FIRST AMENDMENT TO THE SHAREHOLDERS AGREEMENT OF INPAR S.A. THIS FIRST AMENDMENT (this Amendment ) to the Shareholders Agreement of the Company (as defined below), is entered into and shall be effective as of April 30, 2009, by and among: 1. PALADIN PRIME RESIDENTIAL INVESTORS (BRAZIL), LLC, a limited liability company organized and existing under the laws of the State of Delaware, United States of America, with head offices at 10880 Wilshire Boulevard, Suite 1400, Los Angeles, California, 90024, enrolled with the Brazilian National Registry of Legal Entities ( CNPJ/MF ) under No. 105.239.53/0001-98 ( Paladin ); 2. ISA INCORPORAÇÃO E CONSTRUÇÃO S.A., a sociedade anônima (a company incorporated with shares and limited liability) organized and existing under the laws of the Federative Republic of Brazil ( Brazil ), with head offices in the City of São Paulo, State of São Paulo, at Rua Gomes de Carvalho, 1266, 8 th floor, suite 88-D, Vila Olímpia, enrolled with the CNPJ/MF under No. 08.315.381/0001-00 ( Isa ); 3. The shareholders JOSÉ ALFREDO FERNANDES NEVES, Brazilian citizen, married, engineer, bearer of the Identity Card CREA/RJ No. 11.429-D and enrolled with the Brazilian Individual Taxpayers Registry ( CPF/MF ) under No. 003.767.447-15, CLAUDIO HENRIQUE FERNANDES NEVES, Brazilian citizen, married, engineer, bearer of the Identity Card CREA/RJ No. 16.755-D and enrolled with the CPF/MF under No. 044.021.117-49, ANTONIO HENRIQUE DE SOUZA CAMPOS NEVES, Brazilian citizen, married, engineer, bearer of the Identity Card CREA/RJ No. 86-1-00093-6 and enrolled with the CPF/MF under No. 751.807.907-00; FLÁVIO CESAR DE SOUZA CAMPOS NEVES, Brazilian citizen, married, civil engineer, bearer of the Identity Card CREA/RJ No. 90-1-02513-6 and enrolled with the CPF/MF under No. 882.692.647-68, all resident and domiciled in the city of Rio de Janeiro, State of Rio de Janeiro, with an office at Rua Victor Civita, 77, suite 602 (collectively, the Neves Group ); and 4. ASCET I - FUNDO DE INVESTIMENTO EM PARTICIPAÇÕES, investment fund organized and existing under the laws of Brazil, enrolled with the CNPJ/MF under No. 07.319.087/0001-03, herein represented by its manager, Banco Santander S.A., a financial institution organized and existing under the laws of Brazil, with head offices in the City of São Paulo, State of São Paulo, at Rua Amador Bueno, No. 474, enrolled with the CNPJ/MF under No. 90.400.888/0001-42, authorized by the Brazilian Securities Commission (Comissão de Valores Mobiliários - CVM ) to act as portfolio manager by means of the CVM Declaratory Act No. 8.951, of September 12, 2006 ( FIP Chade ); (Isa, Neves Group and FIP Chade shall hereinafter be jointly referred to as Existing Shareholders. Paladin and each of the Existing Shareholders shall hereinafter be individually referred to as Shareholder and jointly as Shareholders );
and as intervening party 5. INPAR S.A., a sociedade anônima (a company incorporated with shares and limited liability) organized and existing under the laws of Brazil, with head offices in the City of São Paulo, State of São Paulo, at Rua Olimpíadas, No. 205, 5 th floor, suite 52-A, with its Bylaws duly registered before the Board of Trade of the State of São Paulo under NIRE 35.300.338.421 on January 10, 2007, and enrolled with the CNPJ/MF under No. 67.571.414/0001-41 (the Company and, collectively with the Shareholders, the Parties ) W H E R E A S (a) Paladin, the Existing Shareholders and the Company have previously entered into that certain Shareholders Agreement, dated as of December 21, 2008 (the Shareholders Agreement ); (b) pursuant to Clause 3.1 of the Shareholders Agreement, the Shareholders agreed to amend the Shareholders Agreement in order to include the number of Bound Shares and the description of their holders as provided in the chart attached to the Shareholders Agreement as Exhibit 1 immediately after the Second Closing Date; (c) Paladin, the Existing Shareholders and the Company have previously entered into that certain letter agreement, dated as of March 10, 2009, pursuant to which the Parties agreed that the amendment to Exhibit 1 of the Shareholders Agreement, as described in Clause 3.1 of the Shareholders Agreement, should be executed only after the procedure provided for in Article 171, paragraph 7, "b", of the Brazilian Corporations Law has been carried out and Paladin has subscribed for all of the New Common Shares to which it is entitled under the Subscription Agreement (the Subscription Process ); (d) the Subscription Process concluded on March 20, 2009; (e) the Parties wish to amend Clause 5 of the Shareholders Agreement in order to clarify that the position of Chief Operations Officer corresponds to the position of Diretor Vice-Presidente de Operações, as set forth in the Bylaws; and (f) the Parties wish to amend Clause 8 of the Shareholders Agreement in order to include new provisions regarding approval of matters subject to super-majority decisions. NOW, THEREFORE, the Parties agree to enter into this Amendment in accordance with the following terms and conditions: 1. Capitalized Terms. The capitalized terms used in this Amendment and not defined herein shall have the meanings ascribed to them in the Shareholders Agreement. 2. Amendment of Exhibit 1. The Shareholders Agreement is hereby amended by deleting Exhibit 1 thereto in its entirety and substituting in lieu thereof the Exhibit 1 attached hereto and incorporated herein by reference.
