REFERENCE FORM 2016

(Free translation of FORMULRIO DE REFERNCIA)

_______________________________________________________________

MILLS ESTRUTURAS E SERVIOS DE ENGENHARIA S.A.

Publicly Held Company
CNPJ n. 27.093.558/0001-15 NIRE 33.3.0028974-7
Estrada do Guerengu, 1381, Taquara, CEP 22.713-002
Rio de Janeiro - RJ

MAY 25, 2016

_______________________________________________________________

1.1

- DECLARATION OF THOSE RESPONSIBLE FOR THE CONTENT OF THE FORM

Name of the responsible for the content

of the form:

GUSTAVO ZENO

Title of the responsible:

Administrative Financial and

Investor Relations Officer

Name of the responsible for the content

of the form:

Title of the responsible:

SRGIO KARIYA

Chief Executive Officer

The officers qualified above declare that:

a. They reviewed the reference form.

b. All information contained in the form meets the requirements of CVM Instruction 480, especially arts. 14 to 19.
c. The information contained in the form is true, accurate and complete with respect to the issuers financial situation and the risks inherent in its activities and the
securities issued by it.

2.1/2.2 Identification and compensation of Auditors

Auditor

YES

CVM code

385-9

Auditor type
Name/Social Reason

Nacional
Deloitte Touche
Tomahtsu

CPF/CNPJ

49.928.567/0001-11

Period of service

4/18/2011 a 3/9/2016
In the fiscal year ended 2015 the services provided by Deloitte of independent audit of the financial statements of
Mills Estruturas e Servios de Engenharia S.A. (Company or Mills) for the fiscal year ended 2015, with issuance of
the opinion, and limited review of quarterly financial statements for the periods ended March 31, June 30 and
September 30, 2015, with the issuance of the related reports; In the fiscal year ended 2014 the services provided by
Deloitte of independent audit of the financial statements of Mills Estruturas e Servios de Engenharia S.A. (Company
or Mills) for the fiscal year ended 2014, with issuance of the opinion, and limited review of quarterly financial
statements for the periods ended March 31, June 30 and September 30, 2014, with the issuance of the related
reports; and services related to the release of previously agreed procedures (PAP) about the financial statements
ended December 31st of 2013 of the investee Rohr S.A Estruturas Tubulares.
In the fiscal year ended 2013 the following services were provided by Deloitte: (i) independent audit of the financial
statements of Mills Estruturas e Servios de Engenharia S.A. (Company or Mills) for the fiscal year ended 2013, with
issuance of the opinion, limited review of quarterly financial statements for the periods ended March31, June 30 and
September 30, 2013, with the issuance of the related reports, and limited review of Industrial Services financial
statements for the purpose of its disposal.

Descripition of contracted service

In the fiscal year ended in December 2014, the Company registered R$ 366.4 thousand of fees paid to Deloitte,
referring to limited reviews of financial statements and the Audit Report of that year. In the fiscal year ended in
December 2014, the Company registered R$ 448.0 thousand of fees paid to Deloitte, referring to limited reviews of
financial statements and the Audit Report of that year and
Total amount of remuneration of auditors separated by ; R$ 30.2 thousand related to the release of previously agreed procedures (PAP) about the financial statements
offered services
ended December 31st of 2013 of the investee Rohr S.A Estruturas Tubulares.

Replacement justification

Periodic rotation of auditors, in the form of CVM 308/99 Instruction.

Not applicable

Reason presented by the auditor in the event of a

discrepancy between the statement of issuer
Period of service
Name of the technician responsable
CPF
Fernando de Souza Leite

8/6/2014 a 3/9/2016

Adress
Avenida Presidente Wilson, 231, Centro, Rio de Janeiro, RJ, Brasil,
CEP 20030-021, Telefone (21)

004.400.929-14
39810500, Fax (21) 39810600, e-mail: feleite@deloitte.com

Auditor?

YES

CVM code

418-9

Auditor type

Nacional

Name/Social Reason

KPMG Auditores Independentes

CPF/CNPJ

57.755.217/0022-53

Period of service

28/03/2016

KPMG was hired to audit the financial statements of Mills Estruturas e Servios de Engenharia S.A.
Description of contracted service
Total amount of remuneration of auditors separated by
offered services:
It hs not made any payment to KPMG, since the contract started on 3/28/2016

Replacement justification

Reason presented by the auditor in the event of a

discrepancy between the statement of issuer
Period of service
Name of the technician responsable
CPF

Luiz Claudio F de Araujo

28/03/2016

Endereo
Avenida Almirante Barroso, 52, 0, Centro, Rio de Janeiro, Brasil, CEP
20031-000, Telefone (21)

079.525.807-01
35159400, Fax (21) 35159000, e-mail: lcaraujo@kpmg.com.br

2.3 Other relevant information

2.3 Other relevant information:

At the meeting of Board of Directors held on April 8, 2011, it approved the replacement of PricewaterhouseCoopers, Deloitte Touche Tohmatsu, as from the first quarter of
fiscal year 2011, as independent auditors Company, in compliance with the rotation provided for in CVM Instruction 308 of May 14, 1999, as amended.
At a meeting of the Board of Directors held on March 28, 2016, approved the replacement of Deloitte Touche Tohmatsu, KPMG Independent Auditors, as from the first quarter
of fiscal year 2016, as independent auditors Company, in compliance with the rotation provided for in CVM Instruction 308 of May 14, 1999, as amended.
3.1 Financial Information

Stockholders equity (in thousands

of R$)

Total Assets (in thousands of R$)

Net revenues (in thousands of R$)
Gross profit (in thousands of R$)
Net income (in thousands of R$)
Number of shares, excluding
treasury
Book value per share (in R$)
Earnings per Share (in R$)

2013

For the Year ended December 31

2014

1.016.513

1.059.397

962.231

1.801.245
832.262
497.328
172.592

1.892.723
794.166
431.786
64.268

1.637.957
576.106
232.327
(97.801)

126.955.111

127.816.990

125.779.503

7,98
1,35

8,27
0,50

7,65
(0,78)

2015

3.2 Non accounting measures

EBITDA
EBITDA is a non-accounting measurement adopted by the Company, reconciled with its financial statements, in accordance with CVM Instruction n o 527/2012 of October 4th, 2012,
as applicable. The Company has calculated its EBITDA as net earnings before financial results, the effect of depreciation of assets and equipment used for rental, and the amortization
of intangible assets. EBITDA is not a measure recognized under BR GAAP, IFRS or US GAAP. It is not significantly standardized and cannot be compared to measurements with
similar names provided by other companies. The Company has reported EBITDA because it is used to measure its performance. EBITDA should not be considered in isolation or as
a substitute for "net income" or "operating income" as indicators of operational performance or cash flow, or for the measurement of liquidity or Companys debt repayment capacity.
Reconciliation of EBITDA with Operational Earnings:

For the Year ended December 31

2013

2014

2015

(in thousands of R$)

Operating income before financial result

293.853

157.938

(65.578)

(+)Depreciation and amortization

136.888

168.259

169.641

EBITDA

430.741

326.197

104.063

Reasons for using the EBITDA

EBITDA is used as a performance measurement by the Companys Management, reason why it is important to be included in this Reference Form. The Company believes that the
EBITDA is an efficient measurement to evaluate the performance of operations, as an indicator that is less impacted by interest rates fluctuation, changes in the rates and chances of
incidence of the corporate income tax (IRPJ) and social contribution on net profits (CSLL) and depreciation levels.
Return on Invested Capital
Return on Invested Capital (ROIC) is a non-GAAP measurement elaborated by the Company. It is calculated as Operating Income before financial results and after the payment of
income tax and social contribution (theoretical 30% income tax rate) on this income, includes remuneration from affiliates, divided by average Invested Capital. ROIC is not a measure
recognized under BR GAAP, and it is not significantly standardized and cannot be compared to measurements with similar names provided by other companies.
ROIC: (Annual Operational Income (30% Income Tax Rate) + remuneration from affiliates) / Average Invested Capital of the last thirteen months.
For the Company, invested capital is defined as the sum of its own capital (net equity or shareholders equity) and capital from third parties (total loans and other liabilities that carry
interest, from banks or not), both being average capital from the beginning to the end of the period considered.
ROIC calculation from the Operating Income

293.853
(88.156)
1.541

For the Year ended December 31

2014
(in thousands of R$, except when percentages)
157.938
(47.381)
1.273

(65.578)
19.673
1.546

207.238

111.830

(44.359)

() Average invested capital .......................................................

(=) net equity (2) .........................................................................
(+) capital from third parties (3) ...................................................
(-) Cash and Cash equivalents .................................................

1.471.402
943.023
619.452
91.073

1.675.840
1.058.376
722.302
104.838

1.505.823
1.026.158
660.509
180.844

ROIC (%).......................................................................................

14,10%

6,67%

-2,9%

2013
Operating Income before financial results .....................................
(+) Income tax and CSLL provision (1) ............................................
(+)Remuneration of affiliated companies
Operating profit before financial income, after taxation and remuneration of affiliated companies
......................................................................................................

2015

________________________________________
(1) Theoretical rate of 30%.
(2) Comprising shareholders equity.
(3) Comprising total loans and other liabilities that carry interest.

Reasons for using ROIC as a performance measure

ROIC is used by the Companys Management as a measure of return to its shareholders, which is why the Company believes it is important its inclusion in this Reference Form. The
Company believes that ROIC indicates the level of wealth generated by the Company from its sources of funds, reflecting adequately the return on investment for its shareholders.
The Company also considers that, since ROIC is based on operating profit before financial result, it provides a more reliable measure of the wealth generated by its operating activities.
ROIC should not be considered solely or as a substitute for net income or operating income as indicators of the Companys performance or return effectively earned by investors.

3.3

Events subsequent to the latest financial statements

The Board of Directors on February 5, 2016, approved by unanimous vote and without any reservations or restrictions, except for the member who said prevented the increase in the
Company's capital stock, within the authorized capital limit, with the possibility of partial approval, through the issuance, for private subscription of new common shares issued by the
Company, in accordance with the following terms and conditions indicated:
Value of the Capital Increase: at least R $ 105,435,311.36 (105.435 million three hundred and eleven reais and thirty-six cents) and a maximum of R $ 124,999,999.71 (one hundred
and 24.999 million nine hundred and ninety-nine reais and seventy one centavos) through the private placement of a minimum of 40,089,472 (forty million eighty-nine thousand, four
hundred and seventy-two) and a maximum of 47,528,517 (47,528,000 five hundred and seventeen) common shares, with no par value.
Issue Price: R $ 2.63 (two reais and sixty-three cents) per share. The issue price per share was set without unjustified dilution for the existing shareholders of the Company, pursuant
to Article 170, paragraph 1, item III, of the Law of Corporations, based on the price of the Company's shares on the stock values, considering the average price (average of the
weighted daily closing prices by trading volume) of the Company's shares on the BM & FBovespa SA - Securities, Commodities and Futures Exchange in trading sessions between
conducted between November 27, 2015 (inclusive) and February 4, 2016 (inclusive), a criterion which, in the opinion of the Board, best fits the current reality of the Company.
Objectives of the capital increase: The capital increase aims to (a) strengthen the Company's capital structure, strengthening its cash to meet the medium and long-term capital needs
for the development of its activities; (B) strengthen the Company's liquidity levels and reduce its debt margins; and (c) enable the Company to take advantage of market consolidation
opportunities that may arise in the medium term.
There were receipts relating to the capital increase now disclosed on the date of February 5, 2016 the following shareholders on the dates of 24 and 25 February 2016.
Number of shares

Value of the new shares

(in thousands)

(in R$ thousands)

Shareholders
Controlling shareholders

15.209

39.999

The actions described above to the reporting date of the consolidated financial statements for the year ended 12/31/2014 were unsubscribed.
3.4

Policy for allocation of results

Rules on retention of profits

Amounts of the retention of profits

Exerccio social encerrado em 31 de dezembro de

2013
2014
2015
In provision introduced In addition to the In addition to other
on February 8, 2010, cases provided by the cases provided by
the Companys bylaws law,
as
provision law, as provision
provide that up to 75% introduced
on introduced on
of the adjusted net February 8, 2010, the February 8, 2010, the
income for the year Companys
bylaws Company's bylaws
could be allocated to provide that up to 75% provide that up to
the expansion reserve, of the adjusted net 75% of adjusted net
as
long
as
the income for the year income may be
recorded amount in could be allocated to allocated to the
such reservation does the expansion reserve, expansion reserve,
not exceed 80% of its as
long
as
the provided that the
capital.
recorded amount in amount recorded in
such reservation does such reserve does not
not exceed 80% of its exceed 80% of its
capital.
share capital.
At
the
Ordinary At
the
Ordinary At the Annual General
Shareholders Meeting Shareholders Meeting Meeting held on April
held in April 25, 2014, held in April 28, 2015, 28, 2015, it approved

it was approved the

constitution
of
statutory reserves in
the net income in the
amount of (i) R$
118,273,166.08 of net
income retention, that
will be used to defray
part of the planned
investments in the
Companys
capital
budget to acquire
equipment
for
expansion
and
investment in facilities
and
information
technology to support
the
planned
expansion; and (ii)
R$8,629,606.52
destinated to the Legal
Reserve.

Arrangements for distribution

of dividends

The
Companys
shareholders
are
entitled to receive the
mandatory minimum
dividend of 25% from
the
adjusted
net
income
(after
allocation to the legal
reserve).
At
the
Ordinary
Shareholders Meeting
held in 2014, it was
approved the payment
of 25% of the adjusted
net income recorded in
2013
to
its
shareholders,
as
dividends and interest
on capital.

it was approved the

constitution
of
statutory reserves in
the net income in the
amount of (i) R$
33,567,832.00 of net
income retention, that
will be used to defray
part of the planned
investments in the
Companys
capital
budget to acquire
equipment
for
expansion
and
investment in facilities
and
information
technology to support
the
planned
expansion; (ii) R$
3,213,392.43
destinated to the Legal
Reserve; and (iii) R$
2,405,624.23
destinated
to
expansion Reserve.
The
Companys
shareholders
are
entitled to receive the
mandatory minimum
dividend of 25% from
the
adjusted
net
income
(after
allocation to the legal
reserve
At
the
Ordinary
Shareholders Meeting
held in 2014, it was
approved the payment
of 39% of the adjusted
net income recorded in
2014, higher percent
than the mandatory
dividend under the
form of interest on
equity.

the establishment of
statutory reserves on
net income in the
amounts (i) R $ 0.00
Retained earnings,
which will be used to
cover part of the
investments planned
in budget Company's
capital in the
acquisition of
equipment for
expansion and
investments in
facilities and
information
technology to support
the planned
expansion; (ii) R $
0.00 for the legal
reserve; and (iii) R $
0.00 for the
Expansion Reserve.

The Company's
shareholders are
entitled to receive the
mandatory minimum
dividend of 25% of
adjusted net income
(after allocation to the
legal reserve).

The Company can

distribute Interest on
Capital, through a
Board of Directors
resolution
and
attribute
it
to
mandatory dividends
as well.
Frequency of dividend
distribution

The dividends are

distributed according
to the deliberation
from the Companys
AGO.

The dividends are

distributed according
to the deliberation
from the Companys
AGO.

Dividends are
distributed as decided
by the Annual General
Meeting. The
Company may
distribute interest on
capital, by resolution
of the Board of

Restrictions to dividend
distribution

3.5

No restrictions.

Directors, and charge

the amount distributed
to the mandatory
dividend.
No restrictions.

No restrictions.

Summary of distributions of dividends and retained earnings occurred

Fiscal Year ended December 31

In R$

2013

2014

2015

Adjusted net income

163,962,523.90

61,054,456.23

0.00

Total dividend distributed

46,497,455.75

25,081,000.00

0.00

Dividend distributed amount

3,483,455.75

43,014,000.00

25,081,000.00

0.00

30/4/2014

5/6/2015

25.0%

39.03%

17.0%

5.76%

118,273,166.08

33,567,832.00

4/25/2014

4/28/2015

Dividend payment date

4/30/2014

Interest on Capital amount

Interest on Capital payment date
Percentage of divided distributed
over adjusted net income
Return rate regarding the net equity
of the issuer
Net Income retained
Date of approval of the retention

realization of the special goodwill reserve in the amount of R $ 808,000 in 2013.

3.6

Dividends declared on account of retained earnings or reserves

The dividends presented in the chart of item 3.5 were declared in the net income of the last three fiscal years.

3.7 - Debt

Social Exercise

12/31/2015

Sum of current liabilities

and non-current

Type Index

675.726.000 Debt ratio

Reason to use the Net debt/EBITDA ratio

0,702249252 Current liabilities plus non-current / equity

Net debt on EBITDA
The Net debt/EBITDA ratio is used by the Companys
management as a debt measure and there are clauses in
bank credit contracts and other debts instruments that
require the observance of the financial indicator, among
others. The management believes that the Net debt/EBITDA
ratio consists in an efficient debt level and payment capability
indicator of the Company.

For the year ended December 31, 2015 in R$ thousands,

except percentages.

Gross Debt
R$ 620.8 millions
(-) Availabilities
- R$232.0 millions
Net Debt
R$ 388.8 millions
() LTM EBITDA Adjusted with non-recurring items
R$ 186.7 millions
Net debt on EBITDA (the Companys debt payment
capacity)
2,1 x

3.8 Obligations of the Company

Social Exercise (12/31/2015)
Type of obligation
Type of guarantee
Unsecured
Collateral
Unsecured
Total

Less than one year

28,011,236.00
3,184,780
186,633,718
189,818,497

Between one and

three years

18,959,222.80
6,276,318
259,658,466
265,934,785

Between three and

Five years

2,347,222.80
5,054,502
159,426,156
164,480,657

Over 5 years

5,574,654.15
599,724
599,724

Total

54,892,335.75
15,115,324
605,718,340
620,833,664

3.9

Other information that the Company deems relevant

There are other relevant information pertaining to this item 3.

4.1

Risk Factors

a.

to the Company.

Companys activities consist of providing solutions and assistance to demand of several economy
sectors, specially in civil construction, oil and gas and industrial segments. Consequently, its
operations are subject to similar risks faced by other companies of the sector.
The Heavy Construction business unit offers customized solutions to companies involved in the
implementation of large infrastructure projects, while the Real Estate business unit provides services to
residential and commercial construction companies. The products offered by Rental business unit are leased
to companies operating in a broad number of industrial segments. Consequently, the Companys financial
condition and results of operations are directly linked to the growth and performance of these several
industries, and the Company is exposed to many of the risks faced by companies operating in these
industries.
Events that may negatively affect these industries in such sectors, includes macroeconomic factors, adverse
climate conditions, deterioration of the Brazilian social conditions, decreases in investment, changes to laws
and regulations that adversely affect these industries, credit restrictions, supplier problem, reductions in client
purchasing power, and difficulties in the management of the clients business, among others, are beyond the
managements control and may cause an adverse material effect on the Companys operations and results.
Additionally, the Company presents relevant exposure in its revenues to companies related to the ongoing
investigations known as Car-wash operation. Consequences of investigations may include reduction or
even extinction of companies involved, which can bring delays on current construction works, lower future
construction activity and, consequently, lower demand for equipment and services of the Company.
The Companys equipments are needed on projects with construction methods that require onsite concrete.
In case there is significant modification in construction firms to other construction methods, as, for instance,
steel or pre-molded structures, the demand for Companys equipment and services can be reduced.

The Company may not be able to fully implement its business strategy
The continued growth depends on several factors, many of them are beyond the Companys control. In
particular, the Companys strategy for the expansion of its business units depends on, specially, the
performance of civil construction and industrial sectors in the next years in Brazil. The performance depends
on private and public investments to improve Brazilian infrastructure in several areas, such as energy,
sanitation, transportation and housing, including housing program Minha casa minha vida and the package
of projects which includes the Package of Logistics Investments - Programa de Investimentos em Logstica,
among others. In case these investments are not implemented, delayed or generate a lower demand than
expected, the Company may not be able to implement its expansion strategy adequately.
The organic growth strategy of Rental business unit includes, yet, activities for geographic expansion,
counting with opening of new branches. The Company may not be able to successfully establish business
in different cities and regions of Brazil due to several factors, as, for instance, skilled labor shortage, lack of
reliable suppliers in the local, local competitors, expensive and hard to find terrains, licensing term, and
difficulties to brand acceptance. Even though geographic expansion comes to happen, the Company is
subject to new local economy risks.

Additionally, the Companys future performance will depend on its ability to manage the growth of its
operations. The Company cannot warrantee that it will be able to manage its growth successfully, or that this
growth will not have an adverse effect on its existing business. If the Company is unable to manage its
growth, it may lose its leading market position, which could have a material adverse effect on its financial
condition, results of operations and the negotiation price of its shares.
With operations growth current facilities may become insufficient to store our equipment and provide space
to maintenance and handling of the equipment in an efficient way, which can result in an increase of our
operational costs or a need of moving to new facilities. In case of moving, Company may suffer increase in
rental costs, incur termination fines and may necessitate a supplementary improvement investment on the
new branches.
Adverse conditions in the financial and credit markets, or the Companys failure to secure financing
on adequate terms, may adversely affect its ability to run its business or to implement its strategy.
The implementation of the Companys expansion strategy, as well as the maintenance of its operational
capacity, could demand additional investments and require additional capital, which may not result in an
equivalent increase in its operating income. In addition, the Company may face an increase in operating
costs as a result of other factors, as, for instance, shortages of raw materials, equipment or skilled labor,
increased equipment costs and increased competition in the segments in which it operates. The Company
may need to raise additional funds through securities offerings, including offerings of its shares or debt
instruments, or through credit financings, in order to meet its future capital needs. The Company may not be
able to secure such funds on favorable terms, or at all.
The Company future capital needs will be determined by a number of factors, which includes growth rate of
its revenues, cost and significance of future acquisitions, and expansion of its business operations.
Depending on the investment volume needed, or of costs that may incur, the Company may be forced to
increment cash flow and/or search alternate sources of funds, including creating strategic partnerships. Anny
effort to increment cash flow, by increasing sales, costs reduction, more efficient receivables charge, and
inventory reduction, can be unsuccessful. In addition, the Company may not be able to raise funds to finance
the Companys operations on favorable terms, in which case it may be unable to take advantage of future
opportunities, to react to an increase in competition, or to meet its existing debt obligations. Any of the events
mentioned above could have a material adverse effect on its financial condition, operation results and the
negotiation price of its shares.
The current funding lines from the Company represented, on December 31 of 2015, total debt of R$ 620.8
million. Pursuant to the terms of the Companys existing financing agreements it must comply with certain
conditions which restrict, among other things, its ability to incur additional debt, pay dividends and carry out
capital reductions. As a result of these restrictions, the Company may have difficulty in securing additional
financing to run its operations. New financing contracts may require even more severe restrictions.
In addition, some of the Companys clients are dependent on the credit availability to finance their
investments. A scenario of credit shortages and high interest rates may adversely affect its clients ability to
fund their projects and, consequently, purchase the Companys services, which may have a material adverse
effect on its financial condition and results of operations.
The Company is also exposed to the fact that counterparts to its financing agreements may be prevented
from fulfilling their obligations toward the company, should they go bankrupt or into receivership due to a
sharp decrease in their liquidity levels, so great that such institutions may be prevented from fulfilling their
obligations. The Companys difficulty in the credit scarcity may also adversely affect its suppliers. Therefore,
should the Companys financial counterparts or suppliers be unable to satisfactorily meet their obligations
under the terms of the Companys existing agreements, the Company may need to secure alternative
financing and/or approach alternative suppliers in order to meet its own obligations toward its clients. Such
events could also lead to litigation with its partners or clients, which could have a significant adverse impact
on its reputation, operation and financial condition.
Service cycle leads the Company to apply significant financial and technical resources even before
engaging.
Companys services require high level of initial investment, directed to new process development and,
mainly, to machinery and equipment acquisition which will be used in clients operation, besides the constant

improvement of employees. Some of these investments are performed without any assurance that the
company will be hired in a continuous base to provide service. Thus, the company is particularly vulnerable
to its equipment idleness, until it is reallocated in a project.
The loss of members of the Companys management team may have a material adverse effect on its
operations.
The Companys current market position and its ability to maintain this position is largely dependent on the
skill of its highly experienced management team. None of the Companys executive officers are subject to
long-term employment contracts or non-compete agreements.
The Company cannot guarantee that it will be able to retain its current executive officers or hire other qualified
professionals. The loss of a few of the Companys senior executive officers, or its failure to attract and retain
experienced professionals, may adversely affect its business.
Flaw in asset management can affect credibility and profitability of the Company.
As a rental Company, it needs to manage efficiently its assets, being in investment and disinvestment
decision or in its equipment rental contracts, equally both.
The Company performs investment and disinvestment based on a demand forecast for its services. In case
this forecast does not happen or changes, the Company may have increase on its idle capacity, affecting its
profitability in terms of return on invested capital, or loss of market share.
In its rental contracts, the Company counts the amount of rented equipment in delivery versus the amount
returned. In case the Company is not efficient in account of rented spare parts, it can have its credibility
affected by charging its clients improper compensation or having not enough equipment to replace lost or
broken equipment, if it charges lower than payable.
All of the Companys business units face significant competition in the markets in which they
operate.
The Company faces strong competition in all of the segments in which it operates. Moreover, the Company
may be exposed in the future to additional competition from new market players, as well as from foreign
competitors entering the Brazilian market. The Company operates in a fragmented market which
demonstrates considerable potential for growth and is served by a substantial number of companies offering
less sophisticated and, therefore, less cost services. The Companys clients decision to hire a particular
service provider is influenced by a number of factors, including the quality of the services, the reliability of
the contractor and its ability to offer innovative solutions, and the price charged for the services required. The
Companys competitors are making substantial efforts to improve their market positions and the Company
may lose certain clients to these competitors, including long-standing clients that regularly employ its
services.
In addition, if construction companies and industries create new in-house departments to complement their
core operations, and no longer require the Companys services (or even to compete with the Company).
Competition could also come from substitute products, such as scaffolding, stairs and other types of access
equipment, in the case of motorized access equipment. All these events can lead to a reduction in demand
for Companys services, and a potential increase in competition, which may adversely affect its market stock
price and results of operations.
The development of engineering solutions and technological innovations which add value to the
Companys services is critical to the protection of its leading market position and to the expansion
of its business.
Due to the nature of the Companys business, it must remain abreast of the latest engineering solutions and
technological innovations in its industry. The Company must employ qualified personnel, maintain an
adequate infrastructure, and expand relationships with suppliers that have a successful track record. Should
the Company fail to provide value-added engineering solutions, or to buy or license new technologies
developed by third-parties on acceptable terms, the services rendered by the Company could become
outdated or obsolete in comparison to the services offered by its competitors. Any failure to remain at the

technological forefront of the industry would adversely affect its relationship with clients and, consequently,
its financial condition and results of operations.
In case the Company is unable to hire qualified professionals and provide training to its staff.
In case there in growth in its activities, the Company will need to hire new qualified professionals active in
the most various business sectors. However, it faces significant competition in the hiring of qualified
personnel from other providers of engineering and industrial services and there can be no assurance that it
will be able to attract the number of professionals necessary to implement its expansion plan in the desired
timeframe. In addition, the Company may face difficulties in retaining its current staff if it is unable to preserve
its corporate culture and offer competitive compensation packages. The Company believes that the hiring
and retention of skilled labor is a critical factor for business success and its growth strategy. If the Company
does not achieve its strategy, it can affect operation and future results.
The Companys operations have already been interrupted in the past by labor issues, and the
Company cannot guarantee that such interruptions will not occur in the future.
As of December 31, 2015, approximately 0.3% of the Companys employees were members of labor unions,
primarily in the civil construction and trade industries. The Company has entered into collective bargaining
agreements with each of these unions, which agreements are renegotiated on an annual basis. The
renegotiation of these agreements could become more difficult as unions campaign for salary increases on
the basis of the growth of its operations. During 2013 and 2014, the operations of Industrial Services business
unit have been interrupted during negotiation of new collective bargaining agreements, the segment was
sold in 2013.
The Companys success depends, to a large extent, on the quality and safety of its services and
products.
The Companys success depends, to a large extent, on the quality and safety of the machinery and
equipment that it uses in the provision of its services or that are rented to its clients. If the Companys products
are in any way defective, incorrectly assembled or unsafe, if they cause any kind of accident or delay in its
clients operations, or if they do not meet the expected quality and safety standards, the Companys
relationships with its clients and partners could suffer, its reputation and strength of its brand could be
adversely affected, and the Company could lose market share, besides being exposed to administrative
proceedings and lawsuits in connection with any potential failures of its machinery or equipment and incur
significant expenses. The occurrence of any of these factors could adversely affect the Companys activities.
In addition, the sales contract of the Industrial Services business unit, from 2013, allow the buyer to use the
brand and expression Mills for 3 years. In this way, Mills brand reputation depends too on quality and safety
of services and products offered by the buyer while he can use the brand.
Proceeds from the Companys insurance policies may not be sufficient to cover damages resulting
from a contingent event.
The Company cannot guarantee that proceeds from its insurance policies will be sufficient to cover the
damages resulting from any event covered by such policies. Accordingly, certain risks may not be covered
under the terms of its insurance policies (such as war, fortuitous events, force majeure and interruption of
certain operations). Therefore, if any non-covered event occurs, the Company may incur additional expenses
to rebuild or refurbish its buildings, or to repair or replace its equipment. Furthermore, the Company cannot
guarantee that the proceeds from its insurance policies will be sufficient to cover the damages caused by
any event for which its insurance policies provide coverage. There can be no assurance that the Company
will be able to renew its insurance policies on favorable or acceptable terms, or at all, or enter into new
insurance policies with alternate providers.

The Companys results could be adversely affected if it receives an unfavorable judgment or decision
in one or more of the administrative proceedings and lawsuits filed against the company.
As of December 31, 2015, the Company was involved in administrative proceedings and lawsuits involving
contingencies amounting to R$ 118.6 million, for which it has recorded provisions of R$ 16.6 million. For
more information in this regard, refer to item 4.3 in this Reference Form.
The Companys financial condition and results of operations could be materially adversely affected, if it
receives an unfavorable judgment or decision with respect to a significant share of these proceedings and
lawsuits. In addition, proceedings involving alleged acts of negligence, imprudence or failure could affect the
Companys reputation and adversely affect its operations, whether or not it receives an unfavorable decision.
The Companys growth may be adversely affected if it fails to identify and complete strategic
acquisitions. Difficulties in the integration of acquisitions could adversely affect its results of
operations.
The Company operates in a fragmented market, where the credit access is limited. The Company believes,
therefore, that its sector will go through a process of consolidation over the next few years, which may
significantly change the existing competitive landscape. The Company believes that identifying and
executing strategic acquisitions is one way it could successfully implement its growth strategy and quickly
and efficiently expand its operations and geographic footprint.
However, this strategy could be adversely affected if the Company fails to identify suitable acquisition
opportunities and/or fail to execute such acquisitions on favorable terms. In addition, the Company may not
be able to integrate companies it acquires into its operations within the timeframe and in the manner
determined by its management. Any such failure could have an adverse effect on the rate of return on the
Companys investment, preventing from taking full advantage of the potential synergies of any such
acquisition and result in an adverse effect on its financial condition and results of operations.
b.

to the controlling shareholder.

The interests of the Companys controlling shareholder may conflict with the interests of its
investors.
The Companys controlling shareholder has the ability, among other things, to elect the majority of the
members of its board of directors and determine the outcome of decisions requiring shareholder approval,
including with respect to transactions with related parties, corporate restructurings, asset sales and
partnership agreements, and will have power to influence the amount and timing of any dividends to be
distributed in the future, subject to the provisions of the Brazilian corporate law regarding the payment of
mandatory dividends. The Companys controlling shareholder may choose to pursue acquisition
opportunities, dispose of assets, and enter into partnership and financing agreements or similar operations
which may conflict with the interests of its other shareholders.

The Company is a diffused controlled company, since it does not have a controlling shareholder or
group of shareholders holding more than 50% of its voting capital, which can allow it be susceptible
to alliances and conflicts between shareholders and other events resulting from the absence of a
controlling shareholder or shareholder group holding more than 50% of the voting capital.
The Company does not have a shareholder holding more than 50% of its voting capital. Alliances or
agreements can be made between the new shareholders, which could have the same effect as having a
group of shareholders. In the event of a group of shareholders and this group takes a hold of the decision
power of the company, it can suffer sudden and unexpected changes in the corporate policies and strategies,
including through mechanisms such as the replacement of the Companys management staff. Besides this,
the Company may be more vulnerable to hostile attempts to acquire control and conflicts from this outcome.
Additionally, the Company's shareholders can possibly change or exclude these provisions from its bylaws
which provide a public offering for share acquisition by a shareholder who becomes holder of 20% of its
share capital and then disregard their obligation to make a public offering to acquire shares as it is required
by its bylaws. The absence of a controlling shareholder or controlling group of shareholders of more than

50% of the voting shares of the Company may also hinder certain decision-making processes, which could
not be reached the quorum required by law for certain decisions. In the case that there isnt a controlling
shareholder holding the absolute majority of the voting shares of the Company, the Company's shareholders
may not use of the same protection granted by Share Companies Law against abuses practiced by other
shareholders and, consequently, may have difficulty in repairing the damage caused. Any sudden or
unexpected change in the Company's management team in its business policy or strategic direction, attempt
to acquire control or any dispute among shareholders concerning their respective rights may adversely affect
the Company's business and operating results.
c.

to the shareholders.

An active and liquid market for the Companys shares may not develop. The volatility and lack of
liquidity of the Brazilian capital market could substantially limit the investors ability to sell their
shares at the desired price and time.
An investment in securities traded in emerging market countries such as Brazil frequently involves a greater
degree of risk when compared to investments in securities of issuers located in major international securities
markets, and are generally considered to be more speculative in nature. The Brazilian securities market is
substantially smaller, less liquid, more concentrated and usually more volatile than major international
securities markets such as the United States.
These characteristics of the Brazilian capital market may substantially limit investors ability to sell the
Companys shares for the desired price and at the desired time, which in turn may have a significant adverse
effect on the price of its shares.
As of December 31, 2015, the BM&FBOVESPA represented, with an average daily trading volume of R$ 4.2
million during the year.

Shareholders may not receive dividends.

The Companys bylaws provide that 25% of the net profit for any year, adjusted pursuant to the provisions
of the Brazilian corporate law, should be distributed to shareholders as mandatory dividends or as interest
on stockholders equity. Despite the requirements regarding the payment of mandatory dividends, the
Company may limit such payment to the realized portion of the dividends or suspend the distribution of
dividends to its shareholders in any year, if the Companys board of directors determines that such
distribution would not be advisable given its financial condition.
The Company may need additional funds in the future and may issue additional securities to secure
such funds. This may adversely affect the price of the shares and result in a dilution of the investors
percentage interest in the Companys shares.
The Company may need to raise funds in the future through an additional public or private offering of shares
or securities convertible into or exchangeable for shares. Any additional funds raised by the distribution of
shares or securities convertible into or exchangeable for shares may impact their price and dilute the
investors percentage interest.
Provisions in the Companys bylaws may discourage, delay or make more difficult a change of
control of the company or the approval of transactions that might otherwise in the best interests of
its shareholders.
The Companys bylaws contain provisions intended to avoid the concentration of ownership of its shares in
small groups of investors and to foster a dispersed ownership. These provisions require that any shareholder
that: (a) acquires or becomes the holder, of the Companys shares with 20% (twenty percent) or more of
emited shares of the company shall, within sixty (60) days from the date of acquisition or event that resulted
in the ownership of shares in an amount equal to or exceeding 20% (twenty percent) of the total shares
issued by the Company; (b) acquires or becomes the holder of other rights such as (i) other Corporate Rights
over a volume equal to or greater than 20% (twenty percent) of the total shares issued by the Company or
that might result in the acquisition of shares issued by the Company in an amount equal to or greater than
20% (twenty percent) of the total shares issued by the Company, or (ii) derivatives that give the right to
shares of the Company representing 20% (twenty percent) or more of the shares of the company, or that

give the right to receive corresponding to 20% (twenty percent) or more of the shares of the Company, shall
apply or request for registration for subsequent realization of an OPA of all shares issued by the Company,
observing the applicable CVM regulations, to the Novo Mercado, the other regulations of BM&FBOVESPA
and the terms of the Company's Bylaws.
These provisions could have the effect to discourage, delay or even prevent the Company to merge with
another company or be acquired by another company, including transactions in which the investor may
receive a bonus over the market value of the Companys shares. Likewise, statutory provision might allow
the maintenance or perpetuation of the staff members of the Company nominated and elected by
shareholders holding less predominant portion of the Company's capital.
d.

to its subsidiaries and affiliates.

The Company does not have subsidiaries or affiliates.

The only society in which the Company holds a stake is Rohr S/A Estruturas Tubulares (Rohr). Since Rohr
operates in the same market of the Company, the Companys management believes that both societies are
subject to the same risks listed in the items (a) above and (e), (f) and (g) below.
In addition, the minority stake held by the Company in Rohr does not allow it to prevail in the deliberations
of its general meetings or elect administrators, and shall only be facultative to elect a fiscal council member
and exercise the rights of shareholders provided for in corporate law. Consequently, the Company is exposed
to various risks, such as (i) does not receive dividends beyond the minimum required in Rohrs bylaws, the
corresponding amount, in each fiscal year of 6% of its capital, (ii) to not be able to influence the executive
administration and management of Rohr, including the case of disagreeing with decisions made by its
officers, and (iii) eventual difficulty to access Rohrs documents and information, or related to its operations.
e.

to its suppliers.

Fluctuations in the price of raw materials, components and equipment used in the Companys
operations, as well as of commodities, may adversely affect its results.
Certain raw materials and components used in the Companys operations are prone to sudden and significant
fluctuations in price, over which it has no control. The final price of components, machinery and equipment
that are acquired or rented from third parties correlates to a significant extent with the price of commodities
such as steel and aluminum. A substantial increase in the price of such commodities generally results in an
equivalent increase in the Companys suppliers operating costs and, consequently, in an increase in the
prices they charge for their products. The Company may not be able to pass these price increases on to its
clients, which could have an adverse effect on its operating costs and financial condition and results of
operations.
In addition, all of the equipment used by the Rental business unit is imported, as there is no equipment of
comparable quality available locally, and their prices are defined in foreign currencies. Brazilian Real
depreciation against the foreign currencies in which the Company purchases equipment increases costs and
the Company may not be able to reflect the increased cost of equipment in the rental prices charged.
The components, machinery and equipment used in the Companys operations are manufactured
and supplied by third parties.
The components, machinery and equipment used in the Companys operations are manufactured by thirdparties. The Company also buys other materials used in its operations from local or foreign companies. The
Company generally does not carry a very large inventory of equipment in its warehouses, only the minimum
required for the provision of its services. As a result, the Company is vulnerable to delays in the delivery of
equipment or increases in the prices charged by its suppliers, which could prevent from providing its services
or renting its equipment to its clients in a timely manner. Also, if the Companys suppliers are not prepared
for and are unable to meet potential increases in the demand for their products, it may not be able to buy the
amount of equipment or volume of raw materials necessary to carry out its operations. The same can occur
if the company interrupts its purchases with a supplier and, because of the interruption, this supplier is not
able to serve by having compromising its production to another client or by any other reason. If such delays
in delivery or lack of products become recurrent, the company may not be able to find new suppliers quickly
enough to meet its clients needs. In addition, the introduction of restrictions on the acquisition of imported

goods, or the increase of taxes due on imported equipment, may have a negative impact on the Companys
business, in particular on the operations of the Rental business unit.
If any of the events above happens, the Company may suffer demand contraction, which, consequently, will
impair its results and financial situation.
f.

to its clients.

The Company is exposed to the credit risk of its clients

The company is subject to the credit risk of clients for payments due by the equipment rental and service
provision. Provisions for allowance for doubtful debts made by the Company monthly, may not be sufficient
to deal with any defaults. For more information, see the section "Credit Risk (accounts receivable)" in table
4.2 of this reference form. Losses above Companys expectations (and therefore not reflected in provisions)
may adversely impact the Company's results. In 2015, allowance for doubtful debt reached 6.7% of
Companys net revenues, versus 5.3% in 2014 and 2.0% in 2013.

The Company has significant exposition to clients related to ongoing Petrobras investigation.

In 2015, approximately 23% of Companys total net revenue derived from companies and its consortiums
that are being mentioned, someway, with ongoing investigations related to Petrobras corruption, called Car
Wash operation. In December 31st, 2015, the Company possessed R$ 23 million in its net receivables.
Investigations ramifications may cause reduction in activities, difficulty to access credit or even the extension
of involved companies, what can result in delays or failure in payments.

The Company may have difficulty to recover its equipment if its clients enter in judicial recovery or
suspends its payments
In case of judicial recovery or suspension of payments, the Company may recover its shoring equipment
only after the concrete structure, held by it, is able to sustain itself, which can take months to happen. During
this period, the Company might not receive rental revenue, and therefore have its profitability affected.
Client relationship can be affected by undue protest
Due to increase in payment delay and, consequently, in the allowance for doubtful debts, the Company
performed a procurement centralization. This change can generate undue clients protests and,
consequently, damage future relationships between the Company and its Clients.
The success of the Heavy Construction business unit depends on the development of long-term
relationships with a limited number of large companies operating in the Brazilian civil construction
sector.
Ten biggest clients of the Company represent [39%] of Heavy Construction billings in fiscal year ended on
December 31st, 2015.
Maintaining long-standing partnerships with such companies is the key to ensure the Companys involvement
in the implementation of prestigious and innovative activities and execute its operations, in particular, more
complex projects. Should the Company lose any of its main clients, or in case the Company is unable to
maintain a close relationship with such clients, the operations and revenue from the Heavy Construction
business unit could be materially adversely affected.

The Company may be unable to attract new clients or to develop new business at the pace required
for the expansion of the Real Estate and Rental business units.
The average term of the service agreements between the Real Estate and Rental business units and their
clients is generally shorter than that of the service agreements negotiated by the other business units. As a

result, both the Real Estate and Rental business units rely on the constant generation of new business in
order to maintain their revenue at a constant level. Due to the high degree of competition faced by the Real
Estate and Rental business units, the Company must make significant investments in order to attract new
clients and retain existing ones, in addition to offering its services at competitive prices. If the Company is
unable to generate new business at the rate required by the Real Estate and Rental business units, the
operations and expansion of the activities carried out by these business units could be adversely affected.
The Company may be unable to meet the needs of all of its clients or deliver its services in a timely
manner.
The Company owns a limited number of machinery and equipment, which must be properly allocated to each
project in which it is involved. Delays or interruptions in the manufacturing and maintenance of such
equipment and its component parts, as well as sudden increases in the demand for the Companys services,
could prevent from providing its services in the agreed timeframe or from meeting the needs of its clients
satisfactorily and efficiently, as a result of any of the following factors:
inability to foresee the needs of its clients;
delays caused by its suppliers;
insufficient production capacity;
equipment failure;
shortage of qualified workers, strikes and labor claims;
interruption in the provision of public services, in particular power cuts;
delays or interruption of the equipment transportation system;
changes to customs regulations;
macroeconomic factors; and
natural disasters.
Besides being subject to applicable penalties, if the Company is unable to meet its deadlines, either due to
internal problems, or as a result of events over which it has no control or not, it may lose the trust of its clients
and, therefore, experience a decrease in the demand for its services, which could adversely affect its financial
condition and operation results.
Fluctuations in the price of commodities may impact the Companys clients investment decisions
and the cost of equipment and, consequently, the Company may face cancellations or delays
affecting its existing and future projects or loss of revenue.
Fluctuation in commodity prices may affect the Companys clients in many areas. For example, for clients
engaged in the oil and gas, copper and fertilizers business, fluctuation in their product prices may have a
direct impact in the profit margins and cash flows, and consequently influence decisions between maintaining
existing investments or making new expenditures. Should the Companys clients choose to postpone new
investments and/or to cancel or delay the execution of existing projects, the demand for the Companys
services would drop, which could have a material adverse effect on its operations and financial condition.
The Companys operations and financial situation has been adversely affected in the past, and could be
substantially affected in the future, due to cancellations and delays in connection with projects in which it
was or is involved.
g.

to the economic sectors in which the issuer is involved.

