The company recorded a provision in the amount of us

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Unformatted text preview: ovisions in the amount of U.S.$ 4,690 relating to several other legal disputes and has also made deposits in the amount of U.S.$ 6,003 in escrow accounts. (b) “Take-or-pay” contract In connection with the sale of the electrochemical plant (see Note 2), the Company and CanadianOxy Chemicals Holding Ltd. (CXY) entered into a long-term contract for chemical products supply. The contract includes clauses of performance incentives such as sharing of productivity gains, preference prices and "take-or-pay", by which the Company is committed to acquire from the electrochemical plant purchased by CXY a volume of chemical products conservatively projected for the next 6 years. Volumes purchased by the Company in addition to the minimum agreed for a given year may be compensated with lower volumes acquired in subsequent years. For the take-or-pay quantities, the Company will pay unit prices which equal cost plus margin as determined in the contract. 33 Aracruz Celulose S.A. Notes to Consolidated Financial Statements Expressed in thousands of United States dollars (unless otherwise stated) (c) Co...
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