CNPJ/MF: 04.423.567/0001-21
NIRE: 33.3.0028401-0
(Public Held Company)
Management Proposal submitted to the Extraordinary General Meeting to
be held on December 30th, 2014, at 11:00 a.m.,
pursuant to the Notice of Meeting
Dear Shareholders,
The Management of ENEVA S.A. (Company), pursuant to the pertinent legislation
and the Company Bylaws, and in the best interests of the Company, submits the
following proposals for your consideration, pursuant to the Extraordinary General
Meeting:
(i) Ratification of the Companys judicial recovery request filed, on an
emergency basis, at the Court of the City of Rio de Janeiro, on December
9th, 2014;
The Company and its controlled company ENEVA Participaes S.A., by orientation
of its controlling shareholders, filed on December 9th, 2014, at the Court of the City
of Rio de Janeiro, request for judicial recovery, in accordance with Article 51 and
following of Law N. 11.101/05, on an emergency basis, pursuant to Article 122,
Sole Paragraph, of the Brazilian Corporations Law.
The request for judicial recovery was a result of (i) the non-revalidation of the
agreement to suspend the amortization and payment of interests of financial
transactions entered into by the Company and certain subsidiaries with financial
creditors, due on November 21, 2014; and (ii) the failure to reach an agreement
between the Company and financial institutions to execute a financial stabilization
plan of the Company aimed for the capital structure strengthening and the debt reprofiling of the Company.
The Management believes that, due to the challenges arising from the Companys
current economic and financial situation, the judicial recovery request is the most
appropriate measure, at this moment, to ensure the preservation of the interests of
its shareholders, employees and lenders, thereby promoting the Companys
preservation, its social function and the stimulus to its economic activity.
(ii) Election of new members of the Companys Board of Directors:
The Companys Management proposes the election of the following new members
to the Companys Board of Directors, for a period until the date of the Companys
Ordinary General Meeting in 2015:
Fabio Hironaka Bicudo
Board Member
Board Member
Messrs. Fabio Hironaka Bicudo and Adriano Carvalhdo Castello Branco Gonalves
will not be elected as independent members of the Companys Board of Directors.
Additionally, shall be called within the period prescribed by the regulations,
specially by the rules of Novo Mercado of BM&FBovespa, new shareholders' meeting
in order to recompose the Board of Directors with the election of independent
members.
In compliance with article 10 of CVM Ruling 481, the Annexure I of this proposal
gives the information called for in items 12.6 to 12.10 of the Companys Reference
Form. This information is also available on the websites of the Company
(http://ri.eneva.com.br),
the
CVM
(www.cvm.gov.br)
and
BM&FBOVESPA
(www.bmfbovespa.com.br).
(iii) Change of the minimum number of members of the Companys Board
of Directors;
The Companys Management proposes to change the minimum number of members
of the Companys Board of Directors from 8 (eight) to 5 (five) and, consequently,
amend the Companys Bylaws, by introducing new wording as contained in the draft
attached as Annexure II hereto.
The Management believes that there will be no legal effects to the Company or its
shareholders as a result of the change the minimum number of members of the
Companys Board of Directors. Also, the Management do not expects any economic
effects resulting from the change proposed herein.
In order to comply with the provisions of article 11 of Brazilian Securities
Commission (CVM) Ruling No. 481/2009 (CVM Ruling 481), the Companys
Management submits the Annexure III to this proposal, containing: (a) copy of the
Bylaws with the proposed amendments highlighted and (b) a report detailing the
origin of and the justification for the amendments proposed, with an analysis of
their legal and financial effects.
(iv) Adjust the wording of Article 5 of the Company's Bylaws in order to
reflect the ratification of the capital increase approved on the Companys
Board of Directors Meeting held on August 1st, 2014;
Change
of
the
global
annual
compensation
of
the
Companys
management;
The Companys management submits to the approval of its shareholders, the
adjustment of the limit of the global annual compensation of the Companys
Management, to be valid until the Companys Ordinary Shareholders Meeting to be
held in 2015, from R$ 8,500,000.00 (eight million, five hundred Reais) to an
amount of up to R$ 12,500,000.00 (twelve million, five hundred Reais). Such
revision results from the administrative restructuring of the Company, with
reflection in the compositions of the Board Directors and the Officers Committee
and, mainly, due to the efforts of the administrators under the difficulties faced by
the Company.
Pursuant to article 12 of CVM Rule 481/09, additional information related to
Management compensation, according to item 13 of the Reference Form, is
attached hereto as Annex II and available at the Companys Investors Relation
website
(ri.eneva.com.br),
at
CVMs
website
(www.cvm.gov.br),
and
at
(a)
Individual Shareholder:
(i)
(ii)
(iii)
(b)
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(c)
law (article 126, paragraph 1st of Law 6,404/76). The attorney must
be a shareholder, a manager of the Company, a lawyer, a financial
institution or an investment fund manager representing the fund
members; and
(ii)
NB: Powers of attorney issued outside Brazil shall be notarized by a notary public
duly qualified for the purpose, consularized at a Brazilian consulate and translated
into Portuguese by a sworn translator.
In order to facilitate the paperwork, the Company requests that the above
documentation be sent up to two (2) days before the date of the Meeting, by hand,
mail or email (in which case the document itself must be brought to the Meeting),
to one of the following addresses:
Delivery of Original Documents:
For the attention of: ENEVA Corporate Secretarys Office
Praia do Flamengo, 66, 7th floor
Rio de Janeiro CEP: 22210-903
Documents sent by email:
Please give the Subject as: Documentos AGE ENEVA 30.12.2014
Email: secretariacorporativa@eneva.com.br
The Company stresses, however, that advance delivery of the documentation is
intended to speed up the process, but that it is not a necessary condition for
attendance at the Meeting.
Lastly, the Company wishes to state that this Management proposal and the
corresponding Notice of Meeting are available on the websites of the CVM
(www.cvm.gov.br),
the
BM&FBOVESPA
(www.bmfbovespa.com.br),
and
the
Jrgen Kildahl
Chairman of the Board of Directors
ENEVA S.A.
ANNEXURE I
ITEMS 12.6 TO 12.10 OF THE REFERENCE FORM
Pursuant to Article 10 of CVM Ruling 481, as amended, the Company provides below, the information specified in items 12.6 to 12.10 of
the Reference Form, informational regime provided for in CVM Ruling 480, as amended.
Age
Profession
Management body
Elective office held
Election Date
Date of investiture
Term of office
Elected by Controlling
Shareholder
42
Businessman
09/12/2014
2 years
Yes
37
Lawyer
09/12/2014
Jrgen Kildahl
50
12/06/2013
000.000.000-00
Administrador
12/06/2013
09/12/2014
09/12/2014
2 years
Yes
Ordinary Shareholders Meeting
2015
Yes
55
12/06/2013
000.000.000-00
Engineer
12/06/2013
49
12/06/2013
000.000.000-00
Administrator
12/06/2013
40
30/12/2014
820.110.876-00
Businessman
30/12/2014
39
30/12/2014
085.158.937-54
Lawyer
30/12/2014
Name
INDIVIDUAL TAXPAYER CARD (CPF) NO.
Age
Profession
Management body
Elective office held
Election Date
Date of investiture
Term of office
Elected by Controlling
Shareholder
Name
INDIVIDUAL TAXPAYER CARD (CPF) NO.
Age
Profession
Management body
Elective office held
Election Date
Date of investiture
Term of office
Elected by Controlling
Shareholder
12.7 - Composition of the statutory committees and the audit, finance and compensation committees
Name
Committee type
Position held
Profession
Date elected
Description of other
committees
Age
Date of investiture
Audit Committee
Term of office
000.000.000-00
Engineer
55
1 year
a. Keith Plowman is an Engineering graduate from UWIST (1980) and holds an MBA from Aston University. He is currently a Chief
Operating Officer of E. ON International Energy (core activity: power generation) (since September 2011). He was previously a
Director of Steam Germany and of Fleet Management Steam (core activity: power generation) (2010-2011). He was a member of the
Board of Directors of E. ON Kraftwerke GmbH (core activity: power generation), Development & Construction Director and Energy
Generation Director of Eon UK Ltd (core activity: power generation) (2004-2007), and also held the following positions in CHP Ltd.
(core activity: power generation): Engineering Superintendent 1991-1997, Sales Superintendent (1998-2002) and Superintendent
General (2002-2004).
b. Keith Plowman declares for all purposes of the law that over the last 5 years he has not been subject to any criminal conviction, or
to punishment or enforcement of penalties as a result of administrative proceedings filed with the CVM, or to final judgment in the
judicial or administrative spheres, that might have resulted in his suspension or disqualification from engaging in any professional or
commercial activities
Stein Dale
Financial Committee
000.000.000-00
Administrator
49
Economist
50
1 year
Other Committee
000.000.000-00
1 year
12.9 - Existing marital relationship, common-law marriage, or family relationship up to 2nd degree relating to managers of the
issuer, subsidiaries and controlling shareholders.
There is no marital relationship, common-law marriage or family relationship up to 2nd degree relating to managers of the issuer,
subsidiaries and controlling shareholders.
12.10 - Relationships of subordination, rendering of services or control between managers and subsidiaries, controlling
shareholders and other:
Identification
CPF/CNPJ
664.976.807-30
Control
Supplier
Position/Function
02.762.115/0001-49
664.976.807-30
11.230.122/0001-90
Control
Supplier
Mr. Eike Batista is one of the controlling shareholders of ENEVA and President of the Board of Directors and controlling shareholder of leo e Gs Participaes S.A., controlling shareholder
of OGX Petrleo e Gs S.A., shareholder of the associated company Parnaba Gs Natural S.A.
664.976.807-30
Control
Supplier
02.762.115/0001-49
664.976.807-30
Control
Supplier
11.230.122/0001-90
664.976.807-30
Control
Supplier
08.741.499/0001-08
664.976.807-30
Control
Supplier
02.762.115/0001-49
ANNEXURE II
NEW WORDING FOR THE BYLAWS
ENEVA S.A.
CNPJ/MF: 04.423.567/0001-21
NIRE: 33.3.0028401-0
(Public Company)
BYLAWS
CHAPTER I
NAME, HEAD OFFICE, OBJECT AND DURATION
Article 1 - ENEVA S.A. (Company) is a corporation governed by the present Bylaws, by Law No. 6,404 of December, 1976 (Law No.
6,404/76) and by the other applicable laws and regulations.
Sole Paragraph The Company, its shareholders, managers and members of the Fiscal Council, when in operation, will also be subject
to the provisions of the Regulations of the so-called Novo Mercado of BM&FBOVESPA S.A. - Bolsa de Valores, Mercadorias e Futuros
(respectively, Novo Mercado Regulations and BM&FBOVESPA).
Article 2 The Companys principal place of business is located in the City of Rio de Janeiro, State of Rio de Janeiro, and the Company
may open branches and agencies in Brazil or abroad.
Sole Paragraph The Company may, upon a resolution of the Executive Committee, open, transfer and/or close branches of any type,
as well as transfer its principal place of business, anywhere in Brazil or abroad.