Risk factors related to macroeconomic aspects

The Brazilian economy has been marked by numerous and, sometimes, by the federal
government, which often changes monetary, credit, tax and others. The Brazilian governments
actions to control inflation and effect other policies have involved in the past, among others,
increases in interest rates, changes in tax policy, price control, currency devaluation, controls the
flow of capital and certain limits on goods and services imported. The Company has no control
and cant predict what measures or policies the Brazilian government may adopt in the future.
The Companys business, financial condition and results of operations, as well as the market
value of the shares may be adversely affected due to changes in public policy at the feral, state
and municipal, referring to public tariffs and exchange controls, as well as other factors such as:

 interest rates;
exchange controls and restrictions on remittances abroad;
changes in exchange rates;
inflation;
social and political instability;
expansion or contraction of global and Brazilian economy;
liquidity in the domestic financial and capital markets and lending markets;
tax burden, fiscal policy, tax regime; and
political, social and economic developments that may affect Brazil.
The uncertainly about the implementation of changes promoted by the government regarding the
policies or standarts that may affect these or other factors in the future can contribute to economic
uncertainty in Brazil and heightened volatility in the securities market in the country.
It is not possible to predict whether the current or future management of the Federal Government
Will implement changes in fiscal, Exchange rate policies, monetary, social security, among others,
or what will be the consequences of such policies in the Brazilian economy and the Companys
operations.
Efforts of the Federal Government to combat inflation may slow the growth of the Brazilian
economy and harm our business.
In the past, Brazil experienced extremely high rates of inflation and, consequently, adopted
monetary policies that resulted in one of the hightest real interest rates in the world. In 2015,
SELIC showed average of 13.38%. The annual inflation calculated by the IGP-M was 5.51%,
3.39% and 10.53% in 2013, 2014 and 2015, respectively, and by the IPCA was 5.91%, 6.41%
and 10.67% in 2013, 2014 and 2015, respectively. Inflation and the measures adopted by the
Federal Government to combat it, mainly through the Central Bank, have had and may have
significant effects on the Brazilian economy on the Companys business. Tight monetary policies
with high interest rates may restrict Brazils growth and the availability of credit. Conversely,
government policy and looser monetary, the decrease in interest rates and intervention in the
foreign Exchange and stock market adjust or fix the real value may trigger increases in inflation
and, consequently, the volatility of growth and the need for sudden and significant increases in
interest rates. In addition, the Company may not have conditions to adjust the prices to offset the
effects of inflation on its cost structure. Any of these factors could affect their business negatively.
The demand for the Companys services is directly linked to the volume of public investment in the
engineering, construction and infrastructure sectors.
The public sector is generally involved in the implementation of large engineering and infrastructure projects
in Brazil, either by means of direct investment in such projects or through financing agreements.
According to estimates from BNDES, the public and private sectors are expected to invest R$ 187 billion in
investments in highways, railways and ports. Although there is great uncertainty about the terms of its
accomplish, that depends on improving in planning and on balancing concession model and financing.
In Brazil, public investments have historically been influenced by macroeconomic, political and legal factors,
which are all beyond of the Companys control. Such factors could determine, among other things, the
suspension or cancelation of projects that require the involvement of the public sector. Any such suspension
or cancellation could have a material adverse effect on the Companys clients operations and on the demand
for its services. If estimates regarding the level of future investments in construction and infrastructure are
not correct, or if such investments are not made, the Companys clients operations (and, consequently, the
Companys financial condition and operations) may be adversely affected.

The Company may have difficulties in adjusting the prices charged by it to offset the
effects of inflation

The Company seeks to pass along the effects of price inflation which charges for its products and
services. However, in case of long-term contracts, the adjustment is only permitted by Brazilian
Law every 12 months. The main price ndices used for the correction values in its long-term
contracts are the IGP-M (ndice Geral de Preos do Mercado), [released by Fundao Getlio
Vargas (FGV)], and the IPCA (ndice de Preos ao Consumidor Amplo), released by Instituto
Brasileiro de Geografia e Estatstica (IBGE). In addition, the cost of the Company's workforce is
impacted by increases agreed in collective bargaining, with adjustments generally also defined
according to price indices.
In periods of low demand and therefore price pressure, you probably cant pass on the effects of
inflation the prices it charges for its products and services and hence profitability could suffer
reduction.
Raw Material Price Risk and Imported Equipment
Increase in the price of commodities used in the manufacture of the equipment used in
providing the Company's services, such as steel and aluminum above the inflation rate used in
the adjustment of their contracts may also compromise their future earnings until these real
increases are incorporated into prices.
Additionally, in the case of contracts in which imported equipment is used, such as business
unit Rental, increases the exchange rate above inflation also compromise their future earnings
until these increases can be incorporated into prices.

h.

to the sectors regulation in which the issuer acts.

Costs related to laws and workplace safety regulations as well as those third-party professionals.
Such costs can be relevant and adversely impact the Companys results.
As of December 31, 2015, the Company had 1.558 active employees (to further information go to section 14
in this Reference Form). Due to the nature of the services provided, both the Companys employees and
employees of third parties face risks when executing its projects, which could result in serious injury or death.
In accordance with existing labor laws and regulations, the Company is required to provide and ensure the
use of safety equipment for its employees and other individuals working on its projects, under the Companys
responsibility. If the Company fails to provide all necessary safety equipment and ensure its proper use, or
if it works with companies that are not sufficiently committed to ensuring the safety of their staff, the Company
could be deemed responsible for any accidents that take place at the worksites where it provides services.
Any accidents at the worksites where it provides its services could potentially reduce the number of able
bodied employees available to carry out its operations and would expose the Company to the payment of
fines and penalties to the workers involved.
Any changes to existing safety regulations may impose additional obligations on the Company and result in
an increase in its expenses with respect to safety equipment and procedures. The Company cannot predict
whether any such changes would have a significant impact on its operations. For example, changes imposing
a reduced work day, for safety reasons, could result in a drop in employee productivity, therefore forcing the
Company to hire additional staff. Similarly, provisions requiring the Company to install additional safety
components could increase the cost of its equipment and, therefore, adversely impact its operating costs
and financial results.
In addition, the Company engaged a third-party labor provider to hire temporary employees during periods
of rapid increases in the demand for the Companys services. As a result, the Company could be considered
responsible for meeting any employment obligations relating to such professionals, or deemed to be their
employer under the terms of existing laws and regulations, and would be subject to potential costs associated
with failure to comply with workplace safety regulations with respect to such professionals. Besides, the
editing of stricter legal and regulatory provisions regarding the use of outsourced personnel, or of provisions
imposing additional obligations on the contractor of outsourced services, could increase the Companys labor
costs and have a negative effect on its financial condition and results of operations.
The technical requirements and the use of the Companys equipments, as well as, the way which the
Company renders its services, may suffer relevant changes due to the incident of drastic climate

change. Moreover, the Companys inability to adapt to climate change may adversely affect its
business and financial results. Additionally, the Company is subjected to several environmental laws
and regulations that may become stricter in the future, as a response to the drastic climate changes,
and may result in higher duties and greater capital investment.
Climate change, including flooding or erosion caused by increased rainfall, could adversely affect the
technical requirements in the projects and equipment to which the Company is subjected to, the way in which
the Company uses its equipment and the way it render its services. In addition, variations in weather caused
by climate change may lead to postponements in project schedules, which in turn may lead to a decrease in
the demand for the Companys services. The Companys inability to adapt its operations to such climate
change and maintain its quality standards from our equipment and services, may lead to a decrease in its
market share, adversely affecting its business and financial results.
The Companys operations are subject to several federal, state and municipal environmental laws and
regulations, including protocols and international treaties to which Brazil is party. Such regulatory framework
may become more stringent in the future due to, among other things, climate change.

i.

to foreign countries in which the issuer operates.

Not applicable, since the Company restricts its operations to Brazil.

j.

the environmental issues

Operations are subject to extensive federal, state and local legislation on environmental
protection, which covers even the normative introduced in the legal system in international
function of agreements and treaties to which Brazil is or may become a party. The occurrence or
perception about climate change at national and international level can lead to the issue of more
stringent environmental standards.
Compliance with the provisions of these laws and regulations is monitored by certain governmental bodies
and agencies that are responsible for applying administrative sanctions in the event of the breach of any
relevant provisions. These sanctions may consist of fines ranging from R$500 to R$50,000,000, result in the
cancelation of our licenses and, ultimately, the temporary or permanent suspension of the Companys
operations, among other penalties. Environmental laws and regulations may become stricter in the future,
which may require the Company to make additional investments in compliance and, as a result, affect its
existing investment program. Such changes may cause an adversely affect to its financial condition and
results of operations. Besides, the failure to comply with such laws and regulations, such as operating without
the necessary environmental licenses and permits, or failing to adequately dispose of residues arising from
the Companys painting and equipment maintenance services, may result in the application of criminal and
administrative sanctions, as well as the obligation to repair the alleged harm or pay penalties for any potential
damage to the environment. Criminal sanctions may include, among other things, the arrest of the persons
responsible for the breach, the revocation or restriction of tax incentives and the cancelation or suspension
of credit facilities provided by public financial institutions. The Company could also be prohibited from
providing services to the public sector. The application of any of these sanctions could have an adverse
effect on the Companys revenues and prevent us from being able to raise capital in the financial markets.
The introduction of additional environmental obligations in the future as a result of legal or regulatory changes
or as a consequence of an increase in the environmental impact of the Companys operations, or failure to
obtain any necessary environmental licenses and permits, may result in additional and substantial
compliance costs and have an adverse effect on its business, financial condition and results of operations.

4.2
Comments on the Companys expectations to reduce or increase its exposure to the risks
factors
Mills Estrutura e Servios de Engenharia S.A. (Mills or Company) is exposed, in particular, to
the following marketing risks: risks of interest rates and monetary, credit, currency and liquidity
risk.

Risks Interest Rate and Monetary Restatement

The Company's indebtedness is subject, mostly at floating interest rates, especially rates CDI,
IPCA and TJLP. There is a risk that the Company may incur losses due to fluctuations in interest
rates, which increase financial expenses related to loans, financing and debentures obtained in
the market.
On December 31, 2013, 2014 and 2015, the CDI rate was 9.8%, 11.57% and 14.14%,
respectively; IPCA was 5.91%, 6.41% and 10.67%, respectively; and TJLP was 5.5%, 5.0% and
6.25%, respectively.
As a management policy, the Company does not use any instruments to mitigate its exposure to
fluctuations in interest rates. This is a market risk due to macroeconomic and regulatory
conditions inherent to all companies operating in Brazil.
The Company analyzes its exposure to interest rate dynamically. Various scenarios taking into
consideration refinancing, financing and hedging are simulated. Based on these scenarios, the
Company defines a reasonable change in the interest rate. The scenarios are run only for
liabilities that represent the major interest-bearing positions. See below sensitivity analysis of
possible fluctuations in interest rates.

Sensitivity analysis
Below, the analysis chart of sensitivity of financial instruments, describing the risks that may
result in material losses for the Company, with the most probable scenario (scenario I)
according to an evaluation carried out by management, considering a horizon of one year. In
addition, two other scenarios are presented in terms determined by the Brazilian Securities
Commission, through Instruction No. 475/2008 in order to provide 25% and 50% deterioration in
the risk variable considered, respectively (scenarios II and III) :

Cash equivalents
Financial investments

Debt
BNDES
1 Issuance of debentures
2 Issuance of debentures
1st Serie
2nd Serie
3rd Issuance of debentures

Indicator

Atual

CDI
Total

231.867
231.867

Effect on the outcome

Prospective
25%
50%
33.034
33.034
Variation

24.775
24.775
25,00%

16.517
16.517
50,00%

Effect on the outcome

Prospective
25%
50%

Indicator

Atual

TJLP
CDI

(15.116)
(92.751)

(1.023)
(4.115)

CDI
IPCA
CDI
Total

(169.629)
(142.277)
(202.527)
(622.300)

(19.156)
(19.016)
(29.925)
(73.235)
Variao

(1.072)
(5.075)

(1.119)
(6.018)

(23.427)
(27.635)
(21.880)
(24.806)
(37.056)
(44.093)
(88.510) (103.671)
20,86%
41,56%

The sensitivity analysis presented above considers changes relating to the risk of interest rate,
holding constant other variables associated with other risks.

References

Prospective

Taxes
CDI (%) (i)
TJLP (%) (ii)
IPCA(%) (iii)

14,25%
7,50%
7,57%

12/31/15
Scenario
II
25%

Scenario
III
50%

17,81%
9,38%
9,46%

21,38%
11,25%
11,36%

(I) As regards the interest rate risk, the Company's Management considered as the probable premise (Scenario I) for its
financial instruments a rate of 14.25%, extracted from the FOCUS report information released by the Central Bank of
Brazil on 26 February 2016 considering an increase in the CDI rate in line with the expected increase in the Selic rate,
since there is a direct relationship between charges, and an increased rate as the premise for the other two scenarios,
according to the impairment scenario.
(Ii) For financial liabilities related to loans and financing - BNDES, the Company's Management considered as the
probable premise (Scenario I) would be the maintenance of the TJLP rate, since there is no evidence of change in the
rate in the short term and increased rate as the premise for the other two scenarios.
(Iii) For financial liabilities related to the second series debentures, the Company's Management considered as the
probable premise (Scenario I) the expectation of the IPCA in 2016 described the FOCUS report released by the Central
Bank of Brazil on February 26, 2016, since there is no evidence of change in the rate in the short term and increasing
rate as the premise for the other two scenarios.

Credit Risk
Credit risk arises from the possibility of the Company suffering financial loss if a customer or
counterparty to a financial instrument fails to meet its contractual obligations arising from its
operating activities (primarily with respect to trade receivables) and financing, including deposits
in banks and financial institutions.
The Company periodically invoices values for leases and sales due by its customers by overdue
periods ranging typically from 30 to 60 days, the average collection period in 2015 was 63 days.
Thus, it is subject to default risk with respect to accounts receivable. Primarily, the portfolio of the
Company's commercial credit is focused on domestic clients. The Company establishes a
provision for impairment when understands that there is a risk of not receiving the amounts due.
The customer credit risk management is exercised by the Company's financial management,
which assesses the financial ability to pay customers. This analysis is carried out before the
actual trade agreement between the parties and such, are individually analyzed each client,
taking mainly into consideration the following information: (i) registration data; (Ii) information
and financial indicators; (Iii) risk classes (SERASA methodology); (Iv) majority controller; and (v)
disputes and protests in Serasa.

The Company believes that the credit risk concentration is limited because the customer base is
comprehensive and there is no relationship between customers. The Company has no
customer concentration in its revenue and accounts receivable, there is no single customer or
economic group that represents 10% or more of their accounts receivable in any of its business
units.
The table below shows the items Accounts Receivable Gross and Allowance for Doubtful
Accounts (PDD) of the Company open for business unit and consolidated the dates indicated:

2013
(in
Bills to
Construction

Receive
150.962

PDD
29.786

On December, 31
2014
R $ thousands)
Bills to
Receive
150.520

PDD
51.117

2015
Bills to
Receive

132.357

PDD
75.932

Buildings
Infrastructure
Industrial services
Rental
Events
Total

82.177
68.785

16.071
13.715

62.407
88.113

25.428
25.689

4.408
73.468
3.769
232.634

4.408
18.637
1.030
53.861

3.992
93.079
2.022
249.613

3.992
36.313
91.422

3.551
91.967
227.875

3.551
48.673
128.156

Remaining amount receivable of Industrial Services business unit operations, discontinued on November 30, 2013.
Amount receivable from the sale of the asset segment events that was discontinued in 2008.

In addition, the risk of credit balances with banks and financial institutions is managed by the
Company's treasury in accordance with the policy established by this. Excess funds are
invested only in approved counterparties.
The Company's practice to use only large financial institutions, which are among the 10 largest
banks with assets in Brazil. Management does not expect any counterparty to fail to meet its
obligations.
Cambial Risk
The Company's policy is to reduce the risk related to the cash exchange rate, conservatively,
since all its revenues are in reais. To this end, the Company enters into contracts NDF (nondeliverable forward) with financial institutions for hedging purposes. All of these agreements
provide for the establishment of the future exchange rate of reais for dollars.
Operationally, the Company is exposed to foreign exchange risk associated, in particular the US
dollar and the euro. Notably, this risk is found in equipment imports (mainly of aerial platforms
and forms) that the Company may hold.
At December 31, 2015, the Company doesnt have significant foreign exchange exposure or
derivative instrument open. The commercial dollar (sale) was R $ 2.3 R $ 2.7 and R $ 3.9,
December 31, 2013, 2014 and 2015, respectively.

Liquidity Risk
Liquidity risk arises from the possibility that the Company encounters difficulties in meeting the
obligations associated with its financial liabilities that are settled with cash payments or other
financial assets. The Company's approach to managing liquidity is to ensure, as much as
possible, you always have sufficient liquidity to meet its obligations as they fall due under normal
and stress conditions, without causing unacceptable losses or risk damaging the reputation of the
Company.
The Company's finance department monitors rolling forecasts of the Company's liquidity
requirements to ensure it has sufficient cash to meet operational needs. The monthly forecasts
take into account the plans of our debt financing, compliance with contract terms and compliance
with internal goals as the Company's strategic plan. In addition, the Company has credit lines with
major financial institutions operating in Brazil.
The chart below analyzes the main financial liabilities by maturity, corresponding to the remaining
period in the balance sheet to the contractual maturity when the Company expects to make
payment:

December 31, 2015

Loans and financing
Debentures
Providers

Up to
one
month

Between
one and
three
months

355
6.844

700
11.464
-

Between
three
months
and one
year

Between Between
one and two and
two
Five
years
years

3.088
3.914
226.833 192.054
-

7.150
347.308
-

More
than 5
years

Total

2.658
-

17.865
777.659
6.844

Interest rates (CDI and TJLP) estimated for the future commitments reflect market rates for each
period.

4.3 Judicial, administrative or arbitral awards, which are not under confidentiality, in
which the company or its subsidiaries are part and whose apelles are administrators or
former administrators, owners or ex-owners or investors of the company or its
subsidiaries.
Mills Estrutura e Servios de Engenharia S.A. (Company) is a party to judicial and administrative
proceedings in the civil, tax, social security, labor as described below. Its reserves are recorded
in the financial statements the total amount of probable losses. At December 31, 2015, the total
value of cases involving contingent liabilities was R $ 118.6 million, and the total amount involved
in processes with probable loss, according to an evaluation of the Company and its legal counsel,
was R $ 16 6 million, as indicated below:
Fiscal year ended
December, 31:

Contingencies
2013

2014

2015

(R$ thousand)
Civil
Probable Losses
Possible Losses
Remote Loss
Fiscais e
Previdencirias
Probable Losses
Possible Losses
Remote Loss

467
4.812
11

787
5.191
13

2.419
5.198
2.560

6.518
26.442
17.878

7.815
31.559
24.692

7.958
40.461
33.215

Trabalhistas
Probable Losses
Possible Losses
Remote Loss

3.588
10.944
3.303

3.978
15.232
4.655

6.235
18.006
2.620

Others
Probable Losses
Possible Losses
Remote Loss

Provisions

10.573

12.580

16.612

Judicial Deposits

10.053

10.422

11.023

The Company believes that the provisions for judicial and administrative contingencies are
sufficient to cover probable losses. The main processes in which the Company is a defendant are
described below.
Civil Proceedings
The Company is defendant in 35 proceedings concerning civil liability and indemnification payments,
regarding, above all, contract terminations and indemnification payments, whose total value was of R$ 10.2
million on December 31, 2015. Based on the advice of the Companys external legal counsel, as of December
31, 2015 it has recorded provisions of R$ 2.4 million to cover probable losses arising from these proceedings.

Process n 0053271-19.2013.8.17.0001
Jurisdiction

Estadual Justice of Pernambuco

Instance

1st Instance

Date of filing

7/4/2013
Mills Estruturas e Servios de Engenharia S.A. e
Habitacional Empreendimentos LTDA.
R$ 3.671 thousand (materials damage updated on
12/31/2015)
Object: This is Indemnity action filed by Housing
Empreendimentos Ltda. against the company seeking
payment by way of damages in the amount of R $
3,671,000 (property damage) updated on 31/12/2015,
and moral damages, because the contract to provide
concrete structure for implementing service signed the
Housing and Reserva do Paiva Company Residence
South Real Estate Development Ltda.
Possible
In the event of an unfavorable decision, the Company
will have to collect fiscal credit subject matter of the
administrative procedures in question, in the updated
amount of R$3.671 thousand (until December 31,
2015). Since this is an isolated fact, which is not a
habitual practice of the Company, the Company does
not believe that an unfavorable decision would have a
material adverse effect on its financial situation or on its
operating results.

Parties in the suit

Amounts,
involved

goods

or

rights

Main facts

Chances of loss

Analysis of impact in the case

of losing the suit

Amount provisioned (if any)

Tax and social security processes

At December 31, 2015, the Company litigava the defendant in 106 tax proceedings, the total
value was R $ 81.6 million. Of this total, R $ 8 million (for the likely snag losses) were provisioned.
Below is structured summary of the main tax and social security actions which the Company is a
party:
Process n 2001.01.1.062399-0
Jurisdiction

Estadual Justice

Instance

1st instance

Date of filing

6/29/2001
Aluma Systems Formas e Escoramentos
(sucedida pela Companhia) and Federal District

Parties in the suit

Amounts,
involved

goods

or

rights

Main facts

Chances of loss

Analysis of impact in the case

of losing the suit

Amount provisioned (if any)

Ltda.

R$ 2.723 thousand on 12/31/2015

Object: This is the Declaration of absence of legal and
tax relationship between the plaintiff and defendant in
relation to the ISS requirement on the lease of
movables, suspending the payment of the tax in
question and condemning the defendant to repeat the
magpie.
Last Progress on 04.26.2016: Began compliance
sentence. Municipality objected motions to stay
execution. Process halted by receipt of embargoes.
Obs .: Embargoes Enforcement no. 014335640.2007.8.07.0001 (2007.01.1.143356-2)
Possible
Given the share of loss with respect to the repetition of
Misuse (Embargoes), the Company will be liable to pay
the burden of defeat in the import of R $ 1,000.00 (one
thousand reais) and also the payment of 1% of the value
of the claim (a fine title) properly fixed until the time of
payment. There will be no payment of condemnation of
the tax, given that declared unconstitutional their
collection.
-

Process n 0505089-94.2008.4.02.5101
Jurisdiction

Federal Justice

Instance

1st Instance

Date of filing

6/7/2006
Mills do Brasil Estruturas e Servios Ltda. (sucedida
pela Companhia) and Unio Federal

Parties in the suit

Amounts,
involved

goods

or

rights

R$ 2.379 thousand on 12/31/2015

Subject: Tax Enforcement filed to require income tax

debts for the Administrative Proceeding No..
13708000745 / 2003-12, in which considerable part of
credit issued refers to the ILL, declared unconstitutional
by the Supreme Court. In addition, required credit
entirety is subject to cancellation due to the
compensation with the accumulated tax losses in the
supervised
exercise.
CDA's:
7020800011581/7020800011662/7060800044438.
Main facts
Obs .: Linked to Annulment Action No.. 001168270.2006.4.02.5101.
Latest Progress on 30/04/2014: was suspended the
course of tax enforcement until the final decision of the
Annulment Action No. 0011682-70.2006.4.02.5101,
based on the general power of caution in order to avoid
possible procedural disorders if the credit exequendo be
satisfied and executed, on the other hand, is successful
in case of such action.
Chances of loss
Possible
If the action will be dismissed, the Company shall collect
the tax credits at issue, the value of R $ 2,379,000 (until
31/12/2015). Because it is an isolated incident that does
Analysis of impact in the case
not reflect a company's usual practice, the Company
of losing the suit
does not believe in an unfavorable decision would have
a material adverse effect on its financial condition or
results of operations.
Amount provisioned (if any)
Process n 12267.000047/2007-14
Jurisdiction

IRS

Instance

1st Administrative Instance

Date of filing

5/23/2005
Mills do Brasil Estruturas e Servios Ltda. (sucedida
pela Companhia) e INSS

Parties in the suit

Amounts,
involved

goods

or

rights

Main facts

Chances of loss

Analysis of impact in the case

of losing the suit

Amount provisioned (if any)

R$ 3.509 thousand on 12/31/2015

This is a tax assessment notice (NFLD No. 357398394) aimed at collecting amounts supposedly not paid by
way of contribution to the SAT. In his defense, the
company claimed that the amounts were deposited in
the records of the Writ No. Measure. 001281849.1999.4.02.5101 having been converted into income
including the National Treasury. The company claimed
also that the tax assessment dismissed payments made
by the Company.
Latest Progress on 17/06/2015: Delivery of the case to
the Board of Tax Appeals ("CARF").
Possible
The Company shall collect the tax credit in question, the
value of R $ 3.509 thousand on 12/31/2015, if that is
unsuccessful in proving that it is deposited in court.
Because it is an isolated incident that does not reflect a
company's usual practice, the Company does not
believe that an unfavorable decision would have a
material adverse effect on its financial condition or
results of operations.
-

Process n 0026197-47.2005.4.02.5101
Jurisdiction

Federal Justice

Instance

2nd Instance

Date of filing

9/21/2005
Mills do Brasil Estruturas e Servios Ltda. (sucedida
pela Companhia) e INSS

Parties in the suit

Amounts,
involved

goods

or

rights

Main facts

Chances of loss

Analysis of impact in the case

of losing the suit

Amount provisioned (if any)

R$ 3.546 thousand on 12/31/2014

Object: This is Lawsuit seeking the termination of the tax
credit subject of NFLD No. 35102802-1 (Contribution
Education Allowance) to the extent that their values
were deposited in the records of the Writ No.
97.0010128 -two
Latest Progress on 19/12/2014: Autos completed for
analysis and decision of the Judge Rapporteur.
Possible
The Company shall collect the tax credit subject of
NFLD No. 35102802-1, the value of R $ 3.546 million on
31/12/2015. The company already collects the
education allowance regularly. Given the amount
involved in demand, the Company does not believe that
an unfavorable decision would have a material adverse
effect on its financial condition or results of operations.
-

Process n E-04/062000/2011
Secretaria de Fazenda do Estado do Rio de Janeiro
(Esfera Administrativa Estadual)
1st Instance (Administrative)
1/31/2011
Mills Estruturas e Servios de Engenharia S.A. e
Secretaria de Fazenda do Estado do Rio de Janeiro

Jurisdiction
Instance
Date of filing
Parties in the suit
Amounts,
involved

goods

or

rights

Main facts

Chances of loss

Analysis of impact in the case

of losing the suit

Amount provisioned (if any)

R$ 2.785 thousand on 12/31/2015

Object: This is notice of infraction issued to demand
ICMS and a fine as a result of carrying goods transfer
operations with Construtora Norberto Odebrecht S / A.
without the payment of tax due. Argues the state tax
authorities that company would not "Trading Company",
why the VAT payable on the Mills' sales operations.
OBS .: Volunteer Appeal no. 57,768 - 3rd Chamber.
Latest Progress on 3/11/2015: protocolled petition by
the Company, with the special registration certificates,
updated and in force in 2006 and 2007 period in the face
of the recipient's address changes, construction
company Norberto Odebrecht and export memos
related all listed invoices in self table showing
infringement, pgs. 310 and 312, and their bills of lading
and export receipts, as provided in 1 of the fourth
clause of the agreement ICMS No. 113/96, in
compliance with the subpoena form.
Possible
The Company shall collect credit worth updated
31/12/2016 at $ 2.785 thousand. Given the amount
involved in the demand, the Company does not believe
that an unfavorable decision will result in a material
adverse effect on its financial condition or results of
operations.
-

Process n 12259.000998/2008-65
Jurisdiction
Administrative Instance
Instance
Administrative Instance
Date of filing
5/23/2005

Instituto Nacional da Previdncia Social INSS e Mills

Estruturas e Servios de Engenharia S.A

Parties in the suit

Amounts,
involved

goods

or

rights

Main facts

Chances of loss

Analysis of impact in the case

of losing the suit

Amount provisioned (if any)

R$ 5.554 thousand on 12/31/2015

Tax delinquency notice served only to prevent the loss
of the right of the Treasury to release the social security
contribution debts discussed at the Annual Action
0062493-78.1999.4.02.5101,
plus
late-payment
penalty.
Obs .: The Annual Action was filed in order to be
recognized the possibility of compensation payments
unduly Social Security contribution, based on the
systematic established by Law no. 9.711 / 98.
Last Progress on 3/11/2015: Judgment converted into
diligence. Resolution no. 2301-000533.
Possible
The Company shall collect credit in the amount of R $
5.554.000 (updated to 12/31/2015). Given the amount
involved in the demand, the Company does not believe
that an unfavorable decision will result in a material
adverse effect on its financial condition or results of
operations.
-

Process n 4019432-32.2013.8.26.0405
2 Vara de Fazenda Pblica da Comarca de Osasco do
Jurisdiction
Tribunal de Justia de So Paulo.
Instance
1st Instance
Date of filing
10/31/2013
Secretaria de Fazenda do Estado de So Paulo e Mills
Parties in the suit
Estruturas e Servios de Engenharia S.A
Amounts, goods or rights
R$ 3.167 thousand on 12/31/2015
involved
It is common share to cancel the collection of debt
embodied in the Notice of Violation no. 4.017.635. due
to the illegality of the ICMS requirement on lease
agreements.
Latest Progress on 2/4/2015: Delivered dispatch: "The
Main facts
feat has been cleaned up and is determined to carry out
technical expertise, given the controversial point
regarding the nature of commercial operation. No more,
before the deposit for the provisional fees and submitted
questions, the expert indicated if intime will fl. 415 to
start the work. "
Chances of loss
Remote
The Company shall collect credit in the amount of R $
3,167,000 (updated to 12/31/2015). Given the amount
Analysis of impact in the case involved in the demand, the Company believes that an
of losing the suit
unfavorable decision would not cause a material
adverse effect on its financial condition or results of
operations.
Amount
provisioned (if any)
Process n 2001.51.01.017629-0
Jurisdiction
Tribunal Regional Federal da Segunda Regio
Instance
2nd Instance
Date of filing
9/14/2001
Mills Estruturas e Servios de Engenharia S.A e Unio
Parties in the suit
Federal
Amounts, goods or rights
R$ 4.384 thousand on 12/31/2015
involved
It is the absence of Tax Legal Relationship Declaratory
action Precept damning the Misuse repeat. Action was
Main facts
presented with the objective of removing the fine on
installment credits of voluntary disclosure.
Chances of loss
Possible

Analysis of impact in the case

of losing the suit

Amount provisioned (if any)

Sentence condemned the plaintiff to pay the costs and

attorneys' fees, set at 10% of the cause, duly corrected.
Latest Progress on 4/26/2016: They opposed new
Declaration Embargoes in view of the judgment
dismissing the grievance of the Company and rejected
the ED presented above. Pending completion. The
decision not to have recourse not to be the fine of 1%
for having procrastinating character. There will be no
payment of costs and the tax because the amount has
already been paid.
Obs .: Interlocutory Appeal (2010.02.01.014806-2).
-

Process n 2009.01.1.057971-6
Jurisdiction

7th Vara da Fazenda Pblica do Distrito Federal

Instance

[2nd Instance]

Date of filing

5/5/2009
Distrito Federal e Mills Estruturas e Servios de
Engenharia S.A

Parties in the suit

Amounts,
involved

goods

or

rights

Main facts

Chances of loss

Analysis of impact in the case

of losing the suit

Amount provisioned (if any)

R$ 2.234 thousand on 12/31/2015

This is the opposite Embargoes execution by the
Federal District, through which to ward off the
condemnation that fell to him (repetition of magpie - ISS
on lease). The sentence was the unenforceability
statements of judicial title, requiring the final award.
Remote
The Company will proceed with the ultimate award in
the main proceedings, in 2001.01.1.081292-9. There
will be the payment of condemnation of the tax, since it
comes to motions to stay execution of judicial title by
Which the Company was Entitled to receive back the
collected ISS in the exercise of leasing activity of
movable property.
In case of sentence maintenance in Their molds
present, there will be need for payment of compensation
for legal fees in favor of the Federal District in the import
of R $ 1,000.00 (one thousand reais).
-

Process n 2004.51.01.004267-5
Jurisdiction
12 Vara Federal do Rio de Janeiro
Instance
2nd Instance (Sobrestados)
Date of filing
4/11/2004
Petitioner: Mills Estruturas e Servios de Engenharia
S.A., sucessora por incorporao de JAH INDSTRIA
E
COMRCIO.
Parties in the suit
Fileds: Delegado da Delegacia da Receita Federal de
Administrao Tributria (DERAT) e Delegado da
Delegacia da Receita Federal de Fiscalizao (DEFIC).
Amounts, goods or rights
R$ 3.655 thousand on 12/31/2015
involved
This is a Writ of Mandamus aiming away from the
increase in COFINS PIS rate imposed, respectively, by
Main facts
Law No. 10,637 / 02 and 10,833 / 03, on the grounds of
offense to several constitutional provisions.
Chances of loss
Possible
The Company will not have to collect the tax credit of R
$ 3.655 thousand, as of 12/31/2015, given that the
amount involved in the lawsuit was filed in court until
September 2005.
Analysis of impact in the case distributed action on 3/11/2004. Decision favorable 1st
of losing the suit
instance. Decision of 2nd unfavorable instance. In
07.01.2010 was brought Extraordinary Appeal (RE)
against decision of the Federal Regional Court of the
2nd Region (TRF of the 2nd Region). In 2/28/2012,
decision was rendered by the Federal Court of the 2nd

Amount provisioned (if any)

Region, which recognized the existence of general

repercussion on the subject discussed in this action,
and sobrestou the case to the judgment of RE No.
570,122. Pending a final decision of the paradigm.
R$ 3.655 thousand

Process n 5240450/2013
Secretaria de Fazenda de Estado do Mato Grosso
(Esfera Administrativa Estadual)
1st Administrative Instance
10/18/2013
Petitioner: Mills Estruturas e Servios de Engenharia
S.A.
Fileds: Secretaria de Fazenda de Estado do Mato
Grosso

Jurisdiction
Instance
Date of filing
Parties in the suit
Amounts,
involved

goods

or

rights

Main facts

Chances of loss

Analysis of impact in the case

of losing the suit

Amount provisioned (if any)

R$ 3.179 thousand on 12/31/2015

Release Review Request Concerning the Collection
Document No. 981513/53/32/2013 concerning wrongly
declared invoices as free goods, hypothesis that
reverberated wrongly in the calculation of ICMS
estimate.
Last progress on 11/4/2013: Delivered Order: "The
suspension of payment is granted with respect to
Paragraph V, the 467-A Article RICMS / MT TO GPPS
for distribution and analysis.."
Remote
The Company shall collect credit in the amount of R $
3,179,000 (updated 12/31/2015). Given the amount
involved in the demand, the Company believes that an
unfavorable decision would not cause a material
adverse effect on its financial condition or results of
operations.
-

Labor Claims
The Company is defendant in 402 labor claims, and with the advisory of an external legal counsel, the
Company has recorded provisions on the amount of R$ 26.7 million (corresponding to probable losses) on
December 31, 2014, to cover probable losses resulting from the labor claims filed against the Company, and
net legal and appellate provision amount was of R$ 4 million.

The labor claims filed against the Company relate to the following matters: (i) payment of indemnifications
for material damages; (ii) payment of risk, hazard, transfer and night shift allowances; (iii) length of lunch and
shift breaks; (ix) payment of equal pay for equal work; (v) workplace accidents; (vi) re-hiring as a result of
the development of professional illness; (vii) recognition of employment relationships; and (viii) existence of
subsidiary (or joint and several) responsibility between the Company and its services providers, with respect
to outsourced workers employed by such providers and allocated to providing services for the Company.
Below, the Company included a structured summary of the major labor claims that it is part:

Process n 0001793-43.2013.5.05.0134
Jurisdiction
16 Vara do Trabalho de Salvador/BA
Instance
Execution 1st Instance
Date of filing
8/22/2013
Autor: N. N. S. Jr
Parties in the suit
Sought: Mills Estruturas e Servios de Engenharia
S.A.
Amounts, goods or rights
involved
R$ 1.220 thousand on 12/31/2015
In the present action, was granted to the Complainant
the overtime pay and profit sharing for the year 2012, in
Main facts
addition to salary increases provided for in the collective
agreement, from January to April 2012 and regulatory
fines.

Chances of loss
Analysis of impact in the case
of losing the suit
Amount provisioned (if any)

Started
running,
the
Complainant
submitted
calculations of R $ 175.665,48, which were approved by
the judge.
Mills secured the amount of R $ 168.507,37, given the
existence of an appeal bond in the case, which
supplemented the total amount of R $ 175.665,48.
Guaranteed judgment, Mills presented motions to stay
execution in which he argued to be due, only the amount
of R $ 53.041,38.
Before the motions to stay execution, the author
presented manifestation and this time, it claimed that
the amount due to him was R $ 103,774.77.
Current position: Still no trial of motions to stay
execution.
Possible
Judged the motions to stay execution, the Company's
sentencing will be in an amount of R $ 53,041.38 and R
$ 103,774.77, which amount must be updated to the
date of payment.
-

Process n 020691-64.2013.5.04.0124
Jurisdiction
4th Vara do Trabalho de Rio Grande/RS
Instance
3rd Instance
Date of filing
11/21/2013
Autor: STMMMERG
Parties in the suit
Sought: Mills Estruturas e Servios de Engenharia S.A.
Amounts, goods or rights
R$ 952 thousand on 12/31/2015
involved
Sentence extinguished the action 20/6/2014 and
judgment dismissing ordinary appeal remained
Main facts
decision, extinguishing the action, on 24/9/2014.
Current position: Waiting unappealable.
Chances of loss
Remote
Payment amount claimed by way of unhealthiness and
Analysis of impact in the case
reflexes to scaffolders, estimated at $ 952,000 on
of losing the suit
12/31/2015.
Amount provisioned (if any)
Process n 00114.2008.131.05.00-4
Jurisdiction
1st Vara do Trabalho de Camaari-BA
Instance
3rd Instance
Date of filing
2/13/2008
Autor: V. R. D. S.
Parties in the suit
Sought: Mills Estruturas e Servios de Engenharia S.A.
Amounts, goods or rights
R$ 564 thousand on 12/31/2015
involved
Judgment recognized the right of realization of
compensation in the amount of R $ 50 thousand as a
moral damages, and R $ 316 thousand by way of
Main facts
damages.
The Judgment dismissing the Ordinary Appeal ruled the
conviction for property damage.
Current position: Brought review appeal. not tried yet.
Chances of loss
Probable
To be refereed to compensation for moral and material
damages. Such values can be modified by the TST,
Analysis of impact in the case
however, in the face of today's existing conviction,
of losing the suit
reaches the approximate amount of R $ 90 thousand on
12/31/2015.
Amount provisioned (if any)
Process n 0120300-11.2009.5.19.0005
Jurisdiction
5th Vara do Trabalho de Macei/AL
Instance
1st Instance
Date of filing
9/10/2009
Autor: C. F.
Parties in the suit
Sought: Mills Estruturas e Servios de Engenharia S.A.

Amounts, goods or rights

involved

Main facts

Chances of loss
Analysis of impact in the case
of losing the suit
Amount provisioned (if any)

R$ 550 sought on 12/31/2015

The Complainant filed a lawsuit demanding
compensation for moral and material damages arising
from occupational disease as well as the payment of
wages resulting from period of stability.
Plead also the payment of severance installments
overtime, RSR, wage differentials, vacation + 1/3, 13th
salary, FGTS + 40% release of unemployment
insurance guides, fine art. 467 of the Labor Code.
Current position: Held medical expertise. Waiting for
results.
Possible
Payment of the amounts arbitrated as compensation for
moral and material damages. Considering the values
pleaded by the Complainant in the application, updated
to 12/31/2015, reach the amount of approximately R $
550 thousand.
-

Process n 0002070-07.2014.5.09.0084
Jurisdiction
22nd Vara do Trabalho de Curitiba/PR
Instance
2nd Instance
Date of filing
12/11/2014
Autor: M. A. J. D. A.
Parties in the suit
Sought: Mills Estruturas e Servios de Engenharia S.A.
Amounts, goods or rights
R$ 550 thousand on 12/31/2015
involved
Sentence sentenced Mills to pay the fold 23 days of
vacation and compensation for moral damages in the
Main facts
amount of R $ 70 thousand. Current position: Brought
ordinary appeal. Awaiting trial.
Chances of loss
Possible
The Claimed shall pay to the former employee, of the
value of enforceable as compensation for moral
Analysis of impact in the case damages and folded vacation, updated to 31/12/2015,
of losing the suit
reach the amount of approximately R $ 133 thousand.
Awaiting judgment of the ordinary appeal, which can
interfere with the conviction installments.
Amount provisioned (if any)
Process n 0117200-48.2008.5.17.0002
Jurisdiction
2nd Vara do Trabalho de Vitria/ES
Instance
1st Instance
Date of filing
10/20/2008
Autor: Sindicato dos Trabalhadores nas Indstrias
Metalrgicas Mecnicas de Material Eltrico e
Parties in the suit
Eletrnico no Estado do Esprito Santo SINDIMETAL
Sought: Mills Estruturas e Servios de Engenharia S.A.
e Arcellormittal Brasil S.A.
Amounts, goods or rights
R$ 729 thousand on 12/31/2015
involved
The union author postulates the conviction of the
defendants to pay commuting time, the argument that,
every day, or every scale of toil, the opportunity of
joining the drudgery, and also during office hours end,
replaced would, by considerable time (fifty-five to
seventy minutes every day), to provide its services
makers, on the way between the gate of the industrial
unit of the second defendant and the construction site
Main facts
(where would the point marking), and vice versa, this
route it would be difficult to access and devoid of regular
public transport, other means not providing the workers
for said displacement but the transportation provided by
the defendants. The defendants denied the peremptory
manner that the time consumed by substituted in the
path taken in the inner area of the plant may be the one
alluded to in the play ticket, saying he did not spend
fifteen minutes a day, at most, and say they are

Chances of loss
Analysis of impact in the case
of losing the suit
Amount provisioned (if any)

surprised by the claim deducted in these proceedings

because the union author have been responsible for
making collective norm that literally repels nature
commuting the distance traveled by such replaced in
their facilities. In the ruling the judge granted
extraordinary twenty minutes per day of effective
service, provided increases of collective norms and
reflexes and law integrations given the customary
character of their provision to both condemning the
defendants, the second, in the alternative. Decision
upheld by the courts, including the TST.
Last Progress on 04/15/2016: Awaiting manifestation of
the parties on accounting expert report.
Probable
The Company shall collect credit in the amount of R $
729 thousand (updated until 12/31/2015). Given the
amount involved in demand.
R$ 729 thousand

Process n 0001836-27.2013.5.03.0007
Jurisdiction
7th Vara do Trabalho de Belo Horizonte
Instance
1st Instance
Date of filing
9/4/2013
Autor: R. F. E.
Parties in the suit
Defendant: Mills Estruturas e Servios de Engenharia
S.A
Amounts, goods or rights
R$ 600 thousand on 12/31/2015
involved
Action involving work accident claim for reinstatement
Main facts
to work with application of moral and aesthetic damages
beyond pension.
Chances of loss
Remote
The Company shall collect credit in the amount of R $
Analysis of impact in the case
600 thousand (updated until 12/31/2015). Given the
of losing the suit
amount involved in demand.
Amount provisioned (if any)
Process n 00000801420115020384
Jurisdiction
4th Vara do Trabalho de Osasco
Instance
Superior
Date of filing
1/19/2011
Autor: Esplio de A. V. F.
Parties in the suit
Defendant: Mills Estruturas e Servios de Engenharia
S.A
Amounts, goods or rights
R$ 1.072 thousand on 12/31/2015
involved
Action involving claim for compensation for material and
moral damages for the death of the worker hiccup. The
lawsuit was dismissed in 1st instance, but the decision
was revised and amended by the Regional Court, which
Main facts
ordered the Company to pay a compensation for moral
damages over a lifetime monthly pension for the widow.
The Company appealed to the Superior Court, and is
still waiting for final decision.
Chances of loss
Possible
According to its legal advisors, if maintained the
decision of the Regional Labor Court - SP, the
Company shall pay to the former employee Estate the
estimated amount of R $ 1.073 thousand on
Analysis of impact in the case
31/12/2015. It has fired the liability insurance company.
of losing the suit
Last progress:. In 04/25/2015 concluded for voting with
Min Claudio Mascarenhas Brando. In 10/20/2015
issued settlement sentence in judgment provisionally
enforceable.
Amount provisioned (if any)
Process n 00000801420115020384
Jurisdiction
3rd Vara do Trabalho de Piracicaba
Instance
1st Instance

Date of filing
Parties in the suit
Amounts, goods or rights
involved

Main facts

Chances of loss
Analysis of impact in the case
of losing the suit
Amount provisioned (if any)

2/28/2014
Autor: V. D. S. D. e Outros
Defendant: Mills Estruturas e Servios de Engenharia
S.A
R$ 1.261 thousand on 12/31/2015
Action involving claim for compensation for material and
moral damages for the death of the worker in a typical
work accident (bridge fall over the river Piracicaba). The
action was upheld in part in 1st instance, being the Mills
ordered to indemnify the claimants for damages (R $
450 thousand) plus a monthly pension. On 04/06/16 the
Company appealed to the TRT-Campinas, and the
plaintiffs also brought an action seeking the increase of
compensation. Still awaits final decision
Possible
According to its legal advisors, if maintained the lower
court decision, the Company shall pay the complainants
the estimated value in the judgment of R $ 500
thousand. It has fired the liability insurance company.
-

Process n 00000801420115020384
Jurisdiction
39th Vara do Trabalho de Belo Horizonte
Instance
1st Instance
Date of filing
12/5/2014
Autor: A. C. M.
Parties in the suit
Defendant: Mills Estruturas e Servios de Engenharia
S.A
Amounts, goods or rights
R$ 572 thousand on 12/31/2015
involved
Process involving application for reinstatement and
payment of all salaries and other benefits of the
withdrawal period or compensatory damages of salaries
and all other benefits from the exemption until the end
Main facts
of the stability period; compensation for moral damages
and invalidity non-compete agreement. Process has not
tried in the first instance, pending for instruction hearing
for the day 05/06/2016.
Chances of loss
Possible
According to its legal advisors, it upheld the action may
Analysis of impact in the case
result in the company's conviction to pay about R $ 572
of losing the suit
thousand on 12/31/2015.
Amount provisioned (if any)
4.4
Judicial, administrative or arbitral awards, which are not under confidentiality, in which the
company or its subsidiaries are part and whose appellees are administrators or former
administrators, owners or ex-owners or investors of the company or its subsidiaries.
Not applicable, since the Company or its subsidiaries are not parties to proceedings in which
the opposing parties are managers or former managers, controlling shareholders or former
controlling shareholders or investors of the Company or its subsidiaries.
4.5 In relation to the relevant confidential proceedings to which the issuer or its
subsidiaries are a party and which have not been disclosed in items 4.3 and 4.4 above,
analyze the impact in case of loss and inform the amounts involved.
On December 31, 2015 the Company was not part of any confidential lawsuit.
4.6
Judicial, administrative or arbitral lawsuits, repetitive or related, non confidential and based
on similar legal facts and causes, which are not under confidentiality and which together, are
relevant.
[Not applicable, since the Company or its subsidiaries are not parties to the repetitive or related
processes based on similar facts and legal causes, which are not confidential and that are
collectively relevant.] [NOTA PG-A: FAVOR CONFIRMAR]
4.7

Other significant contingencies.

