column headed “C2 Loan” in Schedule 1 (The Existing Lenders) or the principal amount outstanding for the time being of that loan.

“C3 Loan” means the term loan being the aggregate of the principal amounts outstanding to each Existing Lender set opposite its name in the column headed “C3 Loan” in Schedule 1 (The Existing Lenders) or the principal amount outstanding for the time being of that loan.

“C1 Loan Interest Payment Date” means 13 November 2006, the Consolidation Date and each of the dates specified in Schedule 4 (Payment Dates) as an Interest Payment Date.

“C2 Loan Interest Payment Date” means the Consolidation Date and each of the dates specified in Schedule 4 (Payment Dates) as an Interest Payment Date.

“C3 Loan Interest Payment Date” means the Consolidation Date and each of the dates specified in Schedule 4 (Payment Dates) as an Interest Payment Date.

“C Loan Repayment Date” means each of the Interest Payment Dates set out in Schedule 4 (Payment Dates) on which an amount of principal specified in the column headed “C Principal Payment Amount” is to be repaid on the C Loan.

“Capital Lease Obligations” means, as to a Person, the obligations of such Person to pay rent or other amounts under a lease of (or other agreement conveying the right to use) real and/or personal property, which obligations are required to be classified and accounted for as a capital lease on a balance sheet of such Person under GAAP and, for the purposes of this Agreement, the amount of such obligations shall be the capitalised amount thereof determined in accordance with GAAP.

“Capital Stock” means, as to any Person, any and all shares, interests, participations, quotas or other equivalents (however designated) of capital stock of a corporation, any and all ownership interests in a Person other than a corporation and any and all warrants or options to purchase any of the foregoing.

“Cash Equivalents” means any of the following:

(a)

readily marketable direct obligations of the government of the United States of America or any agency or instrumentality thereof or obligations unconditionally guaranteed by the full faith and credit of the government of the United States;

(b)

insured certificates of deposit of or time deposits with a Lender or a member of the Federal Reserve System, which member issues (or the parent of which member issues) commercial paper rated as described in paragraph (c) below, is organised under the laws of the United States of America or any State (or the District of Colombia) thereof and has a combined capital surplus of at least $1,000,000,000,000;

(c)

commercial paper in an aggregate amount of no more than $10,000,000 per issue outstanding at any time, issued by any corporation organised under the laws of any State (or the District of Colombia) of the United States of America and rated at least “Prime-1” (or the then equivalent grade) by ▇▇▇▇▇’▇ and “A-1” (or the then equivalent grade) by S&P; or

(d)

other investments considered as cash equivalents under GAAP.

“Collection Account” means the dollar account with ABN AMRO Bank N.V. in Amsterdam in the name of the Guarantor with account number ▇▇.▇▇.▇▇.▇▇▇ USD (and any other renewal or redesignation thereof) or such other account as may be designated as the “Collection Account” from time to time by the Trustee.

“Collection Account Amount” means, at any time, the amount then standing to the credit of the Collection Account.

“Collection Account Security Agreement” means the Collection Account pledge agreement governed by the laws of The Netherlands dated the Restatement Date between the Guarantor as pledgor and the Trustee as pledgee, pursuant to which the Guarantor grants a security interest over, inter alia, all amounts standing to the credit of the Collection Account in favour of the Trustee to secure each of the Obligor’s obligations under the Finance Documents.

“Compliance Certificate” means a certificate substantially in the form set out in Schedule 3 (Form of Compliance Certificate).

“Confidentiality Undertaking” means a confidentiality undertaking substantially in the then current recommended form of the LMA or in any form agreed between the Borrower and the Agent.

“Consolidated Net Tangible Assets” means, on a consolidated basis, the Borrower’s total assets, less current liabilities, less depreciation, amortisation and depletion, less goodwill, trade names, trademarks, patents and other intangibles, calculated based on the most recent balance sheet delivered by the Borrower to the Agent pursuant to this Agreement.

“Consolidation Date” means 20 November 2006.

“Coverage Period” means the period commencing on the Restatement Date and ending on the Consolidation Date and thereafter each successive period commencing on the last day of the preceding Coverage Period and ending on the next succeeding date specified in Schedule 4 (Payment Dates) as an Interest Payment Date.

“Covered Buyer” means any Person that purchases Products from the Guarantor with the support of a letter or letters of credit or an insurance policy or policies issued by a Permitted Covering Institution covering the full amount of the purchase price due to the Guarantor for such Products.

“Debt” means, with respect to any Person (determined without duplication):

(a)

all indebtedness of such Person for borrowed money;

(b)

all obligations of such Person for the deferred purchase price of property or services (other than (i) trade payables (whether payable to Affiliates or other Persons) incurred in the ordinary course of such Person’s business, but only if and for so long as such trade payables remain payable on customary trade terms and (ii) accrued expenses incurred in the ordinary course of business);

(c)

all obligations of such Person evidenced by notes, bonds, debentures or other similar documents;

(d)

all obligations, contingent or otherwise, of such Person in connection with any securitization of any products, receivables or other property;

(e)

all obligations of such Person created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even though the rights and remedies of the seller or the lender under such agreement in an event of default are limited to repossession or sale of such property);

(f)

all Capital Lease Obligations and similar obligations under “synthetic leases” of such Person;

(g)

all obligations, contingent or otherwise, of such Person in respect of acceptances, letters of credit, financial guarantee insurance policies or similar extensions of credit (excluding trade payables to the extent excluded from paragraph (b) above);

(h)

all obligations of such Person to redeem, retire, defease or otherwise make any payment in respect of any capital stock of such Person;

(i)

all net obligations of such Person in respect of any interest rate protection agreement or any currency swap, cap or collar agreement or similar arrangement entered into by such Person providing for the transfer or mitigation of interest rate or currency risks either generally or under specific contingencies (but without regard to any notional principal amount relating thereto);

(j)

all Debt of other Persons of a type referred to in paragraphs (a) to (i) or paragraph (k) that is guaranteed by such Person; and

(k)

all Debt referred to in paragraphs (a) to (j) secured by (or for which the holder of such Debt has an existing right, contingent or otherwise, to be secured by) any Security on property of such Person even though such Person has not assumed or become liable for the payment of such Debt,

in each case whether incurred as principal or as surety and whether present or future, actual or contingent; provided that “Debt” shall exclude any unsecured guarantee made for the benefit of any Person pursuant to a vendor financing transaction for the sale of Products to such Person and in no event shall “Debt” include any liability for Taxes.