Article 3 - The Companys corporate objective is the generation, distribution and trading of electric energy and the participation, in the
capacity as partner, quotaholder or shareholder, in the capital of other civil or commercial companies, either in Brazil or abroad,
irrespective of their corporate objectives. In order to meet its corporate objective, the Company may establish subsidiaries under any
corporate form.
Article 6 - The Company is authorized to increase the capital stock up to the limit of 1,200,000,000 (one billion and two hundred million)
common shares, including the shares already issued, irrespective of any amendments to its bylaws.
Paragraph 1 The capital increase will be implemented upon a resolution of the Board of Directors, which will be responsible for setting
forth the conditions for the issue, including the price, term and form of payment. In case of subscription and payment with assets, the
Shareholders Meeting shall be competent to resolve on the capital increase, after hearing the Fiscal Council, if installed.
Paragraph 2 With due regard for the limit of the authorized capital, the Company may issue common shares and subscription
warrants.
Paragraph 3 At the discretion of the Board of Directors, the right of first refusal can be excluded or the timeframe addressed in 4 of
art. 171 of Law No. 6,404/76 can be reduced upon the issuance of common shares, and subscription warrants, the placement of which is
made by means of (i) sale in the stock market or public subscription, or (ii) swap of shares, in a public takeover bid, pursuant to law and
with due regard for the limit of the authorized capital.
Article 7 - At the discretion of the Board of Directors, the Company may acquire its own shares to keep in treasury and to subsequently
dispose of or cancel them, up to the amount of the balance of profits and reserves, except for the legal reserve, without decrease of the
capital stock, with due regard for the applicable legal and regulatory provisions.
Article 8 - At the discretion of the Board of Directors and with due regard for the plan approved by the Shareholders Meeting, the
Company grant, to the benefit of its managers, employees or individuals rendering service to the Company, an option intended to the
purchase or subscription of shares without the shareholders being entitled to the right of first refusal, which option can be extended to the
managers or employees of companies directly or indirectly controlled by the Company.
CHAPTER III
MANAGEMENT
Section I - General Provisions
Article 9 - The Company shall be managed by one Board of Directors and one Executive Committee, in accordance with the duties and
powers granted by the applicable legislation and by these Bylaws.
Article 10 - The investiture of the managers is conditioned to the prior execution of the Instrument of Consent by the Management
mentioned in the Novo Mercado Regulation, as well as to the compliance with the applicable legal requirements. Immediately after taking
office, the managers must inform BM&FBOVESPA about the quantity and characteristics of the securities issued by the Company directly
or indirectly held by them, including their derivatives.
Article 11 - The Annual Shareholders Meeting shall fix the annual overall amount of the remuneration of the Companys management
and the Board of Directors shall resolve on the distribution thereof.
Section II - Board of Directors
Article 12 The Board of Directors will be composed of a minimum of eight (8) five (5) and a maximum of ten (10) members, who may
or may not be shareholders of the Company, elected by the General Shareholders Meeting with a unified term of two (2) years, with reelection allowed.
Paragraph 1 - At least twenty percent (20%) of the members of the Board of Directors shall be Independent Board Members.
Independent Board Member is any member that (i) is not related to the Company in any manner other than through its interest in the
capital stock; (ii) is not a controlling shareholder, spouse or relative up to the second degree of kinship of the controlling shareholder, is
not and has not been, for the past three years, related to the Company or related to the controlling shareholder (persons related to public
education and/or research institutions are excluded from this restriction); (iii) has not been, in the past three years, an employee or
Executive Officer of the Company, of the controlling shareholder or a company controlled by the Company; (iv) is not a direct or indirect
supplier or purchaser of services of products of the Company, to an extent that entails loss of independence; (v) is not an employee or
manager of the company or an entity that is offering or receiving services and/or products to and from the Company, in magnitude that
results in loss of independence; (vi) is not the spouse or relative up to the second degree of kinship of a manager of the Company; or
(vii) does not receive any compensation from the Company of the than the compensation payable to a board member (cash proceeds
deriving from an interest occasionally held in the capital our excluded from this restriction). Any board member elected pursuant to the
terms of paragraphs 4 and 5 of Article 141 of the Corporation Law is also considered an Independent Board Member. The qualification as
independent board member shall be expressly declared in the minutes of the Shareholders Meeting that elects him.
Paragraph 2 Whenever the result of the application of the percentage defined above reflects a fractional number of board members,
this number will be rounded up for the integer number: (i) immediately above it, if the fraction is equal to or greater than five tenths
(0.5); or (ii) immediately below it, if the fraction is smaller than five tenths (0.5).
Paragraph 3 The members of the Board of Directors shall take office upon the execution of the instrument of investiture drawn up in
the Book of Minutes of Meetings of the Board of Directors. The members of the Board of Directors may be removed at any time by the
Shareholders Meeting, and shall remain in their positions until their successors take office.
Article 13 The Board of Directors shall have one (1) Chairman and one (1) Vice Chairman, which shall be elected by the simple
majority of the votes present, in the first meeting of the Board of Directors held immediately after such members take office, or whenever
such positions go vacant. The Chairman and the Vice Chairman shall be appointed for a two (2)-year term. In case of absence or
temporary impairment of the Chairman of the Board of Directors, the Vice-Chairman will assume the duties of the Chairman. In case of
absence or temporary impairment of the Chairman and Vice Chairman of the Board of Directors, the duties of the chairman will be
assumed by another member of the Board of Directors designated by the other members of the Board of Directors.
Sole Paragraph The positions of Chairman of the Board of Directors and Chief Executive Officer may not be held by the same person.
Article 14 - The regular meetings of the Board of Directors shall take place at least six (6) times a year, upon a written notice delivered,
either personally, by email, by facsimile or by international mail, by the Chairmans and/or Vice Chairmans own initiative or at the written
request of any Board member, with prior notice of at least three (3) business days and specifying the date, place and time and informing
the detailed agenda. Failure by the Chairman to call any meeting requested by any Board member within five (5) days from the date of
receipt of the request by any member allows any other member to call the requested meeting. No resolution shall be passed on any
matters that are not expressly included in the agenda.
Paragraph 1 The meetings of the Board of Directors may be called by its Chairman and/or the Vice Chairman without regard for the
timeframe set forth above whenever any urgent matters so require, provided that all other board members are unequivocally aware of it.
The calls may be made by a written notice delivered, either personally, by email, by facsimile or by international mail, in each case with
proof of receipt.
Paragraph 2 Irrespective of the formalities provided for in this article, any meeting to which all Board Members are present will be
considered regular. The attendance of a Board member at a meeting shall constitute a waiver of notice of such meeting, except when the
member attends the meeting for the express purpose of objecting at the beginning thereof to the transaction of any business because the
meeting has not been properly called or convened.
Article 15 - The meetings of the Board of Directors shall be convened in the first call with the attendance of half of its members. If the
Board of Directors fails to achieve the required quorum at such duly called meeting of the Board of Directors, the members present shall
adjourn the meeting to the second (2nd) day from the time such adjournment (duly taking into account any circumstances that may
prevent any member from attending or participating in such reconvened meeting), and shall promptly give written notice to the members
of the time and place at which the meeting shall reconvene. For avoidance of doubt, the quorum requirement above shall also apply to
such adjourned meeting of the Board of Directors.
Paragraph 1 The meetings of the Board of Directors shall be presided by the Chairman of the Board of Directors and any person
appointed by him may act as Secretary. In case of temporary impairment of the Chairman of the Board of Directors, such meetings shall
be presided by the Vice-Chairman of the Board of Directors or, in his absence, by any board member elected by the majority of the votes
of the other members of the Board of Directors, the chairman of the meeting being responsible for designating the Secretary.
Paragraph 2 In case of temporary absence of any member of the Board of Directors, the relevant member of the Board of Directors
may, based on the agenda, express his/her vote in writing, by means of a written letter to be delivered by email to the Chairman or ViceChairman of the Board of Directors, on the date of the meeting or by means of a digitally certified e-mail.
Paragraph 3 Should any position of the Board of Directors go vacant for any reason, the substitute will be appointed by the
Extraordinary Shareholders Meeting for the remainder of the corresponding term of office. For the purposes of this paragraph, the
positions of the Board of Directors may go vacant as a consequence of dismissal, death, resignation, proven impairment or disability.
Paragraph 4 The resolutions of the Board of Directors may be passed upon the favorable vote of the majority of the members present
or who may have cast their votes as provided for by this Article, paragraph 2 of these Bylaws.
Article 16 - The meetings of the Board of Directors shall be preferably held at the companys principal place of business. In exceptional
cases, single members unable to attend in person for any reason may participate in a meeting of the Board of Directors by conference call
or similar communications equipment by means of which all persons participating in the meeting can hear one another, and such
participation shall constitute presence in person at such meeting.
Paragraph 1 Upon adjournment of the meeting, the minutes of the corresponding meeting shall be drawn up and signed by all board
members physically present to the meeting and subsequently transcribed in the Book of Minutes of Meetings of the Companys Board of
Directors. The votes cast by board members remotely present to the meeting of the board or who have manifested themselves as
provided for in article 15, paragraph 2 of these Bylaws shall also be reflected in the Book of Minutes of Meetings of the Companys Board
of Directors and a copy of the letter, fax or e-mail message, as the case may be, contain the vote of the board member shall be attached
to the book immediately after the transcription of the minutes. All members of the Board of Directors shall receive a copy of the minutes
of the Board of Directors without undue delay.
Paragraph 2 The Minutes of Meetings of the Companys Board of Directors containing resolutions intended to produce effects before
third parties shall be published and filed at the commercial registry.
Paragraph 3 The members of the Executive Committee of the Company shall be present at the meetings of the Board of Directors,
when so convened, to report on the course of the business operations of the Company and answer questions by the members of the
Board of Directors. The Board of Directors may allow other persons to attend its meetings, with a view to follow up the resolutions and/or
render clarifications of any nature; such their parties being, however, forbidden to vote.