No other significant contingencies relating to this item 4.

4.8
Rules of the country of origin of foreign issuer and rules of the country in which the foreign
Company's securities are held in custody, if different from the country of origin.
Not applicable, as the Company is not a foreign issuer.

5. Risk Management Policy and internal controls

5.1 In relation to the risks listed in item 4.1, inform:
a.

if the issuer has a formal policy of risk management, highlighting, if so, the organ which
approved it and the date of its approval, and if negative, the reasons why the issuer has not
adopted a policy.
Risk management is carried out by the Financial Department, under policies approved by the Board
of Directors, if applicable. The Financial Department identifies, evaluates and protects the Company
against possible financial risks in cooperation with the Company's operating units. The Finance
Department establishes principles for overall risk management, as well as for specific areas such as
currency risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative
and investment of excess liquidity.

b.

the objectives and strategies of risk management policy, if any, including:

(i)

the risks for which protection is sought;

The Company's activities expose it to various financial risks (including the risk of interest rate,
inflation risk, exchange rate, price risk of raw materials and imported equipment and credit risk). The
risk management program focuses on the unpredictability of financial markets and seeks to minimize
potential adverse effects on the Company's financial performance. The Company uses derivative
financial instruments to hedge against certain exposures to risk and has a policy not to participate in
any trading of derivatives for speculative purposes.
(ii) the instruments used for protection;
[]

(ii)

the organizational structure of risk management

Policies and risk control procedures are defined directly by the Board of Directors and implemented
by the Finance Director. The Board of Directors is also responsible to supervise compliance with
these practices.
b.

Adequacy of operating structure and internal controls to verify the effectiveness of the policy
adopted
The Company's management analyzes its operating structure and internal controls, and believes
that the policies and adopted control procedures are adequate for the company's operational
structure. In the fiscal years ended December 31, 2013, 2014 and 2015, the reports of the
independent auditors did not identify any material deficiency in these controls.

5.2 In relation to market risks indicated in item 4.2, inform:

a. If the issuer has a formal policy of managing market risks, highlighting, if so, the organ which
approved it and the date of its approval, and if not, the reasons for which the issuer has not
adopted a policy.
Risk management is carried out by the Financial Department, under policies approved by the Board of
Directors, if applicable. The Financial Department identifies, evaluates and protects the Company
against possible financial risks in cooperation with the Company's operating units. The Finance
Department establishes principles for overall risk management, as well as for specific areas such as
currency risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative and
investment of excess liquidity.
a. The objectives and strategies of the market risk management policy, if any, including:
(i) market risks for which protection is sought
a) Financial risk factors

The Company's activities expose it to various financial risks: market risk (including currency risk,
interest rate risk, cash flow risk and price risk), credit risk and liquidity risk. The risk management
program focuses on the unpredictability of financial markets and seeks to minimize potential
adverse effects on the Company's financial performance. The Company uses derivative financial
instruments to hedge certain risk exposures and has a policy not to participate in any trading of
derivatives for speculative purposes.
Risk management is carried out by the Financial Department, under policies approved by the
Board of Directors, if applicable. The Financial Department identifies, evaluates and protects the
Company against possible financial risks in cooperation with the Company's operating units.
Financial Department establishes principles for overall risk management, as well as for specific
areas such as currency risk, interest rate risk, credit risk, use of derivative financial instruments
and non-derivative and investment of excess liquidity.
(i)

Sensitivity analysis

Below is the analysis chart of sensitivity of financial instruments, describing the risks that may
result in material losses for the Company, with the most probable scenario (scenario I) according
to an evaluation carried out by management, considering a horizon of one year. In addition, two
other scenarios are presented in terms determined by the Brazilian Securities Commission,
through Instruction No. 475/2008 in order to provide 25% and 50% deterioration in the risk
variable considered, respectively (scenarios II and III):
Effect on the outcome
Cash equivalents
Indicator
Atual
Probable 25%
50%
Financial aplications

CDI
Total

231.867
231.867

33.034
33.034
Variao

24.775
24.775
25,00%

16.517
16.517
50,00%

Debt

Indicator

Atual

Effect on the outcome

Probable 25%

50%

BNDES
1 Issuance of debentures
2 Issuance of debentures
1 Serie
2 Serie
3 Issuance of debentures

TJLP
CDI

(15.116)
(92.751)

(1.023)
(4.115)

(1.072)
(5.075)

(1.119)
(6.018)

CDI
IPCA
CDI
Total

(169.629)
(142.277)
(202.527)
(622.300)

(19.156)
(19.016)
(29.925)
(73.235)
Variation

(23.427)
(21.880)
(37.056)
(88.510)
20,86%

(27.635)
(24.806)
(44.093)
(103.671)
41,56%

The sensitivity analysis presented above considers changes in relation to a particular risk,
maintaining constant the other variables associated with other risks.
31/12/15
References
Probable I
Scenario II
Scenario III
25%
50%
Taxes
CDI (%) (i)
14,25%
17,81%
21,38%
TJLP (%) (ii)
7,50%
9,38%
11,25%
IPCA(%) (iii)
7,57%
9,46%
11,36%

(i)

As compared to the interest rate risk, the Company's Management considered as

the probable premise (Scenario I) for its financial instruments a rate of 14.25%,
information extracted from the FOCUS report released by the Central Bank of Brazil
on February 26, 2016, considering an increase in the CDI rate in line with the
expected increase in the Selic rate, since there is a direct relationship between
charges, and an increased rate as the premise for the other two scenarios, according
to the impairment scenario.

(ii)

For financial liabilities related to loans and financing - BNDES, the Company's
Management considered as the probable premise (Scenario I) would be the
maintenance of the TJLP rate, since there is no evidence of change in the rate in
the short term and rate increase as a premise for the other two scenarios.

(iii)

For financial liabilities related to the second series debentures, the Company's
Management considered as the probable premise (Scenario I) the expectation of the
IPCA in 2016 described the FOCUS report released by the Central Bank of Brazil
on February 26, 2016, as there is no evidence of change in the rate in the short term
and increasing rate as the premise for the other two scenarios.

b) Market risk
(i)

Cambial risk
The Company's policy is to reduce the risk related to the cash exchange rate,
conservatively, since all its revenues are in reais. To this end, the Company enters into
contracts NDFs with financial institutions for hedging purposes. At December 31, 2015, the
Company had significant currency exposure or derivative instrument open.

(ii)

Risk of interest rates and monetary

The Company's indebtedness is subject to floating interest rates, especially CDI rate, IPCA
and TJLP. There is the risk the Company may incur losses due to fluctuations in interest
rates, which increase financial expenses related to loans, financing and debentures
obtained in the market.
As a management policy, the Company does not use any instruments to mitigate its
exposure to fluctuations in interest rates considering this a risk inherent market to all
companies operating in Brazil.
The Company analyzes its exposure to interest rate dynamically. various scenarios taking
into consideration refinancing, financing and hedging are simulated. Based on these
scenarios, the Company defines a reasonable change in the interest rate. The scenarios
are run only for liabilities that represent the major interest-bearing positions. See sensitivity
analysis of possible fluctuations in interest rates in Note 4.1 (i).

c)

Credit risk
Credit risk is the risk of financial loss the Company if a customer or counterparty to a financial
instrument fails to meet its contractual obligations arising from its operating activities (primarily
with respect to bills to receive) and financing, including deposits banks and financial institutions.
(i)

Bills to receive
The Company periodically invoice values for leases and sales due by its customers for
periods ranging typically from 30 to 60 days, the average collection period in 2015 was 63
days. Thus, it is subject to default risk with respect to accounts receivable. Primarily, the
portfolio of the Company's commercial credit is focused on domestic clients. The Company
establishes a provision for impairment when, believes that there is risk of not receiving the
amounts due.
The customer credit risk management is exercised by the Company's financial
management, which assesses the financial ability to pay customers. This analysis is carried
out before the actual trade agreement between the parties and such, are individually
analyzed each client, taking mainly into consideration the following information: (i)
registration data; (Ii) information and financial indicators; (Iii) risk classes (SERASA
methodology); (Iv) controller and major; (V) disputes and protests in Serasa.

(ii)

Financial instruments and cash deposits

The risk of credit balances with banks and financial institutions is managed by the
Company's treasury in accordance with the policy established by this. Excess funds are
invested only in approved counterparties.
The Company's practice to use only large financial institutions, which are among the 10
banks with major assets in Brazil. Management does not expect any counterparty to fail to
meet its obligations.

c) Liquidity risk
Liquidity risk is the risk of the Company encountering difficulties in fulfilling its obligations associated
with its financial liabilities that are settled with cash payments or with another financial asset. The
Companys approach to managing liquidity is to ensure, to the greatest extent possible, that there is
always sufficient liquidity to fulfill its obligations as they fall due, under normal and stress conditions,
without causing unacceptable losses or risking harming the Companys reputation.
The financial department monitors ongoing forecasts of the Companys liquidity requirements to ensure
that it has sufficient cash to meet its operating needs. The monthly forecasts take into consideration the
plans for financing the Companys debt, fulfillment of contractual clauses and the meeting of internal
targets in accordance with the Companys strategic plan. In addition, the Company maintains lines of
credit with the main financial institutions operating in Brazil.

The table below presents the Companys non-derivative financial liabilities per maturity bracket,
corresponding to the remaining period in the balance sheet until the contractual date of maturity.
More
than
More
three
than one months
month
and
and less less
Up to than
than
one
three
one
month months
year
December 31, 2015
Borrowings and financial
debentures
Debentures
Providers
December 31, 2014
Borrowings and financing
Debentures
Derivative financial
instruments
Providers

Between
Between two and Over
one and Five
Five
two years years
years

355

700

6.844

11.464
-

226.833 192.054
-

347.308
-

46.378
-

998
9.227

3.215 4.100
150.140 230.266

11.002
2.652 68.345
458.685 64.069 912.387

(1.166)
16.510

3.088

3.914

7.150

Total

2.658 17.865
- 777.659
- 6.844

- (1.166)
- 16.510

The interest rates (CDI, IPCA and TJLP) projected for the future compromises reflect the market rates
in each period.
e) Credit quality of financial assets
(i)

Cash and cash equivalents and securities

12/31/2015
Current account
Bank (1)
Total
Aplications
Bank (1)
Total
Cash total and cash equivalent

12/31/2014

144
144

182
182

231.867
231.867
232.011

193.477
193.477
193.659

(1) Leading financial institutions with extensive operations in Brazil and among the 10
largest banks with total assets of Brazil.

(i)

Asset protection strategy (hedge)

The Company intends on using financial derivative instruments locally and abroad to manage the
exchange and interest rate fluctuation risks. In accordance with the accounting principles generally
accepted in Brazil, the derivative contracts are going to be recorded in the balance sheet based on
the fair market value recognized in the revenues statements, unless in cases when the specific
hedging criteria are met. The market value estimations are going to be held on a specific date, usually
based on the mark-to-market.
(ii)

Instruments used for asset protection (hedge)

In order to protect shareholders equity from exposure to foreign currency commitments, the
Company developed a strategy to mitigate the market risk. When applied, the objective of the
strategy is to reduce the volatility of the desirable cash flow, maintaining the planned disbursement
of resources.
The Company considers management of these risks essential to support its growth strategy without
potential financial losses reducing its operating income, as the Company does not seek financial
gains from derivatives. Foreign currency risk management is carried out by the Financial
Management and Director, who assess the potential exposure to risks and establish guidelines for
measurement, monitoring and management of the risks of the Company's operations.
Based on this objective, the Company contracts derivative operations, normally swaps and NDF
(Non Deliverable Forwards), with prime financial institutions (brAAA credit rating - national scale,
Standard & Poor's or similar), to guarantee the commercial value agreed on ordering the item to be

imported. Similarly, swap or NDF contracts should be contracted to guarantee the payment flow
(amortization of principal and interest) of foreign currency financing. Under the Company's by-laws,
any contract or assumption of obligation in excess of R$ 10.0 million) must be approved by the Board
of Directors, unless foreseen in the Business Plan. It is not necessary to contract hedge operations
for amounts of less than R$ 100,000, with maturities of less than 90 days. Other commitments should
be protected against foreign exchange exposure.
Swap and NDF transactions are carried out to translate future foreign currency financial
commitments into reais. By contracting these operations, the Company minimizes the foreign
exchange risk by leveling both the amount of the commitment and the exposure period. The cost of
contracting the derivative is tied to the interest rate, normally to the CDI (Interbank deposit certificate)
percentage. Swaps and NDFs maturing before or after the final maturity of the commitments may, in
time, be renegotiated so that their final maturities are the same as - or close to - the final maturity of
the commitment. In this way, on the settlement date, the result of the swap and the NDF may offset
part of the impact of the exchange variation of the foreign currency against the real, assisting
stabilization of the cash flow.
As derivatives, the monthly position is calculated by the fair value methodology, calculating the
present value by applying the market rates that are impacted on the determination dates. This widely
used methodology may result in monthly distortions in relation to the curve of the derivative
contracted, however, the Company is of the opinion that this is the best methodology to use, as it
measures the financial risk in the event of the need for early settlement of the derivative.
By monitoring the commitments assumed and the monthly valuation of the fair value of the
derivatives, it is possible to monitor the financial results and the impact on the cash flow and to
ensure that the original objectives are achieved. The calculation of the fair value of the positions is
provided monthly for management supervision.
The derivative instruments contracted by the Company are intended to protect its placing the order
and the corresponding formal receipt in Brazil. They are not used for speculative purposes.
(b)

The following table shows details of future contracts open currency at the end of the
reporting period:
Average Exchange
rate

Open
contracts
Cash flow
hedge
Menos de
trs meses
Total
(c)

Foreign currency

National value

Fair value

12/31/2015 12/31/2014 12/31/2015 12/31/2014 12/31/2015 12/31/2014 12/31/2015 12/31/2014

2,61

US$ thousand

R$ thousand

R$ thousand

499
499

1.299
1.299

26
26

Swap
The operation of the foreign exchange swap contracts, contracted by the Company, aimed at
protection against exposure of US $ 16.9 million loan (see note 17) to exchange variation. The
foreign exchange swap for this operation consisted of the exchange of the exchange variation
charges plus interest of 2.31% pa by CDI plus 0.29% pa In January 2015, the Company paid
the fair value recorded R $ 43 in this operation (until December 31, 2014 - R $ 1,166
receivable).
(d)

Methodology for calculating the fair value of derivatives

They are measured at the present value at the market rate on the base date of the future
cash flow calculated by applying the contractual rates through maturity.

(e)

Methodology for calculating the effectiveness of hedges

Company's hedging transactions are carried out in order to hedge against fluctuations in
foreign currency of imports of machinery and equipment. Such operations are classified as
hedge accounting.
The Company proves the effectiveness of these instruments based on the methodology
"Dollar offset", which is commonly used by participants in the derivatives market. This
methodology is to compare the present value of future net foreign currency exposures,
commitments assumed by the Company with derivatives contracted to such hedging.
For the year ended December 31, 2015, there was no ineffectiveness recognized in the
income arising from the Company's hedging transactions.

(f)

Gains and losses in the period

Considering the fact that the Company proves the effectiveness of hedge accounting
operations, losses and gains recorded on these derivative transactions are recognized in
consideration of the hedged assets (fixed assets) as part of the asset's original cost at the
same time the accounting of assets. For the year ended December 31, 2015, the amount
of R $ 244 (December 31, 2014, R $ 1,175) was transferred from equity and deducted from
the initial cost of the equipment. At December 31, 2015, there were no gains or unrealized
losses on derivatives used to hedge.
The provision for unrealized losses is recognized under other liabilities in the balance
sheet, in return for equity valuation adjustment account in equity.

(g)

Embedded derivatives
All contracts with possible clauses for derivative instruments or securities to be made are
evaluated by Financial Management in conjunction with the legal team, prior to signing, so
there is guidance on the eventual realization of the effectiveness tests, establishment of
policy accounting to be adopted and the methodology for calculating the fair value.
The Company currently holds contracts with open embedded derivatives.

(h)

Value and type of margins pledged

The existing operations of foreign currency derivatives not require a guarantee margin
deposit.

(iii)

Parameters used to managing these risks

Regarding the exchange rate risk, The Company's policy is to not be exposed to any
commitments in foreign currency. For the interest rate risk, the Companys policy is to operate
with floating interest rates, since their revenues also grow along with inflation. The Company
does not use protection against the inflation risk caused by momentary mismatch between its
revenues and costs.

(iv)

If the Company uses various financial instruments with various objectives for asset
protection (hedge) and what these objectives are
The Company operates financial instruments in order to maintain the price of imported
equipments and, consequently with foreign currency prices, in Brazilian reais, solely for hedge
purposes.

(v)

Organizational structure for risk management control

The risk control politics and procedures are defined directly through the Companys Board of
Directors and are implemented by the Companys Executive Officers. The Board of Directors are
also responsible for monitoring the fulfillment of these practices.

a. Adequacy of the operational structure and internal controls to verify the effectiveness of the
adopted policy
The Companys Board of Directors analyzes its operational structure and intern controls, and
believes that the policies and procedures of adopted controls are appropriate to the Companys
operational structure. In fiscal years ended in December 31, 2013, 2014 and 2015, the opinion of
independent auditors did not identify deficiencies in those controls.

5.3 Regarding the controls adopted by the issuer to ensure the preparation of
reliable financial statements, indicate:
a. The main internal control practices and the degree of efficiency of such controls, indicating
any imperfections and measures adopted to correct them.
The board of the Company believes that its internal controls and trade policies, operational, financial,
tax and accounting and human resources are adequate to ensure the preparation of reliable financial
statements.
b. Organizational structures involved

All the Company's organizational structures are involved in the practices of internal controls, are
business units are the areas of business support.
c.

If and how the effectiveness of internal control is supervised by the issuer's management,
indicating the position of the persons responsible for such monitoring.
The effectiveness of internal controls is supervised by management constantly and reviewed at least
annually by the Board and Board of Directors, upon the issuance of Control Deficiencies of Internal
Communication by the Independent Auditors.

d.

Deficiencies and recommendations on internal controls included in the detailed report

prepared and sent to the issuer by the independent auditor, in accordance with regulations
issued by the CVM that deals with the registration and the exercise of independent auditing
activity.
COMMENTS OF NA ACCOUNTING AND DISCLOSURE
Significant internal control weaknesses
1.

Formalizing Need for Internal Control Procedures and Improving Accounting Policy
We found that the Company has no formalized internal control policies and should improve
certain aspects of its policy of accounting procedures. The standardization of internal control
policies, together with the improvement of the accounting procedures and policy filling disclosure
checklists allow standardization of procedures allowing the Administration has a better view and
control over financial information. A procedures manual must be easily accessible to the
accounting staff to ensure that the accounting policies are followed and consistently applied.
This manual also benefit the Company when key staff turnover. Policy formalized internal
controls provide management with greater assurance of the effectiveness of compliance with
the adopted policies consistently.

Recommendation
Implementation and formalization of internal control policies;
Improvement of accounting policies formalized by the company, the following:
Revenue recognition, including practice revenue provisions;
Hedge accounting;
Critical analysis of information received from external lawyers in relation to contingent liabilities;
Approval Policy for all unusual transactions, including manual entries;
Cancellations and remission of invoices;
Disclosures and records related parties;
Contract Monitoring aiming to identify embedded derivatives, and
Disclosure checklists Fill each closing (quarterly or yearly);
Accounting manual elaboration for the accounting staff. This manual should even include the main
requirements for closure, as well as address the disclosure requirements for significant notes in
the Company's business environment.
1.

Cut Off Recipe-controls and more accurate accounting routines should be

implemented to recognize revenue on an accrual basis
We identify differences in the recognition of revenue on an accrual basis, thus generating
distortions in revenue balances and receivables of the Company.

Risk
Revenue recognition not respecting the accrual period, thus distorting the presentation of the
Financial Statements.
Recommendation
Implement controls and more accurate accounting routines in order to recognize revenue only when
it meets the CPC accounting standards 30 (R1).
e. Management comments on the shortcomings identified in the comprehensive report prepared
by the independent auditor and on the corrective measures taken
Comment in relation to point 1 above:

Numerous improvements are made in the formalization of internal controls and on over the
Company's accounting policies 2015 policies, which led to a considerable reduction in the points
reported in the comment letter of 2014. The remaining outstanding points of improvement above, will
be subject to analysis for improvement purposes throughout 2016.
Comment in relation to point 2 above:
Sales of leases only after the approval of Measurement Reports are a procedure that needs to be
improved, due to difficulties with customers. In order to correct this procedure, the 2015 closure,
accounting recognize the value of R $ 4.5 million as a provision for deferred revenue.
5.4 Inform if compared to the last fiscal year, there were significant changes in the main risks to
which the issuer is exposed or in the risk management policy adopted, commenting yet, any
reduction or increase in expectations issuer's exposure to such risks
In the fiscal years ended December 31, 2013, 2014 and 2015, there were no events that significantly
alter the main risks to which the Company is exposed or in the risk management policy adopted.
5.5

Other information that the Company deems relevant.

There is no further relevant information about this item 5.

6.1 / 6.2 / 6.4 - Constitution of the Company, Company Lifetime and Date of registration with the
CVM

Date of the Constitution of the Company

12/01/1980

Constitution of the Company The Company was established on December 1, 1980 as a limited liability
company. On January 29, 2009, the Companys shareholders approved a
corporate transformation of the Company, which became a privately held
corporation. The first company of Mills group, named Aos Firth Brown SA
was established in 1952 in the city of Rio de Janeiro, State of Rio de Janeiro,
in the form of privately held corporation.
Country of the Constitution

Brazil

Company Lifetime

Undetermined.

Date of registration with the CVM

6.3

04/14/2010

Brief Company History

The Company was formed in 1952 by the Nacht family, as a scaffold and shoring company which
provided services to the civil construction sector. Mr. Andres Cristian Nacht was a member of the Companys
management team from 1969 to 1998, being President Director from 1978 until 1998. In 1998, Mr. Andres
Cristian Nacht became Chairman of the Board of Directors of the Company, position that occupies until this
Reference Forms date.

In the 70s and 80s, the Company had substantial growth due to the significant civil construction and
industrial sectors expansion in Brazil. Among its activities from this period can be highlighted the construction
of the Rio-Niteroi Bridge (1971), the Itaipu Hydroelectric Plant (1979) and the first Brazilian oil drilling platform
(1983), among other projects.
During this period the Company made important partnerships with international companies that
cooperated with the Companys development. From 1974 to 1986, GKN plc, a large British conglomorate,
was the Companys shareholder, strengthening the beginning of good governance and credibility. In 1980,
the Company signed a partnership with the Canadian company Aluma Systems Inc., the Aluma Systems
Concrete Forms and Formwork Ltda., which had as main objective the introduction of aluminum formworks
in the civil construction sector in Brazil which lasted until 2001.
In the 90s, while seeking to expand the Companys portfolio of services, it made new strategic
partnerships. In 1996, the Company entered into a licensing contract with the German company NOESchaltechnik Georg Meyer-Keller GmbH, to produce and supply modular steel and aluminum panels
formwork to the Brazilian civil construction market. In 1997, the Company entered into a joint venture
partnership with the American company JLG Industries, Inc., to begin activities in the equipment rental sector
in Brazil.
In 2001, the Argentine company Sullair Argentina S.A., replaced JLG Industries, Inc. as the
Companys partner in the in the industrial equipment rental venture, and subsequently acquired its stake in
2003.
In 2007, the private equity funds, Peninsula FIP, managed by IP, and the Natipriv Global L.L.C.,
managed by the Axxon Group, became the Companys shareholders, acquiring, each one, 10% of the
Company for R$ 20 million. The resources from these investments were used, mainly, to acquire equipment.
In 2008, the Company returned to its activities in the rental unit in an organic way, with the
establishment of the Rental business unit, and suspended the operations of its Events business unit, which
was responsible for providing temporary structures, such as outdoor stages and grandstands for the sports
and entertainment segment, as an objective to focus on the segments where it has competitive advantages.
Also in 2008, the Company acquired Jahu Indstria e Comrcio Ltda. (Jahu), which became the Real Estate
business unit, focused on providing engineering services to the residential and commercial civil construction
industry, complementing its activities in the Heavy Construction segment.

The Companys IPO was on April 2010, with a transaction totaling R$ 685 million, of which R$ 411
million related to the primary offering that, consequently, were used to enable its growth plan. Shortly after
the offer, the Companys free float was of 48%.
In October 2010, after the expiration from the lock-up period, due to the IPO, the private equity funds,
Peninsula FIP and Natipriv Global L.L.C., sold the joint participation of 6.2% of the Companys capital,
increasing its free float to 57.2%.
On January 19, 2011, the Company entered into a purchase and sales agreement to acquire 25.0%
of the voting and total capital stock of Rohr S/A Estrutura Tubulares (Rohr), a privately held company
specialized in access engineering and solutions for civil construction, for R$90.0 million. This strategic
acquisition will enable the Company to broaden its exposure to the sectors it serves, especially in the areas
of infrastructure and the oil and natural gas industry. In September 2011, there was a rise in the stake held
in Rohr to 27.5%, resulting from the repurchase by Rohr of 9% of its shares held as treasury stock.
In May 2011, the Company entered into a purchase and sales agreement to acquire 100% of the
voting and total capital stock of GP Sul, one of the largest players in the suspended scaffold rental market to
residential and commercial construction in the state of Rio Grande do Sul, for R$5.5 million, which was
merger into the Company in August 2011. This strategic acquisition, according to Managements opinion,
enabled the Company to become the leader in the suspended scaffold rental market in the state of Rio
Grande do Sul and to broaden its exposure to the residential and commercial construction market in the
South region, in line with the geographic expansion plan of the Real Estate business unit.
In July 10, 2013, the company entered into an agreement for the sale of its Industrial Services
business unit for a total sum of R$102 million, through the sale of their participation in the company
Albuquerque Participaes Ltda. On November 30, 2013, the transaction was completed and the Company
recorded a net gain of R$8,3 million. This sale was made in line with the Company's strategy to focus on
businesses where their skills are able to generate greater value for its shareholders and customers.
Therefore, the Company ceased to operate in the Industrial Services sector where they were offered access
services, industrial painting, surface treatment and thermal insulation, both during construction and in the
maintenance phase of large industrial plants.

6.5 Bankruptcy filings based on relevant values, judicial or extrajudicial recovery of the Company
Not applicable.
6.6 Other information that the Company deems relevant
There is no further relevant information about this item "6.

7.1

Summary of Company and Subsidiary activities

The Company holds as purpose: (a) the rental, commercial intermediation and sale, with or without assembly,
of mobile goods of its own manufacturing or acquired from third-parties, comprising forms, shoring,
scaffolding, pressurized dwellings, floors, structures and similar equipment, steel, aluminum, metal, plastic
and wood, as well as its parts, components, accessories and raw materials; (b) the rental, with or without an
operator, commercial intermediation and sale of aerial work platforms and telescopic handlers, personnel
training for the respective equipments operation, maintenance and technical assistance of its own equipment
or third-party; (c) import and export of the above described goods, including its parts, components and raw
materials; (d) the provision of painting, blasting, thermal insulation, surface treatment, passive protection
against fires, cargo movement, boiler, refractory, inspection and nondestructive testing, including the access
by rope used by the industrial climbers and other equipment and services inherent to such activities, as wll
as manufacturing, assembly and marketing of proprietary products for such activities; (e) consulting and sale
of engineering projects; (f) roofing construction in structured tent with closing a plastic or similar; (g) low
voltage electrical installations; and (h) participation as a shareholder or partner in other companies or
corporations.
According to information released in 2015 by the magazine "O Empreiteiro" and by the IRN - 100
(International Rental News) publication, the Company believes to be one of the specialty engineering
services company and the largest provider of temporary concrete formwork and tubular structures and
motorized access equipment for the Brazilian market. The Company offers its clients specialized engineering
services, providing differentiated solutions, skilled labor and equipment that are essential to large
infrastructure projects, residential and commercial construction and industrial. Customized engineering
solutions include planning, design and implementation of the temporary structures for civil construction (such
as concrete forms, shoring and scaffolding) and motorized access equipments (such as aerial platforms and
telescopic handlers), as well as technical assistance and skilled labor.
During 60 years of history, the Company has developed relationships with most of the largest and most
active Brazilian companies in heavy construction, residential and commercial construction and industry
sector. The Company enjoys strong reputation in accordance to the provision of services on a consistent,
timely, reliable, and quality manner, observing the high safety standards.
The services are offered by four business units: (i) Heavy Construction Business unit (heavy construction,
large-sized, such as infrastructure), (ii) Real Estate Business unit (residential and commercial construction)
and (iii) Rental Business unit (rental of motorized access equipment).
As described in Section 6, the Company entered into an agreement for the sale of its Industrial Services
business unit on July 10, 2013.
Heavy Construction
The Company estimates, according to data published by the O Empreiteiro magazine in 2015, that its
Heavy Construction business unit is Brazils leading provider of specialty engineering solutions and
equipment in revenue. In this unit, the Companys focus is directed to large engineering projects, including
infrastructure projects toward the logistics sectors (specially railways, underground urban networks,
highways, airports, ports and shipyards), social and urban infrastructure (including sanitation networks) and
energy (primarily regarding hydroelectric, thermoelectric and nuclear plants), besides the industrial and large
building construction projects. Such projects are characterized by long-term (usually over one year), usually
developed by the major construction companies in Brazil.
The Heavy Construction business unit offers its clients specific and customized engineering solutions for
every type of construction, considering all the peculiarities and specificities inherent to the location and
complexity of the construction works, with the objective of facilitating the project execution, ensuring safety,
cost, speed and schedule compliance optimization. In many situations, due to its vast experience, the
Company is looked for by its clients to participate in preliminary studies that will provide structuring for its
proposals in the biddings for the construction of large engineering projects.
The Company believes that its main competitive advantages are its expertise, agility, reliability, quality and
safety standards, as well as its ability to provide equipment on a large scale, factors that contribute to the

reduction of overall duration and costs from its clients projects. The Company provides services throughout
the Brazilian territory and also in international projects from its customers, providing high value service and
providing equipment.
The Company's extensive track record includes participation in several of the largest and most important
infrastructure projects in Brazil, such as the construction of the city of Brasilia, the Rio de Janeiro-Niteri Bridge
and the Itaipu Hydroelectric Power Plant. Recently, the Company participated in the construction of the Ring Road,
in So Paulo, the subway systems in the cities of Rio de Janeiro and Sao Paulo, airports and renovated stadiums
or built for the World Cup in 2014, the hydroelectric plant of Estreito, located in northern Brazil, in the Joo
Havelange Olympic Stadium and Olympic Park in the city of Rio de Janeiro. Typical contractual terms of this
business unit ranging from six to 24 months, since the services are critical for a large portion of the construction
project.
In order to facilitate the implementation of the solutions that the Company idealizes, it offers customers through
leasing contracts and in some cases selling a wide range of equipment, including concrete formwork and shoring
structures, including projects and technical studies, technical support and training necessary for its correct use.
Taking into account the specific needs of a particular project, there is flexibility to hire the manufacture of specially
modeled equipment for the work in question.
In general, customers use their own employees to implement solutions designed and assembly of the Company's
equipment. However, in the case of more complex assemblies, the client's discretion, company employees may
be allocated for the assembly and disassembly of structures.

Real State
While the Heavy Construction business unit is focused on large engineering and infrastructure projects, the
Real Estate Business unit attends, primarily, the residential and commercial construction contractors,
developing projects and providing services of concrete formwork, scaffolding, shoring and access equipment.
The Company also provides engineering services in connection with building refurbishing and maintenance,
primarily through the provision of suspended scaffolding. Inside of this business unit's activities, the Company
provides planning, project development, technical supervision, equipment and related services.
In the third quarter of 2015, the commercial management of Infrastructure and Buildings was
unified into one board. The Operational boards and Engineering were also consolidated. As a
result, business units Infrastructure and Buildings are now reported in a unified way, now called
"Construction". We will continue following the recipes of Infrastructure and Buildings separately,
given the different dynamics of each market.
The business unit Construction held on December 31, 2015, 17 operational units located in the
states of Amazonas, Bahia, Cear, Distrito Federal, Esprito Santo, Gois, Maranho, Mato
Grosso, Minas Gerais, Par, Paran, Pernambuco, Rio de Janeiro, Rio Grande do Sul and So
Paulo.

Rental
The Company is one of the largest providers of motorized access equipment, in Brazil, supplying
aerial work platforms and telescopic handlers, to lift people and cargo to considerable heights,
based on data published in the O Empreiteiro magazine in 2015. The equipment enables safe,
fast, versatile and precise access for professionals to perform tasks safely and efficiently at
heights from two to 56 meters. The handlers allows materials weighing up to 5.000 kg to be lifted,
transported and delivered to heights of over 21 meters, at a job site or within an industrial plant.

The main objective of this segment is to increase productivity and security, it is also offered to
customers operating training certified by IPAF (world authority air access) and we serve all the
rules of NR 18.
Indications and Awards
- 2012 - Nominated for the award for Best Training Center
- 2012 - Winner of the Year Access Company award
- 2013 - Nominated as the company that invested in security
- 2014 - Winner of the Best Training Center award
- 2014 - Nominated as the Year Access Company
-2015 - Indicated as pioneer company in Motorized Access
- 2016 - Nominated as a Company with Contribution to secure access height
7 nominations in five years. 2 awards.
The Rental business unit serves the same sectors as the other business units, such as heavy or residential
and commercial construction and industrial construction, as well as other economic sectors, as the

automotive, retail and logistics sectors, among others. Therefore, its client base is diverse, including clients
from the other business units. Generally, the Company rents equipment on a monthly basis, being the
average contract length from two to three months, although 18-month or even longer contracts.
The Company introduced the large-scale use in Brazil of motorized access equipment specific for height
purposes in 1997, when it entered into a joint venture agreement with the American company JLG Industries
Inc., world leader in access equipment manufacturing, to rent aerial platforms and telescopic handlers, the
first joint venture in JLGs history.
In 1999, the Company introduced the large-scale use of telescopic handlers in the Brazilian market. This
motorized equipment can be used to transport loads to various heights and replaces a number of other
pieces of equipment traditionally used at construction sites, such as cranes, munck trucks and service lifts,
among other equipment. In 2001, Sullair, an Argentine equipment rental company, replaced JLG as the
Companys partner. In 2003, due to unfavorable market conditions in Brazil and the lack of capital necessary
to carry out essential investments, the Company suspended its equipment rental operations and transferred
the joint venture to Sullair.
In December 2007, as part of its diversification strategy and based on favorable market and credit conditions,
the Company established its Rental business unit and began renting aerial platforms and telescopic handlers
again.
According to the Companys estimates, based on data of 2011 from Terex and Brazilian import statistic of
2011, there are currently 34 thousands aerial platforms and telescopic handlers in Brazil. In comparison,
789,000 aerial platforms and telescopic handlers are available in the United States based on data provided
by Yengst Associates. The Company believes that this gap, together with the current favorable economic
conditions in Brazil, indicates that this rental market is incipient in Brazil, offering significant opportunities for
expansion in the segment. The Company believes that its scale, specific industrial sector expertise, reliability
and safety record have been the primary factors driving the growth of the Rental business unit since the
beginning of its activities in 2008.
In addition, the Company may benefit from the introduction of stricter technical norms and procedures, in
particular with respect to safety regulations for work performed at significant heights or in areas that are
difficult to access. Among other provisions, Regulatory Norm 18 establishes that workers must be lifted with
the use of motorized access equipment, rather than manual equipment, which has resulted in an expansion
of the potential market for rental of its equipment.
As of December 31, 2015, the Equipment Rental business unit was present through 32
operational branches, in the states of Amazonas, Bahia, Cear, Esprito Santo, Gois, Maranho,
Mato Grosso, Mato Grosso do Sul, Minas Gerais, Par, Paran, Pernambuco, Rio de Janeiro,
Rio Grande do norte, Rio Grande do Sul, Santa Catarina, So Paulo and Sergipe and the Federal
District.
Industrial Services
The Industrial Services business unit is focused on the provision of services to the oil and gas sector, as well
as to the chemical and petrochemical, naval, steel, pulp and paper, and mining industries. The Industrial
Services business unit was established in the 1980s with the recognition that certain equipment used in its
civil construction projects could also be employed to provide access to the structures and facilities of large
industrial plants. At that time, the Company began renting access equipment, such as scaffolding systems,
to carry out maintenance work in industrial plants, rapidly, expanding its services in the industrial sector to
include assembly and disassembly, a sector that the Company believed could easily exploit in view of its
past expertise in civil construction, and in sequence, it also began offering specialized maintenance services,
in particular, industrial painting and thermal insulation, which started to compete with companies that had
regularly rented the Companys access equipment for these purposes of providing such surface treatment
services and helping its clients manage their costs more effectively as they were able to reduce the number
of suppliers contracted for the provision of such services. This way, the Industrial Services business unit
provides the equipment and also the labor required for the provision of its services, being labor-intensive.
Based on data published on 2013 by the O Empreiteiro magazine, the Company believes to be one of
Brazils major players in providing structures designed to provide access for personnel and materials during
the assembly of equipment and pipes, during the construction of industrial plants, as in the maintenance
phase, preventive and corrective. The Company also offers industrial painting services, surface treatments
and thermal insulation.
The Industrial Services business unit works, generally, together with the industrial contractor or the plants
maintenance department in planning, erecting and dismantling structures, when and where they are needed,
and performing painting and insulation, with own labor, as a way to guarantee the quality and safety of its
execution.

The contracts from the Industrial Services business unit with its clients are usually long-term, from one to
three years, being able to be renewed at the end of the contracted period. On most cases, this Business unit
is generally paid based on units of finished services or in service levels, such as meters of erected
scaffolding, or square meters of painted or insulated surface, being able to hire on a man-hour based price.
The Industrial Services business unit is present in the main industrial centers in Brazil, through seven
branches, in the states of Rio de Janeiro, So Paulo, Minas Gerais, Bahia, Pernambuco and Rio Grande do
Sul, and has a long history of developing innovative solutions and making on-time or early delivery of
projects, including with respect to deep sea oil platforms.
Customers of Industrial Services business unit prized for its reliability, quality, consistency and the
Company's award-winning performance in the security area. These factors ensured a high rate of contract
renewal and allowed to develop lasting relationships with customers such as Dow Brazil and Braskem
groups, which are the Company's customers for over 16 years. Customers looking for the Company for
expert, fast and flexible delivery of equipment and highly skilled installation, as well as deep understanding
of local needs.
The main sectors served by the Industrial Services business unit are oil and gas, petrochemicals,
steel, paper and pulp, mining, and naval. Oil and gas represented 61% of the Industrial Services
Business units revenue in 2013. The Companys clients include some of the largest industrial
groups in Brazil, such as Braskem, Camargo Corra, Dow do Brasil, Petrobras, Queiroz Galvo,
among others. The Industrial Services business unit has significant synergies with the Heavy
Construction business unit. After the completion of the concrete structures in large industrial
projects, such as plants or refineries, its clients often engage the Industrial Services business unit
to support the industrial construction of the plant and subsequently to provide preventive and
corrective maintenance.
The Companys commitment to safety, which is reflected in all of its operations, is particularly critical to the
clients from this business unit, many of which operate according to international safety standards established
by their headquarters. Many of its clients operations involve the use of flammable and toxic substances.
Seeking continuous improvement, along the years, the Industrial Services business unit has secured several
international safety certifications, such as OHSAS 18001, ISO 9001 and ISO 14001. The Companys
commitment to the application of robust safety standards has also been recognized by its clients, as
demonstrated by the following awards: Destaque Petrobrs, Braskem Ouro, TOP Copene, Prmio Isopol de
Segurana, Prmio DOW for 14 consecutive years of providing services without work loss time injuries,
Prmio 5 Estrelas Arcelor Mittal (five star award), Prmio Excelncia na Construo Bahia (excellency in
construction), Prmio Performance SSMA Millennium Cristal , Prmio Reconhecimento pelos resultados
de SSMA in the Braskem unit at Alagoas, Prmio Zero Acidente Reportvel - Dow.
The sale of the Industrial Services business unit was completed on November 30, 2013 and the
Company earned net income of R $ 8.3 million from the sale. The agreed sale value of R $ 102
million, R $ 25 million was received in the contract signing date, in July, and the balance will be
paid in installments corrected by CDI, discounting the generation of this business case for Mills
between 1 June 2013 and the closing date, which was equal to R $ 6.8 million. This divestment
is in line with Mills's strategy to focus on businesses where their skills are able to generate
greater value for its shareholders and customers.

7.2 Regarding each operational segment(s) disclosed in the consolidated financial statements for the past
fiscal years
a. Commercialized products e services
Heavy Construction
Usually, the company employs a workforce only in the design of engineering solutions and equipment
use of surveillance, leaving it to their customers to assembly and disassembly. However, in more
complex situations, the Company allocates own labor also in the assembly and disassembly of
equipment.
Offered equipment:
The main equipment offered by the Company to the clients of the Heavy Construction business unit includes:

Steel Shoring Equipment: The primary shoring equipment the Company provides are Millstour shoring posts, a
versatile system capable of supporting loads ranging from 24 to over 156 tons per post, depending on the
configuration. In accordance with the Companys market perception, its shoring equipment is considered the most

flexible and versatile shoring system in Brazil. This system provides for ease of assembly with its heaviest
component parts weighing less than 13 kilograms. Each shoring post has an automatic locking element and can
support loads of up to six tons. Load-bearing capacity may be doubled or even tripled with the use of connecting
trusses. In addition, these telescopic shoring posts are fully adjustable to meet nearly any height requirement and
may be used in multiple applications. Millstour is typically used in the construction of bridges, viaducts and dams,
as well as in large-scale industrial projects.

Shoring Aluminium: The main equipment used is the Alu-Mills, a system of aluminum shoring with load capacity
up to 14 tons, which can be connected by trusses forming isolated towers of different heights. This system also
allows total displacement of the joint without the need for disassembly also bringing significant labor savings.
Compared to the shoring post systems or conventional steel shoring, this system is the one with the lightest weight
/ resistance ratio, being up to 2.5x lighter, saving very much in the amount of equipment deployed in the works.
The Alu-Mills can be used in buildings and even heavy construction works reaching a wide range of application.

Trusses: The Aspen Launching is a motorized horizontal truss able to transport and position precast beams
weighing up to 140 tons and spanning up to 45 meters. This truss may be used during all stages of a construction
project, from the delivery of the beams at the construction site to positioning the beams on permanent supports.
The truss may also be used to launch braces for the construction of viaducts with a high degree of safety and
minimum labor. No additional equipment is required to launch such braces, as the Aspen Launching Truss also
transports the supports, stands and other accessories required for launching such braces. Moreover, the truss may
be operated at inclines as steep as 6% without additional components and without any deterioration in its loadbearing capacity. The Aspen Launching Truss is typically used in the construction of bridges, viaducts and industrial
structures. The M150 Truss is a horizontal heavy duty truss used for laying concrete. The Company believes that
the M150 Truss has the highest load-bearing capacity among similar products in the market, while remaining as
light as conventional trusses. The M150 can bear positive stress of 150 tons per meter and negative stress of 100
tons per meter, thus requiring fewer modules than for conventional trusses and less movement of materials, which
reduces costs for labor and secondary equipment. The Company believe that the M150 Truss is the only truss
available in the market which is able to absorb negative stress and which includes a curvature adjustment
mechanism. The lower rail supports the truss via an exclusive connecting post, eliminating the need for additional
supports. The Companys Truss can be operated either with the use of supporting structures, or through the even
distribution of weight, providing it with the capacity to be operated at significant heights over great spans.

Balanced Cantilevers: Balanced Cantilevers are used to build bridges and overpasses under conditions where the
constructive approach does not allow for shoring directly from the ground, when there is a need to implement large
spans, and when work has to be carried out without interrupting the traffic on urban roads. The principle behind
the Balanced Cantilever is the use of specific equipment (Mills' metal trusses and profiles) implementing portions
of the superstructure "hanging" right on the transversal section (staves) that go on swings, from the pillars, stave
to stave, until the entire span has been completed. The trusses are always anchored on the previous, already
prestressed staves, and all forces coming from the concrete are transferred to and then supported by them.