“Debt Service Coverage Ratio” means, as of the last day of any Fiscal Semester, the ratio (expressed as a decimal) of:

(a)

the sum of: (i) EBITDA for the two Fiscal Semesters ending on such day plus (ii) the amount of cash on the Borrower’s consolidated balance sheet as of such day plus (iii) the sum of, for each marketable security (including Cash Equivalents) on the Borrower’s consolidated balance sheet as of such day, calculated at the lower of: (A) the face value and (B) the market value of such marketable security as of such day; to

(b)

the aggregate amount of Debt of the Borrower (on a consolidated basis) that matured during the two Fiscal Semesters ending on such day plus the aggregate amount of actual Interest Expense during such two Fiscal Semesters.  For the purpose of clarification, the calculation of the Debt Service Coverage Ratio (and all components thereof) shall be made using GAAP.

“Debt Service Obligation” means:

(a)

with respect to any completed Coverage Period, the aggregate of (i) the amount of the scheduled (i.e. without regard to any increase paid or payable under the Finance Documents due to a prepayment (whether voluntary or otherwise)) instalment of principal (if any) which fell due for payment on the last day of such Coverage Period and (ii) the amount of accrued interest which fell due for payment during or on the last day of that Coverage Period; and

(b)

with respect to any Coverage Period which has not yet been completed, the aggregate of (i) the amount of the scheduled (i.e. without regard to any increase paid or payable under the Finance Documents due to a prepayment (whether voluntary or otherwise)) instalment of principal (if any) which will fall due for payment on the last day of that Coverage Period and (ii) the amount of accrued interest which will, in the absence of any unanticipated acceleration or unanticipated prepayment of a Loan prior to the last day of that Coverage Period, fall due for payment during or on the last day of that Coverage Period (and for the purposes of any calculation under this part (ii) it shall, to the extent necessary, be assumed that LIBOR applicable with respect to any Interest Period for a Loan which has not yet commenced shall be equal to LIBOR applicable with respect to the then current Interest Period for that Loan).

“Default” means an Event of Default or any event or circumstance specified in Clause 21 (Events of Default) which would (with the expiry of a grace period, the giving of notice, the making of any determination under the Finance Documents or any combination of any of the foregoing) be an Event of Default.

“Delegate” means any delegate, agent, attorney or co-trustee appointed by the Trustee.

“Designated Subsidiary” means any Person which is a Subsidiary of the Borrower and accounts for 20% or more of the total assets of the Borrower and its consolidated Subsidiaries as determined in accordance with GAAP.

“EBITDA” means, during any period, the total earnings of the Borrower (on a consolidated basis and without duplication) before income taxes, Interest Expense, depreciation and amortisation during such period, eliminating from the calculation of such earnings:

(a)

any net income or gain (or net loss), net of any tax effect, during such period from any extraordinary items;

(b)

any interest income during such period;

(c)

gains or losses during such period on the sale of property (other than the sale of inventory in the ordinary course of business);

(d)

any other extraordinary non-cash items deducted from or included in the calculation of pre-tax net income for such period (other than items that will require cash payments and for which an accrual or reserve has been, or is required by GAAP to be, made); and

(e)

any net income or gain (or net loss) on any foreign exchange transactions or net monetary positions.

“Environmental Claim” means any claim, proceeding or investigation by any Person in respect of any Environmental Law.

“Environmental Law” means any applicable law in any jurisdiction in which any member of the Group conducts business which relates to the pollution or protection of the environment or harm to or the protection of human health or the health of animals or plants.

“Environmental Permits” means any permit, licence, consent, approval and other authorisation and the filing of any notification, report or assessment required under any Environmental Law for the operation of the business of any member of the Group conducted on or from the properties owned or used by the relevant member of the Group.

“Event of Default” means any event or circumstance specified as such in Clause 21 (Events of Default).

“Facility Office” means the office or offices notified by a Lender to the Agent in writing on or before the date it becomes a Lender (or, following that date, by not less than five Business Days’ written notice) as the office or offices through which it will perform its obligations under this Agreement.

“Finance Document” means this Agreement, the Restatement Agreement, each Security Document, each Sales Contract Designation Notice, each Irrevocable Payment Instructions with respect to each Sales Contract and any other document designated as such by the Agent and the Borrower.

“Finance Party” means each of the Agent, the Arranger, the Trustee and each Lender.

“Fiscal Semester” means each period from and including 1 January to and including 30 June of each year and from and including 1 July to and including 31 December of each year.

“GAAP” means, with respect to (i) the Borrower, generally accepted accounting principles (as in effect from time to time) in Brazil and (ii) the Guarantor, generally accepted according principles (as in effect from time to time) in the United States of America.

“Governmental Authority” means any nation or government, any state or municipality, any multi-lateral or similar organisation or any other agency, instrumentality or political subdivision thereof and any entity exercising executive, legislative, judicial, monetary, regulatory or administrative functions of or pertaining to government.

“Group” means the Borrower and its Subsidiaries for the time being.

“Holding Company” means, in relation to a company or corporation, any other company or corporation in respect of which it is a Subsidiary.

“Increased Costs” means:

(a)

a reduction in the rate of return from a Loan or on a Lender’s (or its Affiliate’s) overall capital;

(b)

an additional or increased cost; or

(c)

a reduction of any amount due and payable under any Finance Document.

“Interest Expense” means, for any period, interest (or similar) expense on Debt of the Borrower (on a consolidated basis) including (without duplication):

(a)

fees (including commitment fees);

(b)

net payments under any interest rate protection agreement or other hedging agreement;

(c)

the interest portion of any deferred payment obligations;

(d)

all fees and charges owed with respect to letters of credit or performance or other bonds;

(e)

all accrued or capitalised interest;

(f)

any amortisation of debt discount; and

(g)

all but the principal component of payments relating to Capital Lease Obligations.

For the purpose of clarification, the calculation of Interest Expense (and all components thereof) shall be made using GAAP.