Article 17 - The primary role of the Board of Directors is the general direction of the Companys business, as well as the control and
inspection of the performance thereof and, especially, in addition to any other duties and signed by law or by the Bylaws:
I. To exert the normative duties of the Company, being entitled to evoke any matter which is not in the scope of the private competence
of the Shareholders Meeting or of the Executive Committee;
II. To outline the general guidelines of the Companys business and to decide on any matter of material significance for the strategy of
the Company, provided, however, that the Executive Committee will be responsible for all decisions related to MPX daily activities as
provide herein;
III. Appointment and dismissal of the members of the Executive Committee including the approval of their respective compensation
package within the pre-approved total amount of compensation by the Shareholders Meeting;
IV. To assign to the members of the Executive Committee their respective duties, attributions and limits of competence not specified in
these Bylaws, as well as to appoint the Investor Relations Officer, with due regard for the provisions of these Bylaws;
V. To resolve, collegially or through its Chairman, on the call of the Shareholders Meeting, when deemed expedient or, in the case of
article 132 of the Corporation Law (Law No. 6404/76);
VI. To inspect the management of the members of the Executive Committee examining, at any time, the Companys books and papers
and requesting information about contracts executed or about to be executed and any other deeds;
VII. To elect and dismiss the independent auditors observing, in the election thereof, the provisions of the applicable legislation. The
external audit company shall report to the Board of Directors;
VIII. To summon the independent auditors to render any clarifications deemed necessary;
IX. To assess the Management Report, financial statements and the accounts of the Executive Committee and to resolve on the
submission thereof to the Shareholders Meeting;
X. To approve the Companys annual business and strategic plan as well as the annual budgets, as prepared and recommended by the
Executive Committee, and amendments thereto exceeding an amount of the higher of (i) a deviation of twenty-five per cent (25%) of the
original amount or (ii) R$250 million provided, however, that the Executive Committee will be responsible for the execution of the annual
business plan and annual budget;
XI. To resolve on the capital increase and the issuance of shares of the Company, with due regard for the limits authorized pursuant to
Article 6 of these Bylaws, stipulating the conditions for issuance, including price and terms for payment, as well as to exclude (or reduce
the timeframe for) the right of first refusal in the issuance of shares, subscription warrants and convertible debentures the placement of
which is made by means of a sale in the stock market or public takeover bid, pursuant to terms provided for by law;
XII. To resolve on the filling of any registration statement for the public offering of the Companys shares;
XIII. To resolve on the acquisition, by the Company, of its own shares or on the launching of put and call options referenced to shares
issued by the Company, to keep in treasury and/or subsequent cancellation or disposal;
XIV. Commencement, modification, cessation or abandonment of the development, origination, implementation and/or operation of (i) a
business operation or activity with an amount in excess of R$200 million, unless approved in the annual business plan or budget, in a
single or a series of related transactions, or (ii) any power generation projects, venture, investment or activity by the Company or any of
its Subsidiaries;
XV. Approval of internal rules of procedure for the Board of Directors;
XVI. Entering into any joint venture, association or other business cooperation involving MPX or any of its Subsidiaries which is of
strategic importance for the Company;
XVII. Approval of the entering into or amendment of any Related Party Transaction with an amount in excess of R$80 million;
XVIII. Approval of acquisition, sale, transfer, lease, disposition of encumbrance, the creation of in rem guarantees or any form of
disposal of the Company or any of its Subsidiaries assets, or the offer of guarantees to third parties on account of obligations incurred by
the Company itself, involving an amount in excess of R$100 million, unless approved in the annual business plan or annual Budget;
XIX. Approval of investments or capital expenditures by the Company or any of its Subsidiaries involving an overall estimated amount in
excess of R$200 million in a single or a series of related transactions, unless this investment has already been approved by the annual
business plan or annual budget of the Company;
XX. Approval of loans, financings, non-convertible debentures, debentures not convertible into shares and not covered by in rem
guarantees, or other indebtedness or commercial papers involving an amount in excess of R$100 million, unless approved in the annual
business plan or budget;
XXI. To define the triple list of companies specialized in the economic assessment of companies for purposes of elaboration of the
appraisal report on the companies shares, in case of cancellation of registration of the company as a publicly held company and
withdrawal from Novo Mercado;
XXII. To file for bankruptcy, judicial or extrajudicial recovery by the Company;
XXIII. To give its opinion with respect to any type of tender offer aiming the Companys shares, by means of a reasoned previous
opinion, disclosed within fifteen (15) days from the publication of the tender offer notice, opining on (i) the convenience and opportunity
of the tender offer vis--vis the interests of the shareholders and the liquidity of their securities; (ii) the impact of the offer on the
interests of the Company; (iii) the announced strategic plans of the offeror for the Company; and (iv) any other point of con sideration the
Board of Directors may deem relevant, as well as the information required by the applicable CVM rules;
XXIV. Approval of the entering into, termination, variation or waiver of any material contract with an overall aggregate value in excess of
R$100 million, unless approved in the annual business plan or budget;
XXV. Approval of the granting or contracting by the Company or its Subsidiaries of any guarantees or other security in relation to any
obligation of the Company or its Subsidiaries or any other person in excess of an amount of R$100 million, unless approved in the annual
business plan or budget;
XXVI. Approval of the execution of power trading activities including participation and public bidding processes and the execution of PPAs
in regulated and free markets and marketing of any uncontracted Ancillary Agreements;
XXVII. Approval of the execution of power purchase agreements for energy back-up involving an amount in excess of R$200 million,
unless approved in the annual business plan or budget;
XXVIII. Implementation of significant changes or modifications to the accounting standards, policies and guidelines applied to the
Company; and
XXIX. Submission of proposals to the Shareholders Meeting regarding the allocation of the Companys profits and for amendments to
these Bylaws.
Article 18 The Chairman of the Board of Directors, or the person designated by the Chairman of the Board of Directors, shall represent
the Board of Directors in the Shareholders Meetings.
Article 19 - For advisory purposes, the Board of Directors may stipulate the formation of technical and advisory committees with clear
purposes and duties, which committees may be formed by members of the Companys administrative bodies or otherwise.
Sole paragraph The Board of Directors shall be responsible for setting forth the norms applicable to the committees, including the
rules on membership, term of office, remuneration, operation, scope and the area of activity.
Section III - Executive Committee
Article 20 - The Companys Executive Committee shall consist of two (2) members, whether shareholders or not, resident in this country
and elected by the Board of Directors, the accumulation of duties by the same executive officer being permitted, being designated Chief
Executive Officer, and Deputy Chief Executive Officer; the function of the Investor Relations Officer will be assigned to either the Chief
Executive Officer or the Deputy chief Executive Officer.
Article 21 - The members of the Executive Committee shall take office upon the execution of the instrument of investiture drawn up in
the Book of Minutes of Meetings of the Executive Committee. The term of office of the members of the Executive Committee shall be of
two (2) years, with reelection being permitted. The Executive Committee shall meet whenever required by the Companys business and
shall be convened by the Chief Executive Officer or the Deputy Chief Executive Officer, with a minimum prior notice of 24 hours, in the
meeting shall only be installed by the presence of all its members.
Paragraph 1 In case of temporary absence of any executive officer, such executive officer may, depending on the agenda, manifest his
vote in writing, by letter or fax surrendered to the other executive officer or even by means of digitally certified e-mail as proof of receipt
thereof by the other executive officer.
Paragraph 2 The members of the Executive Committee may not refrain from performing their duties for a period longer than 30
consecutive days under penalty of losing their office, unless in case of a leave of absence granted by the Executive Committee.
Paragraph 3 The meetings of the Executive Committee may be held by means of a conference call, video conference or any other
communication media. Participating in a meeting as expressed above will be deemed personal attendance to the abovementioned
meeting. In this case, the members of the Executive Committee remotely present to the meeting of the Executive Committee shall cast
their votes by means of a letter, fax or any digitally certified e-mail.
Paragraph 4 Upon adjournment of each meeting, the corresponding minutes shall be drawn up and signed by all members of the
Executive Committee physically present to the meeting and subsequently transcribed in the Book of Minutes of Meetings of the Executive
Committee. The votes cast by members of the Executive Committee remotely present to the meeting of the Executive Committee or who
have manifested themselves as provided for in paragraph 2 of this article, shall likewise be included in the Book of Minutes of Meetings of
the Executive Committee, the copy of the letter, fax or e-mail, as the case may be, containing the vote of the Executive Officer to be
attached to the book right after the transcription of the minutes.
Article 22 - The resolutions made in the meetings of the Executive Committee shall be passed by all votes of the members of the
Executive Committee present to each meeting or who may have cast their votes as provided for in article 21, paragraph 2 of these
bylaws.
Article 23 - It is the duty of the Executive Committee to manage the companys business in general and the performance, to this effect,
of all acts deemed necessary or expedient except for those which, pursuant to law or these Bylaws, the Shareholders Meeting or the
Board of Directors is specifically competent to perform. In the exercise of their duties, the members of the Executive Committee may
carry out all operations and perform all acts required for the pursuance of the objectives of their positions, with due regard for the
provisions of these Bylaws as regards the form of representation, competence to perform certain acts and the general direction of the
businesses set forth by the Board of Directors, including to resolve on the approval and allocation of proceeds, compromise, waive, assign
rights, confess debts, enter into agreements, execute commitments, contract obligations, execute contracts, acquire, dispose of and
encumber movable and immovable assets, offer guarantees, aval guarantees and surety, issue, endorse, pledge, discount, withdraw and
secure bonds in general, as well as to opened, operates and close accounts in credit establishments, with due regard for the legal
restrictions and the ones set forth in these Bylaws.
Paragraph 1 The following are also duties of the Executive Committee:
I.
the day-to-day management, administration and supervision of the Company's business and affairs and all decisions related to the
Company's daily activities in accordance with the Company's business and strategic plan as well as the budget as approved by the
Board of Directors;
II.
III.
IV.
the preparation of the Company's business and strategic plan and budget and making a corresponding recommendation to the Board
of Directors;
the implementation of the Company's business and strategic plan as well as budget as approved by the Board of Directors;
the implementation of the decisions and directions of the Board of Directors;
V.
the legal representation of the Company towards third parties, which shall include to compromise, waive, settle and sign
commitments, assume obligations, invest funds and to execute legal agreements and documents on behalf of the Company;
VI.
approve all necessary measures and perform the ordinary acts of a management, financial and economic nature in accordance with
the provisions set forth in these by-laws and the resolutions approved by the Shareholders Meetings and the Board of Directors'
meetings;
VII.
the preparation and delivery of information relating to the Company's affairs to the Board of Directors as requested by the Board of
Directors;
VIII.
the preparation of the issuance, updates and amendments to the Financing and Investment Policy;
IX.
the preparation of the Company's financial statements for approval by the Board of Directors and be responsible for the bookkeeping
of the Company's corporate, tax and accounting books and records; and
X.
The preparation and recommendation to the Board of Directors of the Companys annual business plan and annual budget with
respect to any financial year in a timely manner as to allow for the passing of a resolution by the Board of Directors during the last
quarter of the respective preceding financial year.
Paragraph 2 It is the duty of the Chief Executive Officer and of the Deputy Chief Executive Officer to guide the performance of the
activities related to the companys general planning, as well as the duties, attributions and powers assigned to them by the Board of
Directors, with due regard for the policy and guidelines previously outlined by the Board of Directors:
I. To call and preside over the meetings of the Executive Committee;
II. To oversee the management duties of the Company, and coordinate and supervise the activities of the members of the Executive
Committee;
III. To suggest, without an exclusive initiative on the part of the Board of Directors, the assignment of duties to each executive officer at
the time of the election;
IV. To represent the Company either as a plaintiff or defendant, whether in or out of court, with due regard for the provisions of article 24
of these Bylaws;
V. To coordinate the personnel, organizational, managerial, operating and marketing policy of the Company;
VI. On an annual basis, to elaborate and submit to the Board of Directors the Companys annual plan; and
VII. To generally manage the corporate matters.
VIII. It is the duty of the Investor Relations Officer, in addition to the duties, attributions and powers vested in him by the Board of
Directors, and with due regard for the policy and guidelines previously outlined by the Board of Directors, to:
(i) represent the Company before the controlling entities and other institutions operating in the capital market;
(ii) render information to investors, to CVM, to the Stock Markets in which the Company deals in its securities and other bodies related
to the activities performed in the capital market, according to the applicable legislation, in Brazil and abroad; and
(iii) keep the registration of the company as a publicly-held company duly updated before CVM.