3. Amendment of Clause 5. Clause 5 of the Shareholders Agreement is hereby amended in its entirety and shall become effective as follows: "Clause 5. Board of Executive Officers. Pursuant to the Bylaws, the Board of Executive Officers shall be comprised of 5 (five) members, out of which (a) 1 (one) shall be the Chief Executive Officer (Diretor Presidente), (b) 1 (one) shall be the Chief Operations Officer (Diretor Vice-Presidente de Operações), (c) 1 (one) shall be the Financial Officer and (d) 2 (two) shall be Commercial Officers, all of them with duties provided for in the Bylaws. The duties of the Investor Relations Officer shall be assigned to any of the foregoing officers, as may be determined by Isa and Paladin. 5.1. Subject to Clause 5.1.1, Isa shall have the right to appoint the Chief Operations Officer (Diretor Vice-Presidente de Operações) and Paladin shall have the right to appoint the remainder of the members of the Board of Executive Officers. 5.1.1. In every election or reelection event, (a) Paladin (through the Directors nominated by it) shall have a veto right with respect to individuals appointed by Isa for the position of Chief Operations Officer (Diretor Vice-Presidente de Operações) and (b) Isa (through the Director(s) nominated by it) shall have a veto right with respect to the first individual appointed by Paladin for the Chief Executive Officer (Diretor Presidente) position of the Company, provided that each such veto is reasonably justified by Paladin or Isa, as the case may be. In the event Isa (through the Director(s) nominated by it) exercises its veto right with respect to a Chief Executive Officer (Diretor Presidente) appointed by Paladin, Isa (through the Director(s) nominated by it) shall have no further veto rights with respect to the replacement Chief Executive Officer (Diretor Presidente) appointed by Paladin in connection with that specific election or reelection event in which such veto right was exercised. 5.1.2. The right of Isa to appoint the Chief Operations Officer (Diretor Vice-Presidente de Operações) under this Clause 5.1 shall cease if, cumulatively, (a) the Existing Shareholders ownership of Bound Shares, considered as a group, is reduced to less than 20% (twenty percent) of the Existing Shareholders Bound Shares as of the Second Closing Date; and (b) the Existing Shareholders cease to own, collectively, any Existing Shareholders Restricted Shares. 5.1.3. The Chief Operations Officer (Diretor Vice-Presidente de Operações) shall have the following duties and activities and the Shareholders hereby agree to amend the Bylaws of the Company accordingly: (i) to plan, coordinate, organize, supervise and direct the transactions and the operational activities of the Company; (ii) to supervise the Commercial Officers; (iii) to manage the relationship with the partners of the Company in the real state business; (iv) to evaluate and manage the implementation of the business plans, operational plans, financial plans and technical plans of the Company, pursuant to the targets for the performance and results of the various areas of the Company, of its controlled or affiliated companies and partners; (v) to propose possible necessary adjustments in the Company s performance and results targets; (vi) to coordinate and supervise the relationship with the Company s clients; (vii) to plan, coordinate, organize, supervise and direct administrative matters, as well as the information technology and infrastructure necessary for the good development of the activities of
the Company; (viii) to coordinate and supervise the legal department of the Company, developing the necessary activities for the good development of the legal matters of the Company; (ix) to coordinate and supervise the construction department, developing the necessary activities for the good development of the construction matters of the Company; and (x) other duties to be assigned by the Board of Directors and/or the Chief Executive Officer (Diretor Presidente). 5.2. Paladin and Isa (through the Directors nominated by them) shall have the right to remove from the Board of Executive Officers the members appointed by each of them and to appoint their respective replacements. In case of dismissal, resignation, substitution, permanent impediment or any other event that results in a vacancy on the Board of Executive Officers, the Shareholder nominating the vacant member shall have the right to nominate (through the Directors nominated by them) his or her replacement, and each of the Shareholders (through the Directors nominated by them) agrees to vote to elect the person nominated by the Shareholder to replace the vacant member, in accordance with the terms of this Agreement." 