“Interest Payment Date” means, with respect to the A1 Loan, each A1 Loan Interest Payment Date; with respect to the A2 Loan, each A2 Loan Interest Payment Date; with respect to the A3 Loan, each A3 Loan Interest Payment Date; with respect to the B1 Loan, each B1 Loan Interest Payment Date; with respect to the B2 Loan, each B2 Loan Interest Payment Date; with respect to the B3 Loan, each B3 Loan Interest Payment Date; with respect to the C1 Loan, each C1 Loan Interest Payment Date; with respect to the C2 Loan, each C2 Loan Interest Payment Date; and with respect to the C3 Loan, each C3 Loan Interest Payment Date.

“Interest Period” means, in relation to a Loan, each period determined in accordance with Clause 7 (Interest Periods) and, in relation to an Unpaid Sum, each period determined in accordance with Clause 6.3 (Default interest).

“Irrevocable Payment Instructions” means, with respect to any Sales Contract, a notice of assignment and irrevocable payment instructions given or to be given by the Guarantor to the relevant Buyer with respect to that Sales Contract substantially in the form set out in Schedule 6 (Form of Irrevocable Payment Instructions).

“Lender” means:

(a)

any Existing Lender; and

(b)

any bank, financial institution, trust, fund or other entity which has become a Party in accordance with Clause 22 (Changes to the Lenders),

which in each case has not ceased to be a Party in accordance with the terms of this Agreement.

“LIBOR” shall mean, for any Interest Period, an interest rate per annum determined on the basis of the London interbank offered rate for deposits in dollars for a period of time comparable to the relevant Interest Period, as shown on the display page designated British Bankers Association Interest Settlement Rates, “LIBOR 01” Page, on the Reuters screen (or such other page on the Reuters screen as may customarily be used from

time to time in the Relevant Interbank Market to determine LIBOR for dollars) or such other page or service which displays such a rate for deposits of dollars as the Agent, after consultation with the Borrower, shall select, at approximately 11:00 a.m., London time, 2 London Business Days prior to the first day of such Interest Period. In the event that such rate does not appear on such LIBOR 01 Reuters screen page, or such other page as may replace that page in that service or be selected by the Agent after consultation with the Borrower, then LIBOR shall be the arithmetic mean (expressed as an annual rate and rounded upwards, if necessary, to the nearest 1/16 of 1%) of the rates quoted at approximately 11:00 a.m. London time on that day by Reference Banks, chosen by the Agent, as the rate at which deposits in dollars are offered to prime banks, in the London interbank market for a period of time comparable to the relevant Interest Period.

“LMA” means the Loan Market Association.

“Loan” means an A Loan, B Loan or C Loan.

“London Business Day” means a day (other than a Saturday or Sunday) on which banks are open for general business in London.

“Majority Lenders” means a Lender or Lenders whose participations in the Loans outstanding aggregate more than 66²/₃% of all the Loans outstanding.

“Margin” means:

(a)

in relation to an A Loan, 0.25 per cent. per annum;

(b)

in relation to a B Loan, 0.425 per cent. per annum; and

(c)

in relation to a C Loan, 0.75 per cent. per annum.

“Market Disruption Event” means before close of business in London on the Quotation Day for the relevant Interest Period where LIBOR is determined on the basis of quotations supplied by the Reference Banks (i) none, or one only, of the Reference Banks supplies a rate for the purposes of determining LIBOR or (ii) a Lender reasonably determines that, by reason of circumstances affecting the Relevant Interbank Market, adequate and fair means do not exist for ascertaining the rate of interest by reference to LIBOR.

“Material Adverse Effect” means a material adverse effect on:

(a)

the business, operations, property, condition (financial or otherwise) or prospects of the Obligors and the Designated Subsidiaries taken as a whole which will, in the opinion of the Agent (as explained in writing), adversely affect the ability of any Obligor to perform any of its obligations under any Finance Document; or

(b)

the validity or enforceability of any Finance Document or any rights or remedies of any Finance Party under any Finance Document.

“Month” means a period starting on one day in a calendar month and ending on the numerically corresponding day in the next calendar month, except that:

(a)

(subject to paragraph (c) below) if the numerically corresponding day is not a Business Day, that period shall end on the next Business Day in that calendar month in which that period is to end if there is one, or if there is not, on the immediately preceding Business Day;

(b)

if there is no numerically corresponding day in the calendar month in which that period is to end, that period shall end on the last Business Day in that calendar month; and

(c)

if an Interest Period begins on the last Business Day of a calendar month, that Interest Period shall end on the last Business Day in the calendar month in which that Interest Period is to end.

The above rules will only apply to the last Month of any period.

“Moody’s” means ▇▇▇▇▇’▇ Investors Service, Inc. or any successor organisation thereto.

“Net Debt” means, as of the last day of any Fiscal Semester, Total Debt as of such day minus the sum of: (a) the aggregate amount of cash on the Borrower’s consolidated balance sheet as of such day plus (b) the sum of, for each marketable security (including Cash Equivalents) on the Borrower’s consolidated balance sheet as of such day, the lower of: (i) the face value and (ii) the market value of such marketable security as of such day. For the purpose of clarification, the calculation of Net Debt (and all components thereof) shall be made using GAAP.

“Net Debt to EBITDA Ratio” means, as of the last day of any Fiscal Semester, the ratio (expressed as a decimal) of (a) Net Debt as of such day to (b) EBITDA for the two Fiscal Semesters ending on such day.  For the purpose of clarification, the calculation of the Net Debt to EBITDA Ratio (and all components thereof) shall be made using GAAP.

“Obligor” means each of the Borrower and the Guarantor.

“Original Financial Statements” means the audited consolidated financial statements of the Borrower and the Guarantor for the financial year ended 31 December 2005.

“Parent” means Votorantim Participações S.A.

“Party” means a party to this Agreement.

“Payment Pre-shipment Buyer” means any Person which is acceptable to the Trustee and which:

(a)

is not listed on the “Specially Designated Nationals and Blocked Persons” list maintained by the Office of Foreign Assets Control of the United States Department of the Treasury (“OFAC”) or domiciled in a jurisdiction with respect to which OFAC or the United Nations maintains sanctions programs restricting the purchase, sale or financing of goods; and

(b)

purchases Products from the Guarantor on terms that payment of the purchase price for such Products must be made in full prior to shipment of such Products to such Person.

