After some discussion and negotiation with the bank and bank affiliates, Moreno was able to secure the following agreements: Baker Adhesives’ bank had agreed to offer a forward contract for September 5 at an exchange rate of 0.4227 US$/BRL. An affiliate of the bank, located in Brazil and familiar with Novo, was willing to provide Baker with a short-term real loan, secured by the Novo receivable, at 26.5% (annual effective rate). Moreno was initially shocked at this rate, which was more than three times the 8.5% annual effective rate on Baker’s domestic line of credit. However, the bank described Brazil’s historically high inflation and the recent attempts by the government to control inflation with high interest rates. The rate they had secured was typical of the market at the time.