THE MAIN TYPES OF ENTERPRISES ESTABLISHED IN BRAZIL

1. Rio de Janeiro Boardof Trade: Structure, FunctionsandOperations • THE MAIN TYPES OFENTERPRISESESTABLISHED IN BRAZIL • Mr. Rubens Brancoda Silva • Member of Rio de Janeiro Board of Trade

2. THE MAIN TYPES OF ENTERPRISES IN BRAZIL • This presentation aims to briefly expose the essential characteristics and procedures regarding the main types of enterprises established in the Brazilian territory, as it follows: Empresa Individual de ResponsabilidadeLimitada - EIRELI (ILL); SociedadeLimitada (LLC); SociedadeAnônima (Corporation/Company); Sociedade em Nome Coletivo (General Partnership); SociedadeemComandita Simples (Limited Partnership); SociedadeemComanditaporAções (Limited Partnership by Shares).

3. EIRELI (LLC) • The Federal Law # 12.441/2011 introduced the “Individual Businessperson with Limited Liability” (EIRELI) to the Brazilian legal system, having added new provisions to the Civil Code (Federal Law # 10.406/02) and considering it a private legal entity.

4. EIRELI (LLC) MAIN CHARACTERISTICS • “EIRELI” means “Individual Businessperson with Limited Liability” and corresponds to the Limited Liability Company (LLC); • Consists of a single holder who owns the totality of the capital share, fully paid, which shall not be less than 100 (one hundred) times the highest minimum wage in force in Brazil; • The holder shall not respond for company’s debts with his personal wealth and assets;

5. EIRELI (LLC) MAIN CHARACTERISTICS • The individual can appear registered in only one EIRELI; • The trade name shall consist of the company name accompanied by the acronym “EIRELI“; • May also result from a merge of quotas from another association type into a single corporate associate; • Can be structured as Microenterprise or Small Business, pursuant the requirements of the Complementary Law # 123/2006. 

6. Sociedade Limitada (LLP) • The “Limited Liability Company” (SociedadeLimitada) is contemplated in the articles 1.052 to 1.087 of the Brazilian Civil Code (Federal Law # 10.406/02).

7. Sociedade Limitada (LLP) II – MAIN CHARACTERISTICS • The Brazilian “SociedadeLimitada” corresponds to the Limited Liability Company(LLC); • Consists of a two or more shareholders that contribute with money or assets valued in money for the generation of capital share; • The liability of the shareholders is limited to the amount of capital share, but are jointly liable for paying the entire capital share  that means the stockholder individually has an obligation related to quotas he/she owns in the total capital, however may be required to pay up the quotas of members who have left to pay them; • It is possible to register a LLC before the respective State Board of Trade as Microenterprise or Small Business once duly respected the requirements established by the Complementary Law # 123/2006.

8. Sociedade Anônima (Corp.) • Legal entities constituted under the type of a “SociedadeAnônima”(Corporate/Company)must observe the requirements contemplated in the Brazilian Federal Law # 6.404/76 (“Corporate’s Law”).

9. Sociedade Anônima (Corp.) MAIN CHARACTERISTICS • The Brazilian “SociedadeAnônima” is also denominated “Company”; • Consists of two or more shareholders of prominent business nature regardless of economic activity developed; • Its capital is divided into shares of equal nominal value, which have free negotiability, limiting the shareholders’ liability at the issuance of price of shares; • The trade name shall consist of the company name accompanied by “Companhia" or “Sociedade Anônima" in full or in its abbreviated form.

10. Sociedade Anônima (Corp.) MAIN CHARACTERISTICS • The company may be classified as open or closed, as distinguishes the article 4 of the Corporation’s Law : • "For the purposes of this law, the company is open or closed as the securities issued by it are or are not admitted to trading on the securities market.“ • The open corporation is the one in which the securities (shares, debentures, participation certificates, etc.) are admitted to trading on the stock market or the Over-The-Counter (OTC) market, and should therefore be registered and have their securities registered within the Securities and Exchange Commission (“CVM”); • The closed corporation does not issue securities admitted to trading in these markets.

11. Sociedade em Nome Coletivo (General Partnership) MAIN CHARACTERISTICS • The Brazilian “Sociedadeem Nome Coletivo” corresponds to the “General Partnership”; • The legal status of the General Partnership is ruled in articles 1.039 to 1.044 of the Brazilian Civil Code; • The totality of members must necessarily be individuals and respond jointly and limitlessly for corporate obligations. However, the shareholders may estipulate liability limits for corporate obligations among themselves, but it will not have any enforcement against creditors; • The management of the company rests solely with the shareholders, being forbidden to appoint a third party to that function. • A General Partnership should adopt a social name, not being allowed to use corporate name.