“Payment Testing Date” means each of the days falling three Business Days prior to the last day of a Coverage Period.

“Permitted Covering Institution” means, at any time:

(a)

a financial institution with a long term senior credit rating of at least A from S&P or A2 from Moody’s; and

(b)

any other financial institution agreed from time to time between the Borrower and the Agent to be a “Permitted Covering Institution”.

“Permitted Security” means:

(a)

any Security imposed by applicable law that were incurred in the ordinary course of business, including carriers’, warehousemen’s and mechanics’ liens, statutory landlord’s liens and other similar liens and encumbrances arising in the ordinary course of business, in each case that:  (i) do not in the aggregate materially detract from the value of the assets subject thereto or materially impair the use thereof in the operations of the business of the Person owning such assets; or (ii) are being contested in good faith by appropriate proceedings promptly initiated and diligently conducted, which proceedings have the effect of preventing the forfeiture or sale of the assets subject to such liens and/or encumbrances;

(b)

any Security securing taxes, assessments and other governmental charges or levies, in each case the payment of which is not yet due or is being contested in good faith by appropriate proceedings and diligently conducted and for which such reserve or other appropriate provisions, if any, as shall be required by GAAP shall have been made;

(c)

pledges or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance or other similar social security legislation;

(d)

encumbrances, security deposits or reserves maintained in the ordinary course of business and required by applicable law; and

(e)

survey exceptions, encumbrances, easements or reservations of, or rights of others for, licenses, rights of way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning or other restrictions as to the use of real property or Security incidental to the ownership of assets which were not incurred in connection with indebtedness and which do not in the aggregate materially adversely affect the value of said properties or materially impair the use of the assets affected thereby.

“Person” shall mean any individual, firm, company, corporation, partnership (whether or not having separate legal personality), trust, unincorporated organisation, joint stock company or other legal entity or organisation and any government or agency or political subdivision thereof.

“Products” means bleached eucalyptus kraft pulp and paper products.

“Quotation Day” means, in relation to any period for which an interest rate is to be determined, two London Business Days before the first day of that period (excluding such first day).

“Receiver” means a receiver or receiver and manager or administrative receiver of the whole or any part of the Secured Property.

“Reference Banks” means three or more banks active in the Eurodollar interbank market whose S&P rating (or the equivalent rating from Moody’s or Fitch) is the same as or higher than that of the Administrative Agent on the date hereof.

“Relevant Interbank Market” means the London interbank market.

“Repeating Representations” means each of the representations set out in Clauses 16.1 (Status) to 16.6 (Governing law and enforcement), ▇▇▇▇▇▇ ▇▇.▇ (▇▇ ▇▇▇▇▇▇▇), ▇▇▇▇▇▇▇▇▇ (▇) of Clause 16.11 (No misleading information), paragraph (d) of Clause 16.12 (Financial Statements), Clause 16.13 (Pari passu ranking), paragraph (b) of Clause 16.17 (Taxation) and Clauses 16.20 (Ranking) to 16.23 (Ownership).

“Restatement Agreement” means the restatement agreement dated 27 September, 2006 pursuant to which the parties hereto agreed to restate the terms and conditions upon which the ABN Loans are outstanding on the terms and conditions of this Agreement as of the Restatement Date.

“Restatement Date” has the meaning given to such term in the Restatement Agreement.

“Sales Contract” means each agreement (which may be formed or confirmed by delivery of an invoice, exchange of letters and/or other correspondence) for the sale of Products by the Guarantor to a Buyer which has been designated a “Sales Contract” for the purpose of the Finance Documents by the Guarantor by delivery to the Trustee of a duly executed Sales Contract Designation Notice together with the documentation referred to in such Sales Contract Designation Notice.

“Sales Contract Designation Notice” means a notice given by the Guarantor to the Agent substantially in the form of Schedule 7 (Form of Sales Contract Designation Notice).

“Sales Value” means, with respect to any Sales Contract and any Coverage Period, the amount which is the quantity of Products delivered or to be delivered by the Guarantor under that Sales Contract during that Coverage Period multiplied by the fixed price for the relevant Products as specified in that Sales Contract or, if in any case no fixed price is specified, the market price for the relevant Products as at the time that the relevant calculation of the Sales Value is made.

“Sales Value Testing Date” means each of the days falling thirty days prior to the last day of a Coverage Period.

“Secured Obligations” means all obligations at any time due, owing or incurred by any Obligor to any Secured Party under the Finance Documents, whether present or future, actual or contingent (and whether incurred solely or jointly and whether as principal or as surety or in some other capacity).

“Secured Parties” means the Trustee, any Receiver or Delegate, the Agent and each Lender from time to time party to this Agreement.

“Secured Property” means all right, title and interest in or to any of the assets which are subject to (or purported to be subject to) the Security Documents.

“Security” means a mortgage, charge, pledge, lien or other security interest securing any obligation of any Person or any other agreement or arrangement having a similar effect.

“Security Documents” means each of the Collection Account Security Agreement and the Assignment Agreement together with any other document entered into by an Obligor creating or expressed to create any Security over all or any part of its assets in respect of the obligations of the Obligors under any of the Finance Documents.

“S&P” means Standard & Poor’s Rating Group, a division of McGraw Hill, Inc. a New York corporation or any successor organisation thereto.

“Subsidiary” means in relation to any company or corporation, a company or corporation:

(a)

which is controlled, directly or indirectly, by the first mentioned company or corporation;

(b)

more than half the issued voting share capital of which is beneficially owned, directly or indirectly by the first mentioned company or corporation; or

(c)

which is a Subsidiary of another Subsidiary of the first mentioned company or corporation,

and for this purpose, a company or corporation shall be treated as being controlled by another if that other company or corporation is able to direct its affairs and/or to control the composition of its board of directors or equivalent body.

“Tax” means any tax, levy, impost, duty or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same).

“Total Capitalisation” means, as of the last day of any Fiscal Semester, the sum of: (a) Total Debt as of such day plus (b) the aggregate of shareholders’ equity of the Borrower (on a consolidated basis) as of such day plus (c) without duplication of clause (b), the sum of minority interests of other Persons held in the Borrower (on a consolidated basis) as of such day.

“Total Debt” means, as of the last day of any Fiscal Semester, the aggregate outstanding principal amount of Debt of the Borrower (on a consolidated basis) as of such day.