Reusable metallic formwork systems: The formworks are used as molds for concrete. There are two different
formworks: vertical walls and pillars and horizontal beams and slabs for such as: SL 2000, ALU-L, ALUMA, Mills
Light, TOP MILLS, climbing, automatic climbing and special.
SL 2000: Using the German NOE technology, and with easy application and handling as its main feature, the 2000
SL formwork system allows a single worker to assemble and disassemble the panels.
It was designed especially for work for which there is no equipment available, such as cranes and hoists. It consists
of panels made of steel and coated with a plasticized 12-mm plywood plate that can withstand concrete pouring
pressures of up to 55 KN/sq.m. The SL 2000 formwork panel is light, 33 kgf/sq.m, and affords quick and easy
assembly (few components) in any situation and on any surface. It also allows any geometry to be formed, whether
rectangular or circular, with varying heights and radii. It is ideal for blocks and straps, adjustment layers, gutters,
beam sides and for pillars and walls. The SL 2000 supersedes any conventional formwork of the same nature and
can be used even for the simplest concrete tasks, cutting labor costs by up to 70% compared to conventional
formwork.
Top Mills: The Top Mills system consists of industrialized panels, made in steel and coated with a 21-mm plywood
plate specially designed to withstand concrete pressures of up to 80 KN/sq.m. It is ideal for broad area formwork
and is very efficient not only for use with reservoir walls, powerhouses and spillways, elevator shafts and stairwells,
but also to build large pillars. Panel modulation is smart and allows one to form a large variety of heights and
widths, significantly reducing the use of wood and conventional formwork complements and, thus, allowing for
excellent concrete surface finishing. With Top Mills, no complement needs to be larger than 15 cm. The panels are
interconnected by means of staples and may be transported to the next stage of the work in isolation or coupled to
form a rigid assembly providing a reduction of up to a third of the time in the concrete pouring cyclic. Formwork
assembly takes place at a rate of 0.22 Mh/sq.m, while the disassembly rate is 0.11 Mh/sq.m.

ALU-L: ALU-L is an aluminum formwork system manufactured in Brazil using the cutting-edge German NOE
technology. It is a large-area formwork panel system made with special aluminum profiles and coated with a 15mm high-resistance plasticized plywood plate that can withstand concrete pouring pressures of up to 60 KN/sq.m,
affording excellent concrete finishing. It is self-alignable and ideal for application on large wall formwork, whether
in reservoirs, canals, galleries, cooling towers, rectangular silos or any other structure that has large concrete
pouring sides and repetitive formwork cycles. It is also used as a formwork solution for pillars. This formwork system
was developed for work that requires large cranes or hoists, but it can also be used manually. The lightweight
panels (average weight = 20 kg/sq.m) can be handled individually or joined to form a single panel measuring up to
30 sq.m, and then transported to the next concrete pouring stage. The large panels that are put together, as long
as they are assembled at the application site, do not require full support from the hoist, which can be used to tend
to other needs at the construction site. Hoist support is only required when the panels are positioned and/or
transported. This affords great savings, not only in assembly and disassembly (0.17 Mh/sq.m - assembly and 0.08
Mh/sq.m), but also in machine usage time, freeing them for other activities at the site. ALU-L can also form circular
walls using the same accessories as SL 2000. It is also compatible with the SL 2000 formwork system and it is
possible to join panels from both of these two systems using joining clamps.
Aluma System: The Aluma Formwork System comprises broad area panels made with highly resistant aluminum
beams and headers that afford the work multiple applications in several geometries: walls, pillars, galleries, tunnels
and slabs. Its lightweight components allow broad panels to be built in any dimension with little weight (40 kg/sq.m),
high load capacity and easy assembly, doing away with the need for specialized labor and allowing for excellent
productivity. Its aluminum beams and headers have high impact absorption capacities, performing three times
better than steel. The advantage of aluminum, combined with the best weight/strength ratio afforded by the Aluma
panels, is that it allows for greater flexibility in projects that require speed. It is necessary to use a machine to
operate the panels.
Mills Light: Mills Light is a system of self-aligning panels, structured with steel profiles, covered with hardboard
plate, and with load capacity of 50 KN/m. It is indicated for all concrete structures of a large construction.
Climbing Formwork System: The Mills Climbing System was conceived to address the challenge of very high walls
and pillars, having been designed for vertical concrete structures where a single concrete pouring operation is not
feasible. It should be applied, preferably, in similar and repetitive stages, although this is not essential. Its
application is recommended for special industrial building structures, bridges and overpass pillars and, especially,
hydroelectric power plants. It can also be used to build elevator boxes and stairwells and for blind gables in
residential and commercial buildings. The basic principle behind the climbing formwork is its reuse in a subsequent
concrete pouring stage, always supported on an anchor made in the previous poured layer. A first concrete pouring
stage is carried out leaving a concrete anchorage point in the concrete, typically formed by a small steel tail and a
positioning cone (recoverable). After the removal of the formwork, the positioning cone is substituted for a support
cone, which will serve as a support for the next layer. The set will be raised when the concrete has hardened. It is
moved with the aid of the crane. The next stage is raised, formwork and scaffolding both, with no need for additional
scaffolding. It is compatible with all Mills panels: ALU-l, Top Mills and Aluma.
Automatic Climbing Formwork System: Mills' Automatic Climbing Formwork System comprises metal platforms
and form panels that move vertically, driven by a special hydraulic system, with no need for a crane. The process
takes place with maximum safety and the whole set (platforms and forms) is lifted to the next phase of the work all
at once. The Self-climbing System has advantages over the sliding formwork system: (a) When necessary, the
concrete pouring can be interrupted and then restarted; (b) It allows for labor cost reductions as it does not use
uninterrupted work processes (overtime) and specialized teams; (c) Improved final looks of the finished concrete,
with improved geometric control and greater accuracy; (d) Does not require special concrete, accelerators and
steel frame reinforcements; (e) Greater operating safety.
Modular Formwork and Shoring System: The SM Mills modular system is the new formwork and shoring solution
in a single system. This equipment has high load capacity and it is indicated for complex geometries and can be
moved, making the reuse without disassembly possible, with great labor savings. The SM Mills is formed by the
combination of metallic sections, that, when unified through special connections and combined with aluminum
beams, can form a variety of geometrical formations, attending various types of concrete structures, such as
tunnels, galleries, inclined slabs, suction, diversion and transition tunnels in big hydroelectric plants. The modular
steel composition, in the above described situations, replaces advantageously the traditional shoring systems
made of towers, tubes and clamps, increasing productivity and safety in the construction site. SM Mills is ideal for
repetitive sections, because it allows vertical shoring and horizontal formwork in a single system, and, with the help
of deformation and displacement equipment it is possible to lower it after the concreting and displace it to the next
work phase without the need for disassembly.

Carrelone is an equipment destined to transport pre-molded beams up to 45.00m of interspace and up to 140 tons
of weight. This equipment is composed of two mobile gantries mounted above the tires, devoid of engine for its
self-handling, needing a loader type cat. 930 or 966 for traction of the set and longitudinal transportation of the

beams. Carrelone has a hydraulic system for direction of the set and lifting of the beams in the pre-molded building
side and its capacity is up to 70 tons per gantry.

Stave lifting cart car equipment: This is an equipment destined to lift pre-molded staves in bridge and viaduct
constructions. This equipment has a hydraulic system for levelling ADN adjustment of the cars and of the stave
and electric winches equipped with secure braking system.

Access Scaffolding: The Company offers a scaffolding system called Elite, which is a tubular metal tower system
that can be assembled into access structures of varying heights and dimensions. Elite is a simple system composed
of only three types of pieces: support posts, transverse pieces and diagonal supports, manufactured from
galvanized steel. Each post can bear loads of up to three tons. No tools, bolts or screws are required to assemble
the scaffolding system as each part is simply slotted into each other part. On average, a single worker is generally
able to assemble 15 linear meters of scaffolding per hour.

Mills Lock: a system of towers with multidirectional fittings that enables several geometric forms of towers and can
be used as Access scaffold, scaffold of facade, platforms and other ways.
Another access product are the assembled stairs, measuring 2.00 m x 3.30 m, with flat areas every 1.50 m
vertically, railing at heights of 0.70 and 1.20, and measuring 80 cm in working width. All measurements comply
with Standard NR18. Assembly (0.5 m in height/MH) and disassembly (1.0 m in height/MH) productivity exceeds
customer expectations.
Finally, the steel floor has the lightness demanded to build scaffolds, with the robustness proportioned by the steel,
ensuring a high resistant floor and reliability. The floors top coat is made of electrolytic galvanizing that ensures
long use in aggressive environments without suffering oxidation.
For the Buildings sector, projected to shoring solutions, forms and access providing special equipment for light
constructions such as residential and commercial buildings. The main equipment that the Company offers to its
customers through the business unit Construction for Building sector include:

Steel shoring: The main steel shoring system is the metallic modular towers, formed by the fitting of braced tubular
frames, which allows loads of up to 8 tons per tower. Connecting brackets make it possible to aggregate additional
frames to the tower, increasing its load capacity, and adjustable shoes and brackets allow the millimetric adjustment
of the top and base of the towers, providing great time reduction not only in the leveling but also in the formwork
removal. Metallic sections complete the system, allowing the perfect union of the slab structure, providing great
savings to the shoring. The shoring and bracing system for of buckets enables form removal keeping the slab reshored. It consists of metal guides to support buckets and drop heads on the heads of the struts for quick formwork
removal without strut removal. Re-shoring and conventional shoring for towers and struts. Greater alignment and
ease in positioning of the buckets. The system provides for the locking of the buckets, preventing them from moving
during the framework assembly, thus increasing safety.
Shoring aluminum: The flying table Aluma Light is a shoring system designed in aluminum trlias, highly resistant,
designed to speed up the construction of residential and commercial buildings with large cloths smooth slab and
preferably. The great advantage of Aluma Light is the labor savings in operations because it does not require disassembly
and reassembly of shoring every concreting. It is possible to form tables of up to 80 m fully ready for implementation of
the frame and the entire assembly is lifted by the crane and positioned in the upper level of the slab, in the case of
repeating vertical or slid forward, in the case of horizontal repetition. The Aluma Light System is ideal for short schedule
of works or structural design with many repetitions, whether vertical or horizontal, such as large commercial and
residential buildings, shopping centers and industrial facilities. The Alumills is an aluminum shoring system with a load
capacity up to 14 tons, which can be connected by trusses forming isolated towers units of different heights. The towers
may be mounted horizontally, allowing a much more productive process and subsequently placed in a vertical position.
The sets can be reused without disassembly, allowing horizontal movement and vertical lifting with a crane or hoist. This
system also allows the total displacement of the assembly without disassembly also bringing much labor saving. The
light weight and high load capacity are the major attributes of Alumills system. These features provide much lighter
solutions and, in turn, more productive in the assembly, disassembly and reaproveitamentos. Compared with the shoring
towers or conventional steel stanchions systems, this system is the one with the lowest weight / resistance, reaching 2.5
times lighter, saving a lot on the amount of equipment deployed in the works. The Alumills can be used in buildings since
even in heavy works reaching a wide range of application.

Formwork for concrete in modular reusable panels: The formwork is used as molds for the concrete. There are two
types of formwork: vertical, for walls and pillars, and horizontal, for beams and slabs, such as: SL 2000 and Mills
Deck.

SL 2000: The SL 2000 Formwork was designed to expedite concrete pouring for pillars, curtains, walls, stairwells
or elevators, suspended or buried reservoirs, foundation blocks, beams and walls in general. It affords increased
safety and a substantial reduction in time and labor costs thanks to its ease of assembly. Design based on
technology provided by the German company NOE; Easy to assemble, disassemble and transport, this framework
requires no training or skilled labor, a fact that affords gains in safety and finish quality; Its use enables a 50 to 70%
reduction in labor compared with conventional wooden formwork; Manufactured under strict quality controls, this
framework allows for superior concrete finishing; Because it is a highly versatile product made in different
dimensions, the SL 2000 Formwork allows for a simple, safe application for assemblers in any work situation and
geometry.
Mills Deck Light: The Mills Deck Light is a system of forms of flat slab formworks for the residential and commercial
segment. Formed by struts, aluminum panels and "dropheads" which allow the removal of the bottom panels from
the slabs keeping them shored, the Deck System provides the economy of a form set to the builder and also
provides more speed to the construction work.
Easy-set Formwork (used in the government program Minha Casa, Minha Vida): Easy-Set is a formwork system
that was conceived and developed by Aluma Systems Canada for residential, house and multiple floor building
work and withstands pressures of up to 60 KN/sq.m. With the Easy-Set system, execution time is reduced to less
than half compared with the traditional construction system. It allows for daily concrete pouring cycles, resulting in
a home per day.
Tubular Scaffolding: Real Estate business units scaffolding, of great tradition in the Brazilian civil construction
market, are present in the daily lives of countless workers in Brazil, which doubtlessly makes for a big operational
advantage un the development of the construction work. With fast and simple assembly, the scaffolding towers are
put together through the fitting of tubular frames, braced by diagonals embedded in the frames through extremely
functional latches. All types of frames used by the Company are a result of technological and market research,
aiming to ensure maximum safety and versatility upon use. As an example, the access stairs are embedded to the
tubular frame, making the workers access easier and contributing to the structural rigidity. They are also equipped
of frames and trusses that makes it ideal for use in urban centers, allowing the pedestrian to walk freely, without
being blocked by the tubular structure.
Suspended Scaffolding: Suspended scaffolding are systems that use steel cables fixed to the buildings faades.
The electric suspended scaffolding is meant for the execution of services that require extreme speed and agility
without any effort from its user, since it has a powerful engine and a simplified operation that allows a constant
speed of approximately ten meters/minute. The platforms have a non slip flooring and can be modulated in various
lengths with a minimum configuration of 2 meters and a maximum of 8 meters, and cable lengths that reach up to
150 meters. The Real Estate Light Lifter/Puller Cable suspended scaffolding is suitable for work that requires
extreme speed and agility, but not a high load capacity. Using it in painting, wall cleaning and waterproofing jobs
or in facility or external piping renovation speeds the work up.
Mast Climbing Platform: The mast climbing platform, as it is automatic, allows greater speed in faade works than
traditional scaffolding, also providing much greater safety in its operation.
Rental
Offered equipament
The Rental business unit offers aerial platforms, new or semi-used, which allow workers to perform tasks at different
altitudes, and telescopic handlers, which are used to lift loads to varying heights.
Boom Platforms: Offered both telescopic and articulated boom platforms, which provide access to heights ranging
from 10 to 56.7 meters. Offered with several options, as two or four-wheel, all-terrain kits, models with a narrow or
wide base, and either diesel or electric engines.
Scissor Platforms: Scissor platforms provide an alternative to boom platforms that allow access to narrow spaces.
These platforms have a platform extension sliding system, and are available with either diesel or silent electric
engines. These platforms are available in a number of models which may be used in various types of terrain and
provide access to heights ranging from 6.4 to 18 meters.
Telescopic Handlers: Telescopic handlers are an extremely versatile type of equipment able to lift loads weighting
up to 5.000 kilos to a height of up to 21 meters.
Technical Assistance: To provide support both to rentals and equipment sales, the Company has highly qualified
technical staff trained to deal with the entire line of aerial work platforms and tele handlers. The staff is constantly
trained by equipment manufacturers and take regular refresher courses through an internal training program. The
Company owns a fleet of workshop vehicles, equipped with the tooling needed to carry out preventive and minor
corrective maintenance , thereby speeding up technical services and ensuring greater equipment availability.

IPAF Training: Mills is the first company to provide training for IPAF Operators and demonstrators in Brazil, and
the second to do so in Latin America. Additionally, it is a member of CBI - the Brazilian Council of the IPAF. One
of the main goals of this initiative pioneered by Mills is to instruct these professionals on the concepts of risk
perception/assessment and drive their ability to ensure the proper and efficient operation of Aerial Work Platforms,
increasing productivity and compliance with standards related to safety at work.
Industrial Services
The Company operated in two fronts:
Maintenance: The majority of revenue of this business came from the services that provided maintenance in a
continuous way in plants and installations already built, when the majority of the contracts had duration between
one and three years and, in large number of the cases, had been renovated during several years. Also, part of the
revenue came from interruptions in operational activities for longer periods for maintenance, which usually occur
once a year in industries that operated continuously. This interruption meant lower revenue to our clients, which
emphasized the performance of the Company in comparison to the competitors by demonstrating capacity to
conduct the labors properly with safety and punctuality, reasons why the Company was repeatedly hired.
New Plants: The Company offered services in assembly of access structures in new industrial plants, and also
for platforms and ships which operated in the Oil and Gas market. Many times the Company continued the
service with the Heavy Construction unit, that operates in civil works.

b. Revenue from the segment and its participation in the Company's net revenues
The table below indicates the net revenue from each of the business units and its share in the total net revenue
on the indicated periods:
Business unit
2013

Heavy Construction
Real State
Rental
Industrial Services
Total

Net
Revenue

% of
Total
Net Revenue

216,9
258,0
357,3
208,3
1.040,6

20,8%
24,8%
24,3%
20,0%
100%

Fiscal year ended December 31:

2014
% of
Net
Total
Revenue
Net Revenue
(em R$ milhes, exceto
percentagens)
211,0
26,6%
212,4
26,7%
370,8
46,7%
794,2
100%

2015

Net Revenue

% of
Total
Net Revenue

165,7
117,2
293,2
576,1

28,8%
20,3%
50,9%
100,0%

Pro-forma results consolidated data considering the Industrial Services business unit, until its sale date.

c. Profit or loss resulting from the segment and its participation in the Company's net income.
The table below indicates the net income from each of the business unit and its share in the total net income
on the indicated periods:
Business unit
2013*
% Net
Net Revenue Revenue
Heavy Construction
74.414
43,10%
Rental
87.460
50,70%
Industrial Services
4.918
2,80%
Others
5.800
3,40%
Total
172.592
100%

Fiscal year ended December 31:

2014

2015

% Net
Net Revenue Revenue
8.125
12,60%
58.783
91,50%
-2.640
-4,10%
64.268
100%

% Net
Net Revenue Revenue
-94.094
96,2%
13.634
-13,9%
-17.341
17,7%
-97.801
100,0%

Pro-forma results consolidated data considering the Industrial Services business unit, until its sale date .

7.3 Products and services that correspond to the operating segments disclosed in
item "7.2
a. Characteristics of the production process
The Company outsources the entire process of production of the equipment used in their operations. See
item 7.3(e) below.

b. Characteristics of the distribution process

The Company rents its equipment and provides their services according to the needs from their
clients. As of December 2015, the Company was present in 17 states with 52 branches.
For greater details about our equipment, see item 7.2 above.
c.
(i)

Characteristics of the markets, in particular:

participation in each market

The Company believes to be Brazils leading provider of specialty engineering solutions and equipment, such
as formwork, shoring and scaffolding, and in the access motorized equipment rental for the for the Brazilian
market. However, there is no public information about the exact market share of the Company and its
competitors.
(ii)

Competition conditions in the markets

The Company faces significant competition with respect to all its business units. However, the
Company believes it has competitive advantages in different sectors in which it operates, by
offering solutions with a high degree of excellence, service capacity and innovation in order to
meet or exceed the deadlines expected by potential customers.

Heavy Construction
The Company believes that its Heavy Construction business unit enjoys an established leading
presence in its segments. The competition is highly qualified with companies which have been in
the market for a long time. However, the competitive environment presents stability, with few new
entrants.
Real State
The sector of residential and commercial construction in Brazil is highly fragmented. In comparison with the
Heavy Construction unit, the Real Estate projects are spread, generally, through the whole country in
different cities, with smaller in physical dimension terms and have lower duration with average between four
to six months. The recognized reputation of the Company in the Brazilian market is very important for the
success in activities in this business unit. The Companys biggest advantage is the high velocity to answer
the clients. With regional coverage, the Real Estate unit is closer to its clients, attending their needs with
agility and with a variety of equipment taking to better solutions.
In this market, the ability to reduce construction costs and to provide solutions for reducing execution time
and the use of labor is crucial to attracting new clients and securing participation in new construction projects.
The Company believes that its Real Estate business unit is a leader in the residential and commercial
construction market.
Rental
Due to the participation in a still minor market with great potential for expansion, the Rental market presents
more dynamism, typified by the entry and exit of new companies and high investments of the established
competitors.
The Company believes that its Rental business unit is one of the major providers of motorized access
equipment, aerial platforms and telescopic handlers, both for lifting personnel and cargo to considerable
heights in Brazil. Besides the lack of public information about its competitors, the Company believes to be
leader in this segment.
Industrial Services
The Industrial Services business unit operated in highly competitive market segments. While in the access
segment the Company believed to have solid leadership, in the industrial painting and, in particular, the
insulation market, the Company competed with larger competitors.
The Company believes that the competitive in this sector consists on offering solutions both innovative and
high level of excellence at low cost, building long-term commercial relationships with its clients.
The information above related to Industrial Services is limited to the Companys evaluation up to the
conclusion of business unit sale, in November 2013.

d.

Seasonality

The Company believes that there is not seasonality in its business.

e.
Key inputs and raw materials: (i) description of the relationships with suppliers,
including whether they are subject to governmental control or regulation, identifying the
bodies and the respective legislation; (ii) potential dependence on few suppliers; and (iii)
possible volatility in their prices
To the Heavy Construction, Industrial Services and Real Estate business units are acquired from habitual
suppliers, the raw material necessary for the manufacture of equipment offered by the Company, primarily
steel and aluminum sheets, which prices paid for such materials are directly impacted by fluctuations in
commodity prices. The Company has a large number of options when choosing its raw material suppliers
and the choice is influenced mainly by the charged price.
After purchasing the raw materials, the Company outsources the entire manufacturing process to third
parties, as well as subsequent to the assembly. In this manner, all of the equipment manufactured is done
by third-parties. Due to the very high quality standards that are needed from the equipment, the Company
has very careful restricted selected companies to perform the manufacturing. To catch up with demand,
equipment is also imported from China, through carefully verified suppliers, which must be within the
Companys high-quality standards.
Regarding the Equipment Rental unit, the aerial platforms and telescopic manipulators used are acquired
from third parties. The criterion that guides the choice of suppliers for these products is based on its quality
and on after-sale services. The main suppliers of finished products are JLG, Terex and Skyjack, of whom
the Company is partially dependent on, due to the small number of suppliers in the market. Furthermore,
motorized components and pieces are acquired from others suppliers, either national or foreign.
Regarding the inputs, gasoline and diesel are regularly acquired for the motorized equipment in the Rental
division. For the Heavy Construction and Real Estate unit, hardboards for the maintenance and
industrialization of the equipment are acquired, with the plasticized hardboards used to equip the formwork
in the aluminum chassis systems (Mills Deck-Light, Mills Deck and ALU-L), and in the steel chassis systems,
(SL 2000 formworks). Additionally, the Company buys spare parts for its motorized equipment from other
Brazilian and foreign supliers.
Generally, the agreements with the suppliers are short-term. The charged prices by the suppliers may
experience volatility as a result from the labor prices, and commodities that are used in the equipment
manufacturing, especially steel and aluminum. The Rental Business unit equipment, are impacted by the
exchange rate fluctuations.
7.4 Clients accounted for more than 10% of total net revenues of the Company
In the fiscal years ended December 31, 2013, 2014 and 2015, the Company had no sole clients
accounting for more than 10% of the total net revenue.
7.5 Relevant effects of state regulation on the Company's activities
a. The need for government authorization to exercise the activities and long-standing
relationships with the government to obtain such permits
There is no specific regulation on the activities that the Company carries. The Company does not need to
obtain permission or license in addition to those required to all commercial companies.
For more information about the judicial, administrative or arbitral not confidential and relevant Company,
see item 4.3 of this Reference Form.

b. environmental policy of the Company and costs incurred for compliance with
environmental regulation and, where appropriate, other environmental practices,
including adherence to international standards of environmental protection.

Considering the nature of the Companys activities, it does not adopt environmental policies and regulations
and is not subjected to specific environmental regulations.
The main environmental impacts of the Company regard the maintenance process of its equipment, which
involves, among others, hardboard, paint and lubricant oils. The Company seeks to mitigate the possible
environmental impacts coming from its activities through the survey of the aspects and research of its proper
disposal. As an example, the proper disposal of lubricant oils through separation and disposal in licensed
companies. Investments are also made in the separation systems of water and oil from the lubrication and
washing of machines.
With the objective of reducing use of oils in the lubrication of its equipment, the Company has invested
expressive resources in docking scaffolding for the industrial environment, which exempts the use of clamps
and bolted connection sleeves, and uses instead a system of fitting wedges, which, other than dismissing
the need for maintenance with lubricant oils, also provide gains in productivity and competitiveness.
Since early 2003, the Company has invested expressive amounts of resources to gradually replace wooden
scaffolding floors with aluminum ones, that are more durable and environmentally correct, thus contributing
to the reduction of the extraction of trees, helping to raise a greener planet. Beyond that, the Company has
products that reduce environmental impact, especially the new formwork and shoring systems and the
metallic structures, which reduce the use of wood in the construction process.
The Company acts with environmental responsibility when acquiring the wood that will be used in the
execution of its services. All of the wood used in its equipment come from legal sources licensed by the
Brazilian Ministry Of Environment Brazilian Environment and Natural Renewable Resources Institute, and
the Company maintains archived copies of all the legal documentation regarding the origin, transport and
registry of its suppliers, with focus on: (2) DOF Forest Origin Document; (b) CTF Federal Technical
Certificate of Regularity for the use of Natural Resources; and (c) GF3 Forest Guide for the transport of
forest products.
The equipment that is damaged in the construction work, when classified as improper for reuse, are turned
into pieces of smaller sizes or discarded and sent to further recycling. In the discarding, carbon steel pieces
are sent to steel makers and turn into other metallic products; aluminum beams and floors are sent for
reprocessing in plants, returning to the Company in the form of new products with the same characteristics;
and the wooden floors are sent to accredited partners who transform this residue into an energy source.
c. reliance on patents, trademarks, licenses, concessions, franchises, contracts,
royalties for the development of relevant activities.
In case the Company may not use its main brand, Mills, or if such brand loses distinctiveness, the Company
may have problems in relationships with their clients to tailor their services and equipment in the market,
which may prevent the development from its activities in a satisfactory condition. The development from its
activities does not dependent on secondary brands, patents, concessions, franchises and contracts,
royalties.
The Company has contracts of technology transfer for the exclusive manufacturing of several equipment, as
detailed in Item 9.1b. In case any of these contracts are discontinued or the regulation on patents or on the
use of technology changes, the Company may have its portfolio of products reduced and its competitiveness
affected.

7.6

Countries to which the Company derives revenue

a) revenue from the clients assigned to the host country and their participation share in the
Companys total net revenue;
The Company only operates in Brazil. The fiscal year ended on December 31, 2015, 98% of the
Company's revenue came from clients located in Brazil.

b) revenue from the clients assigned to each foreign country and their participation share in the
Companys total net revenue;
In the fiscal year ended December 31, 2015, 2.0% of our revenues came from clients in other
countries:
Country

AUSTRALIA

0.09%

BOLIVIA

0.13%

CANAD

0.00%

HOLANDA

0.96%

PERU

0.41%

REINO UNIDO

0.30%

REPBLICA DOMINICANA

0.09%

Grand total

1.98%

c) total revenue from foreign countries and their participation share in the Company's total net
revenue.
The fiscal year ended on December 31, 2015, 2.0% of the Company's revenue came from clients
located outside of Brazil.

7.7

Regulation of foreign countries in which the Company obtains relevant revenue

Not applicable.

7.8 In relation to environmental policies, indicate: (a) if the issuer disclose

social and environmental information; (B) the methodology followed in the
preparation of such information; (C) if the information is audited or
reviewed by an independent entity; (D) the page on the World Wide Web
which can be found this information
The Company is in the process design phase, aiming to act
sustainably.
The company does not publish sustainability report or similar. Considering the
significant increase of transparency about the sustainability issue, the Company
is considering formalizing a process of analysis (diagnosis) and action plan to
improve its sustainability practices.

7.9

Other information that the Company deems relevant

On May 21st, 2015, the Companys Board of Directors approved its new code of
conduct, available in
http://ri.mills.com.br/ptb/1936150521_CDIGO_DE_CONDUTAMILLS_p.pdf.

8. Extraordinary Business
8.1 Indicate the acquisition or disposal of any relevant asset that does not
fit as normal operation in the issuer's business.
In the fiscal years ended December 31, 2013, 2014 and 2015, there was no
acquisition or disposal of any relevant asset that does not qualify as the
Company's normal operation, except for the sale of the Industrial Services unit,
as described in item 6.3 of this Form of reference.
8.2 Indicar alteraes significativas na forma de conduo dos negcios do
emissor.
In the last three years, there was no significant change in the conduct of business in
order.
8.3 Identify the relevant agreements entered into by the issuer and its
subsidiaries not directly related to its operating activities
In the fiscal years ended December 31, 2013, 2014 and 2015, there was no
celebration of relevant contracts that were not related to the Company's operating
activities.
8.4 Other information which the Company judges to be relevant.
There is no other relevant information pertaining to this item 8.

10.1

The management should comment on.

a.

Financial status and general assets

The company presented, in 2015, net revenue of R$ 576.1 million and free cash
flow (net cash generated by the operating activities minus net cash applied in
investment activities) of R$ 202.4 million. This is the second time Mills achieved
positive cash generation, after years of high investments, which enabled its
organic growth, geographic expansion, and mainly, the consolidation of its
leadership in its markets. Net revenue amounted R$ 794.2 million in 2014 and R$
832.3 million in 2013.
Applying the premises of Technical Pronouncement CPC-01 - Impairment of
Assets, the Company performed impairment tests on its assets. After said tests,
it was verified that it was necessary to establish an impairment provision
amounting to R$ 26.2 million for the investment in Rohr and R$ 30.9 million for
the Construction Cash Generating Unit. For the assets of the Rental business unit
and other assets of the Company, no need to perform impairment tests were
identified.
The recoverable amount of those assets was determined based on economic
forecasts for determining the market value of the investee, upon through a

revenue approach, through a 10-year term discounted cash flow forecast, for
purposes of substantiating the amount paid, considering the long maturity period
of infrastructure and civil construction investments. The main assumptions
included: (i) revenues were forecast based on historical data and growth
prospective for the segment and Brazilian economy; (ii) negative operating loss
for 2015, resulting from the reduced activity of the industry; (iii) performance of a
continuous productivity improvement program and reduction of costs and
expenses will cause the evolution thereof to be lower than revenue growth
percentage, (iii) the corresponding cash flows are discounted at the average
discount rate, obtained using a methodology typically applied by the market,
taking into account the weighed average cost of capital (WACC); (iv) a strict
working capital evolution control policy, during the forecasted period.
In 2015 there were non-recurring items with a negative effect of R$ 82.7 million,
of which: (i) R$ 57.1 million related to the impairment for Construction business
unit and for the investment in Rohr; (ii) Reorganization costs of R$ 9.0 million; (iii)
ADD related to clients involved with ongoing investigations of Lava Jato (R$ 12.9
million); and (iv) R$ 3.7 million from the Industrial Services business unit due to
the payment of indemnity, related to events that happened before the completion
of the sale.
The cash generation, measured by EBITDA, reached R$ 104.1 million in 2015.
Excluding non-recurring items listed above, EBITDA would reach R$ 186.7
million. In 2014, EBITDA amounted R$ 326.2 million and, in 2013, R$ 438.8
million.
Net loss amounted to R$ 97.8 million in 2015, versus R$ 64.3 million of net
earnings from continuing operations in 2014 and R$ 167.7 million in 2013. In 2013
there was a net positive effect of R$ 8.2 million due to the sale of the Industrial
Services business unit.
Mills total debt was R$ 620.8 million as of December 31, 2015 versus R$ 745.4
million at the end of 2014 and R$ 632.6 million at the end of 2013. At the end of
the year our net debt position was R$ 388.8 million, versus R$ 551.7 million at
the end of 2014 and R$ 606.5 million at the end of 2013. The debt amortization
schedule includes payment of R$ 430 million of principal until 2018, and the first
issuance of debentures will end in April, 2016. We will amortize R$ 90 million of
principal, reducing our gross debt.
Considering non-recurring items to determine the adjusted EBITDA, all covenants
have been complied with, as of December 31, 2015. Our leverage, as measured
by net debt/LTM EBITDA, was at 2.1 times as of December 31, 2015, while
interest coverage, as measured by LTM EBITDA/LTM interest payments, was 3.0
times, excluding non-recurring items for both.
The Companys leverage, in 2014, was at 1.6 time, while interest coverage was
4.8 times. In 2013, the Companys leverage was 1.5 time, while interest coverage
was 8.3 times.
b.

Capital structure and stock redemption possibility

According to the Company's balance sheet on December 31, 2015, the capital
structure of Mills was 58.7% equity, measured by the stockholders equity, and
41.3% capital from third party, measured by total liabilities.
According to the Company's balance sheet on December 31, 2014, the capital
structure of Mills was 56.0% equity, measured by the stockholders equity, and
44.0% capital from third party, measured by total liabilities.
According to the Company's balance sheet on December 31, 2013, the capital
structure of Mills was 56.4% equity, measured by the stockholders equity, and
43.6% capital from third party, measured by total liabilities.
On December 31, 2015, our debt was 31% short-term and 69% long-term, with
an average maturity of 2.8 years, at an average cost of CDI+1.21%. In terms of
currency, 100% of Mills debt is in Brazilian Reais. On December 31, 2014, our
debt was 21% short-term and 79% long-term, with an average maturity of 2.4
years, at an average cost of CDI+0.68%. On December 31, 2013, our debt was
20% short-term and 80% long-term, with an average maturity of 2.1 years, at an
average cost of CDI+1.00%.

On November 10th, 2014 Mills Board of Directors approved a program to

repurchase common shares of Mills issuance, with the objective of acquiring up
to 4,000,000 shares, with a deadline of 365 days as of the date of approval, for
treasury and subsequent cancellation or alienation, including in the context of any
exercise of options under its stock option program, in the case of exercise of
options. The board of directors approved, in the second quarter of 2015, the
alienation of 6,878 shares, that were in treasury, to attend the stock option plan.
Up to December 31st, 2014, the Company kept in treasury 2,278,422 shares.
The management of the Company typically use both equity, from operating cash
generation, and capital from third-party, though the contraction of new loans
and/or the issuance of debt securities, to finance the needs for investments in
non-current assets and working capital of the company. For strategic operations,
when necessary, the Company may resort to the capital from their shareholders
or third parties, through the issuance of shares.
There are no hypotheses of redemption of shares issued by the Company in
addition to the legally provided for.
c.
Payment capability in relation to the financial commitments
assumed
The Companys EBITDA for the year ended December 31st 2015, was R$ 104.1
million. Excluding the non-recurring items of reorganization and impairment,
EBITDA would reach R$ 186.7 million. Financial expenses, net of financial
revenue in the same period were R$ 63.1 million. Thus, the Companys EBITDA
for year ended December 31st 2015 presented a coverage ratio of 3.0 times its
net financial expenses during the same period, excluding non-recurring items.
Only considering its financial expenses, which amounted to R$ 100.1 million as
of December 31st, 2015, the coverage ratio would be 1.9 time.
The Companys total indebtedness for the year ended December 31st 2015,
amounted to R$ 620.8 million, or 2.1 times the Companys EBITDA excluding the
non-recurring items for the year ended December 31st 2015. The flow of payment
from this debt, considering the debt profile as of that date, will take place in a
period of six years, of which R$ 229.9 million in less than one year, R$ 550.4
million from 2 to 5 years, and R$ 2.6 million in more than five years. The
Companys long-term debt profile has a policy for contracting loans and financing
aimed at ensuring that all financial commitments are honored, if necessary,
through its cash generation.
In addition, on December 31st 2015, the Company had registered on its balance
sheet the amount of R$ 10.4 million, which refers to the Tax Recovery Program
(REFIS) with a maturity of 180 months. The Company is compliant to the
remainder installments amounting R$ 9.6 million, of which the last installment
matures in December, 2024.
This way, the Company's management believes that its cash generation and
current liquid assets are sufficient to meet its financial commitments.
The Companys EBITDA for the year ended December 31st 2014, was R$ 335.7
million and its financial expenses, net of financial revenue in the same period
were R$ 67.6 million. Thus, the Companys EBITDA for year ended December
31st 2014 presented a coverage ratio of 5.0 times its net financial expenses during
the same period. Only considering its financial expenses, which amounted to R$
67.6 million as of December 31st, 2014, the coverage ratio would be 3.6 times.
The Companys total indebtedness for the year ended December 31 st 2014,
amounted to R$ 745.4 million, or 2.2 times the Companys EBITDA for the year
ended December 31st 2014. The flow of payment from this debt, considering the
debt profile as of that date, will take place in a period of seven years, of which R$
153.8 million in less than one year, R$ 172.8 million from 1 to 3 years, R$ 373.2
million in a period between 3 to 5 years and R$ 44.5 million in more than five
years. The Companys long-term debt profile has a policy for contracting loans
and financing aimed at ensuring that all financial commitments are honored, if
necessary, through its cash generation.
In addition, on December 31st 2014, the Company had registered on its balance
sheet the amount of R$ 10.1 million, which refers to the Tax Recovery Program

(REFIS) with a maturity of 180 months. The Company is compliant to the

remainder installments amounting R$ 10.1 million, of which the last installment
matures in December, 2024.
The Companys EBITDA for the year ended December 31st 2013, was R$ 403.1
million and its financial expenses, net of financial revenue in the same period
were R$ 46.8 million. Thus, the Companys EBITDA for year ended December
31st 2013 presented a coverage ratio of 8.6 times its net financial expenses during
the same period. Only considering its financial expenses, which amounted to R$
60.0 million in the year ended December 31st 2013, the coverage ratio would be
6.7 times.
The Companys total indebtedness for the year ended December 31 st 2013,
amounted to R$ 632.6 million, or, 1.6 times the Companys EBITDA for the year
ended December 31st 2013. In addition, on December 31st 2013, the Company
had registered on its balance sheet liabilities in the amount of R$ 10.4 million,
which refers to the Tax Recovery Program (REFIS).
With regard to contractual limitations for assumption of new debt, there are
clauses in the Company's bank credit contracts that require adherence to certain
financial indicators, among which: the ratio between EBITDA and net debt, the
ratio of net short-term debt and total net debt, and the ratio between net financial
expenses and EBITDA.
On December 31st of 2013, 2014 and 2015, the Company was within the limits of
contractual financial indicators.
d.
Source of financing for working capital and investments in noncurrent assets.
The investments from the Company in non-current assets and working capital are
financed by its own cash generation and third party capital, through the
contraction of new loans and/or the issuance of debt securities. For strategic
operations, when necessary, the Company can turn to capital from its
shareholders or third parties, through the issuance of shares.
On December 6, 2013 the Company entered into a loan agreement with the
Nassau Branch of Banco Ita BBA S.A. totaling US$ 16.9 million (equivalent to
R$40.0 million, with a dollar rate on December 6th, 2013). The settlement of the
loan will be made in a single installment, paid on January 30, 2015, without rolling
over. Payment of interest will occurred twice a year. In order to eliminate the
foreign exchange risk on this borrowing, on the same date a swap was contracted
with Banco Ita BBA S.A. in the amount of R$ 40 million so that the obligations
(principal and interest) are fully converted into local currency and carried out on
the same maturity dates.
On April 11th, 2014 the Company issued commercial promissory notes with a total
amount of R$ 200.0 million. Remuneration interest charges will fall due
corresponding to 106% of the accumulated variation in the average daily
Domestic Demand (DI) rates. The net proceeds of the offering were used for: (a)
refinancing of Companys debt, (b) rental equipment acquisition and (c)
Companys general uses and expenses.
On May 30th, 2014 the Company issued a series of simple debentures for a total
amount of R$ 200 million, non-convertible into shares, unsecured, with maturity
date on May 30rd, 2019. The nominal value of the this series debentures will be
amortized in three annual installments starting on the third year of the issuance,
and the interest paid semi-annually and equal to surtax of 108.75% per annum of
100% of DI accrued variation. The liquid resources obtained by the Company
through the third debenture issuance were fully used to settlement of Companys
4th edition promissory notes, issued on 11th April, 2014.
e.
Potential sources of financing used for working capital and for
investments in non-current assets.
The Companys main sources of liquidity are:

cash flow from our operations;

financing agreements and through capital market; and

increases in its capital stock.

The Companys main liquidity requirements are:

investments for maintenance and increase of the equipment inventory;

working capital needs;
investments in the Companys facilities and the technology center,
which are necessary to support its operations;
investments in the improvement of processes and controls;
investments in training and occupational safety; and
distribution of dividends and payment of interest on equity.

The management of the Company believes that the existing resources and the
cash flow to be generated from its operations, along with its borrowing capacity,
with proper leverage, will be sufficient to cover its investment plan and the need
for working capital during the same period.
f.

Debt level and composition:

(i) relevant loan and financing contracts

The table below shows the outstanding balance of the Companys loans and
financings, organized by interest rate as of December 31st, 2013, 2014 and 2015:
As of December 31st,
Yearly Interest Rate

2013

2014

2015

(em milhes de reais)

Financings provided by financial institutions

CDI+0.29%

40.2

44.72

Financings provided by financial institutions

TJLP+0.2% to 0.9%

23.4

18.7

15.1

CDI + 2.5% to 3.8%

8.2

Leasing agreements entered into with financial

institutions
Non-convertible debentures
Non-convertible debentures
Non-convertible debentures

112.5% of CDI

274.4

184.4

92.8

1st series: CDI + 0.88%

165.9

168.1

169.7

2nd series: IPCA + 5.5%

120.6

128.7

142.3

108.75% of CDI

202.0

202.5

632.6

746.6

622.3

Total
On December 31, 2014.

Including loans with financial institutions indexed to the U.S. dollar plus 2.13% interest per year in the amount of R$ 39.9 million contract or $16.9 million
and a swap operation to cancel the risk of exchange rate variation of this loan.

Short-Term Debt
As of December 31, 2015, short-term debt amounted to R$ 189.8 million,
compared to R$ 155.0 million as of December 31, 2014, an increase of R$ 34.9
million or 22.5%. This increase was due to, mainly: (i) loan agreement with the
Nassau Branch of Banco Ita BBA S.A. totaling US$ 16.9 million (equivalent to
R$ 40.0 million, with dollar rate of December 6th, 2013); and (ii) transfer from longterm debt to short-term debt of the first portion of the amortization, in August,
2016, of the second issuance of debentures, CDI first series, launched in August,
2012. In April 2015 there was an amortization, and the last one will occur in April,
2016.
As of December 31, 2014, short-term debt amounted to R$ 155.0 million,
compared to R$ 125.3 million as of December 31, 2011, an increase of R$ 29.7
million or 23.7%. This increase was due to the interest and monetary adjustment
of Companys 3rd debentures issuances issued in May, 2014.
Long-Term Debt
As of December 31st, 2015, the Companys long-term debt amounted to R$ 431.0
million, compared to R$ 590.4 million as of December 31, 2014, an reduction of
R$ 159.4 million or 27.0%. This decrease was mainly due to following points: (i)
to the transfer of long-term debt to short-term debt of third installment amortization
of the first issuance of debentures issued in April 2011; and (ii) transfer from longterm debt to short-term debt of the first portion of the amortization, in August,

2016, of the second issuance of debentures, CDI first series, launched in August,
2012.
As of December 31st, 2014, the Companys long-term debt amounted to R$ 590.4
million, compared to R$ 507.3 million as of December 31, 2013, an increase of
R$ 83.2 million or 16.4%. This increase was mainly due to following points: (i) the
liquid effect of 3rd debentures issuances in May 2014; and (ii) to the transfer of
long-term debt to short-term debt of 2nd installment amortization in April 2014, of
debentures issued in April 2011.
Relevant Financial Contracts
Borrowings were used for financing the expansion of Companys investments and
for its general expenses and uses, being indexed to CDI, TJLP and US dollars.
For borrowings in foreign currency, financial instruments were contracted to
hedge the Company against fluctuations in foreign exchange rates.
Financing agreement for rental equipment were agreed based on Long-Term
Interest Rate (TJLP in Brazil) plus interest of 0.2% to 0.9% per year, with monthly
amortization through June 2021.
The financial institutions with which the Company has borrowings as at December
31, 2014 are as follows:

Banco do Brasil
Ita BBA

On December 6, 2013 the Company entered into a borrowing agreement with

Banco Ita BBA S.A., Nassau Branch, in the amount of US$16.9 million
(equivalent to R$40.0 million, with dollar exchange rate on December 6, 2013).
The settlement of the loan will be made in a single installment, paid on January
30, 2015, without rolling over. Payment of interest will occurred twice a year. In
order to eliminate the foreign exchange risk on this borrowing, on the same date
of the borrowing the Company entered into a swap transaction with Banco Ita
BBA S.A. in the amount of R$40.0 million in order to convert the obligations
(principal and interest) into local currency and on the same maturity dates.
Debentures
On April 8, 2011 approval was granted for the issuance by the Company of a total
of 27,000 debentures in a single tranche, of non-convertible unsecured
debentures, of a total amount of R$ 270.0 million, and unit face value of R$
10,000, issued on April 18, 2011. The debentures have maturity on April 18, 2016,
with remuneration equivalent to 112.5% of the CDI rate and semi-annual
payments of interest and amortization in three consecutive installments, with the
first maturity date on April 18, 2014. The transaction costs associated with this
issue, in the amount of R$ 2.4 million, are being recognized as Company funding
expenses, in accordance with the contractual terms of the issue.
On August 3, 2012 approval was granted for the issuance by the Company, in
two series of simple debentures, non convertible into shares, unsecured, public
offering object with limited placement efforts, pursuant to CVM Instruction 476.
On August 15, 2012, 27,000 debentures were issued, each with a nominal value
of R$ 10,000.00, of which: i) 16,094 debentures of the first series, amounting to
R$ 160.9 million, with maturity date on August 15, 2017, not subject to monetary
adjustment. The nominal value of the first series debentures will be amortized in
two annual installments starting on the fourth year of the issuance, and the
interest paid semi-annually and equal to surtax of 0.88% per annum of 100% of
DI accrued variation. ii) 10,906 debentures of the second series, amounting to R$
109.1 million, with maturity date on August 15, 2020, subject to monetary
adjustment by the accrued variation of the IPCA. The nominal value of the second
series debentures will be amortized in three annual installments starting on the
sixth year of the issuance, and the interest paid annually and equal to 5.50% per
annum of the above mentioned monetarily adjusted amount. Transaction costs
related to this issuance are recognized as capital funding expenses, according to
contract terms.
On April 23, 2014 approval was granted for the issuance by the Company of a
total of 20,000 debentures in a single tranche, of non-convertible unsecured

debentures, of a total amount of R$ 200.0 million, and unit face value of R$

10,000, issued on June 18, 2014. The debentures have maturity on May 30, 2019,
with remuneration equivalent to 108.75% of the CDI rate and semi-annual
payments of interest and amortization in three consecutive installments, with the
first maturity date on May 30, 2017. The transaction costs associated with this
issue, in the amount of R$ 0.7 million, are being recognized as Company funding
expenses, in accordance with the contractual terms of the issue.
As of December 31, 2015 the balance of debentures including transaction costs
was R$ 187.3 million in current liabilities and R$ 419.9 million in non-current
liabilities, and R$ 186.6 million and R$ 419.1 million, net of transaction costs,
respectively.
Promissory Notes
On December 7, 2011 the Company issued a single series of three commercial
promissory notes with unit face value of R$ 9.0 million, for a total amount of R$
27.0 million with maturity on December 1st, 2012. Remuneration interest charges
will fall due corresponding to 100% of the accumulated variation in the average
daily Domestic Demand (DI) rates, plus 1.10% per annum. Remuneration was
fully paid upon the maturity date.
On April 23, 2012 the Company issued a single series of thirty commercial
promissory notes with unit face value of R$ 1.0 million, for a total amount of R$
30.0 million with maturity on December 3, 2012. Remuneration interest charges
will fall due corresponding to 100% of the accumulated variation in the average
daily Domestic Demand (DI) rates, plus 4.9% per annum. Remuneration was fully
paid upon the maturity date.
On April 11, 2014 the Company issued in a single series 20 commercial
promissory notes with unit face value of R$10,000, totaling R$200,000 and with
maturity on August 8, 2014. The unit value of the promissory notes bears interest
equivalent to 106% of the accumulated fluctuation of the average daily interbank
deposit (DI) rates. On June 18, 2014 the Company fully paid these promissory
notes with the proceeds from its third issue of debentures.
Finance leases
Referred basically to agreements for purchase of rental equipment with periods
between 36 and 60 months, maturities through 2015 and indexed to the CDI plus
interest of 2.50% to 3.80% per year. This obligation was collateralized by the its
own leased assets. The Company settled in advance all the existing finance lease
agreements during the third quarter of 2014.
(ii) other long-term relationships with financial institutions
The Company adopts the policy of reducing the cash risk relating to foreign
exchange variation on a conservative basis since all its revenues are earned in
Brazilian reais. Therefore, the Company enters into NDF contracts with financial
institutions for hedging purposes. All these contracts set the future exchange rate
from reais to dollars.
These derivative instruments contracted by the Company have the intention to
protect it, on their equipment import operations, in the interval between the
placing of orders and nationalization against the risk of fluctuation in the exchange
rate, and are not used for speculative means.
The Company has also borrowing agreements in dollars and in order to cover
substantially the foreign exchange risk it entered into swap transactions.
On December 6, 2013 the Company entered into a borrowing agreement with
Banco Ita BBA S.A., Nassau Branch, in the amount of US$16.9 million
(equivalent to R$40.0 million, with a dollar exchange rate as of the date of the
contract settlement). Principal was settled in a bullet payment on January 30,
2015 without rolling over. In order to eliminate the foreign exchange risk on this
borrowing, on the same date of the borrowing the Company entered into a swap
transaction with Banco Ita BBA S.A. in the amount of R$40.0 million in order to
convert the obligations (principal and interest) into local currency and on the same
maturity dates.