Article 24 - The Company will be deemed to have incurred obligations when represented as follows:
a) By two (2) members of the Executive Committee acting jointly;
b) By one (one) member of the Executive Committee jointly with one (1) proxy with special powers, duly authorized;
c) By two (2) proxies jointly, with special powers duly authorized; and
d) By one (1) proxy, according to the powers contained in the respective instrument of assignment, in this case exclusively for the
practice of specific acts.
Paragraph 1 - All powers of attorney will be granted in the Companys name by two (2) members of the Executive Committee acting
jointly, except for ad judicia powers of attorney, and shall stipulate the powers assigned, and except for those described in Paragraph Two
herein will have a validity term of one (1) year.
Paragraph 2 - Powers of attorney for legal purposes may be granted for indefinite terms and those granted for purposes of complying
with contractual clauses may be granted for the term of validity of the contract to which they are linked.
CHAPTER IV
GENERAL SHAREHOLDERS MEETINGS
Article 25 - The General Shareholders Meeting shall ordinarily take place within the four (4) months following the end of each fiscal year
and, on extraordinary basis, whenever required by the Companys interests with due regard for applicable provisions and the provisions of
these bylaws as regards the call and installation thereof and resolutions passed therein.
Paragraph 1 The General Shareholders Meetings shall be called with a prior notice of at least fifteen (15) consecutive days and
presided over by the Chairman of the Board of Directors or, in his absence, by the person designated by the Chairman among the
members of the Board of Directors or Executive Committee. In the absence of such designation, the Meeting shall be presided by the
person designated by the General Shareholders Meeting. The Chairman shall invite one of the attending shareholders, or an attorney, to
act as secretary to the meeting.
Paragraph 2 Except for the special hypotheses provided for by law and by these Bylaws, the resolutions of the Shareholders Meeting
shall be adopted by the absolute majority of the votes, the blank votes to not be computed.
Paragraph 3 The minutes of the Shareholders Meetings shall be drawn up as a summary of the facts occurred, including dissidence
and protest, and contain a transcription of the resolutions made, with due regard for the provisions of 1, article 130 of the Corporation
Law.
Article 26 - It is the duty of the Shareholders Meeting, in addition to the other attributions provided for by law, to:
a) Take the managers accounts, examine, discuss and vote the financial statements;
b) Elect and remove the members of the Board of Directors;
c) Stipulate the annual overall remuneration of the members of the Board of Directors and of the Executive Committee, as well as of the
members of the Fiscal Council, if any;
d) Amend the Bylaws and change the Companys corporate purpose;
e) Resolve on the merger, merger of shares, spin-off, amalgamation involving the Company;
f) Approve the granting of stock option plans to its managers and employees and individuals rendering service to the Company, as well as
to the managers and employees of other companies directly or indirectly controlled by the Company, and any amendments thereto;
g) Resolve, according to the proposal submitted by the management, on the allocation of the net profits of the year and distribution of
dividends;
h) Resolve on the increase of the capital stock in excess of the Companys authorized capital;
i) Appoint or replace liquidator(s) of the Company, the suspension of the liquidation status of the Company, as well as the Fiscal Council
to function during the liquidation period;
j) Resolve on the cancellation of the registration of the Company as a publicly-held company before CVM;
k) Resolve on the withdrawal from Novo Mercado, which, if approved, shall be informed to BM&FBOVESPA in writing with a prior notice of
30 days;
l) Resolve on the listing or delisting of the Companys shares in stock;
m) Elect a specialized company responsible for the elaboration of the appraisal report in the case provided for by Articles 37 and 40 of
these Bylaws, from among the companies indicated in the triple list of companies elaborated by the Board of Directors;
n) Approve the capital reduction with distribution of funds and assets to the shareholders;
o) Approve the participation of the Company in a group of corporations (grupo de sociedades);
p) Approve the redemption or amortization of the Companys shares; and
Paragraph 1 Irrespective of any formalities, any regular meeting to which all members of the Fiscal Council are present will be
considered duly convened.
Paragraph 2 The Fiscal Council makes valid resolutions upon the absolute majority of its votes cast by the majority of its members.
Paragraph 3 - All resolutions of the Fiscal Council shall be reflected in the minutes in the corresponding book of Minutes and Opinions of
the Fiscal Council and executed by the members present.
CHAPTER VI
FISCAL YEAR, FINANCIAL STATEMENTS AND PROFIT ALLOCATION
Article 29 - The financial year shall start on January 1st and finish on December 31st and, as regards the financial statements, will
observe the Novo Mercado Regulations of BM&FBOVESPA and the applicable legal provisions.
Paragraph 1 Upon a resolution of the Board of Directors, the Company may (i) draw its balance sheets on a semiannual, quarterly or
shorter basis, and declared evidence or interest over equity capital of the profits assessed in such balance sheets; or (ii) declare interim
dividends or interest over equity capital, to the accrued profit or profit reserve accounts existing in the latest annual balance sheet.
Paragraph 2 The interim dividends distributed and the interest over equity capital may be attributed to the mandatory dividend
provided for in article 31 below.
Paragraph 3 The Company and the management shall, at least once a year, hold a public meeting with analysts and with any other
interested parties to disclose information regarding the economic and financial situation, projects and perspectives of the Company.
Article 30 The accrued losses, if any, shall be deduced from the results of the financial year before any distributions, as well as the
provision for income tax and social contribution on profits.
Paragraph 1 The Shareholders Meeting may distribute to the Managers a participation in the profits corresponding to up to 1/10 of the
profits of the financial year, such distribution to be made with the remaining balance. The distribution of the mandatory dividends to the
shareholders as provided for in paragraph 3 of this article is a requirement for the payment of such participation.
Paragraph 2 The net profit of the financial year shall be distributed as follows:
a) Five per cent (5%) shall, before any other allocation, be used to form the legal reserve, which shall not exceed twenty per cent (20%)
of the capital stock. The allocation of part of the net profits of the fiscal year to the legal reserve shall not be mandatory in any fiscal year
in which the balance of the legal reserve plus the amount of the capital reserves addressed in paragraph 1 of article 182 of the
Corporation Law exceeds thirty per cent (30%) of the capital stock;
b) As suggested by the Board of Directors, part of the net profits may be allocated to the formation of a contingency reserve and a
reversal of the same reserves formed in previous financial years, pursuant to the terms of article 195 of the Corporation Law;
c) Part of the net profits shall be allocated to the payment of the mandatory minimum annual dividend payable to the shareholders, as
provided for in paragraph 4 of this article;
d) In any financial year in which the amount of the mandatory dividend calculated pursuant to the terms of paragraph 4 of this article,
exceeds the realized portion of the profits of the financially year the Shareholders Meeting may, as suggested by the Board of Directors,
allocate the surplus to the formation of a realizable profit reserve, with due regard for the provisions of article 197 of the Corporation
Law;
e) As suggested by the Board of Directors, part of the net profits may be retained based on a previously approved budget pursuant to the
terms of article 196 of the Corporation Law;
f) The Company shall keep a statutory profit reserve denominated Investment Reserve, the purpose of which will be to finance the
expansion of the activities of the Company and/or of any companies controlled and associated to it, including by means of the
subscription of capital increases or creation of new undertakings, which may be constituted of up to one hundred per cent (100%) of the
remainder of the net profit after the legal and statutory deductions and the balance of which, plus the balance of the other profit reserves,
except for the realizable profit reserves and the contingency reserves, may not exceed one hundred per cent (100%) of the Companys
capital stock, duly subscribed; and
g) The balance to be allocated as stipulated by the Shareholders Meeting, with due regard for the legal provisions.
Paragraph 3 The shareholders are entitled to an annual mandatory dividend at least equal to twenty-five per cent (25%) of the net
profit of the financial year, plus the following amounts: (i) the amount intended to form the legal reserve; and (ii) the amount intended to
form the contingency reserve and reversal of the same reserves formed in previous financial years.
Paragraph 4 Pursuant to law, the payment of the mandatory dividend may be limited to amount of the realized net profit.
Article 31 As suggested by the Executive Committee and upon the approval of the Board of Directors, ad referendum of the
Shareholders Meeting, the Company may pay or credit interest on behalf of the shareholders, by way of remuneration of their equity
capital, with due regard for the applicable legislation. Any amounts possibly disbursed on this account may be attributed to the amount of
the mandatory dividend provided for in these Bylaws.
Paragraph 1 Should such interest be credited to the shareholders throughout the financial year and the amount of the mandatory
dividend be attributed to such shareholders, the shareholders will be ensured the right to receive any possible remaining balance. Should
the value of the dividends be smaller than the amount credited to them, the Company may not collect the surplus from the shareholders.
Paragraph 2 Should the amount be credited throughout the financial year, the actual payment of the interest over equity capital shall
occur upon a resolution of the Board of Directors, during the current financial year or in the subsequent financial year.
Article 32 The Shareholders Meeting may resolve on the capitalization of profits or capital reserves, including the ones instituted in
interim balance sheets, with due regard for the applicable legislation.
Article 33 Dividends not received or claimed shall forfeit within three years counting from the date on which they were made available
to the shareholder and shall revert to the benefit of the Company.
CHAPTER VII
TRANSFER OF CONTROL
Article 34 The transfer of the Companys control whether by means of a single transaction or by means of a series of successive
transactions may only be implemented under the suspensive or resolutory condition that the purchaser undertakes to make a tender offer
for purposes of the acquisition of the other shares of other shareholders of the Company, with due regard for the conditions and
timeframes provided for in the prevailing legislation and in the Regulation of the Novo Mercado, in order to guarantee conditions equal to
those guaranteed to the transferring controlling shareholder and, additionally, with due regard for the procedures stipulated by
BM&FBOVESPA and by the Brazilian Securities Commission (Comisso de Valores Mobilirios CVM).
Sole Paragraph The tender offer mentioned in the main section of this article shall also be required in case of an onerous assignment
of the rights to subscribe shares and other securities or rights related to securities convertible into shares that may entail the transfer of
the Companys control and in the event of transfer of control of the company that controls the Company; however, in this case, the selling
controlling shareholder will be obligated to declare to BM&FBOVESPA the value assigned to the Company in this disposal and to attach
documents evidencing such value.
Article 35 The person that acquires the Companys control by virtue of a private stock purchase agreement entered into with the
controlling shareholder involving any amount of shares, shall be required (i) to conduct the tender offer mentioned in Article 35 above,
and (ii) to pay, in the conditions indicated below, the amount equivalent to the difference between the price of the tender offer and the
amount paid per shares eventually acquired in a stock exchange in the six (6) months period prior to the date of acquisition of the
Control, duly updated until the effective payment thereof. Such amount shall be distributed among all the persons that have sold shares
issued by the Company on the same trading session in which the acquirer made the acquisitions of shares, proportionally to the daily sale
net balance of each one, provided that BM&FBOVESPA is incumbent to operationalize the distribution according to its rules.
Article 36 The Company shall not report any transfer of shares to the purchaser of the controlling power or to anyone who may hold
the controlling power for as long as such purchaser or purchasers do not execute the Instrument of Consent of the control is provided for
in the Regulation of Novo Mercado of BM&FBOVESPA.
