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Overview

Corporate Governance Practices

Kepler Weber only has common shares. For further details on your rights, see the Company’s Bylaws.

 

Regulation of Brazilian Capital Market

The Brazilian securities market is governed by the Brazilian Securities and Exchange Commission (CVM), which has the authority to overseeand revisegeneral standards on disciplinary power and management of stock exchanges and financial institutions registered with the CVM, which are members of the Brazilian securities market, as well as by the National Monetary Council (CMN) and the Brazilian Central Bank (BACEN), which have, among others, the power to authorize the creation and operation of brokerage housesand to regulate foreign investments and foreign exchange transactions. The Brazilian securities market is regulated by Securities Law, Brazilian Corporation Law and CVM, CMN and BACEN regulations. These laws and regulations, among other things, determine information disclosure requirements, restrictions on share trading through the misuse of privileged information and stock price manipulation, and protection of minority shareholders. However, the Brazilian securities market does not have the same high level of regulation and oversight as that of the North American securities markets.

Pursuant to Brazilian Corporation Law, a corporation shall be publicly-held if its securities are accepted for trading in the Brazilian securities market, or closely-held if its securities are not publicly traded in the Brazilian securities market. All publicly-held companies shall be registered with the CVM and are subject to the regulatory and information disclosure requirements.

A company

A company registered with the CVM

Companies registered with the CVM may trade their securities on B3 or on the Brazilian OTC market. Companies shall apply for registration with B3 and the CVM so that their shares may be traded on B3. Companies listed on B3 may not trade their shares simultaneously on the Brazilian OTC market. Companies listed on B3 may also trade their shares in private operations, subject to certain limitations.

Use and Disclosure of Information

Pursuant to securities market legislation, we must inform the CVM and B3 of any material act or fact regarding our business. CVM Instruction 358 provides for the use and disclosure of information on material act or fact regarding publicly-held companies, as follows:

Establishes the concept of material fact, including in this definition any controlling shareholders’ decision, resolution of the Shareholders’ Meeting or meetings of publicly-held company’s management bodies, or any other act or fact of a political-administrative, technical, business or economic-financial nature occurred in or related to the company’s business that may materially affect (a) the price of securities; (b) investors’ decision to buy, sell or hold securities; and (c) investors’ decision to exercise any rights inherent in the condition of holder of securities issued by the company;
Gives examples of potential material act or fact, which include, among others, the execution of an agreement or contract for the transfer of the company’s control; addition or removal of a partner that maintains an agreement or operational, financial, technological or administrative collaboration with the company; and any incorporation, merger or spin-off involving the company or related companies;
Obliges the Investor Relations Officer, controlling shareholders, executive officers, members of the Board of Directors, the Fiscal Council and any body with technical or advisory functions to report any material fact to the CVM;
Requires the simultaneous disclosure of material fact in all markets on which the company’s shares are traded;
Obliges the buyer of a publicly-held company’s control to disclose a material fact, as well as announce a possible intention of cancelling the company’s registration as a publicly-held company within one (1) year of the acquisition;
Establishes rules related to the disclosure of acquisition or disposal of relevant interest in a publicly-held company; and
Restricts the use of privileged information. Pursuant to CVM Instruction358, under exceptional circumstances, we may file with the CVM a request for confidential treatment regarding a material act or fact, when our management or controlling shareholders believe that its disclosure would jeopardize the Company's legitimate interest.