“Total Debt to Total Capitalisation Ratio” means, as of the last day of any Fiscal Semester, the ratio (expressed as a decimal) of: (a) Total Debt as of such day to (b) Total Capitalisation as of such day. For the purpose of clarification, the calculation of the Total Debt to Total Capitalisation Ratio (and all components thereof) shall be made using GAAP.

“Transaction Documents” means each Finance Document and each Sales Contract.

“Transaction Security” means the Security created or expressed to be created in favour of the Trustee pursuant to the Security Documents.

“Transfer Certificate” means a certificate substantially in the form set out in Schedule 2 (Form of Transfer Certificate) or any other form approved by the Agent.

“Transfer Date” means, in relation to a transfer, the later of:

(a)

the proposed Transfer Date specified in the Transfer Certificate; and

(b)

the date on which the Agent executes the Transfer Certificate.

“Unencumbered Payment” means, at any time, a payment under a contract or agreement for the sale of Products by the Guarantor which payment is not subject to any Security and which neither Obligor has not dedicated to the payment of any specific indebtedness at such time.

“Unencumbered Payment Amount” means, at any time, the aggregate amount of all Unencumbered Payments which the Guarantor is due to receive during the then current Coverage Period.

“Unpaid Sum” means any sum due and payable but unpaid by an Obligor under the Finance Documents.

“VAT” means value added tax and any other tax of a similar nature.

“Votorantim Party” means each Obligor and each of its Designated Subsidiaries.

1.2

Construction

(a)

Unless a contrary indication appears any reference in this Agreement to:

(i)

the “Agent”, the “Arranger”, the “Trustee”, any “Finance Party”, any “Secured Party”, any “Lender”, or any “Party” shall be construed so as to include its successors in title, permitted assigns and permitted transferees and, in the case of the Trustee, any Person for the time being appointed as trustee or trustees in accordance with this Agreement;

(ii)

“assets” includes present and future properties, revenues and rights of every description;

(iii)

“indebtedness” includes any obligation (whether incurred as principal or as surety) for the payment or repayment of money, whether present or future, actual or contingent;

(iv)

a “Finance Document” or any other agreement or instrument is a reference to that Finance Document or other agreement or instrument as amended or novated;

(v)

a “regulation” includes any regulation, rule, official directive, request or guideline (whether or not having the force of law) of any governmental, intergovernmental or supranational body, agency, department or regulatory, self-regulatory or other authority or organisation;

(vi)

a provision of law is a reference to that provision as amended or re-enacted; and

(vii)

a time of day is a reference to London time.

(b)

Section, Clause and Schedule headings are for ease of reference only.

(c)

Unless a contrary indication appears, a term used in any other Finance Document or in any notice given under or in connection with any Finance Document has the same meaning in that Finance Document or notice as in this Agreement.

(d)

A Default (other than an Event of Default) is “continuing” if it has not been remedied or waived and an Event of Default is “continuing” if it has not been waived.

1.3

Currency Symbols and Definitions

“$” and “dollars” denote lawful currency of the United States of America.

1.4

Third party rights

A Person who is not a Party has no right under the Contracts (Rights of Third Parties) ▇▇▇ ▇▇▇▇ to enforce or enjoy the benefit of any term of this Agreement.

2.

LOAN AMOUNTS

2.1

Loan Amounts

Each of the Borrower and the Lenders hereby agrees that on and as of the Restatement Date the principal amounts outstanding to each of the Lenders under this Agreement in respect of each Loan shall be equal to the amount set opposite such Lender’s name in the applicable column in Schedule 1 (The Existing Lenders).

2.2

Finance Parties’ rights and obligations

(a)

The obligations of each Finance Party under the Finance Documents are several.  Failure by a Finance Party to perform its obligations under the Finance Documents does not affect the obligations of any other Party under the Finance Documents.  No Finance Party is responsible for the obligations of any other Finance Party under the Finance Documents.

(b)

The rights of each Finance Party under or in connection with the Finance Documents are separate and independent rights and any debt arising under the Finance Documents to a Finance Party from an Obligor shall be a separate and independent debt.

(c)

A Finance Party may, except as otherwise stated in the Finance Documents, separately enforce its rights under the Finance Documents.

2.3

Power of Attorney

(a)

The Guarantor may from time to time appoint on a case by case basis the Borrower to act on its behalf as its agent in relation to the Finance Documents and may authorise:

(i)

the Borrower on its behalf to supply information concerning itself contemplated by this Agreement to the Finance Parties and to give notices and instructions, to make such agreements and to effect the relevant amendments, supplements and variations capable of being given, made or effected by any Obligor notwithstanding that they may affect the Guarantor, without further reference to or the consent of the Guarantor; and

(ii)

each Finance Party to give any notice, demand or other communication to the Guarantor pursuant to the Finance Documents to the Borrower,

and in each case the Guarantor shall be bound as though the Guarantor itself had given the notices and instructions or executed or made the agreements or effected the amendments, supplements or variations, or received the relevant notice, demand or other communication.

(b)

Every act, omission, agreement, undertaking, settlement, waiver, amendment, supplement, variation, notice or other communication given or made by, or given to, the Borrower under any Finance Document on behalf of the Guarantor or in connection with any Finance Document (whether or not known to the Guarantor) shall be binding for all purposes on the Guarantor as if the Guarantor had expressly made, given or concurred with it. In the event of any conflict between any notices or other communications of the Borrower on behalf of the Guarantor and the Guarantor, those of the Borrower shall prevail.

3.

PURPOSE

The Borrower shall apply all of the proceeds of the Loans towards financing investments and its working capital needs.

4.

REPAYMENT

4.1

Repayment of Loans

(a)

The Borrower shall repay the A Loans in ten instalments by repaying on each A Loan Repayment Date the principal amount specified in the column headed “A Loan Principal Payment Amount” in Schedule 4 (Payment Dates).

(b)

The Borrower shall repay the B Loans in ten instalments by repaying on each B Loan Repayment Date the principal amount specified in the column headed “B Loan Principal Payment Amount” in Schedule 4 (Payment Dates).

(c)

The Borrower shall repay the C Loans in ten instalments by repaying on each C Loan Repayment Date the principal amount specified in the Column headed “C Loan Principal Payment Amount” in Schedule 4 (Payment Dates).