Sole Paragraph Similarly, no shareholders agreement providing for the exercise of the controlling power may be registered at the
Companys principal place of business for as long as its signatories have not executed the instrument of consent mentioned in this article.
CHAPTER VIII
CANCELLATION OF THE COMPANYS REGISTRATION AS A PUBLICLY HELD COMPANY
Article 37 The cancellation of the registration of the Company as a publicly-held company before the Brazilian Securities Commission
(Comisso de Valores Mobilirios CVM) shall be preceded by a tender offer for the acquisition of shares which shall have, as its
minimum price, at least, the value of the company and its shares determined by means of an appraisal report elaborated by a specialized
company, by using the economic value of the shares as criterion for the appraisal thereof, by means of a well-known methodology of or
based on another criterion to be defined by the Brazilian Securities Commission (Comisso de Valores Mobilirios CVM), as defined in
the Novo Mercado Regulation and pursuant to the applicable legal and regulatory rules. The choice of the specialized company will be
made as provided for by Article 39 of these Bylaws.
Paragraph 1 With due regard for the other terms of the Novo Mercado Regulation of BM&FBOVESPA, these Bylaws and the prevailing
legislation, the tender offer for cancellation of registration shall also provide for the swap of securities of the other publicly held
companies, to be accepted depending on the offer.
Paragraph 2 The cancellation shall be preceded by an Extraordinary Shareholders Meeting specifically resolving on such cancellation.
Article 38 Should the Appraisal Report mentioned in Article 38 be not ready until the Extraordinary Shareholders Meeting called to
resolve on the cancellation of the registration as a publicly-held company, the controlling shareholder, the group of shareholders that
holds the companys controlling power or by the Company itself may inform, in this Shareholders Meeting, the maximum value per share
or lot of thousand shares on which the tender offer will be based.
Paragraph 1 The condition for the tender offer will be that the value assessed in the appraisal report mentioned in Article 37 does not
exceed the value disclosed by the controlling shareholder, group of controlling shareholders or the company itself, in the meeting
mentioned in the main section of this article.
Paragraph 2 Should the value of the shares determined in the appraisal report be in excess of the value informed by the shareholder,
group of controlling shareholders or by the Company itself, the resolution mentioned in the main section of this article will be
automatically cancelled and such information shall be widely disclosed in the markets, unless in case the controlling shareholder expressly
agrees to make the tender offer at the amount assessed in the appraisal report.
Article 39 The Appraisal Report mentioned in Articles 37, 40, 41 and 42 shall be prepared by the specialized company with proven
expertise and independent as regards the decision making power of the company, its managers and/or controlling shareholder, as well as
to meet the requirements of paragraph 1 of article 8 of the Corporation Law, and reflect the responsibility provided for in o paragraph 6 of
the same article.
Paragraph 1 The election of the specialized company is the sole duty of the of the Shareholders Meeting after the submission, by the
Board of Directors, of a triple list, the corresponding resolution to be made, without regard for the blank votes, by the majority of the
votes of the total outstanding shares present in the meeting which, if installed in the first call, may be installed with the presence of
shareholders representing at least 20% of the aggregate Outstanding Shares or, if installed in the second call, may be attended by any
number of shareholders representing the Outstanding Shares.
Paragraph 2 The costs incurred with the elaboration of the report shall be borne by the shareholder or group of controlling
shareholders of by the Company itself, as the case may be.
CHAPTER IX
DELISTING FROM NOVO MERCADO
Article 40 Should the Extraordinary Shareholders Meeting of the Company decide to delist the Company from Novo Mercado of
BM&FBOVESPA, (i) so that its shares be registered for negotiation outside Novo Mercado, or (ii) due to corporate restructuring of the
Company by virtue of which the shares of the company resulting from such restructuring are not admitted for negotiation in Novo
Mercado within one hundred and twenty (120) days from the date of the Shareholders Meeting that approved such transaction, the
shareholder or shareholder group that controls the Company shall make a tender offer for the acquisition of shares held by the other
shareholders at an amount equivalent to, at least, the economic value of the shares as assessed in the appraisal report provided for in
Article 39, with due regard for the applicable legal and regulatory norms.
Article 41 In the event there is no controlling shareholder and the Shareholders Meeting of the Company resolves to delist from Novo
Mercado for the shares to trade outside such listing segment, or due to corporate restructuring by virtue of which the shares of the
company resulting from such restructuring are not admitted for negotiation in Novo Mercado within one hundred and twenty (120) days
from the date of the Shareholders Meeting that approved such transaction, the delisting will be contingent on a tender offer being
launched in the same conditions set forth on the above article.
Paragraph 1 - The same Shareholders Meeting shall define the party or parties responsible for launching the tender offer foreseen
herein, which party or parties, attending the meeting, will be required to undertake express commitment to launch such tender offer.
Paragraph 2 In the event that, in the case of a corporate restructuring by virtue of which the shares of the company resulting from
such restructuring are not admitted for negotiation in Novo Mercado, the party or parties responsible for launching the tender offer are
not defined, the shareholders voting to approve the corporate restructuring transaction will be responsible for conducting the tender offer.
Article 42 The Companys delisting from the Novo Mercado due to default of the obligations contained in the Novo Mercado Regulation
is contingent on a tender offer at an amount equivalent to, at least, the economic value of the shares as assessed in the appraisal report
provided for in Article 40, with due regard for the applicable legal and regulatory norms.
Paragraph 1 The controlling shareholder shall carry out the tender offer set forth in the caput of this Article.
Paragraph 2 - In the event there is no controlling shareholder and the delisting from the Novo Mercado referred to above results from
a resolution by the Shareholders Meeting of the Company, the shareholders voting to approve such decisions which lead to the violation
shall be required to launch a tender offer to purchase the shares of the other shareholders as set forth in Article 41 above.
Paragraph 3 - In the event there is no controlling shareholder and the delisting from the Novo Mercado referred to above results from an
act or fact of the management, the Companys managers shall call a Shareholders Meeting to decide on how to remedy the violation of
the provisions of this Novo Mercado Rules or, as the case may be, to decide for the delisting of the Company from the Novo Mercado.
Paragraph 4 In the event the Shareholders Meeting mentioned in Paragraph 3 above approves the Companys delisting from the Novo
Mercado, the mentioned Shareholders Meeting shall define the party or parties responsible for launching the tender offer foreseen herein,
which party or parties, attending the meeting, will be required to undertake express commitment to launch such tender offer.
CHAPTER X
ARBITRATION
Article 43 - The Company, its shareholders, managers and members of the Fiscal Council (if installed) undertake to solve, by means of
arbitration conducted before the Market Chamber of Arbitration (Cmara de Arbitragem do Mercado), any and all disputes that may arise
between them related or deriving, particularly, from the application, validity, effectiveness, construction, violation and the its effects, of
the provisions of the Corporation Law, these bylaws, the norms published by the Brazilian Monetary Council (Conselho Monetrio
Nacional), the Central Bank of Brazil (Banco Central of the Brasil) and CVM, as well as the other norms applicable to the operation of the
capital market in general, as well as those contained in the Novo Mercado Regulation, in the regulation of the Arbitration Chamber of
Novo Mercado, the Sanctions Regulation and Novo Mercado Participation Agreement.
CHAPTER XI
LIQUIDATION
Article 44 - The Company shall be liquidated and dissolved in the cases provided for by law and the Shareholders Meeting shall be
responsible for establishing the form of liquidation, elect the liquidator and, as the case may be, the Fiscal Council to this effect.
CHAPTER XII
GENERAL PROVISIONS
Article 45 The Company shall observe the shareholders agreement filed at its head office and the members of the board of the
Shareholders Meeting or Board of Directors are forbidden to accept any vote from any shareholder who is a signatory of any
shareholders agreement duly filed at the companys head office which is not in accordance with the provisions of the abovementioned
agreement. Similarly, the company is also expressly forbidden to accept and transfer shares and/or encumber and/or assign the rights of
first refusal in the subscription of shares and/or other securities without regard for the provisions and regulations of the shareholders
agreement.
Article 46 The cases not addressed in these Bylaws shall be handled by the Shareholders Meeting and regulated according to the
precepts of the Corporation Law.
Article 47 With due regard for the provisions of article 45 of the Corporation Law, the value of the reimbursements to be paid to the
dissident shareholders will be based on the equity value reflected in the latest balance sheet approved by the Shareholders Meeting.
Article 48 - The payment of dividends approved by the Shareholders Meeting, as well as the distribution of shares as a consequence of a
capital increase will be made no later than 60 days as of the date of publication of the relevant minutes.
Article 49 The Company may negotiate its own shares, with due regard for the legal provisions and the norms to be issued by the
Brazilian Securities Commission (Comisso de Valores Mobilirios).
Article 50 The provisions of the Novo Mercado Rules shall prevail in relation to the statutory provisions in the event of prejudice to the
rights of the recipients of the tender offers set forth in these Bylaws.
***
ANNEXURE III
PROPOSAL AND JUSTIFICATION FOR THE AMENDMENT OF THE COMPANYS BYLAWS
PROPOSED VERSION
(MARKED UP VERSION AGAINST THE VERSION IN FORCE)
Article 12 The Board of Directors will be composed of a minimum of eight (8) five (5)
and a maximum of ten (10) members, who may or may not be shareholders of the
Company, elected by the General Shareholders Meeting with a unified term of two (2)
years, with re-election allowed.
Article 5 - The Companys capital stock, fully subscribed and paid up, is equal to R$
3.736.568.320,85 (three billion, seven hundred thirty-six million, five hundred sixtyeighty thousand, three hundred and twenty reais and eighty-five cents) R$
4.711.337.093,96 (four billion, seven hundred eleven million, three hundred thirtyseven thousand, ninety three Reais and ninety-six cents) represented by 578.479.962
(five hundred seventy-eight million, four hundred and seventy-nine thousand, nine
hundred sixty-two) 840.106.107 (eight hundred and forty million, one hundred and six
thousand, one hundred and seven) nominative common shares in book-entry form and
with no par value.
JUSTIFICATION
Proposal from the Companys Management for the
amendment of article 12 of the Bylaws in order to
adapt it to the new composition of the Board of
Directors.
Inform that there are no economic effects resulting
from the proposed amendment to article 12 of the
Companys Bylaws of the Company presented herein.
Proposal from the Companys Management for the
amendment of article 5 of the Bylaws in order to
reflect the wording of Article 5 of the Company's
Bylaws in order to reflect the ratification of the
capital increase approved on the Companys Board
of Directors Meeting held on August 1st, 2014.
Inform that there are no economic effects resulting
from the proposed amendment to article 5 of the
Companys Bylaws of the Company presented herein.
ANNEXURE IV
Our compensation strategy is in line with the markets best practices and designed to ensure our competitiveness in relation to our key
rivals and major companies operating in Brazil. The main objective is to reward professionals for their performance ensuring the company
evolves as per the strategic planning we have defined and in alignment with short-, medium- and long-term shareholder returns. We thus
encourage improved management and attract, motivate and retain highly qualified executives, aligning their interests with those of
shareholders.
b.