On December 31st, 2015, the Company did not have any purchase orders with
foreign suppliers of equipment, being the value presented US$ 0.2 million in
foreign suppliers account related basically to installment purchase of equipment
(in 2014 these orders totaled US$ 0.3 million, and in 2013 these orders totaled
US$ 71.3 million).
(iii) degree of subordination between the debts
The Debentures issued by the Company are all unsecured debentures.
Most of the guarantees offered by the Company refers to loans contracted in
previous years, prior to the Initial Public Offering (IPO), when the financial
situation required that the Company offered substantial guarantees to facilitate its
access to credit.
After its initial public offer of shares held in April 2010, the Company conducted
financing operations with real guarantee only for FINAME, credit line from BNDES
to finance investments in manufacturing portion of its equipment, where, at the
request of the financing contract, the equipment manufactured is disposed to the
end of the financing contract, presenting a balance of R$ 27.1 million in
guarantees on 31st of December, 2015.
The management of the Company believes that the existing terms relating to
the provision of guarantees does not significantly restrict the ability to contract
new debt to meet our capital needs.
(iv) any restrictions imposed on the issuer, in particular, for limits of indebtedness
and contracting of new debts, the distribution of dividends, disposal of assets, the
issuance of new securities or disposal of corporate control
Some of the Companys long-term financial instruments contain obligations
relating to the maintenance of certain levels for determined financial indicators.
The main conditions imposed on financial instruments entered into by the
Company are: (i) the ratio between EBITDA and net debt (total bank debt minus
cash equivalents); and (ii) the ratio between EBITDA and net financial expenses.
Thus, the Company is required to maintain a relatively low indebtedness and a
satisfactory capacity to pay its financial obligations, and the hiring of new
borrowings should meet these prerequisites. On the fiscal years ended December
31st, 2013, 2014 and 2015, the Company was in compliance with the required
levels for the indicators.
Additionally, some of the Companys long term financial instruments have
restrictions related to (i) change of transfer of the controlling stake (direct or
indirect) and (ii) asset disposals when the amount represents more than 15% of
the total assets of the Company, based on the consolidated Financial Statements
of the Company. In the case the Company is in default of any of its financial
obligations, it will not be able to distribute any profits to its shareholders above
the minimum mandatory dividend as determined by Law, as defined in the
relevant documents.
The management of the Company believes that the current provisions will not
significantly restrict the ability to recruit new debt to meet its capital needs.
g.

limits of use of financing already concluded

On December 31, 2015, the Company had no limits to use in financing

transactions already contracted. At the same date the Company had unsecured
overdraft account, not used, reviewed annually of R$ 109.6 million and secured
bank credit account used of R$ 15.1 million, 12.1% of the total amount, with
varying maturities and that can be extended in a common agreement.
On December 31, 2014, the Company had no limits to use in financing
transactions already contracted. At the same date the Company had unsecured
overdraft account, not used, reviewed annually of 570.2 million and Secured bank
credit account used of R$ 64.5 million, with varying maturities and that can be
extended in a common agreement.

On December 31, 2013, the Company had no limits to use in financing

transactions already contracted. At the same date the Company had unsecured
overdraft account, not used, reviewed annually of 477.5 million and Secured bank
credit account used of R$ 71.5 million, with varying maturities and that can be
extended in a common agreement.
The Company maintains relationships with major financial institutions operating
in Brazil and, the evaluation of its board has conditions and the risk rating of credit
that enable the Company to contract new debt in the amount required to meet the
current needs of cash for short and long term.
h.

significant changes in each item of the financial statements

In accordance with the existing accounting policies adopted in Brazil, the revenue
reported in the income statement should include only the gross inflows of
economic benefits received and receivable by the Company, when originating
from their own activities. Amounts collected on behalf of third parties - such as
sales taxes, taxes on goods and services and from taxes on added value - do not
generate benefits for the Company and do not result in an increase in equity and
therefore are excluded from revenue. Thus, the comments below relating to
variations between the results for the years ended December 31 st, 2013, 2014
and 2015 refer only to net revenue, not to the gross revenue.
MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

2013

AV(1) (%)

AH(2) (%)

2014

AV(1) (%)

AH(2) (%)

2015

AV(1) (%)

AH(2) (%)

832.3

100.0%

-5.3%

794.2

100.0%

-4.6%

576.1

100.0%

-27.5%

Heavy Construction

217.0

26.1%

24.6%

211.0

26.6%

-2.7%

165.7

28.8%

-21.5%

Real Estate

258.0

31.0%

8.4%

212.4

26.7%

-17.7%

117.2

20.3%

-44.8%

-100.0%

357.3

42.9%

41.0%

370.8

46.7%

3.8%

293.2

50.9%

-20.9%

-334.9

40.2%

-18.5%

-362.4

45.6%

8.2%

-343.8

-59.7%

-5.1%

497.3

59.8%

6.2%

431.8

54.4%

-13.2%

232.3

40.3%

-46.2%

8.3

1.0%

-57.1

-225.4

27.1%

3.2%

-273.8

34.5%

21.5%

-240.8

-41.8%

-12.1%

Operating Profit

280.2

33.7%

12.1%

157.9

19.9%

-43.6%

-65.6

-11.4%

-141.5%

Financial Expenses

-60.0

7.2%

17.2%

-92.8

11.7%

54.6%

-100.1

-17.4%

7.8%

Financial Income

13.2

1.6%

9.1%

25.2

3.2%

90.9%

36.9

6.4%

46.4%

233.4

28.0%

10.8%

90.3

11.4%

-61.3%

-128.7

-22.3%

-242.6%

Net revenue from sales

and services

Industrial Services
Rental

Cost of Sales and

Services

Gross Profit

Operating Revenues
(Expenses)

Other operating income

General and
Administrative

Profit Before Income

Tax and Social
Contribution

Income Tax and Social

-65.7

7.9%

11.0%

-26.1

3.3%

-60.3%

30.9

5.4%

-218.5%

167.7

20.1%

10.7%

64.3

8.1%

-61.7%

-97.8

-17.0%

-252.2%

4.9

0.6%

172.6

20.7%

13.9%

64.3

8.1%

-62.8%

-97.8

-17.0%

Contribution

Profit from continuing

operations
Profit from discontinued
operations
Net Income for the Year

-252.1%

(1)

Vertical analysis, which is a percentage of total net sales and services

Horizontal analysis, which is the percentage of variation in the income statement accounts between fiscal years
indicated.
(2)

Year ended December 31st, 2015 compared with year ended December 31st,
2014
Revenue of Products Sold and Services Provided
In the year ended December 31st, 2015 the Companys net revenue from sales
and services reached R$ 576.1 million. For comparison purposes, there was a
reduction of R$ 218.1 million, or 27.9% yoy. This decrease comes mainly from
the lower rental revenue, with a contribution of 82% of this reduction. The analysis
of the Company's management regarding the factors that led to these changes is
listed below.
In September 2015, Heavy Construction and Real Estate commercial
management have been brought together in a single business unit. Engineering
and operational Officers functions were also consolidated. As a result, the Heavy
Construction and Real Estate business units will now be reported together, under
the label Construction. We will continue to monitor Heavy Construction and Real
Estate revenues separately, due to its different market dynamics.
Heavy Construction
Net revenue from the Heavy Construction business unit totaled R$ 165.7 million
in 2015, with a drop of 21.5% compared to 2014. The management of the
Company attributed this reduction as a result of the 24.1% drop in rental
revenues, due to a less number of contracts.
Real Estate
Net revenue from the Real Estate business unit, totaled R$ 117.2 million in 2015,
with a drop of 44.8% compared to 2014, negatively impacted by a decrease of
55.8% in sales revenues and of 40.9% in rental revenues. The sales of semi-new
equipment related to Easyset product represented 78% of sales in 2014. The
management of the Company attributed this reduction as a result of a
deterioration of the Real Estate market in Brazil, influenced by political and
economic uncertainties, higher interest rates and weakness of economic activity.
Rental
Net revenue from the Rental business unit totaled R$ 293.2 million in 2015, being
20.9% lower yoy. On the evaluation of the management of the company, this
decrease is mainly associated with market retraction, with consequent higher
idleness and pressure on prices.
Cost of products sold and services rendered and general and administrative
expenses
The table below shows the Companys cost of goods sold and services rendered
by nature in fiscal years ended December 31, 2014 and 2015.

2015

2014

2015 x 2014

Nature

Direct
General
Direct
General
Direct
General
project
and
project
and
project
and
and administrative
and administrative
and administrative
rental
expenses
rental
expenses
rental
expenses
costs
and others
Total costs
and others
Total costs
and others

-74.2
Personnel
-4.9
Third parties
-12.1
Freight
Construction/maintenance
-42.3
and repair materials
Equipment rental
-5.8
and others
-2.4
Travel
0.0
Cost of
-34.7
sales
Depreciation and amortization -151.9
-12.8
Write-off of assets
Allowance for doubtful debts
Stock option plan
Provisions
Provision for impairment
-2.6
Others
-343.8

-97.6
-20.5
-3.3

-171.8
-25.4
-15.4

-63.0
-6.5
-16.3

-113.3
-28.2
-0.6

-176.4
-34.7
-16.9

-5.8

-48.2

-44.5

-7.0

-51.5

-19.5

-25.4

-5.3

-18.2

-23.6

-6.4
0.0

-8.8
0.0
-34.7
-169.6
-12.8
-38.2
-9.6
-4.4
-57.1
-20.2
-641.7

-3.8
0.0
-53.2
-152.9
-13.7

-10.5
0.0

-42.3
-9.5
-2.5

-14.3
0.0
-53.2
-168.3
-13.7
-42.3
-9.5
-2.5

-26.2
-273.8

-29.4
-636.2

-17.7
-38.2
-9.6
-4.4
-57.1
-17.6
-297.9

-15.4

-3.2
-362.4

The table below shows the Companys cost of goods sold and services rendered
and general and administrative expenses by business unit in fiscal years ended
December 31st, 2014 and 2015. The information provided in this table does not
reflect the effects of depreciation on such costs.
Year ended December 31st
2014

(%) (1)

2015 x 2014
(%) (1)

Var. (%) (2)

(281.6)

59.6%

-1.0%

2015

(in R$ million)
Construction

(284.4)

60.8%

Heavy Construction

(122.1)

26.1%

Real Estate

(162.3)

34.7%

(174.1)

37.2%

(160.6)

34.0%

-7.8%

(9.5)

2.0%

(30.9)

6.4%

216.0%

(468.0)

100.0%

(472.0)

100.0%

0.9%

Industrial Services
Rental
Total
(1)

Percentage share of the business unit of goods sold and services provided and general and administrative
expenses
(2)
Percentage increase (decrease) of the total registered from one period to another.
N.A. Not applicable

Cost of goods sold and services provided and General and Administrative
expenses, excluding the effects of depreciation, went from R$ 468.0 million in the
year ended December 31, 2014 to R$ 472.0 million year ended December 31,
2015, an increase of R$ 4.1 million, or 0.9%. Excluding the impairment cost of R$
30.9 million in Construction business unit, the total costs would be R$ 441.1
million, 5.7% lower when compared to 2014.
The depreciation of assets used in services rendered, which is part of the costs
of goods sold and services rendered increased, from R$ 168.3 million for the year
ended on December 31, 2014 to R$ 169.6 million in the fiscal year ended
December 31, 2015, maintaining the average depreciation period of 10 years.
The ratio between the Companys operating, general, and administrative
expenses in relation to the net operating income went from 27.1% in the fiscal
year ended December 31, 2013 to 34.5% in the fiscal year ended December,
2014 and to 41.8% in the fiscal year ended December, 2015.
Operating Profit

-11.2
1.6
4.2
2.2
0.0
-0.5
0.0
1.4
0.0
18.5
1.0
0.9
0.0
0.0
0.0
0.0
0.6
18.6

15.7
7.7
-2.7
1.2
0.0
-1.3
0.0
4.1
0.0
0.0
-2.3
0.0
4.1
-0.1
-1.9
-57.1
8.6
-24.1

Total

4.5
9.3
1.5
3.3
0.0
-1.8
0.0
5.5
0.0
18.5
-1.4
0.9
4.1
-0.1
-1.9
-57.1
9.2
-5.5

Operating profit before financial result decreased from R$ 157.9 million in the
fiscal year ended December 31, 2014 to a net loss of R$ 65.6 million in the fiscal
year ended December 31, 2015. Such reduction was a consequence of the
impairment in Construction business unit and investment on Rohr of R$ 57.1
million, and lower rental revenues.
Financial Results
Net financial expenses decreased from R$ 67.6 million in the fiscal year ended
December 31, 2014 to R$ 63.1 million in the fiscal year ended December 31,
2015, representing a decrease of R$ 4.5 million. The Company's bank debt, which
was R$ 745.4 million in December 31, 2014 decreased to R$ 620.8 million in
December 31, 2015.
Income Tax and Social Contribution
Expenditure on income tax and social contribution went from R$ 26.1 million in
the fiscal year ended December 31, 2014 to a positive value of R$ 30.9 million in
the fiscal year ended December 31, 2015. As of December 31, 2015, the
Company has not determined taxable income from income tax and social
contribution. The amounts prepaid in 2015 and withheld at source on invoices
and financial investments make up the negative balance of IRPJ and CSLl that
will be used during 2016.
In the fiscal year ended December 31, 2014, the Companys deducted from its
income tax and social contribution the amount of R$ 8.5 million, due to the
provisioning of interest on equity for distribution of part of the annual results, while
in fiscal year ended December 31, 2013 this deduction totaled R$ 14.6 million.
Moreover, the effective rate of 2014 was of 28.9%, after non-deductible tax items
adjustment, against 28.2% in 2013.
Net Income
For 2015, the Company reported a net loss of R$ 97.8 million, compared to R$
64.3 million net profit in 2014.
In 2015, net profit was negatively impacted by non-recurring effects amounting to
R$ 82.7 million, relating to (i) R$ 8.6 million restructuring indemnities, (ii) R$ 12.9
million in ADD expenses related to on going investigations of Lava Jato, and (iii)
R$ 0.4 million related to branch office relocation/closing.
In 2014 there were non-recurring items with a negative effect of R$ 21.7 million,
of which (i) R$ 7.1 million from the Industrial Services business unit due to the
payment of indemnity, related to events that happened before the completion of
the sale, although the request for indemnity occurred this year; (ii) R$ 12.3 million
from Easy Set formwork cost adjustment, due to higher raw material use than
technical specifications and to customized equipment sale as scrap ate the end
of the rental contract ; and (iii) R$ 2.3 million in cost provision and adjustments
from the raw material and goods for resale inventories. The increase of
depreciation (R$ 37.3 million) and negative financial result (R$ 20.8 million)
figures also contributed to the Net Income decrease.
Year ended December 31st, 2014 compared with year ended December 31st,
2013
Revenue of Products Sold and Services Provided
In the year ended December 31st, 2014 the Companys net revenue from sales
and services reached R$ 794.2 million. For comparison purposes, there was an
reduction of R$ 38.1 million, or 4.6% yoy. This decrease comes mainly from the
lower revenue from sales and technical assistance. The analysis of the
Company's management regarding the factors that led to these changes is listed
below.
Heavy Construction

Net revenue from the Heavy Construction business unit totaled R$ 211.0 million
in 2014, with a slight drop of 2.7% compared to 2013. The management of the
Company attributed this reduction as a result of the 29.7% drop in sales revenues,
technical assistance and others, due to projects not favorable to equipment
purchase, instead of renting.
Real Estate
Net revenue from the Real Estate business unit, totaled R$ 212.4 million in 2014,
with a drop of 17.7% compared to 2013, negatively impacted by a decrease of
17.9% in rental revenues and of 25.3%, in sales revenues. The management of
the Company attributed this reduction as a result of a deterioration of Real Estate
market in Brazil, influenced by political and economic uncertainties, higher
interest rates and weakness of economic activity.
Rental
Net revenue from the Rental business unit totaled R$ 370.8 million in 2014, new
annual record, being 3.8% greater than that 2013. On the evaluation of the
management of the company, this increase is mainly associated with increasing
fleet of equipment and, therefore, in rented volume due to investments in organic
growth since 2010.
Cost of products sold and services rendered and general and administrative
expenses
The table below shows the Companys cost of goods sold and services rendered
by nature in fiscal years ended December 31, 2013 and 2014.
Year ended on December
31st, 2013
Direct
Gener
cost of
al and
constru
Admini
ction
strative
and
Expen
renting
ses
Total

Year ended on December

31st, 2014
Direct
Gener
cost of
al and
constru
Admini
ction
strative
and
Expen
renting
ses
Total

Variation 2014 x 2013(1)

Direct
Gener
cost of
al and
constru
Admini
ction
strative
and
Expen
renting
ses
Total

(in R$ million)
Labor
Third-party
Services
Freight
Construction
Material /
Maintanance and
Repair
Rent Equipment

-58.8

-107.4

-166.2

Travel
Cost of Sales
Depreciation ad
Amortization
Asset impairment
Allowance for
Doubtful Debts
Stcok Option
Update
provisions
Profit sharing
Others
Total
(1)

-63.0

-113.3

-176.4

-4.3

-5.9

-10.2

-5.0

-20.4

-25.5

-6.5

-28.2

-34.7

-1.5

-7.8

-9.2

-15.5

-0.8

-16.2

-16.3

-0.6

-16.9

-0.8

0.1

-0.7

-43.5

-6.1

-49.6

-44.5

-7.0

-51.5

-1.0

-0.9

-1.9

-5.9

-15.0

-20.8

-5.3

-18.2

-23.6

0.5

-3.3

-2.8

-5.0

-11.6

-16.5

-3.8

-10.5

-14.3

1.2

1.0

2.2

-68.0

0.0

-68.0

-53.2

0.0

-53.2

14.9

0.0

14.9

-122.6

-8.4

-131.0

-152.9

-15.4

-168.3

-30.3

-7.0

-37.3

-8.9

0.0

-8.9

-13.7

0.0

-13.7

-4.9

0.0

-4.9

0.0

-16.2

-16.2

0.0

-42.3

-42.3

0.0

-26.1

-26.1

0.0

-9.0

-9.0

0.0

-9.5

-9.5

0.0

-0.6

-0.6

0.0

0.2

0.2

0.0

-2.5

-2.5

0.0

-2.7

-2.7

0.0
-1.9

-18.8
-12.0

-18.8
-13.8

0.0
-3.2

0.0
-26.2

0.0
-29.4

0.0
-1.3

18.8
-14.2

18.8
-15.6

-334.9

-225.4

-560.4

-362.4

-273.8

-636.2

-27.4

-48.4

-75.8

Increase (decrease) of the total recorded from one period to another.

The table below shows the Companys cost of goods sold and services rendered
and general and administrative expenses by business unit in fiscal years ended
December 31st, 2013 and 2014. The information provided in this table does not
reflect the effects of depreciation on such costs.
Year ended December 31st
2013

(%) (1)

2014
(%) (1)
(in R$ million)

2014 x
2013

Var.
(%) (2)

Heavy
Construction
...........................................................
Real
Estate
...........................................................
Industrial
Services
...........................................................
Rental
...........................................................
Total
...........................................................

(108.9)

25.9%

(122.1)

26.1%

12.1%

(164.2)

39.0%

(162.3)

34.7%

-1.2%

(156.1)

37.1%

(174.1)

37.2%

11.6%

8.2

-1.9%

(9.5)

2.0%

N.A.

(421.0)

100.0%

(468.0)

100.0%

11.2%

(1)

Percentage share of the business unit of goods sold and services provided and general and administrative
expenses
(2)
Percentage increase (decrease) of the total registered from one period to another.
N.A. Not applicable

Cost of goods sold and services provided, excluding the effects of depreciation,
went from R$ 421.0 million in the year ended December 31, 2013 to R$ 468.0
million year ended December 31, 2014, a increase of R$ 47.0 million, or 11.2%,
mainly due to a greater allowance for doubtful debts (ADD).
The depreciation of assets used in services rendered, which is part of the costs
of goods sold and services rendered increased 28.4% due to higher investments
in the past years, from R$ 131.0 million for the year ended on December 31, 2013
to R$ 168.3 million in the fiscal year ended December 31, 2014, maintaining the
average depreciation period of 10 years.
The ratio between the Companys operating, general, and administrative
expenses in relation to the net operating income went from 27.1% in the fiscal
year ended December 31, 2013 to 34.5% in the fiscal year ended December,
2014.
Operating Profit
Operating profit before financial result increased from R$ 280.2 million in the fiscal
year ended December 31, 2013 to R$ 157.9 million in the fiscal year ended
December 31, 2014, a reduction of R$ 122.3 million, or 43.6%. Such reduction
was a consequence of higher depreciation, and General, administrative and
operating expenses, both mainly impacted by increase in ADD of the fiscal year.
Operating profit represented 19.9% of net revenues in December 31, 2014,
compared to 33.7% of net revenues in December 31, 2013.
Financial Results
Net financial expenses decreased from R$ 46.8 million in the fiscal year ended
December 31, 2013 to R$ 26.1 million in the fiscal year ended December 31,
2014, representing decrease of R$ 20.8 million due to higher gross debt level and
interest rates in the period. The Company's bank debt, which was R$ 632.6 million
in December 31, 2013 increased to R$ 745.4 million in December 31, 2014.
Income Tax and Social Contribution
Expenditure on income tax and social contribution went from R$ 65.7 million in
the fiscal year ended December 31, 2013 to R$ 26.1 million in the fiscal year
ended December 31, 2014, decreasing R$ 39.6 million, or 60.3%.
In the fiscal year ended December 31, 2014, the Companys deducted from its
income tax and social contribution the amount of R$ 8.5 million, due to the
provisioning of interest on equity for distribution of part of the annual results, while
in fiscal year ended December 31, 2013 this deduction totaled R$ 14.6 million.
Moreover, the effective rate of 2014 was of 28,9%, after non-deductible tax items
adjustment, against 28.2% in 2013.
Net Income
The net profit increased from R$ 172.6 million in the fiscal year ended December
31, 2013 to R$ 64.3 million in the fiscal year ended December 31, 2014, a R$
108.3 million decrease. In 2013 there was a net positive effect of R$ 8.2 million
in the net earnings from continuing operations due to the sale of the Industrial
Services business unit. In 2014 there were non-recurring items with a negative
effect of R$ 21.7 million, of which (i) R$ 7.1 million from the Industrial Services
business unit due to the payment of indemnity, related to events that happened
before the completion of the sale, although the request for indemnity occurred

this year; (ii) R$ 12.3 million from Easy Set formwork cost adjustment, due to
higher raw material use than technical specifications and to customized
equipment sale as scrap ate the end of the rental contract ; and (iii) R$ 2.3 million
in cost provision and adjustments from the raw material and goods for resale
inventories. The increase of depreciation (R$ 37.3 million) and negative financial
result (R$ 20.8 million) figures also contributed to the Net Income decrease.
Year ended December 31st, 2015 compared to year ended December 31st,
2014
Current Assets
The Companys current assets increased from R$ 425.3 million as of December
31, 2014 to R$ 435.5 million as of December 31, 2015, an increase of R$ 10.2
million or 2.4%. The main reasons for such increase, in the assessment of the
management of the Company, were:

Increase of R$ 38.4 million in cash and cash equivalents, due to higher

liquidity mainly derived from the slower pace of investments in rental
equipment and sales;

Increase of R$ 20.7 million in assets maintained for sale, as a result of the

sale contract in Rental business unit;
Increase of 10.0 million in recoverable taxes;
decrease of R$ 54.8 million in accounts receivable, including revenue from
the sale of the investee; and
Reduction of R$ 3.4 million in inventories.

Non-current Assets
The Companys non-current assets of R$ 103.7 million as of December 31, 2014
was decreased to R$ 90.4 million as of December 31, 2015, a reduction of R$
13.3 million or 12.9%.
Investment
The investment dropped from R$ 87.4 million as of December 31, 2014 to R$
61.2 million as of December 31, 2015, a reduction of R$ 26.2 million, or 30.0%,
related to the impaiment in investment on Rohr.
PP&E Property, Plant and Equipment
The Companys PP&E decreased from R$ 1,200.1 million as of December 31,
2014 to R$ 1,004.1 million at December 31, 2015, a decrease of R$ 196.1 million,
or 16.3%.
Intangible assets
The Companys intangible assets decreased from R$ 76.1 million as of December
31, 2014 to R$ 46.8 million as of December 31, 2015.
In the beginning of 2014, the Company concluded SAP implementation, unifying
and standardizing its information systems aiming at achieving a higher efficiency
level for its internal controls, mainly on the financial and operational sides.
Current liabilities
The Companys current liabilities decreased from R$ 221.2 million as of
December 31, 2014, to R$ 218.9 million as of December 31, 2015, a reduction of
R$ 2.3 million. The main factors that led to this change, according to the
managements opinion, were:

Increase of R$ 81.3 million in the sort-term debentures balance, as a result

of the reclassification of the first installment of the second issue from the long
to the short term.

decrease of R$ 46.5 million in the short-term loans and financing balance,

due to a reclassification from long to short-term referring to installment to be
settled in 2015;
reduction of R$ 21.8 million in the balance of dividends and interest on
equity, as dividends or interest on equity were not distributed in 2015; and
reduction of R$ 9.7 million in suppliers account, due reduction of acquisition
of rental equipment of our PPE.

Non-current liabilities
The non-current liabilities decreased from R$ 612.1 million as of December 31,
2014 to R$ 456.8 million as of December 31, 2015, a reduction of R$ 155.3
million, or 25.4%. On the Companys management evaluation, the main factor
that led to this variation was:
Reduction of R$ 156.5 million in the long-term debentures balance, as a
result of the reclassification of the third installment of the first issuance of the
debentures, the first installment of the second issue of the long to the short
term and also the proceeds from the third issuance of debentures.
Stockholders Equity
Shareholders equity decreased from R$ 1,059.4 million as of December 31, 2014
to R$ 962.2 million as of December 31, 2015, a reduction of R$ 97.2 million, or
9.2%. On the Companys management evaluation, the main factor that led to this
variation was:

Reduction of R$ 97.8 million in earnings reserve account, as a result of the

reduction of profit.

Year ended December 31st, 2014 compared to year ended December 31st,
2013

Current Assets
The Companys current assets increased from R$ 319.5 million as of December
31, 2013 to R$ 425.3 million as of December 31, 2014, an increase of R$ 105.8
million or 33.1%. The main reasons for such increase, in the assessment of the
management of the Company, were:

increase of R$ 167.9 million in cash and cash equivalents, due to higher

liquidity mainly derived from the slower pace of investments in rental
equipment.
decrease of R$ 29.9 million in accounts receivable, including revenue from
the sale of the investee;
reduction of R$ 14.5 million in inventories;
reduction of R$ 10 million in recoverable taxes;

Non-current Assets
The Companys non-current assets of R$ 101.5 million as of December 31, 2013
was increased to R$ 103.7 million as of December 31, 2014, a growth of R$ 2.2
million or 2.2%.
Investment
In 2014 the Company maintained the same registered investment value as 2013
of R$ 87.4 million. In January, 2011 it acquired 25.0% of the total voting capital
of Rohr for R$ 90.0 million.
PP&E Property, Plant and Equipment
The Companys PP&E increased from R$ 1,224.5 million as of December 31,
2013 to R$ 1,200.1 million at December 31, 2014, a decrease of R$ 24.4 million,
or 1.99% reflecting investments in line with book depreciation and sale of seminew equipment.

Intangible assets
The Companys intangible assets increased from R$ 68.4 million as of December
31, 2013 to R$ 76.1 million as of December 31, 2014, mainly due to R$ 7.7 million
in software acquisition.
In the beginning of 2014, the Company concluded SAP implementation, unifying
and standardizing its information systems aiming at achieving a higher efficiency
level for its internal controls, mainly on the financial and operational sides.
Current liabilities
The Companys current liabilities increased from R$ 255.0 million as of December
31, 2013, to R$ 221.2 million as of December 31, 2014, a reduction of R$ 33.8
million. The main factors that led to this change, according to the managements
opinion, were:

increase of R$ 36.9 million in the short-term loans and financing balance,

due to a reclassification from long to short-term referring to installment to
be settled in 2015.
reduction of R$ 21.4 million in suppliers account, due to installment
purchase of rental equipment of our PPE.
reduction of R$ 19.2 million in dividends and payable interest on capital,
due to the lower level of profit distribution of 2014;
decrease of R$ 18.7 million in the profit sharing payable account, since
there will not be profit sharing in 2014;
reduction of R$ 7.2 million, in the short-term debentures balance, due to
the amortization of part of the debentures in 2014.

Non-current liabilities
The non-current liabilities increased from R$ 529.7 million as of December 31,
2013 to R$ 612.1 million as of December 31, 2014, an increase of R$ 82.4 million,
or 15.6%. On the Companys management evaluation, the main factor that led to
this variation were:

increase of R$ 201.2 million referring to the third issuance of Debentures

held by the Company;
reduction of R$ 90 million referring to amortization of principal of first
Debentures issuance;
reduction of R$ 43.9 million in long-term borrowings and financing due to
its transfer to short-term.

Stockholders Equity
Shareholders equity increased from R$ 1,016.51 million as of December 31,
2013 to R$ 1,059.4 million as of December 31, 2014, an increase of R$ 42.9
million, or 4.2%. On the Companys management evaluation, the main factor that
led to this variation were:

increase of R$ 39.1 million in earnings reserve account referring to the

net earning registered in 2014 of R$ 64.3 million deducted R$ 25.1 million
of dividends and payable interest on capital registered in 2014;
increase of R$ 10.1 million in stockholders equity due to the exercise of
options by the beneficiaries;
reduction of R$ 1.4 million in capital reserve account, due to R$ 11.0
million in buyback of shares and to R$ 9.5 in stock option premium
reserve amounting; and
Reduction of R$ 5.0 million in valuation adjustment to equity, due to cash
flow hedges in 2014.

CASH FLOW
Year ended December 31st

2013

2014

2015

(in R$ millions)
Cash flow from operating services ............................................

263.4

120.9

200.3

Cash flow from investment activities .........................................

(258.1)

(4.7)

2.1

Cash flow from (used in) financing activities .............................

(23.7)

51.7

(164.1)

Increase (decrease) in liquidity .................................................

(18.4)

167.9

38.4

In 2015 the Company changed the accounting method for acquisition of fixed
assets for rental in its cash flow from investment activities to operational activities.
The cash flow values of 2014 and 2015 already reflect this change. The main
reason is that the company considers as operational activities sales of fixed
assets, and, therefore, its cash flow should reflect this reality.
For comparison purposes, below is the 2013 adjusted cash flow reflecting this
change:
Cash Flow

DFs 2013
Cash flow from operating services..............................................
Cash flow from investment activities............................

changes

263.4

538.4

-258.1

-538.4

Cash flow from (used in) financing

activities.................................................................................................
Increase (decrease) in liquidity..............................................

801.8
-796.5

-23.7

-23.7

-18.4

-18.4

Cash Flow from Operating Activities

In the fiscal years of 2013, 2014 and 2015, the company operating result, was R$
263.4 million, R$ 120.9 million and R$ 200.3 million, respectively. In 2015, there
was a growth of 65.7%. According do managements opinion, the increase was
impacted by significant drop in the Companys investments.
Cash Flow from Investing Activities
The gross investments in PPE for the years ended December 31, 2013, 2014 and
2015 amounted to R$ 489.4, R$ 186.7 million, and R$ 21.3 million, respectively.
In 2013, the Company invested to continue seizing attractive opportunities in its
operating markets.
In 2014 due to the market contraction due to economic and politic uncertainties,
the Company reduced its investments.
In 2015 due to continuous market contraction as a result of economic and politic
uncertainties, the Company reduced, even more, its investments.
The table below shows the investments in PP&E made in 2013, 2014 and 2015:

Year ended December 31st,

2013

DFs 2013
adjusted

2014

2015

(in R$ millions)
Gross investments, before PIS and COFINS credits .......................................

(489.4)

(186.7)

(21.3)

Total Gross investments ...................................................................................

(489.4)

(186.7)

(21.3)

PIS and COFINS credits ..................................................................................

43.4

18.2

1.0

Net Investments ................................................................................................

(446.0)

(168.5)

(20.3)

The gross investments in intangible assets in the years ended December 31st
2013, 2014 and 2015 totaled, R$ 16.5 million, R$ 12.4 million and R$ 6.9 million,
respectively.
Cash Flow from Financing Activities

Year ended December 31st,

2013

2014

2015

(in R$ millions)

Capital contributions.................................................................

15.6

10.1

Purchase of treasury shares ....................................................

(11.0)

(8.7)

Dividends and interest on capital paid ......................................

(41.8)

(46.7)

(21.8)

Repayment of borrowings ........................................................

(38.5)

(300.6)

(133.5)

Borrowings raised ....................................................................

41.0

400.0

The cash flow from financing activities includes new loan agreements, the
amortization of the principal and payment of interest on existing loans, as well as
increases in the capital stock, and dividend payment.
In 2014, the Company issued promissory notes totaling R$ 200 million, and its
third debentures issuance, in May, amounting to R$ 200 million, which were used,
in June, to fully pay the promissory notes issued in April.
On April 11, 2014 the Company issued in a single series 20 commercial
promissory notes with unit face value of R$10,000, totaling R$200,000 and with
maturity on August 8, 2014. The unit value of the promissory notes bears interest
equivalent to 106% of the accumulated fluctuation of the average daily interbank
deposit (DI) rates. On June 18, 2014 the Company fully paid these promissory
notes with the proceeds from its third issue of debentures.
In 2014, the Company captured R$ 200.0 million through its third issue of
Company debentures simple, nonconvertible, registered, unsecured, in a single
series with unit face value of R$10.00. These debentures mature on May 30, 2019
and pay interest equivalent to 108.75% of the CDI, payable semiannually, and
amortized in three annual, consecutive installments, commencing on May 30,
2017. The proceeds obtained by the Company with the third issue of debentures
were fully used to settle the commercial promissory notes amounting R$ 200
million of the Companys fourth issue, issued on April 11, 2014.
10.2

The directors must comment on

a.

Results of the Companys operations, in particular:

(i)

description of important components of revenue

Net Revenue from Sales and Services

On the Companys management opinion, the Company is one of the largest
specialized engineering service provider, leading Brazilian market in formwork
and tubular structure supply and in motorized access equipment for rental. The
Company believes that its operational areas will offer opportunities in the next
years, due to, among other factors: (i) relevant investments in heavy construction
projects, as, for instance, the package of logistics concessions, concerning
highways, railways, ports and airports; (ii) high housing deficit and low penetration
of housing credit; and (iii) growing concern of companies with safety in work and
productivity gain, which may drive to the use of equipment and services provided
by our Company.
All of these areas are directly affected by macroeconomic conditions changes in
Brazil, specially the growth of Gross Domestic Product GDP, interest rates,
inflation, credit availability, level of unemployment, exchange rates and
commodities prices, the last two affect costs of equipment used in Companys
activities. Consequently, these factors affect, indirectly, its operation and results.
The net revenues from sales and services are denominated in reais, and are
derived from the rental and sale of equipment, the provision of technical support
services, and penalty payments for unreturned or damaged equipment. The table
below sets forth the participation of the net revenue for the periods indicated:
Year ended December
31st,
2013

2014

2015

Equipment Rental .....................................................

81.0%

83.5%

84.1%

Sale of Equipment .....................................................

12.2%

10.1%

9.4%

Technical Support Services .......................................

2.6%

1.0%

1.4%

Indemnifications ........................................................

4.2%

5.3%

5.1%

(ii)

Factors that materially affected operational outcomes

Cost of Products Sold and Services Rendered and Operational, General and
Administrative Expenses
The main cost of products sold and services rendered relates to costs for
executing the projects in which the Company are involved, including (i) personnel
for assembly and disassembly of equipment rented to its clients when such tasks
are carried out by the Company; (ii) cost of the equipment sub-leased from third
parties when the Companys inventories are insufficient to meet demand; (iii)
expenses with materials used in the provision of its services, which include
individual safety equipment, wood, paint and insulation material; and (iv) freight
costs relating to the transportation of equipment between its branches and
eventually to its clients. Costs related to the execution of its projects represented
43.7%, 43.9% and 45.1% of its principal costs of sales and services rendered,
excluding depreciation, in the years ended December 31, 2013, 2014 and 2015,
respectively.
The Companys main general and administrative expenses refer to contract
coordination, encompassing the project teams and engineers in the commercial
area, responsible for the management and supervision of each of its projects,
which correspond basically to salaries, payroll charges and benefits, with the rest
relating to travel, representation and communications expenses, as well as the
overhead of the administrative areas. Other material general and administrative
expenses include: (i) administrative expenses incurred with respect to its
financial, investor relations, and human resources departments, as well as its
executive management, including salaries and benefits, (ii) expenses in
connection with the Companys employee profit-sharing plans and expenses
related to its stock option plans, and (iii) other administrative expenses, which
include, in particular, expenses resulting from adjustments to its provisions for
contingencies.
ADD represented 6.6% of net revenues in 2015, versus 5.3% in 2014 and 2.0%
in 2013.
With equipment and maintenance operational synergy from Heavy Construction
and Real Estate, we will see improvement in operational efficiency and,
consequently, a reduction in unit costs for maintenance. In 2014, we had intense
maintenance activities, despite of weaker demand, to equalize deferred
maintenance of our equipment.
Furthermore, we have some initiatives underway in order to reduce Company
expenses, such as (i) a leaner corporate structure and, thus, the disposal of some
administrative and management positions; (ii) procurement centralization; and (iii)
insourcing of some third-party services, such as IT; (iv) Closure of three branches
in the Rental business unit and five branches in the Construction business unit;
and (v) In October, we moved our head office from Barra da Tijuca to our address
in Jacarepagu, where our warehouse is located.
Financial Results
The Companys financial results consist of its financial expenses, net of financial
revenues. The Companys main financial expenses include interest payments on
loans, leasing operations, and costs associated with discounting to present value
certain long-term receivables derived from the sale of equipment owned by its
former Events division. Its main financial revenues consist of income from its
financial investments and interest in connection with late payments by its clients.
The net financial result was a negative R$ 46.8 million, R$ 67.6 million and R$
63.1 million in 2013, 2014 and 2015, respectively.
Impact of public politics

In 2015, the Federal Government announced a new phase of the program of

investment in logistics (PIL Programa de Investimento em Logstica), which will
privatize airports, highways, railways and ports. The plan announced by the
Government stipulates that the companies that win the concessions will invest R$
198.4 billion in infrastructure works in the country. These resources will be
invested in construction and reform of highways, railways, ports and airports. Of
this amount, R$ 69.25 billion should be applied between 2015 and 2018,
according to the Federal Government. The other R$ 129.2 billion will be invested
from 2019 and until the end of the concession period, which varies according to
the work, and may reach 30 years. Has not yet been defined how will the model
be adopted to each grant. Therefore, there is no prediction of how much the
Government will raise with the auctions.
The expansion or contraction of housing credit and changes in interest rates
influenced Real Estate market in the past, therefore, it can affect future revenues
of Construction business unit.

b.

Changes attributable to changes in prices, volume changes and

introduction of new products and services

The Companys revenues have a direct correlation with changes in price and
volume of equipment rented to clients. Introduction of new products and services
also directly impacts revenue. As for inflation, the correlation of its revenue is
indirect, in the extent that the adjustments take place only in the renewal or
closing of new contracts, reflecting the past inflation. As regards to the exchange
rate fluctuation, currently there is no correlation to its revenue, except that the
Rental segments equipment are imported and hence have their acquisition cost
in foreign currency. Consequently, in the future, the rental revenue from this
division may be influenced by possible in exchange rates variations. The increase
in revenues in 2013 was due to an increase in rented and sales volume, given
the favorable market conditions and its geographic expansion. In 2014, rental
revenues were stable compared to 2013, being the consolidated revenues
affected by lower sales volume in the year. In 2015, there was a reduction of
27.5% in revenues, of which 82% from rental revenues.
C.
Impact of inflation, price variations of main inputs and products,
exchange rate and interest rate on operating profit and the issuer's financial
result.
Companys operations and results are directly impacted by variations of: (i)
Inflation rates, which index are used to adjustment of Companys long-term
contracts; (ii) Interest rates, that affect interest-bearing debt of the Company; and
(iii) cost of material used in construction works or equipment maintenance of the
Company.
The Companys expenses are subject to impact of inflation via wage increases
for employees, a raise in the cost of the hired services, such as freight, and inputs
used in the provision of services and through financial expenditure due to the
remuneration of the debentures which are subject to monetary restatement by the
accumulated variation of IPCA. Moreover, the equipment the Company invests in
to use at its services are also subject to increases due to inflation and changes in
commodity prices, mainly steel and aluminum. In the case of Rental business
unit, the prices of the equipment the Company uses can increase according to
the fluctuation of the exchange rate, because they are imported.
The indebtedness of the Company is subject to floating interest rates, especially
CDI rate, IPCA (inflation) and TJLP. There is a risk of the Company come to incur
losses due to fluctuations in interest rates, which increases financial expenses
related to loans, financings and debentures obtained on the market
10.3
The directors must comment on the relevant effects that the events
listed below may have caused or are expected to cause on the Companys
financial statements or its results
a.

Introduction or disposal of operating segment

In 2013, the Company sold, through the sale of the company Albuquerque
Participaes Ltda., the Industrial Services business unit, as described in item (b)
below. The Company did not introduce or dispose of any segment in fiscal years
2014 and 2015.
b.