4.2

Reborrowing

The Borrower may not reborrow any part of a Loan which is repaid.

5.

PREPAYMENT

5.1

Illegality

If, after the Restatement Date, the introduction of, or any change in, any applicable law, rule or regulation or in the interpretation or administration thereof by any governmental authority charged with the interpretation or administration thereof, or compliance by any Lender with any request or directive (whether or not having the force of law) of any such authority, shall make it unlawful or impossible for any Lender to maintain its participation in any Loan, and after the Lender has (to the extent it can lawfully do so without prejudice to its own position) made reasonable efforts to maintain such Loan using other alternatives such as lending offices in other jurisdictions (provided that the Lender shall be under no obligation to take any such action if, in its opinion, to do so may have an adverse effect upon its business, operations or financial condition), then such Lender shall forthwith so notify the Agent (who shall notify the Borrower) in writing, whereupon:

(a)

the obligation of such Lender to maintain such Loan shall be terminated; and

(b)

the Borrower shall prepay such Loan on the later of (i) the last day of the then current Interest Period for such Loan and (ii) 30 Business Days after the date of such notification, provided that the Borrower shall prepay the Loan on any earlier date that the relevant Lender may notify to the Borrower if such Lender considers that it is unlawful for the Loan to be maintained beyond such date.

5.2

Voluntary prepayment

(a)

The Borrower may, if it gives the Agent not less than 3 Business Days’ (or such shorter period as the Majority Lenders may agree) prior notice, prepay the whole or any part of any Loan (but, if in part, being an amount that reduces the amount of the Loan by a minimum amount of $5,000,000 and an integral multiple of $1,000,000).

(b)

A Loan may only be prepaid after the Consolidation Date.

(c)

Any prepayment under this Clause 5.2 shall satisfy the obligations under Clause 4.1 (Repayment of Loans) in inverse chronological order.

5.3

Restrictions

(a)

Any notice of prepayment given by any Party under this Clause 5 shall be irrevocable and, unless a contrary indication appears in this Agreement, shall specify the date or dates upon which the relevant prepayment is to be made and the amount of that prepayment.

(b)

Any prepayment under this Agreement shall be made together with accrued interest on the amount prepaid and, if applicable, any Break Costs.

(c)

The Borrower may not reborrow any part of a Loan which is prepaid.

(d)

The Borrower shall not repay or prepay all or any part of a Loan except at the times and in the manner expressly provided for in this Agreement.

6.

INTEREST

6.1

Calculation of interest

(a)

The rate of interest on the A1 Loan for the first Interest Period in respect of such loan shall be the percentage rate per annum which is the aggregate of the applicable Margin and 5.27875 per cent. per annum; and, thereafter, the rate of interest on the A1 Loan for each subsequent Interest Period shall be the percentage rate per annum which is the aggregate of the applicable Margin and LIBOR.

(b)

The rate of interest on the A2 Loan for the first Interest Period in respect of such loan shall be the percentage rate per annum which is the aggregate of the applicable Margin and 5.36 per cent. per annum; and, thereafter, the rate of interest on the A2 Loan for each subsequent Interest Period shall be the percentage rate per annum which is the aggregate of the applicable Margin and LIBOR.

(c)

The rate of interest on the A3 Loan for the first Interest Period in respect of such loan shall be the percentage rate per annum which is the aggregate of the applicable Margin and 5.39938 per cent. per annum; and, thereafter, the rate of interest on the A3 Loan for each subsequent Interest Period shall be the percentage rate per annum which is the aggregate of the applicable Margin and LIBOR.

(d)

The rate of interest on the B1 Loan for the first Interest Period in respect of such loan shall be the percentage rate per annum which is the aggregate of the applicable Margin and 5.27875 per cent. per annum; and, thereafter, the rate of interest on the B1 Loan for each subsequent Interest Period shall be the percentage rate per annum which is the aggregate of the applicable Margin and LIBOR.

(e)

The rate of interest on the B2 Loan for the first Interest Period in respect of such loan shall be the percentage rate per annum which is the aggregate of the applicable Margin and 5.36 per cent. per annum; and, thereafter, the rate of interest on the B2 Loan for each subsequent Interest Period shall be the percentage rate per annum which is the aggregate of the applicable Margin and LIBOR.

(f)

The rate of interest on the B3 Loan for the first Interest Period in respect of such loan shall be the percentage rate per annum which is the aggregate of the applicable Margin and 5.39938 per cent. per annum; and, thereafter, the rate of interest on the B3 Loan for each subsequent Interest Period shall be the percentage rate per annum which is the aggregate of the applicable Margin and LIBOR.

(g)

The rate of interest on the C1 Loan for the first Interest Period in respect of such loan shall be the percentage rate per annum which is the aggregate of the applicable Margin and 5.27875 per cent. per annum; and, thereafter, the rate of interest on the C1 Loan for each subsequent Interest Period shall be the percentage rate per annum which is the aggregate of the applicable Margin and LIBOR.

(h)

The rate of interest on the C2 Loan for the first Interest Period in respect of such loan shall be the percentage rate per annum which is the aggregate of the applicable Margin and 5.36 per cent. per annum; and, thereafter, the rate of interest on the C2 Loan for each subsequent Interest Period shall be the percentage rate per annum which is the aggregate of the applicable Margin and LIBOR.

(i)

The rate of interest on the C3 Loan for the first Interest Period in respect of such loan shall be the percentage rate per annum which is the aggregate of the applicable Margin and 5.39938 per cent. per annum; and, thereafter, the rate of interest on the C3 Loan for each subsequent Interest Period shall be the percentage rate per annum which is the aggregate of the applicable Margin and LIBOR.

6.2

Payment of interest

(a)

The Borrower shall pay accrued interest on each Loan on the last day of each Interest Period relating to that Loan.

(b)

The Borrower shall pay:

(i)

the Existing ABN Loan No. 1 Accrued Interest Amount to the Existing Lenders (pro rata in accordance with their respective participations in the Loans as of the Restatement Date) on 13 November 2006;

(ii)

the Existing ABN Loan No. 2 Accrued Interest Amount to the Existing Lenders (pro rata in accordance with their respective participations in the Loans as of the Restatement Date) on the Consolidation Date; and

(iii)

the Existing ABN Loan No. 3 Accrued Interest Amount to the Existing Lenders (pro rata in accordance with their respective participations in the Loans as of the Restatement Date) on the Consolidation Date.