Compensation - breakdown
(i) description of components of compensation and their objectives
The compensation policy of the Management and of the non-statutory Executive Office of the Company insists of (i) a fixed
component, the maximum amount being set annually by the Ordinary General Meeting (administrators) and by the Board of
Directors (non-statutory office), which may, depending on the case, include direct or indirect benefits; (ii) a variable component;
and (iii) a share based component - stock options - to purchase or subscribe our shares (Stock Options). Each body will have
compensation broken down as described in the items below.
All these components of compensation are intended to enhance teams performance, attract highly qualified professionals for our
management, and retain them.
Board of Directors
Fixed compensation
As of May 2012, as decided by the 2012 annual general meeting, members of the board of directors have been
entitled to fixed monthly compensation (fees) with the purpose of recognizing and reflecting the value of the position
internally and externally.
Variable compensation
Short term
Until April 2012, the short-term remuneration of the Board of Directors was paid upon attendance of board meetings.
From the 2013 fiscal year onwards, it was defined that the Board of Directors would be eligible only to the Fixed
Compensation and the Long-Term Variable Compensation compensation based on shares issued by the Company.
Long term - Compensation based on company shares
Share-based compensation through options to buy or subscribe company shares, which may be granted in two ways:
(i)
By the Shareholders Plan, i.e. options granted by the co-controlling shareholder, Eike Fuhrken
Batista, with shares held by him, therefore not involving any issue of new shares and consequently not
causing dilution of other shareholders equity. These options are granted in favor of certain members of
the executive board and Board of Directors of the Company. With the change of control of the Company
during the 2013 fiscal year, new grants of Shareholders Plan Options were suspended and the current
beneficiaries are awaiting the periods of completion of the agreements still in force.
(ii)
Through annual stock option plans (Company Plans), under the Program Granting Options to Buy or
Subscribe Companys Common Shares, the latest amendment and consolidation of which was voted at
the general meeting held on January 26, 2012 (Program).
Both the Company Program and the Shareholders Plan incentivize directors and key employees and staff to conduct
our business successfully, encourage entrepreneurial and results-oriented culture, and align the Companys
managements interests with those of the Companys shareholders.
For more information, see item 13.4 of the Reference Form.
Statutory and non-statutory board
Fixed Compensation
Managements fixed monthly compensation is determined in accordance with the responsibilities of each position and
in line with best market practices. When appropriate, this compensation may be supplemented by direct or indirect
benefits as follows: medical assistance, dental assistance, life insurance, supplementary life insurance, meal voucher
and food voucher. Fixed compensation is intended to compensate directors/officers for their work in accordance with
their activity and seniority
Variable Compensation
Short term
The statutory and non-statutorys management short-term variable compensation consists of an annual amount
based on the extent to which company targets are reached. Its aim is to provide compensation for results reached by
management in accordance with their performance and returns earned for our company
Long term - Compensation based on company shares
Share-based compensation is established through the granting of Options that may be granted in two ways:
Shareholders Plan and Company Plan, within the scope of the Companys Option Program, both already described
above.
Both the Company Program and the Shareholders Plan incentivize directors and key employees and staff to conduct
our business successfully, encourage entrepreneurial and results-oriented culture, and align the Companys
managements interests with those of the Companys shareholders.
Board of Directors
Statutory Board
Audit Committee
Fiscal Council
Fixed compension
Salary or withdrawal
100,0%
42,1%
0%
0%
Benefits
0%
0,9%
0%
0%
Others
0%
16,6%
0%
0%
0%
40,4%
0%
0%
0%
0%
0%
0%
Company Program
0%
0%
0%
0%
100,0%
100,0%
100%
0%
Variable compensation
Share-based compensation
Total
(iii) Methodology used for calculation and adjustment of each component of compensation
Management compensation is benchmarked against market practices, taking into account the practices used by peer companies
with similar size and characteristics, as well as internal references, which are analyzed on a regular basis. In the case of the
Statutory Board, it is also based on merit and international competitiveness. There is no forecast for adjustment of fees due to
inflation rates or adjustment defined in collective bargaining.
There is no specific methodology for adjustment each of the components of compensation.
(iv) Reasons for composition of compensation
The composition of compensation aims to reflect the responsibility involved in each position, while maintaining competitiveness in
the market. The Company seeks to encourage improved management, and to attract and retain managers while aligning their
interests with those of shareholders by sharing risks in long-term incentives. For the Statutory Board, the use of varied
components of compensation and compensation and the establishment of the largest portion of the compensation through stock
options (granting of Options through the Shareholders Plan). On the other hand, for the members of the Board of Directors, the
use of varied compensation components is made and the establishment of the largest portion of the compensation occurs by
means of fixed compensation, as demonstrated in the table above.
c.
Key performance indicators taken into account to determine each component of compensation
To determine fixed and variable compensation for executive board members, we use market surveys as benchmarks, as well as merit and
the extent to which company targets are met. Compensation of members of the board of directors and committees is also based on
market parameters. Performance is not monitored by indicators. In relation to share -based compensation (stock options), management
compensation reflects the performance and evolution of the value of our companys shares.
d.
Compensation is determined from market surveys to define amounts and takes into account responsibilities, time spent on duties,
competence and professional reputation. Share-based compensation for our companys management is directly linked to share price,
which in turn reflects our companys performance.
e.
How compensation policy or practice aligns with issuers short-, medium- and longterm interests
Fixed and variable compensation together with share-based compensation aims to encourage better management, and to attract and
retain managers, seeking gains through commitment to short and medium-term results.
In addition, stock options plan gives beneficiaries an opportunity to become company shareholders and encourage them to work to
optimizing all aspects that may add to the companys value on a long-term sustainable basis.
f.
The stock options plan granted by the co-controlling shareholder Eike Furken Batista in favor of certain members of management
(Shareholders Plan), as mentioned above, grants stock options issued by ENEVA. With the change of Companys control during the
2013 fiscal year, new grants of the Shareholders Plan Options were suspended and the current beneficiaries are awaiting the periods of
completion of the agreements still in force, as referred to above.
For more information, see item 13.4 of the Reference Form.
g.
Existence of any compensation or benefit related to the occurrence of certain corporate events, such as transfer of
control of the issuer
Not applicable, given that there is no component of management compensation tied to the Company's corporate events.
13.2 Total compensation of the board of directors, statutory board and fiscal council
Total compensation for the current fiscal year (2014) Annual Amounts
No. of members
Board of Directors
Statutory board
Fiscal Council
Total
7,9
2,1
0,0
10,0
Fixed anual
compensation
Salary or
withdrawal
800.000,00
4.049.925,20
0,00
4.849.925,20
Direct and
indirect benefits
0,00
87.537,62
0,00
87.537,62
Attendinf
committees
0,00
0,00
0,00
0,00
Others
0,00
1.592.960,63
0,00
1.592.960,63
0,00
0,00
Description of
other fixed
Contributions to INSS/FGTS
compensation
items
Variable
compensation
Bonus
0,00
0,00
0,00
0,00
Profit sharing
0,00
3.884.092,92
0,00
3.884.092,92
Attendance to
meetings
0,00
0,00
0,00
0,00
Commission
0,00
0,00
0,00
0,00
Other
0,00
0,00
0,00
0,00
Description of
other variable
compensation
items
0,00
0,00
0,00
0,00
Postemployment
0,00
0,00
0,00
0,00
Leaving position
0,00
0,00
0,00
0,00
Based on
shares
0,00
0,00
0,00
0,00
Note
Annual information set for the fiscal year of 2014. The number of members
was ascertained as specified by Official Circular
Letter/CVM/SEP/N01/2014.
Total
compensation
Annual information set for the fiscal year of 2014. The number of
members was ascertained as specified by Official Circular
Letter/CVM/SEP/N01/2014.
800.000,00
9.614.516,37
There is no
forecast up until
now for the
instatement of a
Fiscal Council for
the 2014 fiscal
year.
0,00
10.414.516,37
Total compensation for the fiscal year ended on 12/31/2013 Annual Amounts
Board of Directors
No. of members
Statutory board
Fiscal Council
Total
9,3
3,3
0,0
12,51
497.820,37
3.295.934,69
0,00
3.793.755,06
0,00
139.205,04
0,00
139.205,04
Fixed anual
compensation
Salary or withdrawal
Direct and indirect
benefits
Total compensation for the fiscal year ended on 12/31/2013 Annual Amounts
Board of Directors
Attendinf committees
Statutory board
Total
47.999,98
0,00
0,00
47.999,98
0,00
732.798,40
0,00
732.798,40
0,00
0,00
Others
Description of other
fixed compensation
items
Fiscal Council
Contributions to INSS/FGTS
Variable
compensation
Bonus
0,00
0,00
0,00
0,00
Profit sharing
0,00
397.290,00
0,00
397.290,00
Attendance to
meetings
0,00
0,00
0,00
0,00
Commission
0,00
0,00
0,00
0,00
Other
0,00
0,00
0,00
0,00
Description of other
variable compensation
items
0,00
0,00
0,00
0,00
Post-employment
0,00
0,00
0,00
0,00
Leaving position
0,00
0,00
0,00
0,00
Based on shares
65.116,19
39.824.567,73
Taking the total number of options exercised in 2013, under both the
Shareholders Plan and the Companys Plan. The number of members
was ascertained as specified by Official Circular
Letter/CVM/SEP/N01/2014..
Taking the total number of options exercised in 2013, under both the
Shareholders Plan and the Companys Plan. The number of
members was ascertained as specified by Official Circular
Letter/CVM/SEP/N01/2014.
610.936,54
44.389.795,86
Note
Total compensation
Total compensation for the fiscal year ended on 12/31/2012 Annual Amounts
Board of Directors
No. of
11,50
members
0,00
39.889.683,92
45.000.732,40
Statutory board
Fiscal Council
Total
5,00
3,00
19,50
Total compensation for the fiscal year ended on 12/31/2012 Annual Amounts
Board of Directors
Fixed anual
compensation
Salary or
355.000,00
withdrawal
Direct and
indirect
0,00
benefits
Attendinf
165.000,00
committees
Others
Description of
other fixed
compensation
items
Variable
compensation
Statutory board
0,00
Fiscal Council
Total
4.180.276,66
89.402,00
4.624.678,66
177.096,06
0,00
177.096,06
0,00
0,00
165.000,00
834.473,39
0,00
834.473,39
Contributions to INSS/FGTS
No payment of INSS
Bonus
0,00
0,00
0,00
0,00
Profit sharing
0,00
0,00
0,00
0,00
195.000,00
195.000,00
Commission
0,00
0,00
0,00
0,00
Other
0,00
0,00
0,00
0,00
Attendance to
meetings
Description of
other variable
compensation
items
Postemployment
Leaving
position
Based on
shares
Note
6.216.161,54
18.672.647,84
24.888.809,37
Total compensation for the fiscal year ended on 12/31/2012 Annual Amounts
Board of Directors
Total
6.931.161,54
compensation
Total compensation for the fiscal year ended on 12/31/2011 Annual Amounts
Board of Directors
No. of
8,92
members
Fixed anual
compensation
Salary or
withdrawal
Direct and
indirect
benefits
Attendinf
committees
Others
Description of
other fixed
compensation
items
Variable
compensation
Statutory board
Fiscal Council
Total
23.864.493,95
89.402,00
30.885.057,48
Statutory board
Fiscal Council
Total
5,00
3,00
16,92
0,00
3.807.761,82
69.748,00
3.877.509,82
0,00
173.292,35
0,00
173.292,35
120.000,00
0,00
0,00
120.000,00
0,00
761.552,43
0,00
761.552,43
Contributions to INSS/FGTS
No payment of INSS
Bonus
0,00
0,00
0,00
0,00
Profit sharing
0,00
0,00
0,00
0,00
395.000,00
0,00
0,00
395.000,00
Commission
0,00
0,00
0,00
0,00
Other
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
27.500.757,20
0,00
36.879.598,25
Attendance to
meetings
Description of
other variable
compensation
items
Postemployment
Leaving
position
Based on
shares
Note
N/A
9.378.841,05
Taking the total number of options exercised in 2011, under
both the Shareholders Plan and the Companys Plan. The
number of members was ascertained as specified by Official
Circular Letter/CVM/SEP/N01/2014..