4. Amendment of Clause 8. Clause 8 of the Shareholders Agreement is hereby amended by including a new Section 8.1 therein, which shall become effective as follows: "8.1. Notwithstanding anything to the contrary set forth herein and regardless of the corporate body responsible for its approval pursuant to the Bylaws, any matter subject to supermajority decision as listed in Clause 7 or Clause 8 hereof shall only be approved and implemented by the Company if such matter has been presented to, and approved by, a Preliminary Shareholders' Meeting held in accordance with the procedures set forth in Clause 6 above, in which case such corporate body responsible for approval of such matter shall be bound by the final decision of the Preliminary Shareholders' Meeting." 5. Irrevocability; Amendment to the Contract. This Amendment is irrevocable and binds the Parties and their successors of any nature. The Shareholders Agreement, as amended by this Amendment, may be amended only by written instrument, duly executed by all the Parties. 6. Tolerance and Waivers. Tolerance by any of the Parties as to delay in performance, nonperformance or inexact performance of any of the provisions of the Shareholders Agreement, as amended by this Amendment, shall not be construed or interpreted to be a waiver of any right of such Parties, shall not adversely affect their right to demand performance of the relevant obligation and shall not constitute novation. 7. Severability. The nullity or inefficacity of any of the provisions in this Amendment shall not adversely affect the validity and efficacy of the other provisions, which shall be complied with in full, and the Parties hereby agree to use their best efforts to attain, through valid means, the same effects of any provision that may be annulled or become ineffective. 8. Exhibits. The Exhibits to this Amendment constitute an integral and inseparable part hereof for all legal purposes and effects.
9. Final Understanding. The Shareholders Agreement, as amended by this Amendment, constitutes the final understanding among the Shareholders with regard to the matters dealt with herein, replacing and prevailing over all prior agreements, understandings and declarations, whether written or oral. 10. Registrations and Filings. This Amendment shall be recorded and kept on file at the head offices of the Company, which shall be bound: (a) to comply with it, pursuant to Article 118 of the Brazilian Corporations Law; and (b) to refrain from performing any and all acts arising out of non-compliance with any obligation assumed under this Amendment. 11. Consenting Intervening Party. The Company executed this Amendment to acknowledge all the terms and conditions hereof, agreeing to comply with all its provisions and, in particular, to record this Amendment in accordance with the Brazilian Corporations Law. 12. Portuguese Version. This Amendment is executed in English, and the Company will provide and keep a translation of this Amendment in Portuguese. If there is a conflict, the English version shall prevail over the Portuguese version. 13. Full Force and Effect. Except as expressly amended hereby, the Shareholders Agreement shall remain in full force and effect. 14. Governing Law. This Amendment shall be governed by, and construed in accordance with, the laws of Brazil and any Dispute in connection with this Amendment shall be resolved in accordance with Clause 29 of the Shareholders Agreement. IN WITNESS WHEREOF, the Parties have caused this Amendment to be duly executed in 8 (eight) identical counterparts, in the presence of the undersigned witnesses and the result shall be the same as it would be if the signatures on the counterparts were on a single copy of this Amendment. São Paulo, April 30, 2009
[Signature Page of the First Amendment to the Shareholders Agreement, entered into on April 30, 2009 (1/5)] PALADIN PRIME RESIDENTIAL INVESTORS (BRAZIL), LLC
[Signature Page of the First Amendment to the Shareholders Agreement, entered into on April 30, 2009 (2/5)] ISA INCORPORAÇÃO E CONSTRUÇÃO S.A.
[Signature Page of the First Amendment to the Shareholders Agreement, entered into on April 30, 2009 (3/5)] JOSÉ ALFREDO FERNANDES NEVES CLAUDIO HENRIQUE FERNANDES NEVES ANTONIO HENRIQUE DE SOUZA CAMPOS NEVES FLÁVIO CESAR DE SOUZA CAMPOS NEVES
[Signature Page of the First Amendment to the Shareholders Agreement, entered into on April 30, 2009 (4/5)] ASCET I - FUNDO DE INVESTIMENTO EM PARTICIPAÇÕES
[Signature Page of the First Amendment to the Shareholders Agreement, entered into on April 30, 2009 (5/5)] INPAR S.A. WITNESSES
Exhibit 1 List of Shareholders and Bound Shares Date: April 28, 2009 Shareholder Number of Bound Equity Interests Shares Percentage Paladin Prime Residential Investors (Brazil), LLC 97,683,712 65.37% Ascet I Fundo de Investimento em Participações 3,105,138 2.08% ISA Incorporação e Construção S.A. 39,331,752 26.32% José Alfredo Fernandes Neves 3,539,858 2.37% Cláudio Henrique Fernandes Neves 2,887,779 1.93% Antonio Henrique de Souza Campos Neves 2,328,854 1.56% Flávio Cesar de Souza Campos Neves 558,925 0.37% Total 149,436,018 100.0%