CONFORMED COPY



                                                LOAN NUMBER 7837-BR




         Guarantee Agreement
 (Additional Financing for the São Paulo State Feeder Roads Project
Programa de Recuperação de Estradas Vicinais do Estado de São Paulo)


                              between


             FEDERATIVE REPUBLIC OF BRAZIL


                                and


       INTERNATIONAL BANK FOR RECONSTRUCTION
                  AND DEVELOPMENT




                     Dated September 27, 2010
                                                             LOAN NUMBER 7837-BR

                             GUARANTEE AGREEMENT

        AGREEMENT, dated September 27, 2010, entered into between the
FEDERATIVE REPUBLIC OF BRAZIL (“Guarantor”) and INTERNATIONAL BANK
FOR RECONSTRUCTION AND DEVELOPMENT (“Bank”) (“Guarantee Agreement”)
in connection with the Loan Agreement of same date between the Bank and the STATE
OF SÃO PAULO (“Borrower”) (“Loan Agreement”). The Guarantor and the Bank
hereby agree as follows:

             ARTICLE I – GENERAL CONDITIONS; DEFINITIONS

      Section 1.01. The General Conditions (as defined in the Appendix to the Loan
Agreement) constitute an integral part of this Agreement.

        Section 1.02. Unless the context requires otherwise, the capitalized terms used in
this Agreement have the meanings ascribed to them in the General Conditions or in the
Loan Agreement.

                             ARTICLE II – GUARANTEE

        Section 2.01. The Guarantor hereby unconditionally guarantees, as primary
obligor and not as surety merely, the due and punctual payment of all Loan Payments
payable by the Borrower pursuant to the Loan Agreement.

                ARTICLE III – REPRESENTATIVE; ADDRESSES

        Section 3.01. The Guarantor’s Representative is its Minister of Finance.

        Section 3.02. The Guarantor’s Address is:

                Ministério da Fazenda
                Procuradoria Geral da Fazenda Nacional
                Esplanada dos Ministérios, Bloco "P" - 8º andar
                70048-900 Brasília, DF
                Brazil

                Facsimile:

                (55-61) 3412-1740
                                        -2-


       Section 3.03. The Bank’s Address is:

               International Bank for
                Reconstruction and Development
               1818 H Street, N.W.
               Washington, D.C. 20433
               United States of America

               Cable:                 Telex:                  Facsimile:

               INTBAFRAD              248423 (MCI) or         (202) 477-6391
               Washington, D.C.        64145 (MCI)




         AGREED at São Paulo, Federative Republic of Brazil, as of the day and year
first above written.


                              FEDERATIVE REPUBLIC OF BRAZIL


                                      By /s/ Suely Dib de Sousa e Silva
                                                            Authorized Representative



                              INTERNATIONAL BANK FOR
                              RECONSTRUCTION AND DEVELOPMENT


                                      By /s/ Makhtar Diop
                                                            Authorized Representative