Total compensation for the fiscal year ended on 12/31/2011 Annual Amounts
Board of Directors
Total
9.893.841,05
compensation
Statutory board
Fiscal Council
32.243.363,80
Total
69.748,00
42.206.952,85
Statutory Board
Fiscal Council
Total
2,1
2,1
Amount set forth in the compensation plan, if the goals are reached
2.718.865,04
2.718.865,04
5.049.320,79
5.049.320,79
Amount set forth in the compensation plan, if the goals are reached
3.884.092,92
3.884.092,92
Board of Directors
Statutory Board
Fiscal Council
No. of Members
Bonus
Profit sharing
No. of members
Total
Bonus
Minimum amount set forth for the compensation plan
Amount set forth in the compensation plan, if the goals are reached
R$ 287.000,00
R$ 533.000,00
Amount set forth in the compensation plan, if the goals are reached
R$ 410.000,00
R$ 397.290,00
Profit sharing
R$
287.000,00
R$
533.000,00
R$
410.000,00
R$
397.290,00
There was no variable compensation related to bonuses or participation in results in the fiscal years of 2012 and 2011 for the Board of
Directors, Statutory Board and Fiscal Council of the Company.
13.4 Share-based compensation for the board of directors and statutory
Officers
a.
The Extraordinary General Meeting held on November 26, 2007 approved a stock option program consisting of grant of options to
purchase or subscribe ENEVA common shares for members of the board of directors, senior managers and other Company
employees, as well as those of other companies belonging to the ENEVA Group. This program was altered and consolidated at
general meetings held on September 28, 2010, April 26, 2011 and January 26, 2012.
The latest consolidation of this program determines general guidelines to be considered by our companys management for options
to purchase or subscribe our companys common shares granted to members of the Board of Directors, executive board and
employees, as well as those of other companies belonging to the Group ENEVA . These guidelines state that:
(iii) the total number of shares allocated to the program may not exceed 2% of the total number of shares issued by our company,
not including authorized capital;
(iv) share value will be determined based on the market value of our shares calculated as the simple average of their price over
the 20 most recent trading sessions, counted as of the date - inclusive- of the participants appointment, in all cases taking the
daily average price at close of trading (Share Value).
(v) the price for subscribing or buying shares will be calculated based on the percentage of share value stated in the Option
Agreement and will never be less than 40% or more than 100% of said value (Subscription Price); and
(vi) the responsibility for administering the program was delegated to the board of directors.
Therefore, the board of directors shall:
(vii) decide issues of shares under the program (art. 168, 1, b of the Law of 261 Corporations);
(viii) within the parameters of the program, define periodic plans (referred to in this Reference Form as Company Plans);
(ix) proceed to make any alterations in relation to Company Plans currently in place;
(x) take any other steps required to manage the Company Program, as long as they do not lead to its being altered; and
(xi) propose alterations to the Company Program to be submitted to the approval of extraordinary general meetings.
The board of directors shall also decide on the opportunity and convenience of implementing said periodic plans in each year of the
programs duration, or not doing so. If implemented, plans must at least state: (a) their duration; (b) the maximum number of
Options that may be granted under each plan; and (c) whether or not the trading of shares acquired by the exercise of the Options
will be blocked, and the period stipulated for this blocking.
On the recommendation of its president, the board of directors shall opportunely discuss and decide: (a) proposed participants for
each Plan; (b) the respective quantities of stock Options; (c) subscription or purchase prices; and (d) other conditions for acquiring
the right to exercise the Options.
b.
Both the Controlling Shareholder Plan and the Company Program have the following objectives: (i) align management and shareholder
interest, encourage continuous improvement of management to boost our enterprise value and that of companies under our direct or
indirect control; and (ii) attract, motivate and retain highly qualified executives to our staff and increase the attractiveness of the
Company and ENEVA Group companies.
c.
Both the Shareholder Plan and the Company Program enable their beneficiaries to become our companys shareholders, thus encouraging
them to work to optimize all aspects that may add to the value of the Company on a sustainable basis.
d.
The Companys compensation policy seeks to encourage the professional growth of its managers, employees and service providers, and
value their individual merit. In this sense, the Stock Option Program is in line with the Companys compensation policy as it allows its
managers, employees and service providers to measure their variable compensation in accordance with their personal performance
through the granting of stock options based on that merit.
e.
How the plan aligns the interests of the issuers management with issuer shortmedium-and long-term interests
The Shareholders Plan and the Company Plan stipulate the exercise of options in annual proportions for a period of up to ten years,
depending on the plan. Therefore, managements gains are linked to the performance of our shares until the last period for exercising
options, thus boosting managements commitment to our companys short-, medium- and long-term performance.
f.
Under the Company Program, beneficiaries may be granted options to purchase shares up to the limit of 2% of the total number of shares
issued by our company, computing in this calculation all options already granted but not yet exercised.
The maximum number of shares that may be covered by the Controlling Shareholder Plan is determined by the Controlling Shareholder
itself, and does not follow a pre-established criterion, since such plan does not involve issuing new shares and therefore will not cause
dilution of shares of other company shareholders.
g.
Under the Company Program, beneficiaries may be granted options to purchase shares up to the limit of 2% of the total number of shares
issued by our company, computing in this calculation all options already granted but not yet exercised.
The maximum number of shares that may be covered by the stock option plan granted directly by co-controlling shareholder Eike Fuhrken
Batista (Shareholders Plan) is determined by himself, and does not comply with a pre-established criterion, seeing that such plan does
not entail the issuance of new shares and, consequently, the dilution of the shares of the other shareholders of the Company.
h.
Once the options have been granted, both under the Shareholders Plan and the Company Plan, the manager shall: (i) remain with the
company until the date on which each portion of options vests, saving exceptions stipulated in paragraph 16 of the Program; (ii) state
their wish to exercise portions within the maximum period stipulated in the contract; and (iii) pay the exercise price set for the shares.
i.
Under the Company Program, the option exercise price will be determined based on market value of the shares calculated by the simple
average of the price of the Companys shares in the latest 20 trading days as of the share grant date for a given employees of the
company, in all cases taking closing prices of each trading session. The purchase or exercise price of each share will never be less than
40% or more than 100% of the market value of the shares. Prices may also be updated by IPCA inflation as announced by IBGE.
Under the Shareholders Plan, the purchase price or exercise price is determined at the discretion of the co-controlling shareholder Eike
Fuhrken Batista.
j.
In the Company program, the maximum period for option exercise is stated in the respective stock option contracts. This period shall not
exceed one year as of period of maturity of the last portion of options granted under the respective option contract.
k.
Means of payment
Subscription or purchase of stock options granted under the Program and Plan, as applicable, must be paid cash from the beneficiarys
own funds. The same criteria apply to stock options granted by our controlling shareholder in favor of executives.
For options granted under the Company Program, exceptionally, the Companys board of management may authorize Participants to pay
a minimum portion equivalent to 10% of total subscription price at the time of purchase, with the remaining 90% to be paid within thirty
days of the date of the first payment.
l.
The Shareholders Plan does not allow trading in shares it has granted for 36 months as of signing contracts.
Under the Company Plans, some contracts stipulate restriction on trading shares within three years of signing the contract.
m.
Criteria and events that, when verified, shall cause the suspension, amendment or termination of the plan
The occurrence of factors that cause severe alterations in the economic outlook and compromise the Companys financial condition may lead
to modification or termination of the Program, including in relation to plans already in place and stock options already granted but not yet
exercised. However, note that it is the incumbency of extraordinary general meetings to approve, alter, suspend or terminate the Companys
Stock Option Plan.
n.
Dismissal for retirement for length of service or age: (a) unvested options will be cancelled; and (b) vested options, which were not
exercised yet, may be exercised within 90 days counted from the date of approval by the National Social Security Institute (INSS) of
the request for retirement for length of service or age.
Permanent disability retirement: (a) unvested options will be cancelled upon termination of the employment agreement due to the
granting of permanent disability retirement, and the Company may establish otherwise in specific cases; and (b) vested options, which
were not exercised yet, may be exercised by the disabled participant or his/her legal representative (curator) by presenting to the
Company the respective proof of granting of permanent disability retirement issued by the INSS and respective termination of
employment agreement within 180 days counted from the date of approval by the INSS of the request for permanent disability
retirement.
Dismissal for the Participants death: (a) unvested options will be cancelled after the Participants death, and the Company may establish
otherwise in specific cases; and (b) vested options, which were not exercised yet, may be exercised by the administrator, as duly defined
in the regular probate proceeding, by presenting to the Company the respective administrators commitment agreement, as appointed by
the competent court, within 180 days counted from the appointment of the administrator by the court, or, in the event of extrajudicial
probate proceeding by the office of the notary public, it is hereby agreed that, if the probate proceeding is not initiated within six months
counted from the date of death, the vested options will be also cancelled automatically.
With respect to the Shareholders Plan, the dismissal of the manager implies the loss of unvested options.
13.5 Holdings in shares, units or other convertible securities held by management and fiscal council members - by body
ENEVA Shares
MMX Shares
MMX Debentures
OG Par Shares
OSX Shares
CCX Shares
Board of Directors
155.155
277.500
137.885
139.100
50
34.305
Statutory Board
485.700
Fiscal Council
13.6 Share-based compensation for the board of directors and statutory board
Companys stock option plan
Board of Directors
Statutory Board
Statutory Board
Grant date
(1)
The calculation of the fair value of options takes into account the total number of shares included in the Companys Stock Options Plan that may be subscribed or acquired in the proportion of 20% per year and in the event of full option exercise.
Statutory Board
Grant date
Number of member
Grant of stock options
(1)
The calculation of the fair value of options takes into account the total number of shares included in the Companys Stock Options Plan that may be subscribed or acquired in the proportion of 20% per year and in the event of full option exercise
Number of member
Board of Directors
Statutory
Board
04
11/26/2007
528.000
The options shall be exercised in the proportion of 20% in each of the first five anniversaries of the public offer occurred on December 13,
2007
none
1,01
R$16,03
0,02%
(1)
The calculation of the fair value of options takes into account the total number of shares included in the Companys Stock Options Plan that may be subscribed or acquired in the proportion of 20% per year and in the event of full option exercise.