Constitution, acquisition or divestiture of shareholdings

Sale of the Industrial Services business unit

On July 10, 2013, the Company entered into an agreement for the sale of its
Industrial Services business unit for R$ 102 million through the sale of its stake
in the company Albuquerque Participaes Ltda.
The Industrial Services business unit recorded:

for the nine months ended September 2013 (end of the last quarter before
the actual sale), net profit of R$ 6.1 million 30 representing in the same period,
4.8% of total net profit of Mills, and net income of R$ 168.4 million, over the same
period, 21.3% of consolidated net revenue of Mills;

in fiscal year 2012, net income of R$ 2.3 million, in the same period, 1.2%
of total net profit of the Mills, and net income of R$ 213.8 million, over the same
period, 24.3% of consolidated net revenue of Mills.
The sale is aligned with the Companhys strategy to focus on businesses in which
its competencies are able to add higher value to its shareholders and clients.
Therefore, the Company ceased to operate in the Industrial Services sector, in
which were offered access services, industrial painting, surface treatment and
thermal insulation, during both construction and maintenance phase of large
industrial plants.
The sale of the Industrial Services business unit was concluded in November 30,
2013, and the Company recorded gain of R$ 8.3 million with the sale. Of the
agreed sales price of R$ 102 million, (i) R$ 25 million was received on the date
of the sale agreement, in July; (ii) R$ 17 million were paid in April 2014, net of R$
6.8 million related to adjusts settled between the Buyer and the Company; and
(iii) the outstanding amount of R$ 60 million will be paid in installments adjusted
by the Interbank Deposit Certificate CDI rate. This disposal is in line with Mills
strategy to focus on businesses in which its competences are able to add higher
value for its shareholders and clients.
c.

Unusual transactions or events

There were no unusual transactions or events in fiscal years 2013 and 2014,
except as described above.
In 2015, the Company recognized R$ 57.1 million of impairment in Construction
business unit and in the investment on Rohr.
Applying the premises of Technical Pronouncement CPC-01 - Impairment of
Assets, the Company performed impairment tests on its assets. After said tests,
it was verified that it was necessary to establish an impairment provision
amounting to R$ 26.2 million for the investment in Rohr and R$ 30.9 million for
the Construction Cash Generating Unit. For the assets of the Rental business unit
and other assets of the Company, no need to perform impairment tests were
identified.
The recoverable amount of those assets was determined based on economic
forecasts for determining the market value of the investee, upon through a
revenue approach, through a 10-year term discounted cash flow forecast, for
purposes of substantiating the amount paid, considering the long maturity period
of infrastructure and civil construction investments. The main assumptions
included: (i) revenues were forecast based on historical data and growth
prospective for the segment and Brazilian economy; (ii) negative operating loss
for 2015, resulting from the reduced activity of the industry; (iii) performance of a
continuous productivity improvement program and reduction of costs and
expenses will cause the evolution thereof to be lower than revenue growth
percentage, (iii) the corresponding cash flows are discounted at the average
discount rate, obtained using a methodology typically applied by the market,

taking into account the weighed average cost of capital (WACC); (iv) a strict
working capital evolution control policy, during the forecasted period.
10.4

The directors must comment on:

a.

Significant changes in accounting practices

a) New standards and interpretations and amendments to existing standards

that are effective since January 1, 2014:
Effective for annual periods beginning on or after July 1, 2014:

IAS 19/CPC 33 Employee Benefits The amendments clarify how

an entity should account for contributions made by employees or third
parties based on whether those contributions are dependent on the
number of years of service provided by the employee.
Annual Improvements to IFRSs 2010-2012 and 2011-2013 Cycles
Minor amendments to existing pronouncements.

Management has not identified any impact of these amendments to existing

standards.
b) New standards, interpretations of and amendments to existing standards
that are not yet effective at December 31, 2015:
Effective for annual periods beginning on or after January 1, 2016:

IAS 16 and IAS 38 Amendments to these standards to clarify the

acceptable methods of depreciation and amortization.

IFRS 11 Amendments that address accounting for acquisitions of

interests in joint operations. The amendments provide guidance on how
to account for the acquisition of a joint operation that constitutes a
business as defined in IFRS 3, the amendments state that the relevant
principles on accounting for business combinations in IFRS 3 and other
standards should be applied, except when there is a conflict with IFRS
11, and that a joint operator is also required to disclose the relevant
information required by IFRS 3 and other standards for business
combinations. Applicable both for the initial acquisition of interest in a joint
operation and for the acquisition of additional interest, in the latter case,
the investment previously held is not remeasured with prospective effect.

IAS 27 Amendments to standard to include the option to account for

investments in subsidiaries, joint ventures and associates using the
equity method in separate financial statements.

IAS 1 Amendments to standard to address potential hindrances

identified in exercising judgment in the preparation of financial
statements. These amendments clarify that the concept of materiality
should be considered both for reporting purposes, either the information
is required or not, and in the presentation of the notes to financial
statements and in the use of aggregation criteria.

Annual Improvements to IFRSs 2010-2012 Cycle Minor amendments

to existing standards.

Effective for annual periods beginning on or after January 1, 2017:

IAS 7 - Amendments to this standard to clarify that the Companies should
provide disclosures that permit users of financial statements to assess the
changes in liabilities arising from financing activities, presented in the cash
flows

 IAS 12 - Amendments to this standard to clarify that the methods to classify

unrealized losses on debt instruments measured at cost and fair value is
considered as a deductible temporary difference.
Effective for annual periods beginning on or after January 1, 2018:

IFRS 15 Revenue from Contracts with Customers establish five

simple steps to be applied to contracts with customers for revenue recognition
and disclosure. It will replace the standards (IAS 18 and IAS 11) and
interpretations (IFRIC 13, IFRIC 15 and IFRIC 18) currently effective on the
matter.

IFRS 9 Financial Instruments New standard (with amendments

subsequent to it) that introduces new requirements for the classification,
measurement, impairment, hedge accounting and derecognition of financial
assets and liabilities
Effective for annual periods beginning on or after January 1, 2019:

IFRS 16 Specification of recognition, measurement and disclosure of

leases, through a single accounting model of lessee.
Effective for annual periods beginning on or after an undefined date:

IFRS 10 and IAS 28 Amendments to these standards to clarify the

treatment of sale or entry of assets of an investor to its associate or joint venture.
The Company intends to adopt these standards when they become effective. The
Company is analyzing the impacts of these standards and so far no material
impact on its financial statements has been identified.
b.

Significant changes in accounting practices

There was no change in significant accounting practices, methods of calculation,

judgments, estimates and accounting assumptions in the financial statements of
the company for the fiscal years ended December 31, 2013, 2014 and 2015.
c.

Qualifications or points on the auditors opinion

There were no points or qualification on the auditors opinion

10.5
The management shall indicate and comment on critical accounting
policies adopted by the issuer, by exposing mainly the accounting
estimates made by management on uncertain and relevant questions for
description of the financial situation and the results, which require
subjective or complex judgments, such as: provisions, contingencies,
recognition of revenue, fiscal credits, long-term assets, useful life of noncurrent assets, pension plans, conversion adjustments in foreign currency,
recovery environmental costs, standards for testing the recovery of assets
and financial instruments.
Estimates and judgments used in the preparation of Financial Statements
In the preparation of the Company's financial statements, management is
required to make judgments, estimates and assumptions about the carrying
amounts of revenues, expenses, assets and liabilities, as well as the disclosure
of contingent liabilities at the end of the reporting period. However, the uncertainty
related to these assumptions and estimates might lead to results that require a
significant adjustment to the carrying amount of the affected asset or liability in
future periods.
The following are the key assumptions concerning the future, and other key
sources of estimation uncertainty at the end of the reporting period, hat may have
a significant risk of causing a material adjustment to the carrying amount of assets
and liabilities within the next fiscal year.

(i)

Impairment of nonfinancial assets and investments carried at cost

An asset is impaired when its carrying amount exceeds its recoverable amount,
which is the higher of an asset's fair value less costs to sell and its value in use.
The value in use calculation is based on the discounted cash flow model. Cash
flows derive from the budget and Managements expectations for the next five
years and do not include reorganization activities to which the Company has not
yet committed or significant future investments that will improve the asset base
of the cash-generating unit or investment subject to testing. The recoverable
amount is sensitive to the discount rate used in the discounted cash flow method,
as well as to the expected future cash receipts and to the growth rate used for
extrapolation purposes.
(ii)

Share-based payment transactions

Equity-settled share-based payments to employees are measured at the fair

value of the equity instruments at the grant date. The fair value of share-based
payments requires the determination of the most appropriate valuation model for
the granting of equity instruments, which depends on the terms and conditions of
the grant. This also requires the determination of the most appropriate valuation
model, including the expected life of the option, volatility and dividend yield and
related assumptions.
(iii)

Taxes

There are uncertainties regarding the interpretation of complex tax regulations,

as well as the amount and timing of future taxable profits. Differences between
actual results and the assumptions adopted, or future changes in these
assumptions, may require future adjustments in tax income and expenses already
recorded. The Company recognizes provisions based on applicable estimates,
for potential consequences of audits by tax authorities. The amount of these
provisions is based on several factors, such as experience of prior tax audits and
interpretations diverging from the tax regulations by the taxable entity and by the
responsible tax authority. These diverging interpretations may arise in a wide
variety of matters, depending on the prevailing conditions prevailing at the
Companys domicile. Deferred tax assets are recognized for all temporary
differences to the extent that it is probable that sufficient taxable profits will be
available to allow their utilization.
Significant judgment by management is required to determine the amount of
deferred tax assets that can be recognized, based on the probable term and level
of future taxable profits, together with strategies for future tax planning.
(iv)

Fair value of financial instruments

When the fair value of financial assets and liabilities, such as stock options,
securities and hedging instruments presented in the statement of financial
position, cannot be obtained from active markets, it is determined by using
valuation techniques, including the discounted cash flow method. Inputs for these
methods are based on market inputs, when possible; however, when this is not
feasible, a certain level of judgment is required to establish the fair value.
Judgment includes considerations on the inputs used, such as liquidity risk, credit
risk and volatility. Changes in assumptions on these factors could affect the
reported fair value of the financial instruments.
(v)

Allowance for doubtful debts

The need to recognize such allowance involves an analysis of the available

evidence as regards the Company's ability to pay customers, including in a
manner so as to classify some of them as preferred customers and base other
cases that will be sent to legal collection. Significant judgment by Management is
required in classifying its customers, in defining the criteria applied, and in
assessing its accuracy.
(vi)

Provision for tax, civil and labor claims

The Company recognizes a provision for tax, civil and labor risks. The
assessment of the likelihood of loss includes examining available evidence, the
hierarchy of laws, former court decisions, the most recent court decisions and
their relevance in the legal system, and the assessment of the outside legal
counsel. The provision is reviewed and adjusted to take into account any changes

in circumstances, such as the applicable prescriptive periods, conclusions of tax

audits or additional exposures identified based on new matters or court decisions.
(vii)

Useful lives of property, plant and equipment

The Company reviews the estimated useful lives of its property, plant and
equipment annually at the end of each reporting period. During the year the
Company assessed the useful lives of its assets and concluded that the ten-year
period adopted in prior years reasonably represents the average useful life of the
Company's assets and should be maintained for its equipment in 2015.
(viii)

Revenue recognition

Service revenue is recognized in profit or loss based on the stage of completion

of the services at the end of the reporting period.
Following, the Companys Management presents a discussion about what they
consider relevant as accounting practices for the presentation of Companys
financial information.
(i)

Financial Instruments

Financial assets and liabilities are recognized when the Company becomes a
party to the contractual provisions of the respective instrument.
Financial assets and financial liabilities are initially measured at fair value.
Transaction costs that are directly attributable to the acquisition or issue of
financial assets and financial liabilities (other than financial assets and financial
liabilities at fair value through profit or loss) are added to or deducted from the fair
value of the financial assets or financial liabilities, as appropriate, on initial
recognition. Transaction costs directly attributable to the acquisition of financial
assets or financial liabilities at fair value through profit or loss are recognized
immediately in profit or loss.
ii)

Current and deferred income tax and social contribution

Income tax expense comprises current and deferred taxes. Taxes on income are
recognized in the income statement, except when they relate to items that are
recognized directly in equity or in other comprehensive income, in which case,
the tax is also recognized in equity or in other comprehensive income.
The current income tax and social contribution expense is calculated based on
tax rates prevailing in Brazil at the end of the reporting period, which are 15% for
income tax, plus a 10% surtax on taxable profit exceeding R$240 thousand, and
9% on taxable profit for social contribution. Management periodically reviews
positions taken in respect of tax matters that are subject to interpretation and
recognizes a provision when the payment of income tax and social contribution
according to the tax bases is expected.
Deferred income tax and social contribution are calculated on temporary
differences between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable
profit. The tax rates currently defined are 25% for income tax and 9% for social
contribution.
Deferred tax assets are recognized to the extent that it is probable that future
taxable profits will be sufficient against which the deductible temporary
differences can be utilized, based on projections of future results prepared on the
basis of internal assumptions and future economic scenarios that are, therefore,
subject to changes.
The carrying amount of deferred tax assets is reviewed at the end of each
reporting period and reduced to the extent that it is no longer probable that
sufficient taxable profits will be available to allow all or part of the asset to be
recovered.
Current and deferred taxes are recognized in profit or loss, except when they
relate to items that are recognized in Other comprehensive income or directly in
equity, in which case, current and deferred taxes are also recognized in Other
comprehensive income or directly in equity, respectively Where current and

deferred taxes arise from the initial accounting for a business combination, the
tax effect is included in the accounting for the business combination.
(iii)

PP&E: Company use and rental and operational use

A majority of the Company revenues come from property, plant and equipment
for operational rental and use, either solely through rental, or rental combined
with assembly and disassembly.
Property, plant and equipment for own use consists mainly of facilities to store
equipment, office, improvements, furniture and equipment necessary for the
operation of these facilities.
Property, plant and equipment are carried at historical cost, less accumulated
depreciation and accumulated impairment losses. Historical cost includes
expenditure directly attributable to the acquisition of the property, plant and
equipment items.
The items of PP&E are valued at historic cost, less accumulated depreciation.
The historic cost includes expenditures as well as any exchange rate hedge gain
or loss cash flow directly attributed to the acquisition of such fixed assets.
Subsequent costs are added to the residual value of property, plant and
equipment or recognized as a specific item, as appropriate, only if the future
economic benefits associated to these items are probable and the amounts can
be reliably measured.
Depreciation is calculated under the straight-line method, taking into
consideration the estimated economic useful lives of assets. Land is not
depreciated.
Assets held under finance leases are depreciated over their expected useful lives
on the same basis as owned assets or, where shorter, the term of the relevant
lease.
Any gain or loss arising on the disposal of an item of property, plant and
equipment is determined as the difference between the sales proceeds and the
carrying amount of the asset and is included in operating income or expense.
The residual values and estimated useful lives of assets are reviewed at the end
of each reporting period, with the effect of any changes in estimate accounted for
on a prospective basis.
(iv)

Goodwill

Goodwill arising on an acquisition of a business is carried at cost as established

at the date of acquisition of the business less accumulated impairment losses, if
any.
Goodwill is allocated to cash-generating units (CGUs) for impairment testing
purposes. Goodwill is allocated to each of the cash-generating units (or groups
of cash-generating units) that is expected to benefit from the synergies of the
combination and is identified according to the operating segment.
(v)

Impairment of assets

At the end of each reporting period, the Company reviews the carrying amount of
its tangible and intangible assets to determine whether there is any indication that
those assets have suffered an impairment loss. If any such indication exists, the
recoverable amount of the asset is estimated in order to determine the extent of
the impairment loss (if any). Where it is not possible to estimate the recoverable
amount of an individual asset, the Company estimates the recoverable amount
of the cash-generating unit to which the asset belongs, for this purpose the
Company considers its divisions as cash-generating units. When a reasonable
and consistent basis of allocation can be identified, corporate assets are also
allocated to individual cash-generating units, or otherwise they are allocated to
the smallest group of cash-generating units for which a reasonable and consistent
allocation basis can be identified.

Intangible assets with indefinite useful lives and intangible assets not yet available
for use are tested for impairment at least annually, and whenever there is an
indication that the asset may be impaired.

Recoverable amount is the higher of fair value less costs of disposal and value in
use, and the latter is the method used by the Company in testing the impairment
of the goodwill recognized in the cash-generating unit Construction. In
assessing value in use, the estimated future cash flows are discounted to their
present value using a pretax discount rate that reflects current market
assessments of the time value of money and the risks specific to the asset for
which the estimates of future cash flows have not been adjusted. If the
recoverable amount of an asset (or cash-generating unit) is estimated to be less
than its carrying amount, the carrying amount of the asset (or cash-generating
unit) is reduced to its recoverable amount. An impairment loss is recognized
immediately in profit or loss.
When an impairment loss subsequently reverses, the carrying amount of the
asset (or cash-generating unit) is increased to the revised estimate of its
recoverable amount, but so that the increased carrying amount does not exceed
the carrying amount that would have been determined had no impairment loss
been recognized for the asset (or cash-generating unit) in prior years. A reversal
of an impairment loss is recognized immediately in profit or loss.
(vi)

Provisions

Provisions are recognized when the Company has a present obligation (legal or
constructive) as a result of a past event, it is probable that the Company will be
required to settle the obligation, and a reliable estimate can be made of the
amount of the obligation.
The provisions for tax, civil and labor claims are recognized at the amount of
probable losses, according to the nature of each provision. Based on the opinion
of its legal counsel, management believes that the recognized provisions are
sufficient to cover any losses on ongoing lawsuits. Provisions are measured at
the present value of the expenditures expected to be required to settle the
obligation using a pre-tax rate that reflects current market assessments of the
time value of money and the risks specific to the obligation. The increase in the
provision due to passage of time is recognized as expense.
(vii)

Stock option plans

The Company offers stock option plans to certain employees and executives. The
fair value of the options granted is recognized as an expense during the period
over which the right is vested, that is, period during which specific vesting
conditions should be met. At the end of the reporting period, the Company
reviews its estimates of the number of options whose rights must be vested based
on the conditions.
This recognizes the impact of the revision of the initial estimates, if any, in the
statement of profit or loss, as a balancing item to the capital reserve in equity.
The amounts received, net of any directly attributable transaction costs, are
credited to capital when options are exercised.
(viii)

Revenue recognition

Revenue from a contract to provide services is recognized by reference to the

stage of completion of the contract at the end of the reporting period.
Revenue from the sale of goods is recognized when the Company has transferred
to the buyer the significant risks and rewards of ownership of the goods. The
Companys policy for recognition of revenue is the date at which goods are
delivered to the buyer.
The rental income is prorated and recognized on a straight-line basis over the
term of the equipment rental agreements.
The Company separates the identifiable components of a single contract or a
group of contracts to reflect the substance of the contract or group of contracts,
recognizing the revenue of each of the elements proportionally to its fair value.

Therefore, the Company's revenue is divided into rental, technical assistance,

sales and indemnities/expense recoveries.

Interest income is accrued on a time basis, by reference to the principal

outstanding and at the effective interest rate through maturity, when it is
determined whether such income will accrue to the Company.
Dividend income from investments is recognized when the shareholders right to
receive payment has been established (provided that it is probable that the
economic benefits will flow to the Company and the amount of income can be
measured reliably).
Income, expenses and assets are recognized net of taxes on sales.
10.6
Regarding the internal controls adopted to ensure the preparation
of reliable financial statements, the management shall comment on:
a.
the assets and liabilities held by the Company, directly or indirectly,
that do not appear on its balance sheet (off-balance sheet items), such as:
(i) commercial leases, operating assets and liabilities, (ii) Receivables
portfolios written-off over which the entity keep risks and responsibilities,
indicating their respective liabilities, (iii) future contracts, purchase and
sale of products or services, (iv) construction contracts not terminated (v)
future receivables financing contracts
The Company does not have relevant assets and liabilities not evidenced in the
financial statements of the years 2013, 2014 and 2015.
b.

others items not included in the balance sheet

In the evaluation of the management, there are no significant items not included
in the balance sheet of the Company in the years 2013, 2014 and 2015.
10.7
For each of the items that are not evidenced in the financial
statements listed in item 10.6, management must comment:
a.
how such items change or may change the revenues, expenses,
operating results, financial expenses or other items of the financial
statements of the company
In the evaluation of the Management, there are no relevant items not evidenced
in the financial statements of the company of in the years 2013, 2014 and 2015.
a. nature and the purpose of the operation
In the evaluation of the Management, there are no relevant items not evidenced
in the financial statements of the company of in the years 2013, 2014 and 2015.
b.

nature and amount of the obligations assumed and rights

generated in favor of the company as a result of the operations

In the evaluation of the Management, there are no relevant items not evidenced
in the financial statements of the company of in the years 2013, 2014 and 2015.
10.8
Management shall indicate and comment on key elements of the
Company's business, specifically exploring the following topics:
a.
Investments, including: (i) quantitative and qualitative description
of investments in progress and forecasted investments; (ii) financing
sources of investments and (iii) relevant alienations in progress and
forecasted alienations

The Company plans its investment policy in accordance with its demand
prospects, cash flow and credit availability in the market. The Companys internal
policy is to maintain its leverage around 1.0x net debt to EBITDA. To ensure the
necessary amount of capital for the implementation of its investment plan, the
Company constituted a statutory reserve, of which the shareholders may allocate
up to 75% of net income, provided that such reservation does not exceed the limit
of 80% of the capital. The cash generation of the Companys normal operations,
from the retention of profits was used to partially finance the investments made
in 2013, 2014 and 2015.
In 2015 the Company recognized net loss, therefore no reserve constitution was
necessary.
In 2014, the amount of R$ 2.4 million were designated to this reservation,
whereas there was not any amount for this reservation in 2013.
The management presents below the major investments made in the course of
the years ended December 31, 2013, 2014 and 2015, and highlight the
investment budget for fiscal year 2016.

Investments in 2013, 2014 and 2015

Companys principal investments in this period are described below:
Heavy Construction
In the fiscal years ended by December, 31st, 2013, 2014 and 2015, the Heavy
Construction business unit invested, mainly, in shoring structures and
industrialized steel and aluminum formwork acquisition, amounting to R$ 106.3
million in 2013, R$ 47.5 million in 2014 and R$ 9.4 million in 2015.
Real Estate
Over the past three fiscal years ended by December, 31st, 2013, 2014 and 2015,
the Real Estate business unit invested mainly in acquisition of shoring equipment,
suspended scaffolding and industrialized formworks, having disbursed R$ 90.1
million in 2013, R$ 19.3 million in 2014 and R$ 2.2 million in 2015.
Rental
Over the financial years ended 31 December 2013, 2014 and 2015, the Company
carried out investments of R$ 267.2 million, R$ 105.3 million and R$ 0.6 millioN,
respectively.
In 2013 and 2014, the Company continued to implement its strategy of expanding
its portfolio
of aerial work platforms and telescopic handlers, investing R$ 267.2 million, R$
105.3 million and R$ 0.6 million in the acquisition of such equipment, respectively.
The Company intends to finance its investments with (i) cash generated in its own
activities, and (ii) indebtedness. For strategic operations, when necessary, the
Company may resort to the capital from their shareholders or third parties,
through the issuance of shares.
Investments planned for 2016
In 2016, the Company does not intend to make investments for the acquisition of
rental equipment, since the market is retracted and recognized net loss of R$
97.8 million in 2015.

b.
If already disclosed, indicate the purchase of plants, equipment,
patents or other assets that could influence materially the productive
capacity of the company.
In 2016, the Company does not plan to invest to purchase rental equipment in
2016.
c.
New products and services, by indicating: (i) description of
researches in progress already disclosed; (ii) total amounts paid by the
issuer in researches for development of new products or services; (iii)
projects under development already disclosed and (iv) total amounts paid
by the issuer for the development of new products or services
The Companys management believes that providing innovative solutions is a
constant mark of its activities and a key aspect to retain its customers. In this
sense, although the Company does not carry out in-house research and
development activities, it annually visits the main national and international fairs
of equipment from the industrial and construction sectors to meet the main
technological innovations available to the industry in which the company
operates. Furthermore, the Companys representatives visit the factories of
leading national and international manufacturers of equipment and construction
sites around the world to assess the functioning and operation of advanced
equipment available for purchase.
The Company does not develop new products and services, so it does not incur
expenses related to the research and development department. All the
technology and innovation present in its equipment and offered to its clients come
from its suppliers. For this, the Company seeks to acquire or license new
technologies from third parties on acceptable terms in the domestic and
international market, preferably with usual suppliers with whom the Company
seeks to establish long term partnerships. As an example of such partnerships,
the Company entered into a licensing contract in 1996 with the German company
NOE Schaltechnik, to produce and supply modular steel and aluminum panel
formwork (replacing the wood) for the Brazilian construction market, an innovation
in the Brazilian market.
10.9
Management is expected to discuss and analyze other material
factors that influenced operating performance, which were not discussed
under previous items in this section.
There are no other factors to comment on about operational performance of 2013,
2014 and 2015 results.
For being a service company with its main target audience quite segmented,
advertising investments are focused on targeted actions, whether they are direct
marketing, email marketing, relationship actions or online advertising.
Furthermore, as the services provided by the Company are, for the most part, in
activities related to construction, the Company prioritizes the sponsorship of
projects focused on reconstruction and development of the urban space or using
the Companys equipment. Following this line, in 2015, the Company sponsored
actions related to urban art with graffiti, in projects in Rio de Janeiro, Sao Paulo,
Fortaleza, Belo Horizonte, Brasilia and Salvador. The Company also sponsored
the show "pera do Malandro", which used the Company's equipment as
scenario and had presentation in nine of the locations where the Company
operates, providing relationships with clients who were invited to watch the show.

Projections

11.1 Identification of projections

Not applicable, as the Company does not disclose guidance.

11.2 Projection monitoring

Not applicable, as the Company does not disclose guidance.

12.1 Administrative Structure

a. Responsibilities of each body and committee
BOARD OF DIRECTORS
The Board of Directors is a decision-making body responsible for both formulating and monitoring the implementation of the general guidelines and policies of
its business, including long-term strategies, and appointing and supervising the Executive Officers.
In accordance with the Companys bylaws, the Board of Directors shall be comprised of a minimum of five and a maximum of 11 members, shareholders or not,
in accordance with the Novo Mercado Listing Rules. Members of the Board of Directors are to be elected for a continuous two-year term at the General
Shareholders meeting. Further, such members may be reelected and removed from office at any time by a decision of the Companys shareholders, at the
General shareholders meeting.
Pursuant to the Brazilian corporate law and CVM Instruction No. 282, dated June 26, 1998, the minimum percentage of voting capital required to adopt cumulative
voting in publicly-held companies is 5%. If the adoption of cumulative voting is not required, the directors will be elected by a majority vote of the shareholders
that are present, or represented by proxy. Additionally, 2005 established that shareholders who, individually or collectively, represent at least 10% of the total
capital of publicly-held companies, are entitled to appoint a director and its substitute in separate voting.
All new members of the Board of Directors must a sign a Consent Agreement of the Administrators, in which their respective position will depend on the signing
of the document. Through the Consent Agreement, the Companys new members of the Board of Directors are personally responsible to act in accordance with
the Contract of Novo Mercado, Regulation of the Market Arbitration Chamber and the Rules of the Novo Mercado.
Currently the Companys Board of Directors is comprised of six members (without any substitutes), of which were elected at Ordinary Shareholders Meeting
held on April 28, 2016. The members were elected for a two-year term expiring in the 2018 Ordinary General Meeting. The table below indicates the name, age
and title of the board of directors.
The table below presents the information related to the members of the Board of Directors.

Name

Date of
Birth

Profession

CPF

Title

Date of
Last
Election

Date of
office

Termo f
office

Other titles
in the
Company

Elected by
the
controling
shareholders

If independent
member,
criterion used to
determine the
independence

Number of
consecutive
terms

Andres
Cristian
Nacht

8/1/1942

Business
Administrator

098.921.33749

Chairman

4.28.2016

4.28.2016

2 years

No

Yes

Not applicable.

Elio
Demier

1/28/1951

Bachelor of
Social
Communication

260.066.50720

Vice
Chairman

4.28.2016

4.28.2016

2 years

Yes, is
member of
the Human
Resources

Yes

Not applicable.

Francisca
Kjellerup
Nacht

12/28/1970

Business
Administrator

124.175.65706

Advisor
Tutelary

4.28.2016

4.28.2016

2 years

No

Yes

Not applicable.

Jorge
Marques
de
Toledo
Camargo

4/28/1954

Geologist and
Physicist

114.400.15104

Independent
Director

4.28.2016

4.28.2016

2 years

No

Yes

Aymar
Ferreira
de
Almeida
Junior

6/16/1971

Production
Engineer

098.052.72877

Independent
Director

4.28.2016

4.28.2016

2 years

No

No

Roberto
Pedote

2/24/1967

Lawyer and
Public
Administration

115.324.29827

Independent
Director

4.28.2016

4.28.2016

2 years

No

Yes

Is an
independent
member. The
criteria used by
the Company to
determine its
Independence
was established
by the Listing
Regulation of the
Novo Mercado of
BM&FBOVESPA.
Is an
independent
member. The
criteria used by
the Company to
determine its
Independence
was established
by the Listing
Regulation of the
Novo Mercado of
BM&FBOVESPA.
Is an
independent
member. The
criteria used by
the Company to
determine its
Independence
was established
by the Listing
Regulation of the
Novo Mercado of
BM&FBOVESPA.

According to the Novo Mercado Listing Rules and the Companys bylaws, the companys board of directors must have at least 20% independent members.
Whenever the percentage of 20% mentioned above results in fractional number of members, the number shall be rounded to reach a whole number: (i)
immediately above, if fractional number is equal to or higher than 0.5; or (ii) immediately below, if fractional number is lower than 0.5. Since the Companys
Board of Directors is composed of six members, it should have at least one independent director. The Independent director should be identified as such in the
minutes of the General Shareholders meeting that elects him. Currently Mr. Nicolas Arthur Jacques Wollak and Mr. Jorge Camargo are the Companys
Independent Directors.
The decisions of the Companys Board of Directors are taken by a majority vote of the members that are present. Under Brazilian corporate law, members of
the board of directors are prohibited to vote in any meeting ou General Meeting, on any matter or intervene in any transaction that would create a conflict of
interest between the Company and that board member.

EXECUTIVE BOARD
The Companys Executive Officers are responsible for the management of daily operations of the business and for implementing the general policies and
guidelines established by the Board of Directors.
The Brazilian corporate law provides that executive officers must reside in Brazil and that they may or may not be shareholders of the company in which they
serve. In addition, up to one-third of the members of a companys Board of Executive Officers may also serve as members of the Board of Directors.
The Companys board of directors elects the members of the board of executive officers for one-year term and they may be reelected. Any executive officer may
be removed by the board of directors before the expiration of his or her term. According to the Companys bylaws, the board of executive officers must be
comprised of four to eleven officers, including one chief executive officer, one chief financial officer and the remaining without specific designation.

All the members of the Board of executive officers must a sign a Consent Agreement of the Administrators, in which their respective position will depend on the
signing of the document. Through the Consent Agreement, the Companys new members of the Board of executive officers are personally responsible to act in
accordance with the Contract of Novo Mercado, Regulation of the Market Arbitration Chamber and the Rules of the Novo Mercado.
The table below indicates the name, age and title of the board of executive officers.
Name

Date of Birth
3/2/1974

Profession
Engineer

CPF
197.064.378-19

Avelino Pinto da Silva Garzoni

9/28/1965

Engineer

857.596.607-30

Ricardo de Araujo Gusmo

9/6/1968

Engineer

987.271.927-68

Gustavo Artur Ciocca Zeno

12/26/1975

Economist

078.413.147-36

Srgio Kariya

Title
Chief Executive Officer
Officer
Officer
Chief Financial and Investor
Relations Officer

Date of Last
Election
3.9.2015

Date of office
3.9.2015

4.28.2015

4.28.2015

9.17.2015
4.26.2016

Elected by the Contro

Shareholder
Yes

Termo f Office
Until August, 2017
Until August, 2017

Other titles
No
No

Yes

9.18.2015

Until August, 2017

No

Yes

4.26.2016

Until August, 2017

No

Yes

FISCAL COUNCIL
Under the Brazilian Corporate Law, the Fiscal Council is responsible for: (i) reviewing, by any of its members, the actions of management and verify compliance
with its legal and statutory duties; (ii) opine on management's annual report, including in its opinion the additional information it deems necessary or useful to
the General Meeting decision; (iii) give their opinion on the administrations proposals, to be submitted to the General Meeting, relating to changes in capital,
issuance of debentures or warrants, capex plans or capital budget, capital distribution, dividend distribution, transformations, incorporations, merger or split up;
(iv) report, by any of its members, to the administrators or, if they do not take the necessary action to protect the interests of the company, to the general meeting,
the mistakes, fraud or crimes they find out, and suggest necessary measures to the company; (v) convene the ordinary shareholder meeting, if the administrative
bodies delay for more than one month calling, and extraordinary, whenever there are serious or urgent matters, including in the agenda the subjects they deem
relevant; (vi) analyze, at least quarterly, the balance sheet and other financial statements periodically prepared by the company; (vii) review and give an opinion
on the financial statements of the fiscal year; and (viii) exercise those powers during the settlement, in view of the special rules that govern it.

According to the Company's Bylaws, the Fiscal Council works on a permanent basis, and consists of three members and an equal number of alternates,
shareholders or not, resident in Brazil and elected at the General Meeting, when will determine their remuneration. The Chairman of the Fiscal Council is elected
at the General Meeting.
All new members of the Fiscal Council must sign a Fiscal Council Compliance Statement, conditioned on possession in their respective offices the signing of
this document. Through the Compliance Agreement, new members of its Board of Directors are personally responsible to act in accordance with the Novo
Mercado, with the Rules of the Arbitration Chamber and the Novo Mercado Listing Rules.
At the Ordinary and Extraordinary General Meeting held on April 19, 2011, the Company's shareholders requested the installation of the Fiscal Council and
elected three members and three alternates. At the Extraordinary General Meeting held on April 20, 2012, the Audit Committee became a permanent body. The
members of the Supervisory Board appointed by the controllers were elected at the Annual General Meeting held on 28 April 2016, in which the Lords Isabella
Saboya de Albuquerque (holder) and Walter Luis Bernardes Albertoni (alternate) were elected separately by minority shareholders.
The table below presents name, age and title of the Fiscal Council members:

Name

Eduardo
Botelho
Kiralyhegy
Leonardo
Roslindo
Pimenta
Marcus
Vincius
Dias
Severini
Vera Lucia
de Almeida
Pereira Elias
Isabella
Saboya de
Albuquerque
Walter Luis
Bernardes
Albertoni

ADVISORY COMMITTEES

Date of
Birth

Profession

CPF

Title

President
of the
Fiscal
Council

3/13/1979

Lawyer

082.613.21703

5/25/1976

Lawyer

016.749.90766

Substitute

10/2/1957

Accountant/
Engineer

632.856.06720

Member

492.846.49749

Substitute

8/11/1958

Accountant

8/25/1970

Consultant

017.919.00755

Member

9/29/1968

Lawyer

147.427.46848

Substitute

Other titles

Elected by
the
Controlling
Shareholder

If independent
member,
criterion used
to determine
the
independence

1 year

No

Yes

Not applicable.

4.28.2016

1 year

No

Yes

Not applicable.

4.28.2016

1 year

No

Yes

Not applicable.

4.28.2016

1 year

No

Yes

Not applicable.

No

No

Not applicable.

No

No

Not applicable.

Date of
Last
Election

Date of
office

Office
term

4.28.2016

4.28.2016

4.28.2016

4.28.2016

Number of
consecutive
terms

4.28.2016

1 year
4.28.2016

4.28.2016

4.28.2016

4.28.2016

1 year

With the goal of improving the decision-making process, sustaining the execution of our growth plan, and supporting it in its functions, the Board of Directors
has approved the creation of the Human Resources Committee, in line with the best practices of corporate governance.
The Human Resources Committee is responsible for: (a) supervision and support during the development, planning and execution of strategies that enable the
company to attract and retain talent, as well as the improvement of the work environment, and (b) proposals for the remuneration of Mills executive officers for
analysis and approval by the Board of Directors.
The current members of the Human Resources Committee are Elio Demier (Vice-Chairman of Mills Board of Directors) and Jos Felipe Vieira de Castro.
Committees of this type are non-permanent and therefore can be either created or extinguished anytime by the Board of Directors.
The table below presents the names, ages and positions of the Human Resources members:
Human Resources Committee
Date of Last
Election
Name

Age

Elio Demier

64

Profession
Bachelor of Social
Communication

Srgio Kariya

41

Engineer

CPF

Title

260.066.507-20

Member

197.064.378-19

Member

5.21.2015
4.26.2016

Starting Date

Term of Office

Other positions

Elected by
Controlling
Shareholder

5.21.2015

1 year

Yes

Yes

4.26.2016

1 year

Yes

Yes

b. Date of formation of Fiscal Council, if not permanent, and Committees

The Companys Fiscal Council is permanent.
c. Mechanisms for evaluating the performance of each body or committee
The activities of the Executive Officers are supervised and evaluated by the Board of Directors, whose performance is an object of appreciation by its
shareholders.
Until the end of 2010, the Company did not adopt mechanisms or pre-set valuation methods to measure the performance of its Administration. In 2011 a
Performance Management Program was established, aiming to map the competence gaps and guide the development programs to improve the attributes that
lead to high performance, and establish and evaluate individual goals, which continues in effect until the date of this Reference Form.
For compensation and calculation purposes of the aggregated economic value that will determine the output participation, the organs of its Administration are,
jointly with its employees, evaluated based on the results obtained by the Company.
Each member of the Committee shall be entitled to individual compensation equivalent to 50% (fifty percent) of the Board of Directors monthly payment. The
members of the Committee who are Executive Officers or employees of the Company shall not be entitled to any compensation.
d. Responsibilities and individual powers of the Executive officers

Is the responsibility of the Chief Executive Officer: (i) to convene and chair meetings of the Executive Officers meetings; (ii) to maintain permanent coordination
between the Executive Board and the Board of Directors; (iii) To Comply with and enforce, within his authority, these Articles provisions and the resolutions
made by the Executive Board, Board of Directors and Shareholders Meetings.
The Director of Investor Relations is responsible: (i) release and inform CVM and BM&FBOVESPA, if necessary, any act or relevant fact occurred or related to
the Companys business. As well as, ensure the immediate dissemination, simultaneously in all markets where such securities are negotiated, besides other
duties established by the Board of Directors; (ii) provide information to the investors; and (iii) keep the registration of the Company in accordance with the
applicable rules of the CVM.
The remaining Directors will have the assignments that may be established by the Board of Directors upon his election, as set forth in the Company's Bylaws.
e. Mechanisms for evaluating the performance of the Board of Directors, committees and the Executive Board
See item 12.1(c).
12.12 Other relevant information

a) Positions held by the members of the Board of Directors in other companies or entities.

Jorge M. T. Camargo - Member of the Board of Directors

Administrative positions occupied in other companies / entities: He works as a consultant Karoon Oil and Gas and McKinsey & Company in Brazil.
It is member of the Board since March 2014 and Chairman of the Board of Directors since April 2015, the Brazilian Institute of Oil, Gas and Biofuels (IBP). It
is the Board member since April 2015 Ultrapar Group, since March 2014 in Plummet Global Logistics, and since January 2015 as a member of the Strategic
Advisory Board of Nexans SA of Brazil.

Francisca Kjellerup Nacht Member of the Board of Directors

Administrative positions occupied in other companies / entities: Member of Board of Directors of Bybi, Danish enterprise located in Copenhagen,
Denmark since 2011.
Aymar Ferreira de Almeida Junior - Member of the Board of Directors
Administrative positions occupied in other companies / entities: Partner Kinea Investments since its founding in 2007 where he also holds the
position of variable income investment manager. Currently also serves as a member of the board of Unicasa Industria S.A furniture, Rodobens S.A.
Roberto Pedote - Member of the Board of Directors

Administrative positions occupied in other companies / entities: Member of the Board, Finance Committee and leader of WWF's governance
committee Brazil (since 2015) and member of the ENOX Council (since 2015). Since 2015 is Academic Director of Executive Education Insper a
non-profit institution whose mission is to be a center of excellence in education and knowledge generation in the areas of administration, economics,
law and engineering.

b) Information about the General Meetings held by the Company, after its IPO, on April 2010:
Ordinary General Meeting
First Call
Realization date: 04/28/2015
Quorum: Shareholders representing 58.42% of the capital
Ordinary General Meeting
First Call
Realization date: 04/28/2015
Quorum: Shareholders representing 63.40% of the capital
Ordinary General Meeting
First Call
Realization date: 04/25/2014
Quorum: Shareholders representing 61.66% of the capital
Extraordinary General Meeting
First Call
Realization date: 02/25/2014
Quorum: Shareholders representing 53.90% of the capital
Ordinary General Meeting
First Call
Realization date: 04/26/2013
Quorum: Shareholders representing 61.23% of the capital
Ordinary and Extraordinary General Meeting
First Call
Realization date: 04/20/2012
Quorum: Shareholders representing 72.48% of the capital

12.3

Dates of Newspaper publications

2013

Minute of the General Shareholders Meeting

Financial Statements

12.4

2015

Publicated
Newspaper

Date(s) of Newspaper
publication

Publicated
Newspaper

Date(s) of Newspaper
publication

Publicated Newspaper

3/21/2014

DOE-RJ
Valor Econmico RJ

3/27/2015

DOE-RJ
Valor Econmico RJ

3/29/2015

DOE-RJ
Valor Econmico RJ

5/13/2014

DOE-RJ
Valor Econmico RJ

5/26/2015

DOE-RJ
Valor Econmico RJ

5/4/2015

DOE-RJ
Valor Econmico RJ

3/20/2014

DOE-RJ
Valor Econmico RJ

3/19/2015

DOE-RJ
Valor Econmico RJ

3/21/2015

DOE-RJ
Valor Econmico RJ

Notice to shareholders announcing the

availability of the Financial Statements
General Shareholders Meeting Convening
Notice

2014

Date(s) of Newspaper
publication

Board rules, policies and practices

The Board of Directors shall consist of a minimum of five (5) and a maximum of eleven (11) members, shareholders or not, of which 20% shall be independent,
elected at a General Meeting for a unified 2-year term of office and who may be reelected. In the event of a fractional number of independent directors as a
result, due to the compliance with this percentage, the fractional number shall be rounded off to: (i) the next higher whole number, where the fraction is equal or
higher than 0.5 (five tenths); or (ii) next lower whole number, where the fraction is lower than 0.5 (five tenths).
a.

Frequency of meetings

The Board of Directors holds ordinary meetings once a month, and extraordinary meetings, whenever corporate interests so require.
b.

Shareholder provisions establishing voting restrictions on members of the Board of Directors

Doesnt exist.
c.

Identification rules and handling of conflicts of interest

See the item 16.3.

12.11

Directors Insurance

The Company has held civil responsibility insurance since 2009, for administration and proxy holders acting on behalf of them, with full cover for fines and civil
penalties, statutory responsibilities, regulatory risks, responsibility for errors and omissions, among others, excluding intentional acts, complaints arising from
acts known about prior to the policy date, responsibilities associated with product failures (already covered by civil responsibility insurance), among other events.

The policy contract was renewed for the period December 31, 2015 until December 31, 2016.
12.5

Administration and members of the Fiscal Council

Administrative Council
Currently, the Board of Directors is composed of six regular members, who were elected by the Company's controlling shareholders at the Annual General
Meeting held on 25 April 2014. The mandate of these directors is unified two years, ending in date of the Annual General Meeting in 2016.
The table below shows the information on the candidates nominated by the controlling shareholders to the Board of Directors.
Until the date of submission of this proposal, there is no definition of the name of all members who join the sheet to be submitted to the shareholders. Below,
we present the information indicated in items 12.5 to 12.10 of the reference form, as required by Art. 10 of CVM Instruction 481/09, referring to the three members
have indicated. The definition of the remaining names depends, among other factors, the completion of the capital increase approved at the meeting of board
of directors held on February 5, 2016.

Name

Date of
Birth

Profession

CPF

Title

Date of
last
election

Date of
office

Termo f
office

Other titles

Ellected by
the
controlling
shareholder

If independent
member,criterion used to
determine the independence

Number of
consecutive
terms

Andres
Cristian
Nacht

8/1/1942

Business
administrator

098.921.337Chairman
49

4.25.2014 4.25.2014 2 years

No

Yes

Not applicable.

Elio
Demier

1/28/1951

Bachelor in
260.066.507- Vice
social
20
Chariman
communication

4.25.2014 4.25.2014 2 years

Yes, He is member
of the Human
Yes
Resources Comitee

Not applicable.

Francisca
Kjellerup
Nacht

12/28/1970

Business
administrator

4.25.2014 4.25.2014 2 years

No

Not applicable.

124.175.657Counselor
06

Yes

Fiscal Council
At the Ordinary General Meeting held on April 20, 2012, the Fiscal Council became a permanent body.
For the purposes of article 10 of CVM Instruction 481/2009, the controlling shareholders of the company support the reelection, in the fiscal year of 2016, of the
members of the Fiscal Council elected in the fiscal year as indicated below, with the Company's minority shareholders to decide on the election of the other
members.

The table below shows the information on the candidates nominated by the controlling shareholders to members of the Supervisory Board.
1.
Name

Eduardo
Botelho
Kiralyhegy
Leonardo
Roslindo
Pimenta
Marcus
Vincius Dias
Severini
Vera Lucia de
Almeida
Pereira Elias

Date of birth

3/13/1979

5/25/1976

Profession

Lawyer

Lawyer

CPF

Title

Date of last
election

Date of
office

Termo f
office

Other titles

Ellected by
the
controlling
shareholder

If independent
member,criterion
used to determine
the independence

Number of
consecutive
terms

082.613.217-03 President

4.28.2015

4.28.2015

1 year

No

Yes

Not applicable.

016.749.907-66 Alternate

1 year

No

Yes

Not applicable.

10/2/1957

Accountant/
Engineer

632.856.067-20 Member

4.28.2015

4.28.2015

1 year

No

Yes

Not applicable.

8/11/1958

Accountant

492.846.497-49 Alternate

4.28.2015

4.28.2015

1 year

No

Yes

Not applicable.