12. Sociedade em Comandita Simples (LimitedPartnership) MAIN CHARACTERISTICS • The Brazilian “SociedadeemComanditaSimples” corresponds to the “Limited Partnership”; • The legal status of the Limited Partnership is ruled in articles 1.045 to 1.051 of the Brazilian Civil Code; • Consists of the shareholders who have unlimited liability for its social obligations (general partners) and of shareholders that respond only for the payment of their respective shares (limited shareholders); • The company shall be managed by a general partner  In the absence of a shareholder who possesses the quality of general partner, limited shareholders must appoint an administrator, who will assume the condition of membership, to perform management during 180 days; • The limited shareholder that practices management and/or makes use of the company name will be subject to social responsibilities as a general partner, meaning unlimited liability.

13. Sociedade em Comandita por Ações (LimitedPartnershipbyShares) • MAIN CHARACTERISTICS • The Brazilian “SociedadeemComanditaporAções” corresponds to the “Limited Partnership by Shares”; • The legal status of the Limited Partnership by Shares is ruled in articles 280 to 284 of the Corporation’s Law and 1.090 to 1.092 of the Brazilian Civil Code; • The capital is divided into shares: • Shareholders:respond solely for the subscribed or purchased amount by them; • Managers (directors): have unlimited liability due to social obligations; • The director, who must be a shareholder, is appointed for an indefinite period in the Bylaws and has unlimited liability towards the partnership obligations

14. THE MAIN PROCEDURES FOR ESTABLISHING AN ENTERPRISE IN BRAZIL GENERAL STEPS • Registration before the Board of Trade; • Tax Registration before the Brazilian Federal Revenue Office (RFB); • Depending on the nature of the business activities that will be developed, it is also required to register within other agencies such as: • the  State Treasury Office: for granting state and ICMS registrations; • the Municipality: for granting Business Permit and licenses from specific agencies responsible for health, public safety, environment, among others sectors; • the Securities and Exchange Commission (“CVM”).

15. THE MAIN PROCEDURES FOR ESTABLISHING AN ENTERPRISE IN BRAZIL THE CONSTITUTION: STEP-BY-STEP • State Board of Trade and Governmental Agencies: Consultation of trade name and address in order to check if the intended business name had already been claimed (what avoids a change of business’ name after the registering process have been started) and also whether the chosen place has any debts with the Municipality and/or other involved agencies  business’ acts subject to prior approval of governmental agencies, for registration in the Boards of Trade, are listed in Annex of Normative Instruction DREI # 14/2013; • Those type of companies allowed to be registered as a Microenterprise or Small Company, pursuant the requirements of the Complementary Law # 123/2006, should in the occasion of filing the Entrepreneur’s Application at the respective State Board of Trade choose the company structure desired.

16. THE MAIN PROCEDURES FOR ESTABLISHING AN ENTERPRISE IN BRAZIL THE CONSTITUTION: STEP-BY-STEP Brazilian Federal Revenue Office (RFB): Tax Registration in the National Business Register System in order to grant a Corporate Register Number (CNPJ)  this registration can be performed with the filing for the Entrepreneur’s Application in almost all Boards of Trade, what reinforces the practice provisioned by the Brazilian REDESIM  if the local Registration System is not yet connected to national level, this registration should be performed directly before the Brazilian Federal Revenue Office after the filing at the Board of Trade;

17. THE MAIN PROCEDURES FOR ESTABLISHING AN ENTERPRISE IN BRAZIL THE CONSTITUTION: STEP-BY-STEP Secretary of State Treasury: If the company performs industrial or commercial activities then register in the Secretary of State Treasury as taxpayer of the ICMS is mandatory  this registration must be done after filing for the Entrepreneur’s Application in the Board of Trade and the registration on the Brazilian Federal Revenue Office; Municipality: If the company performs service-related activities, the registration at the Municipal’s Taxpayer Registry must be provided (in several cities, according to the Brazilian REDESIM, this registration takes place simultaneously with the Business License)  when meeting all License’s issuance requirements and fulfilling tax registration, the Business License shall be requested and issued before the Municipality.