6.3

Default interest

(a)

If an Obligor fails to pay any amount payable by it under a Finance Document on its due date, interest shall accrue on the overdue amount from the due date up to the date of actual payment (both before and after judgment) at a rate which, subject to paragraph (b) below, is one per cent higher than the rate which would have been payable if the overdue amount had, during the period of non-payment, constituted a Loan in the currency of the overdue amount for successive Interest Periods, each of a duration selected by the Agent (acting reasonably).  Any interest accruing under this Clause 6.3 shall be immediately payable by that Obligor on demand by the Agent.

(b)

If any overdue amount consists of all or part of a Loan which became due on a day which was not the last day of an Interest Period relating to that Loan:

(i)

the first Interest Period for that overdue amount shall be for the period equal to the unexpired portion of the current Interest Period relating to that Loan; and

(ii)

the rate of interest applying to the overdue amount during that first Interest Period shall be one per cent higher than the rate which would have applied if the overdue amount had not become due.

(c)

Default interest (if unpaid) arising on an overdue amount will be compounded with the overdue amount at the end of each Interest Period applicable to that overdue amount but will remain immediately due and payable.

6.4

Notification of rates of interest

The Agent shall promptly notify the Borrower of the applicable interest rate for each Interest Period and in any event no later than two Business Days after (and excluding) the date such interest rate is determined.

7.

INTEREST PERIODS

7.1

Interest Periods

Subject to this Clause 7, the Interest Period for each Loan will be, initially, the period commencing on the Restatement Date and ending on the first Interest Payment Date in respect of that Loan and, thereafter, each successive period commencing on the last day of the preceding Interest Period and ending on the next Interest Payment Date in respect of that Loan.

7.2

Non-Business Days

If an Interest Period would otherwise end on a day which is not a Business Day, that Interest Period will instead end on the next Business Day in that calendar month (if there is one) or the preceding Business Day (if there is not).

7.3

Consolidation of Loans

On and from the Consolidation Date:

(a)

the A Loans will be consolidated into and treated as a single A Loan;

(b)

the B Loans will be consolidated into and treated as a single B Loan; and

(c)

the C Loans will be consolidated into and treated as a single C Loan.

8.

CHANGES TO THE CALCULATION OF INTEREST

8.1

Market disruption

If a Market Disruption Event occurs in relation to a Loan for any Interest Period, then the Agent and the Borrower shall negotiate (for a period of not more than thirty days) with a view to agreeing a substitute basis for determining the rate of interest. The rate of interest on each Lender’s share of that Loan for the relevant Interest Period shall be the rate per annum which is the sum of:

(a)

(if an alternative rate is so agreed within such period) the Margin plus such rate; or

(b)

(if an alternative rate is not so agreed within such period) the Margin plus the rate notified to the Borrower by the Agent as soon as practicable and in any event before interest is due to be paid in respect of that Interest Period, to be that which expresses as a percentage rate per annum the cost to the relevant Lender of funding the Loan from whatever source it may reasonably select.

8.2

Alternative basis of interest or funding

Any alternative basis agreed pursuant to Clause 8.1 (Market disruption) above shall, with the prior consent of all Lenders, be binding on all Parties.

8.3

Break Costs

The Borrower shall, within five Business Days of written demand by a Finance Party, pay to that Finance Party its Break Costs attributable to all or any part of a Loan or Unpaid Sum being paid by the Borrower on a day other than the last day of an Interest Period for that Loan or Unpaid Sum subject at all times to the exceptions in Clause 5 (Prepayment) and the Lender having provided in its demand, written calculations showing how any such Break Costs have been calculated.

9.

NOT USED

10.

TAX GROSS-UP AND INDEMNITIES

10.1

Tax gross-up

All payments to be made by an Obligor to any Finance Party under a Finance Document shall be made free and clear of and without deduction for or on account of Tax unless that Obligor is required to make such a payment subject to the deduction or withholding of Tax, in which case the sum payable by that Obligor (in respect of which such deduction or withholding is required to be made) shall be increased to the extent necessary to ensure that the Finance Party receives a sum net of any deduction or withholding equal to the sum which it would have received had no such deduction or withholding been made or required to be made.

10.2

Tax indemnity

If a Finance Party is required to make any payment of or on account of Tax on or in relation to any sum received or receivable under any Finance Document (including any sum deemed for purposes of Tax to be received or receivable by the Finance Party whether or not actually received or receivable) or if any liability in respect of such payment is asserted, imposed, levied or assessed against the Finance Party, the Borrower shall, upon demand of the Finance Party, promptly indemnify the Finance Party against such payment or liability, together with any interest, penalties, costs and expenses payable or incurred in connection therewith, provided that this Clause 10.2 shall not apply to:

(a)

any Tax imposed on and calculated by reference to the net income actually received or receivable by the Finance Party (but, for the avoidance of doubt, not including any sum deeded for purposes of Tax to be received or receivable by the Finance Party but not actually received) by the jurisdiction of incorporation in which the Finance Party is incorporated; or

(b)

any Tax imposed on and calculated by reference to the net income of the Facility Office of the Finance Party actually received or receivable by the Finance Party (but, for the avoidance of doubt, not including any sum deeded for purposes of Tax to be received or receivable by the Finance Party but not actually receivable) by the jurisdiction in which its Facility Office is located; or

(c)

the extent a loss, liability or cost is compensated for by an increased payment under Clause 10.1 (Tax gross-up).

10.3

Tax Credit

If an Obligor makes a payment under Clause 10.1 (Tax gross-up) (a “Tax Payment”) and the relevant Finance Party determines that:

(a)

it has received a credit against, relief or remission for, or repayment of, any Tax (a “Tax Credit”) which is attributable either to an increased payment of which that Tax Payment forms part, or to that Tax Payment; and

(b)

that Finance Party has obtained, utilised and retained that Tax Credit,

the relevant Finance Party shall pay an amount to that Obligor which the Finance Party determines will leave it (after that payment) in the same after-Tax position as it would have been in had the Tax Payment not been required to be made by that Obligor.