2.
Summary of the business experience
Board of Directors
Andres Cristian Nacht - 098.921.337-49
Mr. Andres Cristian Nacht has been the Chairman of the Companys Board of Directors since 1998. The son
of Mr. Jose Nacht, one of the founders of the Company, Mr. Nacht has a degree in Engineering from
Cambridge University, England. In 1965, Mr. Nacht joined GKN, a British engineering company, where he
worked during three years, holding engineering posts in the UK. In 1967, he worked during one year as an
Engeneer in Echafaudages Tubulaires Mills from France. Mr. Nacht became a director of the Company in
1969 and was appointed managing director in 1978, a position he held until 1998 when he became the
Chairman of the Board of Directors.
Mr. Andres Cristian Nacht has not been involved in any criminal conviction, in any conviction in a CVM
administrative proceeding and in any final unfavorable judicial or administrative decision, which has resulted
in his suspension or impediment to the exercise of any professional or commercial activity, being thus
qualified to practice his professional activities.
Francisca Kjellerup Nacht - 124.175.657-06
Mrs. Francisca Kjellerup Nacht holds a degree in Business Administration and Economy from the
Copenhagen Business School, Denmark, since 1995. The granddaughter of Mr. Jose Nacht, one of the
founders of the Company, and daughter of Andres Cristian Nacht, Chairman of the Board of Directors of the
Company, has built her career in Europe, where she lives since 1990. Francisca worked for Procter & Gamble
Nordic between 1997 and 2010, mainly in the fields of leadership and business development. Among other
positions, Francisca was responsible for the commercial integration after Gillettes acquisition, as well as for
the business with the largest retailer of Denmark. In her last position at P&G, she was responsible for initiating
and leading the pharmaceutical division in the Nordic region. Since 2011, is a member of the Board of
Directors for the foreign social business Bybi. In the last five years, besides her position at P&G, Francisca.
Nos ltimos cinco anos, alm de sua posio na P&G, Francisca works in the area of social entrepreneurship,
in Denmark, and in Family governance in Brazil. Mrs. Francisca Kjellerup Nacht has not been involved in any
criminal conviction, in any conviction in a CVM administrative proceeding and in any final unfavorable judicial
or administrative decision, which has resulted in her suspension or impediment to the exercise of any
professional or commercial activity, being thus qualified to practice her professional activities.
Elio Demier - 260.066.507-20
Mr. Elio Demier is a graduate of Social Communication from the Fluminense Federal University. He also
holds an MBA degree from the Institute of Post-Graduation and Research in Administration of the Rio de
Janeiro Federal University (COPPEAD). He served as the Companys
127
chairman from 1998 to 1999 and has been a member of the Companys Board of Directors since 1998. Mr.
Demier was President of the Bomtexto Publisher, company in the book publishing business located in Rio
de Janeiro.
Mr. Elio Demier has not been involved in any criminal conviction, in any conviction in a CVM administrative
proceeding and in any final unfavorable judicial or administrative decision, which has resulted in his
suspension or impediment to the exercise of any professional or commercial activity, being thus qualified to
practice his professional activities.
Fiscal Council
Eduardo Botelho Kiralyhegy - 082.613.217-03
Mr. Eduardo Botelho Kiralyhegy graduated in Law from Universidade Cndido Mendes, a member of the
Order of Lawyers of Brazil, and founding partner of Negreiro Office, Medeiros & Kiralyhegy Advogados, in
Rio de Janeiro, specializing in Tax Law, Administrative and Regulatory. On the date hereof works as Tax
Inspector of external control the Department of Finance. Mr. Eduardo Botelho Kiralyhegy not held any
management position in public companies.
Mr. Eduardo Botelho Kiralyhegy was not subject to the effects of any criminal conviction, any conviction or
penalty in administrative proceedings before the CVM and no unappealable conviction at judicial or
administrative level, which had caused the suspension or disqualification for practice of any professional or
commercial activity, and are thus duly authorized to practice their professional activities.
Leonardo Roslindo Pimenta - 016.749.907-66
Mr. Leonardo Roslindo Pimenta, graduated in law at PUC/RJ, has more than 20 years of experience in
corporate law, banking and capital markets law, contracts in general and negotiation, having worked for more
than 11 years at the head of the Legal Department of some of the main institutions of asset mangement of

Summary of the business experience

Brazil, such as Opportunity and ARX Investimentos. During this period, participated in various operations
involving the structuring of investments in Brazil and abroad, as well as M&A transactions. He was a member
of the legal Commission of ANBID and several Committees of ANBIMA. Coordinated the sale of ARX Capital
Management for the Bank of New York Mellon. For two years was responsible for Corporate and Legal
Management and Financial Contracts at the company Oi, where he conducted successfully the operation of
spin-off of call center company Contax, and the debt renegotiation of Oi. In the last six years he worked as
Legal and Compliance Director of a private equity manager, whose main Fund under management was
focused in the area of electric power generation. In addition, occupied the position of Member of the Board
of Directors of a company formed in partnership with Santander for the deployment of 07 wind farms of 170
MW in Bahia, in a project of R$ 800 million. Mr Leonardo Pimenta acts since January 2016 until the date of
submission of this document as a lawyer responsible for corporate division and contracts in the Negreiro
Office, Medeiros & Kiralyhegy Lawyers, in Rio de Janeiro, specializing in Tax Law, Administrative and
Regulatory. In the period of June 2011 until December 2015, worked on Nova Gesto de Recursos Ltda.,
management company of third-party resources, responsible for the management of private equity funds of
enterprises (i) BRAZIL ENERGY S.A.; (ii) BRAZIL BIOMASS ENERGY S.A.; (iii) BRAZIL HYDROPOWER
PARTICIPAES S.A.; (iv) BRAZIL WIND S.A.. (v) BW GUIRAP I S.A.; (vi) BRASYMPE ENERGIA S.A.;
and (vii) SANTA F EXTRAO DE MINRIOS S.A. During this period he worked as partner and General
Counsel and compliance; was member of the Board of Directors of BW I GUIRAP S.A.; alternate member
of the Board of Directors of BRAZIL ENERGY S.A.; BRAZIL BIOMASS ENERGY S.A.; BRAZIL
HYDROPOWER PARTICIPAES S.A.; and BRAZIL WIND S.A.
Mr. Leonardo Roslindo Pimenta has not been involved in any criminal conviction, in any conviction in a CVM
administrative proceeding and in any final unfavorable judicial or administrative decision, which has resulted
in his suspension or impediment to the exercise of any professional or commercial activity, being thus
qualified to practice his professional activities.
Marcus Vincius Dias Severini - 632.856.067-20
Mr. Marcus Vincius Dias Severini graduated in Accounting and Electric Engineering, post graduated in
Economic Engineering. He acted as Controller Director of Vale S.A. until March 26, 2015, having entered the
Company in 1994, coming from Arthur Andersen S/C, where he worked in auditing. Member of IBGC with
fiscal advisor certification and acted as effective or alternate member of fiscal councils of the following
companies: Fertilizantes Fosfatados S/A- Fosfrtil, Associao Brasileira de Alumnio ABAL, Usinas Minas
Gerais S/A USIMINAS, Companhia Siderrgica de Tubaro - CST e Caemi Minerao S.A. He was
president of the deliberative council of Fundao Vale do Rio Doce de Seguridade Social VALIA from May
2007 to March 2015. From april 2015 until March 2016 he was member of the Fiscal Council of BRF S.A.,
company from the food industry.
Mr. Marcus Vincius Dias Severini has not been involved in any criminal conviction, in any conviction in a
CVM administrative proceeding and in any final unfavorable judicial or administrative decision, which has
resulted in his suspension or impediment to the exercise of any professional or commercial activity, being
thus qualified to practice his professional activities.
Vera Lucia de Almeida Pereira Elias - 492.846.497-49
Mrs. Vera Lucia de Almeida Pereira Elias graduated in Accounting and Law, post graduated in Finance. Mrs.
Vera Lucia de Almeida Pereira Elias acted as accountant of Vale S.A. until September 2013. Since December
2013 she holds the position of International Standards Officer and CPC in the Associao Nacional dos
Executivos de Finanas, Administrao e Contabilidade ANEFAC. Mrs. Vera Lucia de Almeida Pereira
acted and/or act as effective or alternate member of the fiscal council of the following companies: Norte
Energia S.A., Vale do Rio Doce de Seguridade VALIA, Fundao Vale do Rio Doce, Ferrovia CentroAtlntica, Caemi Minerao e Metalurgia AS and Associao Mulheres Geniais.
Mrs. Vera Lucia de Almeida Pereira Elias has not been involved in any criminal conviction, in any conviction
in a CVM administrative proceeding and in any final unfavorable judicial or administrative decision, which
has resulted in her suspension or impediment to the exercise of any professional or commercial activity,
being thus qualified to practice her professional activities.
3.
4.
12.6 For each person who acted as a member of the board of directors or the supervisory
board in the last year, report in table format, the percentage of participation in the meetings held by the
respective body in the same period, which occurred after the taking office

Board of Directors
Andres Cristian Nacht
Elio Demier
Francisca Kjellerup Nacht

Total meetings held by the

agency since taking office
49
50
49

% Share of the member in the

meetings held after the
investiture
94,2%
96,2%
94,2%

Total meetings held by the

agency since taking office

Fiscal Council
Eduardo Botelho Kiralyhegy
Leonardo Rosnildo Pimenta
Marcus Vincius Dias Severini**
Vera Lucia de Almeida Pereira
Elias

11
11
0*

% Share of the member in the

meetings held after the
investiture
100,0%
100,0%
0%

* Members of the Supervisory Board alternates who have not been invited to attend any meetings during the year.
** He was elected in April / 2015

12.7 Provide the information referred to in item 12.5 in respect of members of the statutory committees, as well as
audit committees, risk, and financial remuneration, even if these committees or structures are non-statutory
Currently, the Company has only a Human Resources Committee, whose members are elected by the Board of Directors.
For the purposes of art. 10 of CVM Instruction 481/2009, the appointed member of Board of Directors, Elio Dernier, is a
member of that Committee, and his information is on item 12.5 above.
12.8 For each person who acted as a member of the statutory committees and the audit, risk, financial and
compensation committees, even if such committees or structures are not statutory, inform, in table format, the
percentage participation in the meetings held by the respective body in the same period, which occurred after
taking office
Currently, the Company has only a Human Resources Committee, whose members are elected by the Board of Directors.
For the purposes of Art. 10 of CVM Instruction 481/2009, it is stated below, the applicant's participation percentage of the
Board of Directors member, Elio Dernier, in meetings of the Committee:
Total meetings held by the
agency since taking office

Board of Directors
Elio Dernier

% Share of the member in the

meetings held after the
investiture
100%

12.9 Relationship (as a spouse or significant other) or relationship to the second degree between:
a. Members of the Board of Directors
Administrator of the Company or Controlled Company:
Name: Andres Cristian Nacht / CPF: 098.921.337-49
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Chairman of the Board of Directors
Related Person:
Name: Francisca Kjellerup Nacht / CPF: 124.175.657-06
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Type of relationship: Father/Daughter
b. (i) members of the Board of Directors, Executive Board and Fiscal Council and (ii) members of management
of entities controlled by the Company, either directly or indirectly
Not applicable. The Company does not control, directly or indirectly, any society.

c. (i) members of management of entities controlled by the company, either directly or indirectly; and (ii)
Companys direct or indirect controlling shareholders

Administrator of the Company or Controlled Company:

Name: Andres Cristian Nacht / CPF: 098.921.337-49
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Presidente do Conselho de Administrao
Related Person:
Name: Jytte Kjellerup Nacht / CPF: 289.858.347-20
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Direct Controlling Shareholder
Type of relationship: Husband/Wife
-------------------------------------Administrator of the Company or Controlled Company:
Name: Andres Cristian Nacht / CPF: 098.921.337-49
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Presidente do Conselho de Administrao
Related Person:
Name: Tomas Richard Nacht / CPF: 042.695.577-37
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Direct Controlling Shareholder
Type of relationship: Father/Son
-------------------------------------Administrator of the Company or Controlled Company:
Name: Andres Cristian Nacht / CPF: 098.921.337-49
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Cargo: Presidente do Conselho de Administrao
Related Person:
Name: Francisca Kjellerup Nachtt / CPF: 124.175.657-06
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Direct Controlling Shareholder
Type of relationship: Father/Daughter
--------------------------------------

Administrator of the Company or Controlled Company:

Name: Andres Cristian Nacht / CPF: 098.921.337-49
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Presidente do Conselho de Administrao
Related Person:
Name: Antonia Kjellerup Nacht / CPF: 073.165.257-62
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Direct Controlling Shareholder
Type of relationship: Father/Daughter
--------------------------------------

Administrator of the Company or Controlled Company:

Name: Andres Cristian Nacht / CPF: 098.921.337-49
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Presidente do Conselho de Administrao
Related Person:
Name: Pedro Kjellerup Nacht / CPF: 127.276.837-66
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Controlador direto da Companhia
Type of relationship: Father/Son
-------------------------------------Administrator of the Company or Controlled Company:
Name: Francisca Kjellerup Nacht / CPF: 124.175.657-06
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Membro do Conselho de Administrao
Related Person:
Name: Jytte Kjellerup Nacht / CPF: 289.858.347-20
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Controladora direta da Companhia
Type of relationship: Daughter/Mother
-------------------------------------Administrator of the Company or Controlled Company:
Name: Francisca Kjellerup Nacht / CPF: 124.175.657-06
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Membro do Conselho de Administrao
Related Person:
Name: Tomas Richard Nacht / CPF: 042.695.577-37
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Controlador direto da Companhia
Type of relationship: Brothers
-------------------------------------Administrator of the Company or Controlled Company:
Name: Francisca Kjellerup Nacht / CPF: 124.175.657-06
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Membro do Conselho de Administrao
Related Person:
Name: Antonia Kjellerup Nacht / CPF: 073.165.257-62
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Controladora direta da Companhia
Type of relationship: Sisters
-------------------------------------Administrator of the Company or Controlled Company:
Name: Francisca Kjellerup Nacht / CPF: 124.175.657-06

Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Membro do Conselho de Administrao
Related Person:
Name: Pedro Kjellerup Nacht / CPF: 127.276.837-66
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Controlador direto da Companhia
Type of relationship: Irmos
-------------------------------------Administrator of the Company or Controlled Company:

Name: Francisca Kjellerup Nachtt / CPF: 124.175.657-06

Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Membro do Conselho de Administrao
Related Person:
Name: Andres Cristian Nacht / CPF: 098.921.337-49
Corporate name of the issuer company, controlled or controlling: Mills Estruturas e Servios de Engenharia S.A. /
CNPJ: 27.093.558/0001-15
Title: Controlador direto da Companhia
Type of relationship: Daughter/Father
a. (i) members of the Board of Directors, Executive Board and Fiscal Council and (ii) Mills direct or indirect
controlling shareholders
There is no marital relationship, stable union and kinship to the second degree between the Company's managers and
managers of the direct or indirect parent companies of the Company.
12.10 Subordination, rendering of services or control relationships for the previous three fiscal years between
administrators and:
a. Controlled entities, either directly or indirectly by the company
Not applicable. The Company does not control, directly or indirectly, any entity.
b.

Direct or indirect controlling shareholders of the company

Mr. Eduardo Kiralyhegy, by the entity Negreiro, Medeiros & Kiralyhegy Advogados, provided in the last three fiscal years
legal services to Mr. Andres Cristian Nacht and Ms. Jytte Kjellerup Nacht, controlling shareholders of the Company, by
means of the Nacht Participaes S.A., also controlled by Mr. Andres Cristian Nacht.
c.

In case its relevant, supplier, client, debtor or creditor of the Company or its controlled or controlling
shareholders

Mr. Eduardo Kiralyhegy is an associate of Negreiro, Medeiros & Kiralyhegy Advogados, which provided services of legal
advisory to the Company over the past three fiscal years.

12.11

Seguro para Administradores

A Companhia mantm, desde 2009, seguro de responsabilidade civil para os membros do Conselho de Administrao, da
Diretoria, do Conselho Fiscal ou qualquer outro rgo estatutrio ou rgo criado pelo contrato ou estatuto social do
tomador do seguro ou de qualquer das controladas ou subsidirias ou qualquer pessoa fsica que tenha poderes de
representao perante terceiros ou cujo cargo ou funo implique na representao de fato ou direito na prtica de ato
prprio de administrao, com cobertura para custos, encargos, honorrios (advocatcios, de assistentes tcnicos e
pericias) depsitos recursais e todas as demais despesas necessrias e razoveis na defesa ou investigao de uma
reclamao em processos judiciais, arbitrais e administrativos entre outros, excluindo atos dolosos, reclamaes

decorrentes de atos j conhecidos anteriormente data da aplice, responsabilidades advindas de falhas em produtos (j
cobertas pelo seguro de responsabilidade civil), entre outros eventos.
A aplice contratada foi renovada para o perodo de 31 de dezembro de 2015 a 31 de dezembro de 2016.
12.12

Other information about the Company

General Meetings held by the Company in the last three social exercises:

Ordinary General Meeting

First Call
Realization Date: 4/28/2016
Quorum: Shareholders representing 58.42% of the capital
Ordinary General Meeting
First Call
Realization Date: 4/28/2016
Quorum: Shareholders representing 63.40% of the capital
Ordinary General Meeting
First Call
Realization Date: 4/25/2014
Quorum: Shareholders representing 61.66% of the capital
Ordinary General Meeting
Second Call
Realization Date: 2/25/2014
Quorum: Shareholders representing 53.90% of the capital
Ordinary General Meeting
First Call
Realization Date: 4/26/2013
Quorum: Shareholders representing 61.23% of the capital

14.1 - HUMAN RESOURCES

14.1 Description of the Companys Human Resources, providing the following information
a. the number of employees (total, by groups based on activity and by geographic location)
The chart below shows the number of our employees in the financial years ended December 2013, 2014
e 2015:
Year ended December 31

Heavy Conctruction and Real

Infrastructure
Industrial Services
Buildings
Real State
Rental
Operations
Corporate
Total

2013

2014

2015

604
838

43
238
239

423
-

492
844

357
371
622

227
2.092

220
2.076

217
1.567

The conclusion of the sale of the Industrial Services business unit was on November 30, 2013.

In December 31, 2013, 2014 e 2015, all employees were allocated in Brazil. The table below
indicates the location of the employees of the Company, considering the business units and
departments to which they belong, as indicated below:
2015
States

Construction

Operations

Alagoas
Amazonas

Rental

Corporate

Total

13

Bahia

18

50

17

92

Distrito Federal

28

67

108

Espirito Santo

12

29

Fortaleza

16

48

14

83

Gois

15

Maranho

12

19

12

45

Mato Grosso
Mato Grosso do Sul

15

Minas Gerais

20

24

42

95

Para

12

12

31

Paran

19

14

42

Pernambuco

13

27

25

73

Rio de Janeiro

68

122

62

124

376

15

28

12

63

113

31

463

371

217

1567

Rio Grande do Norte

Rio Grande do Sul
Santa Catarina
So Paulo

144

175

Sergipe
Total

357

622

2014
Employees

States

Heavy Construction
And Real State - Heavy Construction Real State Operations Rental Corporate Total
Shared
Alagoas
Amazonas
Bahia
Cear
Distrito
Federal
Espirito
Santo
Goiais
Maranho
Mato
Grosso
Mato
Grosso do
Sul
Minas
Gerais
Par
Paran
Pernambuco

0
0
2
4

13

28

11

55

27

108

11

12

68

19

116

25

16

104

161

10

16

13

41

20

11

18

12

43

13

15

33

15

11

43

36

113

13

21

43

0
0
3

17

19

14

52

17

11

53

22

111

33

29

149

61

108

386

21

32

17

77

3
0
0
0
0
0

Rio de
Janeiro
Rio Grande
do Norte
Rio Grande
do Sul
Santa
Catarina
So Paulo

0
21

Sergipe

118

62

240

199

79

Total

43

238

2013
States

719
4
239

844

492

220

2076

Employees
Industrial

Amazonas
Bahia
Cear
Distrito
Federal
Esprito
Santo
Gois
Maranho
Mato
Grosso
Mato
Grosso do
Sul
Minas
Gerais
Par
Paran
Pernambuc
o
Rio de
Janeiro
Rio Grande
do Sul
Santa
Catarina
So Paulo
Sergipe
Total

Heavy
Construction
31
26

Services
-

Real State
26
51
44

Rental
7
26
14

Corporate Total
33
6
114
1
85

75

87

174

26

13

41

28

28
1

8
10

36
39

24

29

16

54

39

10

119

24
40

26
14

50
56

54

43

28

129

113

119

77

162

471

60

26

89

261
604

211
838

114
2
423

29
227

615
2
2.092

The conclusion of the sale of the Industrial Services business unit was on November 30, 2013

b. the number of outsourced employees (total, by groups based on activity and by geographic
location)
The Company has outsourced certain activities which are not directly related to its core business, such as
janitorial services, security, transport, meal preparation, and IT support, among others. In addition, the Company
signs short-term employment contracts in accordance with the fluctuation in demand for their services. In December
31, 2013, 2014 and 2015, the Company had, respectively, 241, 247 and 199 outsourced workers, as detailed below:

2015

Janitorial
Services

Security

Transport

Catering

IT Support

Total

Alagoas

Amazonas

Bahia

Distrito Federal

Espirito Santo

Fortaleza

Goias

Maranho

Mato Grosso

States

Mato Grosso do Sul

Minas Gerais

11

18

Para

12

Paran

Pernambuco

11

Rio de Janeiro
Rio Grande do
Norte

15

29

Rio Grande do Sul

12

17

Santa Catarina

So Paulo

14

32

49

Sergipe

Total

70

117

199

2014

Janitorial
Services

States
Alagoas
Amazonas
Bahia
Distrito Federal
Espirito Santo
Fortaleza
Goias
Maranho
Mato Grosso
Mato Grosso
do Sul
Minas Gerais
Par
Paran
Pernambuco
Rio de Janeiro
Rio Grande do
Norte
Rio Grande do
Sul
Santa Catarina
So Paulo
Sergipe
Total

Security

Transport

Catering

IT Support

Total

1
2
3
4
3
3
2
2
1

1
8
2
7
2
10
4
4
4

0
0
0
0
0
0
0
0
0

0
0
0
0
0
0
0
0
0

0
0
0
1
0
1
0
1
0

2
10
5
12
5
14
6
7
5

1
5
3
2
4
17

4
12
8
4
2
14

0
2
0
0
0
7

0
0
0
0
0
4

0
1
0
0
1
9

5
20
11
6
7
51

4
1
21
1

10
0
30
4

0
0
3
0

0
0
2
0

0
0
3
0

14
1
59
5

81

131

12

17

247

2013
States
Rio de Janeiro
So Paulo
Minas Gerais
Esprito Santo
Bahia
Cear
Pernambuco
Paran
Rio Grande do Sul
Distrito Federal
Gois
Par
Manaus
Mato Grosso
Rio Grande do
Norte

Janitorial
Services
17
19
5
3
4
3
4
1
4
5
2
2
2
1
2

Security
11
15
12
2
8
8
7
2
15
6
2
6
8
2
3

Transport
4
2
2
-

Catering
4
-

IT Support
24
3
1
1
2
1
2
1
1
1
-

Total
60
39
18
6
14
12
15
4
20
12
4
8
10
3
5

Sergipe
Maranho
Total

c.

2
76

4
4
115

1
38

4
7
241

employee turnover ndex

The index of employee turnover (churn) in financial years ending in 2015, 2014 and 2013 was 6.7%,
3.1% and 3.2%, respectively, excluding the employees allocated in the Industrial Services business unit in
2013, when the business unit was sold

14.2 Comments about any relevant change that occurred with regard to the figures in the item 14.1" above
In 2014 and 2015, the decrease of the Company's workforce is mainly related to centralization of Real Estate and
Heavy Construction maintenance operations, as well as the flattening of the organizational structure and the elimination of
administrative and managerial positions for greater synergy between these two units business.
In 2013, the reduction in the Companys workforce is mainly related to the sale of the Industrial Services business
unit.
14.3 Description of Company employee remuneration policies
a. Salary and variable remuneration policy
The Company believes one of its key competitive advantages is the quality of its skilled labor. The
Company has developed, over the years, a human resources development culture based on achievement,
employee participation and transparency. The Company also has profit sharing programs and offer
opportunities for professional development. The Company believes this culture promotes the loyalty,
engagement and enthusiasm of the employees, which leads to a historically low rate of substitution of skilled
labor (turnover) and increases our ability to provide quality services to our customers.
The Companys compensation policy includes the payment of salaries consistent with those in the
market. Additionally, the Company offers the Profit Sharing Program to all its employees.
b.

Benefits Policy

As a standard policy, the Company offers its employees the following benefits and facilities, which may
change due to contracts executed with its clients:
health insurance with coverage for hospital stays: employees contribute part of the cost of this benefit
(15% to 35%, according to their salary);
group life insurance fully funded by the Company;
dental care fully funded by the employees opting in for this benefit;
essential food baskets partially funded by the Company (50%) for employees who receive up to six times
the minimum wage, and that have not missed a workday or arrived late in the month. Each of these
employees receives one food basket per month. In 2015 the Company distributed 17,768 food baskets to
our employees, of which 1,387 were in December.
meal allowance: 10% to 20% of the cost of the benefit is discounted from the employee's paycheck;
loans to employees under the "Desafogo" Project: the funds should be allocated to specific purposes
and cannot exceed one nominal salary of the employee, limited to the amount of 6 minimum wages;
pharmacy benefit agreement;
lending of a car to the executives, who must bear all maintenance costs of the vehicle (except for
insurance and IPVA property tax); and
stock option plan (only for our directors and executives).

c.
Characteristics of compensation plans based on stock options of non-administrator
employees
[atualizar com novo plano]
The Company has one stock option plan that benefits their employees, Plan of stock options 2010,
previously granted purchase options remaining.
Plano f Stock Options 2010

At the Extraordinary General Shareholders meeting held on February 8, 2010, the Stock Option Plan
for Shares Issued by the Company was approved called Plano de Opes de Compra de Aes 2010
(Stock Option Plan - 2010), with amendments approved by the Board of Directors Meeting held on May
31, 2010 and by the Extraordinary General Shareholders meeting held on April 20, 2012. The Board of
Directors approved (i) on March 11th, 2010, the Companys Program 1/2010 Stock Options Plan (1/2010
Program); (ii) on March 25th, 2011, the Program 1/2011 Stock Options Plan (1/2011 Program); (iii) on May
30th 2012, the Program 1/2012 Stock Options Plan (1/2012 Program); and (iv) on March 25 th 2013, the
Program 1/2013 Stock Options Plan (1/2013 Program).
a.

Groups of beneficiaries

The 2010 Stock Options Plan is managed by the Companys Board of Directors, which considers the
contribution of each beneficiary to achieving the targets designed to create added value, the development
potential of each, and the essential nature of their jobs among other characteristics considered strategically
relevant, elected as beneficiaries of the 2010 Stock Options Plan (i) for the 1/2010 Program, all the directors
(or executives with similar roles) of the Company, and Company managers who have held their positions in
2009 for more than 6 (six) months; (ii) for the 1/2011 Program, all the directors (or executives with similar
roles) of the Company, and Company managers who have held their positions in 2010 for more than 6 (six)
months; (iii) for the 1/2012 Program, all the directors (or executives with similar roles) of the Company, and
Company managers who have held their positions in 2011 for more than 6 (six) months; and (iv) for the
1/2013 Program, all the directors (or executives with similar roles) of the Company, and 170 Company
managers who have held their positions in 2012 for more than 6 (six) months.
b. Conditions for the exercise
To receive the stock options in the 1/2010 Program, each beneficiary must use at least of 33% of
the variable portion of their compensation under the Company's Profit Sharing Program, net of taxes, which
were received related to the 2009 financial year, to acquire shares issued by the Company.
To receive the stock options in the 1/2011 Program, each beneficiary must use at least of 33% of
the variable portion of their compensation under the Company's Profit Sharing Program, which were received
related to the 2010 financial year, to acquire shares issued by the Company.
To receive the stock options in the 1/2012 Program, each beneficiary must use at least of 33% of
the variable portion of their compensation under the Company's Profit Sharing Program, which were received
related to the 2011 financial year, to acquire shares issued by the Company.
To receive the stock options in the 1/2013 Program, each beneficiary must use at least of 33% of
the variable portion of their compensation under the Company's Profit Sharing Program, which were received
related to the 2011 financial year, to acquire shares issued by the Company.
To receive the stock options in the 1/2014 Program, each beneficiary must use at least of 33% of
the variable portion of their compensation under the Company's Profit Sharing Program, which were received
related to the 2013 financial year, to acquire shares issued by the Company.
Additionally, the Board of directors approved grants within the 1/2010, 1/2011, 1/2012, 1/2013 and
1/2014 Programs, independent of the investment in the Companys shares to certain employees of the
Company, due to its performance in the exercise of their jobs.
For as long as the exercise price is not fully paid, the shares acquired through the exercise of the
option under the Plan cannot be sold to third parties, except upon prior authorization from the Board of
Directors, in which case the sale proceeds will be mainly used to settle the beneficiary's debt with the
Company.
Pursuant to the respective Option Agreement, each beneficiary is prohibited to trade their acquired
shares for a period of 5 years, respecting the following rules:
(i)

After one year as of the execution of the respective Option Agreement, beneficiaries are
free to trade up to 25% of their acquired shares;

(ii)

After one year as of the term defined in item i, beneficiaries are free to trade another
25% of their acquired shares;

(iii)

After one year as of the term defined in item ii, the beneficiary is free to trade another
25% of the acquired shares; and

(iv) After one year as of the term defined in item iii, each beneficiary is free to trade the remainder
of their acquired shares;
c.

Exercise price

Until April 20, 2012, the price of the ordinary shares to be acquired by the beneficiaries, by exercising
their option rights were determined by the Companys Board of Directors or committee based exclusively on
the average share price on the BM&FBOVESPA, weighted by the trading volume in the month or the two
months prior to the granting of the stock option, monetarily adjusted by the inflation index IPCA (ndice de
Preos ao Consumidor Amplo), and deducting the value of dividends and interest on equity per share paid
by the Company as from the stock option date. On April 20, 2012, according to the resolution of the General
Meeting held on that date, the criterion for fixing the exercise price of the options that have as a counterpart
the acquisition of shares by its beneficiary was changed and was defined as the equity value of the 171
shares on the last day of the subsequent fiscal year. This change does not affect the options granted prior
to that General Meeting and the new criterion does not apply to options granted that have no counterpart of
the acquisition of shares by the beneficiary, which continues to be applied the criterion of market price,
described above.
For the 1/2010 Program, the exercise price of the options will be based on the value of the shares
issued at the Companys Initial Public Offering (R$11.50), monetarily adjusted by the inflation according to
the IPCA, deducting the value of dividends and interest on equity per share paid by the Company as from
the stock option date.
For the 1/2011 Program, the exercise price of the options will be (i) the average share price acquired
according to brokerage invoice sent by the beneficiary to the Board of Directors or Human Resources
Committee of the Company (R$ 19.28), (ii) monetarily adjusted by the inflation according to the IPCA,
disclosed by the Brazilian Institute of Geography and Statistics (IBGE), or by another index determined by
the Board of Directors or committee, according to the case, from the date of conclusion of the stock option
agreement until the date the option is exercised, (iii) deducting the value of dividends and interest on equity
per share paid by the Company as from the stock option date.
For the 1/2012 Program, regarding the Basic Grant, the exercise price of the options will be the
amount of the shares net worth in December 31 of the fiscal year immediately after the stock option date of
the Company (R$5.86), monetarily adjusted by the inflation according to the IPCA, or by another index
determined by the Board of Directors or committee, according to the case, from the date of conclusion of the
stock option agreement until the date the option is exercised, deducting the value of dividends and interest
on equity per share paid by the Company as from the stock option date.

For the 1/2012 Program, regarding the Discretionary Grant, the exercise price of the options will be the average, weighed by the trading volume, of the ordinary shares of the
Company in BM&FBOVESPA, during the fiscal year of 2011 (R$19.22), monetarily adjusted by the inflation according to the IPCA, or by another index determined by the Board of
Directors or committee, according to the case, from the date of conclusion of the stock option agreement until the date the option is exercised, deducting the value of dividends and
interest on equity per share paid by the Company as from the stock option date.
For the 1/2013 Program, regarding the Basic Grant, the exercise price of the options will be the amount of the shares net worth in December 31 of the fiscal year immediately
after the stock option date of the Company (R$6.81), monetarily adjusted by the inflation according to the IPCA, or by another index determined by the Board of Directors or committee,
according to the case, from the date of conclusion of the stock option agreement until the date the option is exercised, deducting the value of dividends and interest on equity per share
paid by the Company as from the stock option date.
For the 1/2013 Program, regarding the Discretionary Grant, the exercise price of the options will be the average, weighed by the trading volume, of the ordinary shares of the
Company in BM&FBOVESPA, during the fiscal year of 2011 (R$26.16), monetarily adjusted by the inflation according to the IPCA, or by another index determined b y the Board of
Directors or committee, according to the case, from the date of conclusion of the stock option agreement until the date the option is exercised, deducting the value of dividends and
interest on equity per share paid by the Company as from the stock option date.
For the 1/2014 Program, regarding the Basic Grant, the exercise price of the options will be the amount of the shares net worth in December 31 of the fiscal year immediately
after the stock option date of the Company (R$7.98), monetarily adjusted by the inflation according to the IPCA, or by another index determined by the Board of Directors or committee,
according to the case, from the date of conclusion of the stock option agreement until the date the option is exercised, 172 deducting the value of dividends and interest on equity per
share paid by the Company as from the stock option date.
For the 1/2014 Program, regarding the Discretionary Grant, the exercise price of the options will be the average, weighed by the trading volume, of the ordinary shares of the
Company in BM&FBOVESPA, during the fiscal year of 2013 (R$30.94), monetarily adjusted by the inflation according to the IPCA, or by another index determined by the Board of
Directors or committee, according to the case, from the date of conclusion of the stock option agreement until the date the option is exercised, deducting the value of dividends and
interest on equity per share paid by the Company as from the stock option date.
The options granted under this plan will be subject to vesting periods of up to 72 months for the conversion of options into shares.
d. Numbers of shares in the plain
In the 2010/1 Program: Up to 1,475,234 common shares issued by the Company, which 795,345 designated to non-administrators employees. By December, 31, 2014, 834,320
shares were exercised (options of non-administrators employees).
In the 2011/1 Program: Up to 1,184,229 common shares issued by the Company, which 648,741 designated to non-administrators employees. By December, 31, 2014, 427,886
shares were exercised (options of non-administrators employees).

In the 2012/1 Program: Up to 1,257,467 common shares issued by the Company, which 930,410 designated to non-administrators employees. By December, 31, 2014, 338,295
shares were exercised (options of non-administrators employees).
In the 2013/1 Program: Up to 768,335 common shares issued by the Company, which 473,087 designated to non-administrators employees. By December, 31, 2014, 56,338
shares were exercised (options of non-administrators employees).
In the 2014/1 Program: Up to 259,909 common shares issued by the Company, which 158,057 designated to non-administrators employees. By December, 31, 2014, no shares
were exercised.

Plan of Stock Options 2016

At the Extraordinary General Meeting held on May 28, 2016, the Stock Option Plan called "Plan" (Plan Options 2016) was approved.
a) Groups of beneficiaries
They may be elected as beneficiaries of grants of options to purchase shares under the Plan administrators and employees in the Company's officers and directors or companies
under its control
b) Conditions for the exercise
The options granted under the Plan may be exercised in whole or in part, provided that the respective grace periods observed, not less than twelve (12) months, determined by
the Board of Directors, and the other terms and conditions contained in the respective contracts Option.
c) Exercise prices
The exercise price of options granted under the Plan is equal to R $ 2.63 (two reais and sixty-three cents), defined based on the issue price of the Company's shares under the
capital increase approved by the Board of Directors on February 5, 2016. the exercise price will be adjusted for inflation according to the IPCA (price index Broad Consumer), released
by the Brazilian Institute of Geography and Statistics, or other content that may be determined by the Board of Directors or the Committee, as appropriate, and deducting the value of
dividends and interest on capital per share declared by the Company from the date of grant.
d) Number of shares in the plan
The stock options granted under the Plan may confer purchase rights on a number of shares not to exceed 1,700,000 (one million seven hundred thousand) Company's shares
throughout the term of the Plan, computing If this calculation all the options already granted under the Plan, exercised or not, except those that have been canceled and not exercised,
provided that the total number of issued shares or likely to be issued under the Plan is always within the limits the authorized capital of the Company.

14.4 Description of the relationships between the Company and trade unions
At December 31, 2015, approximately 0.3% of the Companys employees were represented by a trade union, especially the Civil Construction Trade Union and the Commerce
Union. The Company has agreements with each trade union, and renegotiates them every year. The Company maintains a good relationship with the main trade unions its employees
are represented by.

14.5

Provide other information that the Company deems relevant

In Ordinary and Extraordinary General Meeting held on April 28, 2016 approved a new stock option plan of the Companys shares.

15.1 / 15.2

Controling Group

Andres Cristian Nacht

4/19/2016

Individual

098.921.337-49

Argentinian

Yes

Yes

20.703.976

11.8%

%
Capita
l
Stock
12.18
%

Jytte Kjellerup Nacht

4/19/2016

Individual

289.858.347-20

Brazilian

Yes

Yes

7.151.672

4.10%

4.18%

Tomas Richard Nacht

4/19/2016

Individual

042.695.577-37

Brazilian

Yes

Yes

2.971.857

1.70%

1.68%

NAME

Date of last
amendment

Type of
Person

CNPJ/CPF

Nationality

UF

Participates
in
shareholder
agreement

Controlling
shareholder

Quantity
of
common
shares

Antonia Kjellerup

4/19/2016

Individual

073.165.257-62

Brazilian

Yes

Yes

2.971.857

1.70%

1.68%

Pedro Kjellerup Nacht

4/19/2016

Individual

127.276.837-66

Brazilian

Yes

Yes

3.060.357

1.70%

1.75%

Francisca Kjellerup
Nacht

4/19/2016

Individual

124.175.657-06

Brazilian

Yes

Yes

1.337

0.00%

14.740.333/0001
-61

Espanish

Yes

Yes

23.676.659

13.50%

American

No

No

6.710.804

5.24%

Brazilian

No

No

7.705.300

6.02%

Brazilian

No

No

7.038.900

5.50%

No

No

2.278.422

1.30%

1.78%

No

No

91.315.301

47.44%

52.79
%

Snow Petrel S.L.

4/19/2016

Entity

Brandes Investment
Partners

4/19/2016

Entity

Fama Investimentos

4/19/2016

Entity

BTG Pactual WM

4/19/2016

Entity

Shares in Treasury

4/19/2016

Entity

00.156.956/0001
-87
60.451.242/0001
-23

Other
Total

15.3

175.586.442

0.00%
13.84
%
4.94%
5.11%

100%

Description of the share capital

On April 28, 2016, date of the last meeting:

Number of individual shareholders

1000

Number of corporate shareholders

61

Number of institutional investors

230

Shares in Circulation
Shares in circulation corresponding to all shares of the issuer with the exception of the controlling ownership, people linked to it, the issuer's management and treasury shares.

Number of outstanding shares, by class type

% Of shares outstanding

15.4

111.988.576
63,8

Organization chart of shareholders with more than 5% of share capial

Controlling
shareholders
34.5%

BTG Pactual
WM
5.5%

BRANDES

FAMA

Others

5.24%

6.02%

47.4%

5,50%

MILLS ESTRUTURAS E SERVIOS DE

ENGENHARIA S.A.

15.5

Shareholders Agreements
I. 2014 Agreement

On February 28, 2014, a Shareholders Agreement was signed concerning the Company, without changing its control group, to regulate the relationship between
the Companys controlling shareholders, as indicated in item 8.1(a) of this Reference Form ("2014 Agreement"). The 2014 Agreement provides for, among other
provisions and as detailed below, clauses related to (i) exercise of voting rights and control; (ii) appointment of directors; and (iii) transfer of shares and preferential rights
for acquiring them.
The 2014 Agreement was amended on May 5, 2014 due to Francisca Kjellerup Nachts adhesion to said instrument. The main characteristics of the 2014
Agreement are described below.

a.

Parties

Andres Cristian Nacht, Jytte Kjellerup Nacht, Tomas Richard Nacht, Antonia Kjellerup Nacht, Pedro Kaj Kjellerup Nacht e Francisca Kjellerup
Nacht (em conjunto, "Famlia Nacht");

Snow Petrel S.L. (collectively with the Nacht Family, "Parties"); e

Mills Estruturas e Servios de Engenharia S.A. ("Company")

b.

Execution Date: 28.2.2014

c.

d.

Term: 3 anos

Description of the clauses related to exercise of voting rights and control

The vote of the parties in general meetings will be made by shareholder Andres Cristian Nacht, except in case any other signatory of the
2014 Agreement requests the adoption of the preliminary meeting procedure, in which case the decision will be made by majority vote within
the control block, subject to veto rights in specific matters:

mergers, spin-offs, acquisitions, and any other corporate reorganization transaction involving the Company;

reduction of the Companys mandatory dividends, in order to make it less than 25% of the net profit calculated in accordance with Act 6.404/76;

increase or decrease of the Companys capital stock, except for capital increases under the Board of Directors authority;

cancelation of registration as a publicly held company and discontinuation of Novo Mercados differentiated practices of corporate governance;

application for bankruptcy or court-supervised or out-of-court reorganization of the Company;

approval of valuation reports submitted for the approval of the Companys general meeting;

amendment of the Companys corporate purpose;

amendment of the minimum or maximum number of members of the Board of Directors, as provided for in the Companys Bylaws, or amendment
of the matters under the Board of Directors authority;

e.

amendment of the provisions in the Companys Bylaws relating to the distribution of income, establishment of reserves and retention of earnings;
amendments to Chapter VII of the Companys Bylaws; and
liquidation and dissolution of the Company, cessation of its condition of liquidation, and approval of the accounts of liquidators.
The 2014 Agreement does not bind the vote of members of the Board of Directors or other Company bodies.

Description of clauses related to appointment of directors or members of committees established in the Companys Bylaws

In the absence of a motion for holding a preliminary meeting, Andres Cristian Nacht shall appoint all members of the Companys Board of
Directors that the control block has the right to elect.
Should a preliminary meeting be requested in order to appoint the members of the Companys Board of Directors:

of the total number of members of the Board of Directors that the Parties, together, have the right to elect at the Companys general meeting, each
Party may elect a number of members proportional to their interest in the Companys capital stock (disregarding shares held by shareholders who are not
parties to the 2014 Agreement);


in the event a fractional number is found when determining the number of directors to be appointed by each Party pursuant to the item above,
fractions equal to or higher than 0.5 will be rounded up to 1.0;

regardless of the rounding provided for in the item above, the member of the control block with the highest interest will have the right to appoint
the majority of the members of the Board of Directors that the control block are allowed elect.

Whenever the Parties, or the members of the Board of Directors appointed by them, are allowed to appoint the Chairperson of the Companys Board of Directors,
such appointment will be carried out by Andres Cristian Nacht.
The rules described above apply, mutatis mutandis, to the appointment of members of the Audit Committee.
The 2014 Agreement does not contain provisions relating to the appointment of members of the executive board.
f.

Description of the clauses related to transfer of shares and preferential rights for acquiring them
The 2014 Agreement establishes, as a general rule, that the Parties shares may not be disposed of (lock-up) during its term.
As an exception to the general rule of lock-up, each party may release from the 2014 Agreement, during its term, up to 10% of their shares for purposes of disposition
("Released Shares").
In case of disposition of Released Shares, non-selling shareholder shall have right of first offer, which will allow them to acquire the Released Shares at the price offered
by the selling shareholder. 177
If non-selling shareholders do not acquire the Released Shares through the exercise of the preferential rights, the selling shareholder may sell them on the stock market
at a price not lower than that offered to the non-selling shareholders.

g.

g. Description of the clauses that restrict or bind the voting rights of members of the Board of Directors

There are no provisions relating to the restriction or binding of the vote of directors.
II. 2016 Agreement

On April 7, 2016, a new shareholders agreement was signed concerning the Company, to regulate the relationship between the Companys controlling
shareholders and the shareholder Fundo de Investimento em Participaes Axxon Brazil Private Equity Fund II ("2016 Agreement"). The 2016 Agreement provides for,
among other provisions and as detailed below, clauses relating to (i) exercise of voting rights and control; (ii) appointment of directors and committee members; (iii)
transfer of shares and preferential rights for acquiring them; and (iv) restriction or binding of voting rights of members of the Board of Directors. The main characteristics
of the 2016 Agreement are described below.
a.

Parties

Andres Cristian Nacht, Jytte Kjellerup Nacht, Tomas Richard Nacht, Antonia Kjellerup Nacht, Pedro Kaj Kjellerup Nacht, Snow Petrel S.L. e

Francisca Kjellerup Nacht (collectively, "Controlling Shareholders");

Fundo de Investimento em Participaes Axxon Brazil Private Equity Fund II ("Axxon" and, collectively with the Controlling Shareholders,
"Shareholders" or "Parties"); and

Mills Estruturas e Servios de Engenharia S.A. ("Company")

b.

Execution Date: 7.4.2016

c.
Term: From the execution date of the 2016 Agreement until the Date of Acquisition of Political Rights (defined in item "d" below) and, after this
period, for 8 years. Note that the 2016 Agreement shall automatically terminate if Axxon does not become the holder of shares representing at least 7%
of the Companys capital stock by the 5th August, 2016 (120 days from the execution of the 2016 Agreement).
d.

