10.3 Capital Contribution Agreement between Sanepar and the
state of Parana ................................................................
EXHIBIT 10.3
Draft
Agreement by and between the State of Parana and
Companhia de Saneamento do Parana -- Sanepar for
repayment in cash with reference to the advance toward a
future capital increase.
COMPANHIA DE SANEAMENTO DO PARANA -- SANEPAR, a private, legal entity, a
partially state-owned corporation with headquarters in Curitiba, at Xxx
Xxxxxxxxxxx Xxxxxxxx 0000, XXXX [Taxpayer Identification] No.
76.484.013/0001-45, [represented] by its Executive Officers: Xxxxxx Xxxxxx
Xxxxxxxx xx Xxxxxxx, President and Chief Executive Officer, and Xxxxxxx Del
Xxxxxx Xxxxxxxx, Chief Financial Officer; and, the State of Parana, an internal,
public legal entity, with headquarters in Curitiba, majority shareholder and
controlling entity of Companhia de Saneamento do Parana, represented herein by
the Honorable Governor of the State, Xxxxx Xxxxxx, hereby sign this agreement
for repayment to the State of the amount provided toward a future capital
increase, and stipulate the following clauses:
CLAUSE ONE: The purpose of this Agreement is to establish the conditions under
which SANEPAR will repay to the State of Parana the amount provided toward a
future capital increase.
CLAUSE TWO: The parties set forth that the repayment must be made in Brazilian
currency, not in shares of SANEPAR.
CLAUSE THREE: The repayment by SANEPAR must take place within 30 days after
receiving the funds from the initial public offering (IPO); however, this is
subject to the occurrence of the initial public offering and receipt of the
funds.
CLAUSE FOUR: Repayment of the credits toward a future capital increase
transferred by the State of Parana covers the period from June 1998 to December
2001, pursuant to the attached statement (Exhibit 1).
PARAGRAPH ONE: The nominal value of the credits is BRR 158,598,665.28 (One
hundred fifty-eight million five hundred ninety-eight thousand six hundred
sixty-five reais and twenty-eight centavos), representing the amounts
contributed up to December 31, 2001.
PARAGRAPH TWO: The above-mentioned nominal value was adjusted to December 31,
2001 and represents BRR 179,552,206.70 (One hundred seventy-nine million five
hundred fifty-two thousand two hundred six reais and seventy centavos).
PARAGRAPH THREE: The values were adjusted in accordance with the change in the
monthly TR (Taxa Referencial) [Benchmark Rate] issued by Banco Central do
Brasil, added to the average annual interest rate paid by SANEPAR for its other
loans, as follows:
1998: 8.31%
1999: 8.05%
2000: 8.08%
2001: 8.02%
2002: 8.02%
CLAUSE FIVE: The parties set forth that the repayment will be subject to the
condition precedent mentioned in clause Three, making sure that in the event
that the initial public offering (IPO) does not occur, the terms and conditions
will be renegotiated for partial payment of the amounts contained in this
Agreement.
PARAGRAPH ONE OF ONE: In the event that it is impossible to make the repayment
in kind, Companhia de Saneamento do Parana reserves the right to make it in
shares pursuant to Law 6404/76.
CLAUSE SIX: The value of the agreement refers to the adjusted amount of the
credits toward a capital increase, that is, BRR 179,552,206.70 (One hundred
seventy-nine million five hundred fifty-two thousand two hundred six reais and
seventy centavos) as of December 31,2001.
PARAGRAPH ONE OF ONE: The current value of the main body of this clause will be
adjusted as of January 1, 2002 to the TR -- Benchmark Rate added to the average
annual interest rate paid by SANEPAR for its other loans in accordance with
paragraph 3 of Clause Four -- up to the date of its actual payment.
CLAUSE SEVEN: This Agreement may be automatically rescinded in the event of a
supervening legal provision that renders it impossible [to perform] for all
intents and purposes.
CLAUSE EIGHT: The signatories may at any time terminate this Agreement, if
administratively appropriate, for breach of its clauses, or on account of a
supervening law, regulation or act that renders it impossible [to perform] for
all intents and purposes.
CLAUSE NINE: Omissions arising from the execution of this Agreement will be
settled by mutual agreement of the parties.
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CLAUSE TEN: The court of the District of Curitiba - PR is selected to settle any
questions that may arise during the effective period of this Agreement.
CLAUSE ELEVEN: Future alterations that may be necessary to satisfy the purpose
of this Agreement will be carried out by amendment.
CLAUSE TWELVE: This Agreement will terminate on December 12, 2002 and may be
extended by the parties.
Therefore, having so agreed, the parties sign 4 (four) copies of this Agreement,
each of the same tenor and form, in the presence of the witnesses listed below.
Curitiba,
STATE OF PARANA
XXXXX XXXXXX
GOVERNOR
XXXXXX XXXXXX XXXXXXXX XX XXXXXXX
PRESIDENT AND CHIEF EXECUTIVE OFFICER OF SANEPAR
XXXXXXX DEL XXXXXX XXXXXXXX
CHIEF FINANCIAL OFFICER OF SANEPAR
WITNESSES:
3