Number of member
Board of Directors
Statutory
Board
04
11/26/2007
528.000
The options shall be exercised in the proportion of 20% in each of the first five anniversaries of the public offer occurred on December 13,
2007
none
0,96
0,96
R$16,03
0,02%
(1)
The calculation of the fair value of options takes into account the total number of shares included in the Companys Stock Options Plan that may be subscribed or acquired in the proportion of 20% per year and in the event of full option exercise.
Stock Option Plan by Co-controlling Shareholder Eike Fuhrken Batista (Shareholders Plan)
Statutory Board
Grant date
Number of members
Grant of stock options
Board of Directors
Board of Directors
Statutory Board
01
01
05
04/28/2008
04/28/2008
04/28/2008
2.885.400
1.295.940
17.312.640
None
None
None
R$ 0,01
R$ 0,01
R$ 0,01
Number of members
Grant of stock options
Grant date
Quantity of stock options granted
Period for vesting options
Final date for exercising options
Options transfer restriction period
Weighted average price for
period:
(a) Options outstanding at
beginning of year
(b) Options forfeited during the period
R$ 0,01
R$ 0,01
R$ 0,01
R$15,83
R$15,83
R$15,83
None
None
None
Board of Directors
Board of Directors
Statutory Board
01
01
05
Number of members
Board of Directors
Board of Directors
Statutory Board
04/28/2008
04/28/2008
04/28/2008
2.885.400
1.295.940
17.312.640
None
None
None
R$0,01
R$0,01
R$0,01
R$0,01
R$0,01
R$0,01
R$15,83
R$15,83
R$15,83
None
None
None
Board of Directors
Board of Directors
Statutory Board
01
01
05
04/28/2008
04/28/2008
04/28/2008
2.885.400
1.295.940
17.312.640
None
None
None
R$0,01
R$0,01
R$0,01
R$0,01
R$0,01
R$0,01
R$15,83
R$15,83
R$15,83
None
None
None
13.7 - Details of outstanding options held by the board of directors and by the statutory board
Companys stock option plan
Quantity
Vesting date
Quantity
Options vested
Stock Option Plan by Co-controlling Shareholder Eike Fuhrken Batista (Shareholders Plan)
Outstanding options at the end of fiscal year ended 12/31/2013
Board of Directors
No. of members
Statutory Board
1
1.613.276
12/13/2017
R$ 0,01
R$ 2,92
Vesting date
Options vested
Quantity
322.655
12/13/2017
R$ 0,01
Statutory Board
R$ 2,92
R$ 5.652.919,10
13.8 - Options exercised and shares delivered in relation to share-based compensation for the board of directors and statutory officers
Companys stock option plan
Options exercised - Fiscal Year ended 12/31/ 2013
Board of Directors
Statutory Board
Number of shares
Number of shares
Board of Directors
Statutory Board
04
Number of members
Options exercised
Shares delivered
R$0,00
R$0,00
Number of shares
Board of Directors
Statutory Board
04
Number of shares
35.140
R$3,52
R$1.510.317,20
Shares delivered
Statutory Board
Number of shares
Shares delivered
Stock Option Plan by Co-controlling Shareholder Eike Fuhrken Batista (Shareholders Plan)
Options exercised - Fiscal Year ended 12/31/2013
Board of Directors
Statutory Board
01
05
Number of shares
636.092
3.816.612
R$ 0,01
R$ 0,01
R$ 6.354.559,08
R$ 38.127.953,88
Number of shares
Board of Directors
Statutory Board
02
05
Number of shares
547.740
1.731.240
R$ 0,01
R$ 0,01
R$ 6.101.823,60
R$ 19.286.013,60
Number of members
Options exercised
R$ 0,00
R$ 0,00
Statutory Board
02
05
ENEVA
ENEVA
MMX
LLX
182.580
577.080
10.640
10.640
R$ 0,01
R$ 0,01
R$ 0,01
R$ 0,01
R$ 8.488.144,20
R$ 26.828.449,20
R$ 70.862,40
R$ 35.750,40
Statutory Board
R$ 0,00
R$ 0,00
R$ 0,00
R$ 0,00
13.9 Information required to understand figures disclosed in items 13.6 to 13.8 - Pricing method for shares and options
a.
Pricing model
Companys Program
To determine the fair value of the stock options program, the Merton (1973) model, a variant of the Black & Scholes (1973) model,
which takes into account dividend payment, was used.
Stock Option Plan offered by Co-controlling Shareholder Eike Fuhrken Batista (Shareholders Plan)
To determine the fair value of the stock options program of the Companys Program, the Black & Scholes model was used.
b.
Data and assumptions used in the pricing model, including the weighted average price of shares, exercise price,
expected volatility, term of the option, expected dividends and risk-free interest rate
Companys Program
(i) Determination of expected volatility
The limited historical series of quotes of ENEVA shares on the stock exchange does not guarantee a reliable projection of
future volatility of prices from past data. Therefore, the Electric Power Index-IEE, the first sector index released by
BM&FBOVESPA in August 1996, was used as a proxy. The sector indexes are designed to provide a segmented view of the
stock market behavior. The definition of time window to estimate expected future volatility (that is, the extent of the
historical data series examined) was also maintained as equal to the T term of the option to which it will be applied in the
pricing.
(ii) Expected Dividend Rate
ENEVA has not distributed any amounts as dividends or interest on shareholders equity since its incorporation. Therefore,
the hypothesis that dividends will not be paid during the effectiveness of the stock options program was upheld.
(iii) Risk-Free Rate
Reference rates were used for adjustments of SWAP agreements with IPCA coupon, disclosed by BM&FBOVESPA.
(iv) Program Abandonment Rate
There has been no record of abandonment by the executive officers participating in the incentive program since its
establishment.
Stock Option Plan offered by Co-controlling Shareholder Eike Fuhrken Batista (Shareholders Plan)
(i) Determination of expected volatility
To calculate share volatility, in those cases where there was no historical series of share price, an approximation through
average beta of similar companies was used and applied to the Bovespa index.
The definition of time window to estimate expected future volatility (that is, the extent of the historical data series
examined) was also maintained as equal to the T term of the option to which it will be applied in the pricing.
(ii) Expected Dividend Rate
As of the granting date, there was no estimated payment of dividends or interest on shareholders equity. For this reason,
the hypothesis that no dividends will be paid during the effectiveness of the Companys Program was taken into
consideration.
(iii) Risk-Free Rate
The risk-free interest rate was determined based on market forecasts.
(iv) Program Abandonment Rate
There has been no record of abandonment by the executive officers participating in the incentive program since its
establishment.
c.
Method and assumptions used to incorporate the effects expected from early exercise
Companys Program
The Companys Program 1 sets forth that options granted under the Plan may be exercised as follows: (i) 20% per year, at the end
of years 1 to 5, counted from the execution of the corresponding Stock Options Agreement, according to the terms and conditions
established by the Board of Directors and the terms and conditions set forth in the Stock Options Agreements.
Options granted under the terms of the other Companys Plans may be exercised as follows: (i) 10% per year, at the end of years
1 to 4; (ii) 20% per year, at the end of years 5 to 7, counted from execution of the corresponding Stock Options Agreement,
according to the terms and conditions established by the Board of Directors and under the terms and conditions set forth in the
Stock Options Agreements.
Companys Stock Option Plan granted by Co-Controlling Shareholder Eike Furken Batista (Shareholders Plan)
Options granted under the terms of the Plan may be exercised as follows: (i) 10% per year, at the end of years 1 to 10, counted
from the date of ENEVA s initial public offering, December 13, 2007, according to the terms and conditions set forth in the
respective Stock Options Agreements.
For each of the Plans referred to above, the Company determined a period of time in which the beneficiary may exercise the
option. This period is one year, counted from the date of maturity of the option. The Beneficiary may not exercise the option before
this period.
d.
e.
If any other characteristic of the option has been incorporated into the measurement of its fair value
All characteristics of the option were mentioned in the previous items of this Reference Form.
13.10 Information on pension plans provided to members of the board of directors and to statutory directors
The Company does not provide a pension plan to its managers.
13.11 Maximum, minimum and average compensation of the board of directors, statutory board and fiscal council
Board od Directors
Statutory Board
12/31/2014
12/31/2013
7,9
9,3
11,5
2,1
3,3
240.000
96.000
3.112.108
6.410.595
180.000
31.324
70.000
101.266
65.692
602.710
No. of members
Amount of highest
compensation
(Reais)
Amount of lowest
compensation
(Reais)
Average amount of
compensation
(Reais)
12/31/2012
12/31/2014
12/31/2013
Fiscal Council
12/31/2012
12/31/2014
12/31/2013
12/31/2012
5,0
0,0
0,0
3,0
15.933.138
7.629.279
29.801
162.864
991.666
4.011.041
29.801
4.578.341
13.451.453
4.772.899
29.801
Board of Directors
Statutory Board
Fiscal Council
2011
91%
32%
-
2012
91%
0%
-
2013
71%
0%
-
13.14 Compensation of management and members of the fiscal council, grouped by body, received for any reason other
than the office they hold
There was no compensation payment to the Board of Directors or Executive Board members for any reason other than the position they
hold.
13.15 Compensation of management and members of the fiscal council recognized in income of controlling shareholders,
whether direct or indirect, companies under common control and subsidiaries of the issuer
MMX/LLX/ OGX/EBX/OSX (1)
2011
4.693.307
Board of Directors
Officers
Fiscal Council
Others
(1) MMX Minerao e Metlicos S.A.
LLX Logstica S.A.
OGX Petrleo e Gs Participaes S.A.
OSX Brasil S.A.
EBX Investimentos Ltda.
CCX Carvo da Colmbia S.A.
Board of Directors
Statutory Board
Fiscal Council
(A)
(B)
(C)
(A)+(B)+(C)
(D)
(A)+(B)+(C)+(D)
2011
515.000
4.742.607
69.748
5.327.355
5.152.819
10.480.173
2012
715.000
5.191.846
89.402
5.996.248
3.702.157
9.698.405
2013
545.820
4.565.228
0,00
5.111.048
4.338.255
9.449.304
In the case of share-based compensation, it is important to point out that the accounting practices adopted in Brazil and the IFRS, notably
CPC 10 (R1) Share-based compensation (equivalent to IFRS 2), paragraph 12, require the stock option granted to employees, board
members and executives to be shown at fair value, as disclosed by the Company in Financial Statements of 2013, in its explanatory note
No. 22, and of 2012, in its explanatory note No. 23 Share-based payment plan. In this note we showed two tables: the first containing
the accrued position showing the fair value of all options not yet exercised by the participants, and the second, showing the effect on
income (expense) of the fair value of the options ascertained for the period disclosed. Also in the financial statements for 2013 and 2012,
we presented information regarding the accumulated position under liabilities, in explanatory note No. 15 Related parties, item d.
Notwithstanding that, the Company undertakes to inform in the next disclosures, in the Related Parties explanatory note, that the
balances refer to the position of the accrued liabilities of the fair values, calculated on the stock options granted.