I do know that the Federal Senate has approved, and I, José Sarney, President, in the terms of art. 48, inciso XXVIII, of the Internal Rules, promulgated the following

R E S O L Ç No 51, DE 2010

Authorizes the State of Santa Catarina to hire operation of external credit, with a guarantee from the Union, with the International Bank for Reconstruction and Development (Bird), worth up to US$ 90,000,000.00 (ninety million U.S. dollars), for partial financing of?Program Santa Catarina Rural-Microbasins 3?.

The Federal Senate resolves:

Art. 1º It is the State of Santa Catarina authorised to hire external credit operation, with guarantee from the Union, with the International Bank for Reconstruction and Development (Bird), worth up to US$ 90,000,000.00 (ninety millions of U.S. dollars).

Paragraph single. Are the resources of this credit operation intended to partially finance the?Program Santa Catarina Rural-Microbasins 3?.

Art. 2º The credit operation referred to in art. 1º should be carried out in the following conditions:

I-debtor: State of Santa Catarina;

II-creditor: International Bank for Reconstruction and Development (Bird);

III-guarantor: Federative Republic of Brazil;

IV-value: up to US$ 90,000,000.00 (ninety millions of U.S. dollars);

V-modality: variable margin;

VI-deadline of disbursement: until September 30, 2016;

VII-amortization of the debtor balance: each disbursement is to be paid in 30 (thirty) semi-annual and consecutive installments, on March 15 and on September 15 of each year, winning the first on September 15, 2020 and the last one on March 15, 2035, being that the values of each parcel will be equivalent to 1/30 of each disbursement, except the last one that will be equivalent to the remaining value;

VIII-applicable interest: required semester on the same repayment terms of amortization and calculated on the periodic debtor balance of the loan, at a rate comprised of the interest rate Libor semestral for U.S. dollar increased from a spread to be determined by Bird to each fiscal year;

IX-interest of mora: 0.50% a.a. (fifty hundred percent a year) add to the interest due and not yet paid. Overdue 30 (thirty) days after the target date for payment of the interest, will constitute the borrower in arrears, and applying the provisions of Section 3.2 (d) of the General Rules;

X-commission in sight (front-end fee): 0.25% (twenty five hundred percent) on the value of the loan, to be debited on the date the contract enters into effectivity;

XI-option of change of loan modality: the hiring in the variable margin modality allows for your change for hiring in fixed margin upon formal request to the creditor (clause 2.07 of the loan agreement).

§ 1º The fixed margin allows the borrower the use of the following financial instruments:

I-conversion of the interest rate applicable to the partial or total amount of the loan, from float to fixed or vice-versa;

II-change of the reference currency of the credit operation to the amount already disbursed;

III-change of the reference currency of the credit operation for the amount to disburse.

§ 2º The exercise of the options previously referred to implies the collection of the charges incurred by Bird in the realization of the options and a transaction commission (transaction fee).

Art. 3º It is the Union authorized to grant assurance to the State of Santa Catarina in the contracting of the external credit operation referred to in this Resolution.

Paragraph single. The exercise of the authorization provided for in the caput is conditional on that, in advance of the signing of the contractual instruments, is verified by the Ministry of Finance the fulfilment of the following requirements:

I-which does not constrain, within the framework of the Union, concerning the State of Santa Catarina, procedure for collection concerning to the recovery of credits arising from endorsal of endorsal or grant of guarantees;

II-which there is a condition of addedness of the Direct Administration of the State of Santa Catarina to with the Union and its controlled entities, including in what tange to the fulfillment of the inciso VI of the art. 21 of Resolution No. 43, of 2001, of the Federal Senate;

III-that is formalized contract of contragarantia.

Art. 4º The maximum term for the exercise of this authorization is 540 (five hundred and forty) days, counted as of the duration of this Resolution.

Art. 5º This Resolution comes into effect on the date of its publication.

Federal Senate, on August 31, 2010.

Senator Jose Sarney

President of the Federal Senate