10.4

Tax receipts

All Taxes required by law to be deducted or withheld by an Obligor from any amounts paid or payable under the Finance Documents shall be paid by that Obligor when due and that Obligor shall, upon request of any Finance Party, promptly deliver to the Finance Party evidence satisfactory to the Finance Party that the payment has been duly remitted to the appropriate authority.

10.5

Stamp taxes

The Borrower shall pay and, within three Business Days of demand, indemnify any Finance Party against any cost, loss or liability that the Finance Party incurs in relation to all stamp duty, registration and other similar Taxes payable in respect of any Finance Document.

10.6

Value added tax

Any amount (including costs and expenses) expressed to be payable under a Finance Document by an Obligor to a Finance Party shall be deemed to be exclusive of any VAT or any other Tax of a similar nature which might be chargeable in connection with that amount. If any such Tax is chargeable on any supply made by a Finance Party to an Obligor under a Finance Document, that Obligor shall pay to the Finance Party (in addition to and at the same time as paying the consideration) an amount equal to the amount of that Tax.

11.

INCREASED COSTS

11.1

Increased costs

If by reason of:

(a)

any change in or introduction of law, decree, rule or regulation or in the interpretation, administration or application thereof; and/or

(b)

compliance with any request from or requirement of any central bank or other fiscal, monetary or other authority (including, without limitation, a request or requirement which affects the manner in which a Finance Party is required to or does maintain capital resources having regard to that Finance Party’s obligations hereunder and to amounts owing to it hereunder),

a Finance Party or any of its Affiliates:

(i)

incurs a cost as a result of it having entered into and/or performed its obligations under this Agreement and/or assuming or maintaining a Loan under this Agreement;

(ii)

becomes liable to make any payment on account of any Taxes which are calculated by reference to the amount of a Loan and/or any sum received or receivable by it under any Finance Document; or

(iii)

suffers any other Increased Cost,

then the Borrower shall, within three Business Days of a demand by that Finance Party, pay for the account of that Finance Party the amount of any such costs or amounts suffered or incurred by that Finance Party or any of its Affiliates.

12.

OTHER INDEMNITIES

12.1

Currency indemnity

(a)

If any sum due from an Obligor under the Finance Documents (a “Sum”), or any order, judgment or award given or made in relation to a Sum, has to be converted from the currency (the “First Currency”) in which that Sum is payable into another currency (the “Second Currency”) for the purpose of:

(i)

making or filing a claim or proof against that Obligor; or

(ii)

obtaining or enforcing an order, judgment or award in relation to any litigation or arbitration proceedings,

that Obligor shall as an independent obligation, within three Business Days of demand, indemnify each Secured Party and the Arranger to whom that Sum is due against any cost, loss or liability arising out of or as a result of the conversion including any discrepancy between (i) the rate of exchange used to convert that Sum from the First Currency into the Second Currency and (ii) the rate or rates of exchange available to that Person at the time of its receipt of that Sum.

(b)

Each Obligor waives, to the full extent possible by applicable law, any right it may have in any jurisdiction to pay any amount under the Finance Documents in a currency or currency unit other than that in which it is expressed to be payable.

12.2

Other indemnities

The Borrower shall, within three Business Days of demand, indemnify each Secured Party and the Arranger against any cost, loss or liability incurred by that Secured Party or Arranger as a result of:

(i)

the occurrence of any Event of Default;

(ii)

a failure by an Obligor to pay any amount due under a Finance Document on its due date, including without limitation, any cost, loss or liability arising as a result of Clause 27 (Sharing Among the Finance Parties); or

(iii)

a Loan (or part of a Loan) not being prepaid in accordance with a notice of prepayment given by the Borrower.

12.3

Indemnity to the Agent

(a)

The Borrower shall promptly indemnify the Agent against any cost, loss or liability incurred by the Agent (acting reasonably) as a result of:

(i)

investigating any event which it reasonably believes is a Default; or

(ii)

acting or relying on any notice, request or instruction which it reasonably believes to be genuine, correct and appropriately authorised,

provided that the Borrower shall not be obliged to indemnify the Agent against any cost, loss or liability where that cost, loss or liability arises directly as a result of the gross negligence or wilful misconduct of the Agent.

(b)

If paragraph (a) of this Clause 12.3 applies, the Agent will (i) promptly inform the Borrower that it intends to conduct such an investigation and (ii) as soon as reasonably practicable supply the Borrower with an estimate of the costs, expenses, losses or liabilities that the Borrower may incur as a result of the Agent conducting such investigations.

12.4

Indemnity to the Trustee

(a)

The Borrower shall promptly indemnify the Trustee and every Receiver and Delegate against any cost, loss or liability incurred by any of them as a result of:

(i)

the taking, holding, protection or enforcement of the Transaction Security;

(ii)

the exercise of any of the rights, powers, discretions and remedies vested in the Trustee and each Receiver and Delegate by the Finance Documents or by law; and

(iii)

any default by an Obligor in the performance of any of the obligations expressed to be assumed by it in the Finance Documents.

 (b)

The Trustee may, in priority to any payment to the Secured Parties, indemnify itself out of the Secured Property in respect of, and pay and retain, all sums necessary to give effect to the indemnity in paragraph (a) above and shall have a lien on the Transaction Security and the proceeds of the enforcement of the Transaction Security for all moneys payable to it.

13.

MITIGATION BY THE LENDERS

13.1

Mitigation

(a)

Each Finance Party shall, in consultation with the Borrower, take all reasonable steps to mitigate any circumstances which arise and which would result in any amount becoming payable under or pursuant to any of Clause 10 (Tax gross-up and indemnities) or Clause 11 (Increased costs) including (but not limited to) transferring its rights and obligations under the Finance Documents to another Affiliate or Facility Office.

(b)

Paragraph (a) of this Clause 13.1 does not in any way limit the obligations of any Obligor under the Finance Documents.

13.2

Limitation of liability

(a)

The Borrower shall indemnify any Finance Party for all costs and expenses reasonably incurred by that Finance Party as a result of steps taken by it under Clause 13.1 (Mitigation).

(b)

A Finance Party is not obliged to take any steps under Clause 13.1 (Mitigation) if, in the opinion of that Finance Party (acting reasonably), to do so might be prejudicial to it.

14.

COSTS AND EXPENSES

14.1

Transaction expenses