Description of the clauses related to exercise of voting rights and control

Acquisition of Political Rights

If Axxon, within 120 days from the execution date of the 2016 Agreement, becomes the holder of shares representing at least 7% of the Companys capital
stock, Axxon will acquire rights relating to (i) Qualified Matters Under the Meetings Authority and Qualified Matters Under the Boards Authority (defined
below), and (ii) appointment of members of the Board of Directors and advisory committees to the Board of Directors (as detailed in item "e" below) ("Date
of Acquisition of Political Rights").
Preliminary Meeting

The Shareholders or members of the Board of Directors appointed by the Shareholders shall vote together in general meetings and in
meetings of the Board of Directors. For this purpose, the Shareholders shall meet prior to: (i) each general meeting of the Company; (ii)
each meeting of the Board of Directors voting on Qualified Matters Under the Boards Authority (defined below); (iii) any meeting of the
Board of Directors, regardless of the matter to be voted, if requested by any of the Shareholders; and (iv) each general meeting, meeting of
the Board of Directors,meeting of executive board, or meeting of shareholders of Companys subsidiaries that have Qualified Matters Under
the Meetings Authority or Qualified Matters Under the Boards Authority (defined below) among the matters to be decided ("Preliminary
Meeting").
The resolutions of the Preliminary Meetings shall be made by majority vote, except in cases of Qualified Matters Under the Boards Authority
and Qualified Matters Under the Boards Authority (defined below), whose approval requires the favorable vote of the representative of
Axxon and of the Controlling Shareholders. Even if Axxon holds, directly or indirectly, interest higher than 15% of the Companys capital
stock, Axxons votes in the Preliminary Meetings shall be limited to those to which it would be entitled with 15% of the capital stock.

The resolutions passed at Preliminary Meetings shall bind the Parties and the members of the Board of Directors appointed by them, who shall follow the
voting instructions received, pursuant to Article 118 of Act 6.404/76 ("Stock Corporations Act"), even if the Shareholders (or the shareholders who appointed
them, in the case of members of the Board of Directors) (i) dissented from the resolution passed at the Preliminary Meeting; (ii) abstained in relation to the
resolution passed; or (iii) did not attend the Preliminary Meeting.
Qualified Matters Under the Meetings Authority

The favorable vote of the Shareholders in the Companys general meetings regarding the matters listed below shall require the prior approval
of Controlling Shareholders and Axxon in a Preliminary Meeting ("Qualified Matters Under the Meetings Authority"):

amendments to the Companys bylaws and/or bylaws or articles of incorporation of any subsidiary of the Company on the following matters: (i)
corporate purpose; (ii) list of matters under the Board of Directors authority; and (iii) list of matters under the general meetings or shareholders meetings
authority, to the extent that they affect the Qualified Matters Under the Meetings Authority or the Qualified Matters Under the Boards Authority (as defined
below);

any corporate reorganization, including mergers, acquisitions, spin-offs, or transformation involving the Company or its subsidiaries, except for
transactions made exclusively between the Company and its wholly owned subsidiaries (or companies that have 99% of their capital held by the Company);

reduction of the capital stock of the Company or of a subsidiary of the Company, except if carried out exclusively for the absorption of losses;

creation of new classes of shares or modification of the current rights and preferential rights of shares issued by the Company or a subsidiary of
the Company;

issuance of any security that grants its holder the right to subscribe or acquire new shares or securities (i) convertible into shares with or without
voting rights in the Company or a subsidiary of the Company; or (ii) exchangeable for shares of the Company or its subsidiaries, except for public offerings
for the issuance of shares of the Company or a subsidiary of the Company and in the scope of any plans involving options to purchase shares issued by
the Company or a subsidiary of the Company;

approval of plans involving options to purchase shares issued by the Company or a subsidiary of the Company;

amendments to the dividend policy of the Company or of a subsidiary of the Company;

conversion of the Company into a closely held corporation or its exit from the Novo Mercado segment of BM&FBOVESPA;

participation of the Company in groups of companies, in accordance with Article 265 of the Stock Corporations Act; and

application for bankruptcy, court-supervised or out-of-court reorganization of the Company or of a Subsidiary, as well as liquidation and dissolution,
or cessation of its condition of liquidation.

Qualified Matters Under the Boards Authority

The favorable vote of representatives appointed by the Shareholders in meetings of the Board of Directors regarding the matters listed below
require the prior approval of Controlling Shareholders and Axxon in a Preliminary Meeting ("Qualified Matters Under the Boards Authority"):

granting any type of encumbrance on any asset (including rights) of the Company or of of its subsidiaries as guarantee of any indebtedness,

provided that (i) it is not provided for in the Companys annual budgets; and (ii) in an amount exceeding 3 times the adjusted EBITDA of the Company for
the current budgeted year, in any case, except for the creation of encumbrances to finance the acquisition of any asset, provided that the encumbrance
is created solely over the asset acquired;

execution, by the Company or any of its subsidiaries, of contracts with (i) any party related to the Shareholders; (ii) members of the Board of
Directors; or (iii) officers of the Company, except, with respect to the Companys directors, through contracts exclusively related to stock-based
compensation plans or employment contracts for directors under usual market conditions and consistent with the past practices of the Company;

contracting of any new indebtedness or changes in conditions, restructuring, agreements or advance payments of any indebtedness of the
Company and/or its subsidiaries (i) not provided for in the annual budget; and (ii) in an amount exceeding 3 times the Companys Adjusted EBITDA for
the current budgeted year;eleio ou destituio do Diretor Administrativo Financeiro e de Relaes com Investidores;

approval of the Companys annual budget if (i) the disposition of lease equipment is provided for, outside the normal course of business, whose
net value exceeds 10% of the Companys fixed assets; or (ii) the sale of assets represents a net loss, in the aggregate, exceeding 10% of the Companys
Adjusted EBITDA of the immediately preceding year;

sale, exchange, or any other form of disposition to third parties of any relevant assets owned by the Company or its subsidiaries (i) if total sales
or net loss have reached the ceiling approved in the annual budget; and (ii) whose total aggregate value (a) is equal to or greater than BRL 5,000,000.00;
or (b) represents a net loss of BRL 1,000,000.00;

during the lock-up period (as described in item "f" below), any investment in any company (i) that conducts, at the time of investment, the same
activity conducted by any investee of funds managed by The Axxon Group Private Equity Assessoria Ltda., or its controlling members, direct or indirect,
or companies under common control; and (ii) (a) whose activities are not included in items (a) to (g) of Article 2 of the Companys bylaws; or (b) that do
not operate the business practiced by the Company; or

approval or modification of the Companys annual budget, if, in the 12 months preceding the annual budget being prepared, a negative difference
of more than 20% has been verified between the projected Adjusted EBITDA and the actual Adjusted EBITDA.

e.

Description of clauses related to appointment of directors or members of committees established in the Companys Bylaws

The Controlling Shareholders and Axxon may appoint a number of members of the Board of Directors proportional to their percentage in the
total number of shares bound by the 2016 Agreement, provided that: (i) while Axxon is the holder of shares representing at least 13% of the
Companys capital stock, Axxon shall have the right to appoint and elect at least one member of the Board of Directors; and (ii) to the extent
that the Controlling Shareholders are holder of shares of the Companys capital stock representing at least 50% of the shares plus one share
(i.e. the majority of shares that make up the block bound by the 2016 Agreement), the Controlling Shareholders shall have the right to
appoint and elect at least the same number of members of the Board of Directors that Axxon elects, plus one member.
The chairperson of the Board of Directors shall be appointed by the Controlling Shareholders.
The Controlling Shareholders and Axxon undertake to conduct a Preliminary Meeting to determine the names to be appointed at the
Companys general meeting to elect the members of the Board of Directors.
The Companys executive board will be composed of qualified and experienced professionals, who have all the necessary qualifications for
the positions held by them. The members of the executive board shall be appointed by the Board of Directors, by majority vote, and the CEO
will be heard before the choice of the other officers.

While Axxon is the holder of shares representing at least 13% of the Companys capital stock, Axxon will have the right to appoint and elect
one representative for any existing committee or any committee that may be created to advise the Board of Directors.
f.

Description of the clauses related to transfer of shares and preferential rights for acquiring them

The 2016 Agreement has clauses on the transfer of shares and preferential rights for acquiring them, such as lock-up, right of first offer,
right of first refusal, tag along rights and drag along rights, as described below.

Lock-up

As a general rule, the shares of the Parties may not be sold (lock-up) during (i) the period between the execution date of the 2016 Agreement and the Date
of Acquisition of Political Rights, and, after this period, (ii) for a period of 30 months.
If Axxon, after 6 months from the Date of Acquisition of Political Rights, has not become the holder of at least 13% of the Companys capital stock, the
percentage of shares subject to lock-up will be reduced to up to: (i) 10% of the Companys capital stock between the 7th month and the 12th month from
the Date of Acquisition of Political Rights; and (ii) 5% of the capital stock between the 13th month and the 24th month from the Date of Acquisition of Political
Rights. After the 24th month from the Date of Acquisition of Political Rights, Axxon may sell its shares without complying with the lock-up.
After the end of the lock-up, Axxon will be entitled to sell at BM&FBOVESPA, every 12 months from the Date of Acquisition of Political Rights, 2% of the
shares owned by Axxon, without the restrictions of right of first offer and right of first refusal, detailed below.

As an exception to the general rule of lock-up, the following are considered permissible:

the sale, at BM&FBOVESPA, of up to 10% of the shares of the Controlling Shareholders existing at the execution date of the 2016 Agreement;

the sale of Axxon shares exceeding 15% of the Companys capital stock, without the need to observe the right of first offer and the right of first
refusal, described below;

the sale of shares (i) between the Controlling Shareholders and their controlling members/shareholders and/or affiliates, or, in the case of
individuals, their heirs and successors, provided that the acquirer executes the 2016 Agreement, through an instrument of adhesion, without any
restrictions; or (ii) between the Shareholders without the need to observe the tag along rights, described below; and

the sale of shares between Axxon and other investment vehicles managed by The Axxon Group Private Equity Assessoria Ltda., its direct or
indirect controlling members/shareholders or companies under common control, provided that the acquirer executes the 2016 Agreement, through an
instrument of adhesion, without any restrictions.

Right of First Offer

If Axxon intends to dispose of all or part of its shares it must always grant the Controlling Shareholders the right of first offer for the acquisition of such
shares, in accordance with the terms and procedures provided for in the 2016 Agreement.
Right of First Refusal

If Axxon intends to sell all or part of its shares to one or more third parties (i) that are competitors of the Company or an investment fund holding interest
equal to or higher than 10% of the capital of and/or controls or has the right to appoint directors in a competitor of the Company ("Competitor"); or (ii) in the
scope of a Public Offer for Acquisition of Shares, Axxon shall grant the Controlling Shareholders the right of first refusal for acquisition of all the shares to
be sold by Axxon (i) at the same price and conditions offered by the Competitor, or (ii) in the case of a Public Offer for Acquisition of Shares, offering the
shares at the same price offered in the Public Offer with a 5% discount, adjusted by the variation of the DI Rate, in accordance with the terms and procedures
provided for in the 2016 Agreement.

Tag Along Rights

If the Controlling Shareholders receive an offer from one or more third parties for the sale of at least 41% of the shares held by them on the execution date
of the 2016 Agreement in a transaction outside the stock exchange environment, Axxon will have the right to sell, to the third party, the same proportion of
the shares held by Axxon, at the same price and under the same terms and conditions provided for in the offer made by the third party, in accordance with
the terms and procedures provided for in the 2016 Agreement.
Drag Along Rights

If the Controlling Shareholders make or receive an offer from one or more third parties for the acquisition of at least 50% of their shares, the Controlling Shareholders
shall have the right to demand that Axxon sell to the third party, together with the Controlling Shareholders, all shares held by Axxon, limited to the percentage of 15%
of the Companys capital stock, under the same pricing terms and conditions they were offered, provided that the transaction results in the receipt, by Axxon, of an
amount of their updated investment equivalent to at least 2.5x the amount invested by Axxon until reaching an interest of 15% (or, if such interest has not been reached,
the interest effectively reached), and limited, in any case, to 15% of the Companys capital stock, for which the conditions, terms, and procedures provided for in the
2016 Agreement shall be observed.

g.

Description of the clauses that restrict or bind the voting rights of members if the Board of Directors

As described in item "d" above, the favorable vote of representatives appointed by the Shareholders in the decisions of the meetings of the Companys Board of
Directors regarding Qualified Matters Under the Boards Authority require the prior approval of the Controlling Shareholders and Axxon in a Preliminary Meeting.
The resolutions passed in Preliminary Meetings shall bind the members of the Board of Directors appointed by the Parties, who shall follow the voting instruction
received regarding the matter in question, pursuant to Article 118 of the Stock Corporations Act, even if the Shareholders who appointed them (i) dissented from the
resolution passed at the Preliminary Meeting; (ii) abstained in relation to the resolution passed; or (iii) did not attend the Preliminary Meeting.
15.6 Significant Changes in the shareholdings of Members of the Control Group and directors of the Company in the last 3 financial years
Corporate rearrangements involving Nacht Participaes
The company, in December 28, 2012, was notified by Nacht Participaes S.A. about the effectiveness of its capital stock reduction, with the delivery of the totality of its previously held
shares issued by Mills to its shareholders, following the correspondence sent by Nacht Participaes in October 30, 2012, which informed of such capital reduction approval
According to that notices terms, with the effectiveness of the aforementioned capital stock reduction, Andres Cristian Nacht and his family began to hold 27,421,713 (twenty-seven
million, four hundred and twenty-one thousand, seven hundred and thirteen) shares issued by Mills, representing 21.7% of corporate capital in that time.
Still within the notices terms, neither the capital reduction nor the related transfer of the shares issued by Mills resulted in any change of Mills corporate control, which, before the capital
reduction, was formerly exercised jointly by Nacht Participaes, its shareholders and Snow Petrel S.L., and, after the capital reduction, will be exercised by Nacht Participaes
shareholders jointly with Snow Petrel S.L.. Furthermore, this operation did not change the number of shares or the value of the share capital of the Company.
Liquidation of Jeroboam Investments LLC
The Company was informed, on March 14, 2012, by Snow Petrel S.L., a company headquartered in Barcelona, Spain, at Calle Johann Sebastian Bach 20, 3rd floor, and registered with
the CNPJ/MF under n. 14.740.333/0001-61 (Snow Petrel), of the transfer of all common shares, book-entry shares, with no par value issued by Mills held by Jeroboam Investments
LLC (Jeroboam) for Snow Petrel, due to the dissolution and consequent extinction of its wholly owned subsidiary Jeroboam. Therefore, Snow Petrel came to hold 19,233,281 (nineteen
million, two hundred thirty-three thousand, two hundred eighty-one) shares of Mills, representing 15.3% of its capital stock.
The dissolution of Jeroboam and the corresponding transfer of Mills's shares did not cause any change in the administrative structure or the control of the Company, since the Snow
Petrel, as well as Jeroboam to extinction, is controlled by Mr. Nicolas Nacht . Additionally, this operation did not involve change in the number of shares or the capital value of the
Company.
15.7 Describe the main corporate transactions in the group which have had a material effect to the issuer, such as takeovers, mergers, stock acquisitions, disposals and
corporate takeovers, acquisitions and disposals of important assets, indicating when to involve the issuer or any of its subsidiaries and affiliates
Sale of Industrial Services business unit

On July 10, 2013, the Company entered into an agreement for the sale of its business unit Industrial Services for R $ 102 million through the sale of its stake in Albuquerque Participaes
Ltda.

This sale was made in line with the Company's strategy to focus on businesses where their skills are able to generate greater value for its shareholders and customers. Thus, the
Company ceased to operate in the industrial services sector, in which were offered access services, industrial painting, surface treatment and thermal insulation, both in the construction
phase, as in the maintenance phase of large industrial plants.
The transaction was closed on November 30, 2013 and the Company earned income of R $ 8.3 million. The agreed sale value of R $ 102 million was received R $ 25 million in contract
signing date, in July, and the balance will be paid in installments corrected by CDI, discounting the generation of this business case for Mills between 1 June 2013 and the closing date,
which was equal to R $ 6.8 million.
Capital increases
The Company carried out capital increases within the limit of authorized capital through the issuance of common, registered shares with no par value, due to the exercise by
beneficiaries of purchase options granted pursuant to the Stock Option Program Options 01/2010 , 01/2011, 01/2012, 01/2013 and 01/2014. The dates of approvals, programs, number
of shares, the share price and the amounts of these exercises are detailed in item 17.
In compliance with the provisions of Instruction of the Securities and Exchange Commission No. 358, of January 3, 2002, as amended, that its Board of Directors approved, in a
meeting held on February 5, 2016, the completion of an increase in Company's capital stock, within the authorized capital limit, with the possibility of partial approval, through the
issuance, for private subscription of at least 40,089,472 (forty million, eighty-nine thousand, four hundred and seventy-two) and a maximum of 47,528,517 (forty-seven million, five
hundred and twenty-eight thousand, five hundred and seventeen) new common shares, at an issue price of R $ 2.63 (two reais and sixty-three cents) per share, amounting to at least
R $ 105,435,311.36 (one hundred and five million, four hundred thirty-five thousand, three hundred and eleven reais and thirty-six cents) and a maximum of R $ 124,999,999.71 (one
hundred twenty-four million, nine hundred ninety-nine thousand, nine hundred and ninety-nine reais and seventy one cents) ( "Increase Capital"). The issue price was fixed without
undue dilution for the existing shareholders of the Company, pursuant to Article 170, paragraph 1, item III, of Law No. 6404 of December 15, 1976, as amended ( "the Companies Act
by shares "), taking into account the average price (average of the weighted daily closing prices by trading volume) of the Company's shares on the BM & FBOVESPA SA - Securities,
Commodities and Futures Exchange in trading sessions between November 27, 2015 ( inclusive) and February 4, 2016 (inclusive). The price of such shares on the stock exchange is,
in the opinion of the Board, the most appropriate criteria in the current reality of the Company. The raising of funds through the capital increase aimed to (i) strengthen the Company's
capital structure, strengthening its cash to meet the medium and long-term capital needs for the development of its activities; (Ii) strengthen its liquidity levels, reducing the Company's
debt margins; and (iii) take advantage of market consolidation opportunities that may arise in the medium term. Because it was reached the maximum subscription of the Capital
Increase, it was held on April 19, 2016, the Board of Directors meeting which approved the ratification of the capital increase with the issuance of 47,528,517 ( forty-seven million, five
hundred and twenty-eight thousand, five hundred and seventeen) new common shares, totaling R $ 124,999,999.71 (one hundred twenty-four million, nine hundred ninety nine
thousand, nine hundred ninety-nine reais and seventy one cents). Due to the approval of the Capital Increase, the Company's share capital shall be R $ 688,318,462.91 (six hundred
eighty-eight million, three hundred and eighteen thousand four hundred and sixty-two reais and ninety-one cents), divided in 175,586,442 (one hundred seventy-five million, five
hundred and eighty-six thousand, four hundred and forty two) common shares.

15.8

Outras informaes que a Companhia julga relevantes

There are no other relevant information.

16.1

Rules, Policies and Practices for Transactions with Related Parties

The business and transactions with related parties of the Company are always performed by observing price and usual market conditions and they do not generate any benefit or
detriment to the Company or any other party.
Under the Companys bylaws, the Board must approve any transaction with any of the Company's shareholders.
As of December 31, 2015, the Company did not hold any consulting services contracts with members from the Board of Directors. There has not been any loans between the Company
and its administrators during the fiscal year of 2015.
16.2 Information on Transactions with Related Parties
There has not been any transactions with related parties during the last three fiscal years.
16.3 Measures Taken to Address the Conflict of Interest
The Company adopts corporate governance practices and those recommended and/or required by applicable regulations including those set out in Novo Mercado regulations. The Board
of Directors must approve the policies and make necessary arrangements for directors and shareholders to not be involved in conflict of interest situations. Additionally, pursuant to the
Companys by-laws, the Board of Directors must approve any transaction with any of the Company's shareholders.

17.1 Information about the share capital

Date of approval
Capital (Reais)
Type of Capital

8/15/2014

47,528,517

47,528,517

124,999,999.71

47,528,517

47,528,517

47,528,517

47,528,517

563,318,463.20

128,057,925

128,057,925

563,318,463.20

128,057,925

128,057,925

124,999,999.71
Subscribed Capital

8/15/2014
Type of Capital

124,999,999.71

Authorized Capital

2/5/2016
Type of Capital

Quantity of preferred Total quantity of shares

(Units)
shares (Units)

Paid-up Capital

4/19/2016
Type of Capital

Quantity of common
shares (Units)

Subscribed Capital

4/19/2016
Type of Capital

Payment term

Paid-up Capital

PGINA: 281 de 345

17.2 Increase of the share capital

Decision
Date

Body that
decided the
increase

2/8/2013

Board of
Directors

Criteria for
determining the
issue price
Manner of Payment

2/8/2013

Board of
Directors

Criteria for
determining the
issue price
Manner of Payment

Total Value of the

issue
Date of issue
2/8/2013

Manner of Payment
Board of
Directors

Private
Subscrip
tion

600

Subscription /
previous capital

Total shares
(units)

Preferred
(Units)

Price Issue
0

600

0.00140000

Factor Price

12.49

R$ per unit

Cash

2/8/2013

37,820.00

Private
Subscrip
tion

3,050

3,050

0.00700000

12.40

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less
the amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2010)

Cash
1,819,309.96

Board of
Directors

Criteria for
determining the
issue price

4/10/2013

7,494.00

Common
(Units)

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less
the amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2010)

2/8/2013
2/8/2013

(Reais)

Type of
increase

Private
Subscrip
tion

88,574

88,574

0.33840000

20.54

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less
the amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2011)

Cash

4/10/2013

169,264.59

Private
Subscrip
tion

66,903

66,903

0.03140000

2.53

R$ per unit

PGINA: 282 de 345

Criteria for determining

the issue price
Manner of Payment

5/9/2013

Board of
Directors

Criteria for
determining the
issue price
Manner of Payment

5/9/2013

Board of
Directors

Criteria for
determining the
issue price
Manner of Payment

Values as the stock option plan of the Company (Special Plan Top Mills).

Cash

5/9/2013

2,973,204.90

Private
Subscrip
tion

230,481

230,481

0.55090000

12.90

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less
the amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2010)

Cash

5/9/2013

2,919,849.05

Private
Subscrip
tion

138,185

138,185

0.53810000

21.13

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less
the amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2011)

Em espcie

PGINA: 283 de 345

Decision
Date

5/9/2013

Body that
decided
the
increase
Board of
Directors

Criteria for determining

the issue price
Manner of Payment

5/9/2013

Board of
Directors

Criteria for
determining the issue
price
Manner of Payment

5/22/2013

Board of
Directors

Criteria for determining

the issue price
Manner of Payment

8/15/2013

Board of
Directors

Criteria for
determining the
issue price

Date of issue

Total Value of the

issue

Type of
increase

Common
(Units)

Preferred
(Units)

Total shares
(units)

Subscription /
previous capital

Price Issue

Factor price

(Reais)
5/9/2013

143,307.36

Private
Subscrip
tion

24,372

24,372

0.02630000

5.88

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2012)
Cash

5/9/2013

3,072,963.25

Private
Subscrip
tion

153,265

153,265

0.56310000

20.05

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2012)

Cash

5/22/2013

39,555.60

Private
Subscrip
tion

15,512

15,512

0.00720000

2.55

R$ per unit

101,395

101,395

0.23670000

12.81

R$ per unit

Values as the stock option plan of the Company (Special Plan Top Mills).

Cash

8/15/2013

1,298,869.95

Private
Subscrip
tion

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2010)

PGINA: 284 de 345

Manner of Payment

8/15/2013

Board of
Directors

Criteria for determining

the issue price
Manner of Payment

8/15/2013

Board of
Directors

Criteria for determining

the issue price
Manner of Payment

Cash

8/15/2013

1,180,587.20

Private
Subscrip
tion

55,952

55,952

0.21460000

21.10

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2011)
Cash

8/15/2013

41,029.52

Private
Subscrip
tion

7,148

7,148

0.00740000

5.74

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2012)
Cash

PGINA: 285 de 345

Decision
Date

8/15/2013

Body that
decided
the
increase
Board of
Directors

Criteria for determining

the issue price
Manner of Payment

11/1/2013

Board of
Directors

Criteria for determining

the issue price
Manner of Payment

11/1/2013

Board of
Directors

Criteria for determining

the issue price
Manner of Payment

11/14/2013

Board of
Directors

Criteria for
determining the
issue price

Date of issue
8/15/2013

Total Value of the Type of

issue increase
586,700.00

Private
Subscrip
tion

Common
(Units)
29,335

Total shares
(units)

Preferred
(Units)
0

Subscription /
previous capital

29,335

0.10640000

Price Issue
20.00

Factor price
R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2012)
Cash

11/1/2013

109,892.16

Private
Subscrip
tion

5,152

5,152

0.01990000

21.33

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2011)
Cash

11/1/2013

19,117.35

Private
Subscrip
tion

945

945

0.00350000

20.23

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2012)
Cash

11/14/2013

248,118.00

Private
Subscrip
tion

19,086

19,086

0.01500000

13.00

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2010)

PGINA: 286 de 345

Manner of Payment

11/14/2013

Board of
Directors

Cash

11/14/2013

368,743.40

Private
Subscrip
tion

17,231

17,231

0.01400000

21.40

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2011)

Criteria for determining

the issue price
Manner of Payment

11/14/2013

Conselho de
Administrao

Criteria for determining

the issue price
Manner of Payment

Cash

11/14/2013

10,377.40

Private
Subscrip
tion

1,780

1,780

0.00100000

5.83

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2012)
Cash

PGINA: 287 de 345

17.2 Increase of the share capital

Decision
Date

11/14/2013

Body that
decided
the
increase
Board of
Directors

Criteria for determining

the issue price
Manner of Payment

Total Value of the

issue (Reais)
Date of issue

11/14/2013

Manner of Payment

Manner of Payment

1/10/2014

124,155.72

Board of
Directors

27,600

0.02200000

Price Issue

Factor price

20.28

R$ per unit

Private
Subscrip
tion

5,772

5,772

0.00450000

21.51

R$ per unit

Cash
4,095.36

Board of
Directors

Criteria for determining

the issue price

Subscription /
previous capital

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2011)

1/10/2014
1/10/2014

27,600

Total shares
(units)

Preferred
(Units)

Cash

Board of
Directors

Criteria for determining

the issue price

Private
Subscrip
tion

Common
(Units)

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2012)

1/10/2014
1/10/2014

559,728.00

Type of
increase

Private
Subscrip
tion

711

711

0.00060000

5.76

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2012)

Cash

1/10/2014

61,170.00

Private
Subscrip
tion

3,000

3,000

0.00240000

20.39

R$ per unit

PGINA: 288 de 345

Criteria for determining

the issue price
Manner of Payment

1/10/2014

Board of
Directors

Criteria for determining

the issue price
Manner of Payment

2/5/2014

Board of
Directors

Criteria for determining

the issue price
Manner of Payment

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2012)

Cash

1/10/2014

78.12

Private
Subscrip
tion

0.00000500

13.02

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2010)

Cash

2/5/2014

658,784.62

Private
Subscrip
tion

50,174

50,174

0.03940000

13.13

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2010)

Cash

PGINA: 289 de 345

17.2 Increase of the share capital

Decision
Date

2/5/2014

Body that
decided
the
increase
Board of
Directors

Criteria for determining

the issue price
Manner of Payment

2/5/2014

Board of
Directors

Criteria for determining

the issue price
Manner of Payment

2/5/2014

Board of
Directors

Criteria for
determining the issue
price
Manner of Payment

2/5/2014

Board of
Directors

Date of issue

2/5/2014

Total Value of the

issue (Reais)
300,002.50

Type of
increase

Private
Subscrip
tion

Common
(Units)

13,825

Preferred
(Units)

Subscription /
previous capital

Total shares
(units)
0

13,825

0.01090000

Price Issue

Factor price

21.70

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2011)
Cash

2/5/2014

231,300.00

Private
Subscrip
tion

11,250

11,250

0.00880000

20.56

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2011)
Cash

2/5/2014

52,273.80

Private
Subscrip
tion

7,710

7,710

0.00610000

6.78

R$ per unit

Book value of the shares on December 31 of the fiscal year immediately preceding the date of grant, adjusted for inflation according to the IPCA, minus the amount of dividends and interest on equity per share
declared by the Company from the date of grant (Programme 1/2013)

Cash

2/5/2014

20,648.74

Private
Subscrip
tion

3,554

3,554

0.00280000

5.81

R$ per unit

PGINA: 290 de 345

Criteria for
determining the issue
price
Manner of Payment

2/14/2014

Board of
Directors

Criteria for
determining the
issue price
Manner of Payment

2/14/2014

Board of
Directors

Criteria for determining

the issue price
Manner of Payment

Book value of the shares on December 31 of the fiscal year immediately preceding the date of grant, adjusted for inflation according to the IPCA, minus the amount of dividends and interest on equity per share
declared by the Company from the date of grant (Programme 1/2012)

Cash

2/14/2014

23,951.20

Private
Subscrip
tion

1,820

1,820

0.00140000

13.16

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2010)

Cash

2/14/2014

84,568.60

Private
Subscrip
tion

3,890

3,890

0.00310000

21.74

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, from the execution date of the option contract, less the
amount of dividends and interest on capital own per share paid by Mills, until the exercise date (Plan 1/2011)
Cash

PGINA: 291 de 345

17.2 Increase of the share capital

Decision
Date

2/14/2014

Body that
decided
the
increase
Board of
Directors

Criteria for determining

the issue price
Manner of Payment

5/15/2014

Board of
Directors

Criteria for
determining the
issue price
Manner of Payment

5/15/2014

Board of
Directors

Criteria for determining

the issue price
Manner of Payment

5/15/2014

Board of
Directors

Date of issue

2/14/2014

Total Value of the

issue (Reais)
57,680.00

Type of
increase

Private
Subscrip
tion

Common
(Units)

2,800

Subscription /
previous capital

Total shares
(units)

Preferred
(Units)

Price Issue

2,800

0.00220000

Factor Price

20.60

R$ per unit

The average price of the Shares Acquired restated according to the IPCA, from the execution date of the Option Agreement to the Option exercise date, deducting the value of dividends and interest on capital per
share paid by the Company from the grant date. (Plan 1/2012)
Cash

5/15/2014

3,360,053.76

Private
Subscrip
tion

250,004

250,004

0.19610000

13.44

R$ per unit

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, less dividends and interest on equity per share paid by
Mills, until the exercise date (Plan 1/2010).

Cash

5/15/2014

2,117,680.20

Private
Subscrip
tion

95,391

95,391

0.07480000

22.20

R$ per unit

The average price of the Shares Acquired restated according to the IPCA, from the execution date of the Option Agreement to the Option exercise date, deducting the value of dividends and interest on capital per
share paid by the Company from the grant date. (Plan 1/2011)
Cash

5/15/2014

147,064.00

Private
Subscrip
tion

24,800

24,800

0.01950000

5.93

R$ per unit

PGINA: 292 de 345

Criteria for
determining the issue
price

Book value of the shares on December 31 of the fiscal year immediately preceding the date of grant, adjusted for inflation according to the IPCA, minus the amount of dividends and interest on equity per share
declared by the Company from the date of grant (Programme 1/2012)

Manner of Payment

Cash

5/15/2014

Board of
Directors

5/15/2014

2,135,596.50

Private
Subscrip
tion

101,550

101,550

0.07970000

21.03

R$ per unit

Criteria for determining

the issue price

The average price of the Shares Acquired restated according to the IPCA, from the execution date of the Option Agreement to the Option exercise date, deducting the value of dividends and interest on capital per
share paid by the Company from the grant date. (Plan 1/2012)

Manner of Payment

Cash

5/15/2014

Board of
Directors

Criteria for
determining the issue
price
Manner of Payment

5/15/2014

443,597.65

Private
Subscrip
tion

63,827

63,827

0.05010000

6.95

R$ per unit

Book value of the shares on December 31 of the fiscal year immediately preceding the date of grant, adjusted for inflation according to the IPCA, minus the amount of dividends and interest on equity per share
declared by the Company from the date of grant (Programme 1/2013)

Cash

PGINA: 293 de 345

17.2 Increase of the share capital

Decision
Date

8/15/2014

Body that
decided
the
increase
Board of
Directors

Criteria for
determining the
issue price
Manner of Payment

Date of issue

8/15/2014

Manner of Payment
Board of
Directors

Criteria for determining

the issue price
Manner of Payment

8/15/2014

Board of
Directors

Private
Subscrip
tion

Common
(Units)

4,800

Preferred
(Units)

Subscription /
previous capital

Total shares
(units)
0

4,800

0.00370000

Price Issue

Factor Price

13.36

R$ per unit

Cash
33,901.00

Board of
Directors

Criteria for
determining the issue
price

8/15/2014

64,128.00

Type of
increase

The price is based on the value of the launch of Mills shares upon completion of the first public distribution, adjusted for inflation according to the IPCA, less dividends and interest on equity per share paid by
Mills, until the exercise date (Plan 1/2010).

8/15/2014
8/15/2014

Total Value of the

issue (Reais)

Private
Subscrip
tion

5,845

5,845

0.00460000

5.80

R$ per unit

Book value of the shares on December 31 of the fiscal year immediately preceding the date of grant, adjusted for inflation according to the IPCA, minus the amount of dividends and interest on equity per share
declared by the Company from the date of grant (Programme 1/2012)

Cash

8/15/2014

32,581.00

Private
Subscrip
tion

1,550

1,550

0.00120000

21.02

R$ per unit

The average price of the Shares Acquired restated according to the IPCA, from the execution date of the Option Agreement to the Option exercise date, deducting the value of dividends and interest on capital per
share paid by the Company from the grant date. (Plan 1/2012)
Cash

8/15/2014

134,013.00

Private
Subscrip
tion

19,650

19,650

0.01530000

6.82

R$ per unit

Criteria for determining the issue price

PGINA: 288 de 345

Book value of the shares on

December 31 of the fiscal

year immediately preceding the date of grant, adjusted for inflation according to the IPCA, minus the amount of dividends and interest on equity per share declared by the Company from the date of grant
(Programme 1/2013)

Manner of Payment

Cash
19/04/2016

05/02/2016

Board of
Directors

Criteria for
determining the
issue price
Manner of Payment

124,999,999.71

Private
Subscrip
tion

47,528,571

47,528,571

37.10000000

2.63

R$ per unit

The Company considered the weighted average of the daily closing prices by the trading volume in the trading sessions between November 27, 2015 (inclusive) and February 4, 2016 (inclusive).

Cash

PGINA: 288 de 345

17.3 Stock splits, reverse splits and bonuses.

Not applicable, as none of these operations occurred.
17.4 Regarding reductions in the Companys share capital
Not applicable, as there wasnt any reductions in the Companys capital in the last three fiscal
years.
17.5 Other information that the Company considers relevant

At the Ordinary and Extraordinary General Meeting held on April 19, 2011, it was approved the
amendment of the caput of Article 5 of the Company's Bylaws, to adjust it to the deliberations of
the Board of Directors taken on April 14, 2010 and November 30, 2010, which approved the
increase of capital stock within the limit of authorized capital.
At the Extraordinary General Meeting held on April 20, 2012, it was approved the amendment of
the caput of Article 5 of the Company's Bylaws, to adjust it to the deliberations of the Board of
Directors taken on July 27, 2011, September 23, 2011, October 24, 2011, January 24, 2012 and
February 28, 2012, which approved the increase of capital stock within the limit of authorized
capital.
At the Extraordinary General Meeting held on February 25, 2014, it was approved the
amendment of the caput of Article 5 of the Company's Bylaws, to adjust it to the deliberations of
the Board of Directors taken on April 2, 2012, April 24, 2012, June 21, 2012, July 2, 2012,
August 9, 2012, November 12, 2012, February 8, 2013, April 10, 2013, May 9, 2013, May 22,
2013, August 15, 2013, November 1, 2013, November 14, 2013 and January 10, 2010, which
approved the increase of capital stock within the limit of authorized capital, passing the relevant
article to henceforth as the following wording:
5th Article - The capital, fully subscribed and paid, is R$553,420,638.63 (five hundred fifty-three
million, four hundred twenty thousand, six hundred thirty eight reais and sixty-three centavos),
represented by 127.395.485 (one hundred twenty-seven million, three hundred ninety-five
thousand, four hundred, eighty-five) common, nominative, inscribed and without par value
shares.

18.1 Description of the rights of each class and type of share issued
Type of shares: Common
Tag Along: 100,00%
Dividend rights: At each Ordinary Shareholder Meeting, the Board of Directors should make a
recommendation on the allocation of net income for the preceding fiscal year, which will be
subject to approval by the shareholders. The Company's Bylaws provides that an amount
equivalent to 25% of the adjusted net income for the year should be available for the payment of
dividends or interest on equity in any fiscal year. This amount represents the compulsory
dividends. If the mandatory dividend exceeds the realized portion of net income, the excess
may be allocated to an unrealized profit reserve. The calculation of net income and allocations
to reserves and the amounts available for distribution are made based on financial statements
prepared pursuant to the Brazilian Corporate Law.
Voting rights: Full
Convertibility to other class or type of share: No
Right to reimbursement of capital: Yes
Description of the reimbursement of capital: The Company's statutory provisions follow, in this
subject, the rules established in the Corporate Law Act and applicable legislation.
Restrictions regarding outstanding shares: No
Circumstances where guaranteed rights of said securities may be altered: Under the Brazilian
Corporate Law, the Bylaws, or resolutions adopted by shareholders in General Meetings can
restrict the shareholders from the following rights: (i) Right to profit sharing; (ii) Right to participate
in the distribution of any remaining assets in case of Company liquidation, proportionately to their
interest in the capital stock; (iii) Preemptive rights in the subscription of shares, convertible
debentures or subscription rights, except in certain circumstances provided in the Brazilian
Corporate Law; (iv) The right to supervise the management of corporate businesses, as provided
by the Brazilian Corporate Law; (v) The right to vote in Shareholders General Meeting; (vi) The
right to leave the Company, in the cases provided in the Brazilian Corporate Law. Changes in
rights assured by shares other than those listed above (e.g.: change in the minimum compulsory
dividend, change in the reimbursement amount, limitations to the exercise of voting rights, etc.)
may be modified by decisions made in general shareholders meetings, by simple or qualified
majority of the Company's shareholders, depending on the nature of the matter to be resolved.
Other Relevant Characteristics: No further relevant information pertaining to this item 18.
18.2 Statutory regulations which limit the right to vote of relevant shareholders or which
cause them to hold a public offering.
According to Article 32, Chapter 7 of the Companys bylaws, the transfer of shareholding Control
of the Company, directly or indirectly, whether through a single transaction, or through successive
transactions, shall be contracted under a condition precedent or subsequent that the acquiring
party shall obligate itself to make a Public Tender Offer for the remaining shares of the other
shareholders of the Company, subject to the conditions and periods provided for in applicable
legislation and the Novo Mercado Rules, such that they are assured treatment equal to that given
to the Selling Controlling Shareholder.
Paragraph 1 The public offering referred to in this article shall also be required: (a) when there
is encumbered assignment of subscription rights or an option to acquire shares or other securities
or rights relating to securities convertible into shares, or that give the right to their subscription or
acquisition, as applicable, which comes to result in the sale of Control of the Company, and (b) in
the case of a transfer of control of company(ies) holding the Power of Control of the Company, in
which case, the Selling Controlling Shareholder shall be obliged to declare to the

BM&FBOVESPA the value assigned to the Company in such transaction and provide supporting
documentation.
18.3 Description of exceptions and suspension clauses relative to ownership or political
rights set forth in the bylaws
Not applicable, as there are no exceptions or suspension clauses relative to ownership or political
rights set forth in the Companys bylaws.
18.4 Information on the volume of trading as well as minimum and maximum values for
securities traded on the stock exchange or the over-the-counter market, in each of the
quarters in the last 3 fiscal years.
Date
ending
quarter

Securities

Type

Class

3/31/2013

Shares

Common

Stock
Exchang
e

6/30/2013

Shares

Common

Stock
Exchang
e

9/30/2013

Shares

Common

Stock
Exchang
e

12/31/2013

Shares

Common

Stock
Exchang
e

3/31/2014

Shares

Common

Stock
Exchang
e

6/30/2014

Shares

Common

Stock
Exchang
e

9/30/2014

Shares

Common

Stock
Exchang
e

12/31/2014

Shares

Common

Stock
Exchang
e

3/31/2015

Shares

Common

Stock
Exchang
e

6/30/2015

Shares

Common

Stock
Exchang
e

9/30/2015

Shares

Common

Stock
Exchang
e

12/31/2015

Shares

Common

Stock
Exchang
e

Marketpl
ace

Administrative Body
BM&FBOVESPA Bolsa de Valores,
Mercadorias e
Futuros
BM&FBOVESPA Bolsa de Valores,
Mercadorias e
Futuros
BM&FBOVESPA Bolsa de Valores,
Mercadorias e
Futuros
BM&FBOVESPA Bolsa de Valores,
Mercadorias e
Futuros
BM&FBOVESPA Bolsa de Valores,
Mercadorias e
Futuros
BM&FBOVESPA Bolsa de Valores,
Mercadorias e
Futuros
BM&FBOVESPA Bolsa de Valores,
Mercadorias e
Futuros
BM&FBOVESPA Bolsa de Valores,
Mercadorias e
Futuros
BM&FBOVESPA Bolsa de Valores,
Mercadorias e
Futuros
BM&FBOVESPA Bolsa de Valores,
Mercadorias e
Futuros
BM&FBOVESPA Bolsa de Valores,
Mercadorias e
Futuros
BM&FBOVESPA Bolsa de Valores,
Mercadorias e
Futuros

Total financial
volume funded
(R$)

Highest
Price
(R$)

Lower
price
(R$)

Factor
Price
(R$)

664.392.189

35,00

29,81

R$ per
unit

971.831.194

35,99

27,21

R$ per
unit

890.684.261

32,00

26,28

R$ per
unit

893.622.222

33,24

28,47

R$ per
unit

963.809.173

32,85

24,49

R$ per
unit

754.418.847

29,85

24,75

R$ per
unit

795.428.358

25,68

17,9

R$ per
unit

757.968.011

9,55

8,21

R$ per
unit

385.275.761

9,41

5,26

R$ per
unit

389.790.979

9,45

6,54

R$ per
unit

244.853.913

7,36

4,5

R$ per
unit

163.451.037

5,95

2,2

R$ per
unit

18.5 Description of other securities which are not shares

Promissory notes of the second issue, issued in a single series, now fully redeemed.
a Identification of securities

Promissory notes of fourth issue, issued in a single series, already fully redeemed.

b Quantity

20 commercial notes.

c Total Amount

Total amount of R$200.000.000,00.

Issue date

April 11, 2014

Maturity Date

August 8, 2014

e Restrictions on trading

The commercial notes were the subject of public distribution with restricted placement efforts, pursuant
to CVM Instruction 476, under the firm commitment and, consequently, can only be traded between
qualified investors. The trading restriction period laid down in article 13 of that 90 days after the
statement expired date of issue

Not applicable. The second issue of promissory notes are not convertible into shares issued by the
company.

Convertibility

g Possibility of redemption:

(i) Possibility of redemption

The Company shall, unilaterally, and that, for the purposes of the paragraph 2, article 7, CVM
Instruction 134, the holders will have given their express prior consent, irrevocably and irreversibly, at
the moment of the subscription of the Notes in the primary market or acquisition in the secondary
market, as appropriate, perform, at any time, from the 31st (thirty first) day counted from the Issue
Date. In case of partial early redemption, the same will take place by lot, pursuant paragraph 4, article
7, CVM Instruction 134, and all the steps in this process, such as license, qualification, verification and
validation of the number of Notes to be redeemed will be held outside of CETIP. The Company shall
communicate the holders, the Payment Agent and CETIP, about the redemption with at least 2 (two)
business days of the date of the event.

The amount to be paid by the Company to the holder of each commercial note of the fourth issue
(ii) Assumptions and method
corresponds to the nominal value of the commercial notes plus the remuneration, calculated pro rata
of calculating the redemption
temporis since the date of issue until the date of effective payment, but without payment of prize or
value
penalty, according to the terms and conditions set forth in the notes.
h

if debt securities, indicate

where applicable:
(i) maturity date, including
For more information on maturity date, please refer to item 18.10 below.
conditions for acceleration
The nominal value of the promissory note will not be updated monetarily.
Over the nominal value of each note there will be remuneration interest of 100% of accumulated
variation of the DI rate plus spread 1.10% per annum from the date of issue until the date of the effective
payment of their commercial note.
(ii) interest

The remuneration shall be paid in full by the due date or the date of any anticipated payment.
In case of payment after the deadline of any amount due in respect of any obligation under the
Commercial Papers, on any and all amounts in arrears would address, without notice, notification or
judicial or extrajudicial, and subject to the Remuneration, calculated pro rata from the date of default to
the date of actual payment, (i) fines of 2% (two percent), and (ii) interest of 1% (one percent) per month
or fraction of a month, calculated pro rata from the date of default until the date of actual payment

(iii) guarantee and, if in the

form of collateral, description
Not applicable. The second issue of promissory notes does not have collateral or surety.
of the goods used as
collateral
(iv) in the absence of a
guarantee, if the credit is The credit of the promissory note is unsecured.
secured or subordinate

(v)
possible
restrictions
imposed on the issuer
The dividend distribution
The sale of certain assets

See terms of acceleration described in item 18.10 below.

The possibility of new debt

The issue of new securities
(vi) the fiduciary agent,
indicating the key terms of the Not applicable.
contract

Conditions for amendment of

A alterao de quaisquer direitos assegurados por cada nota comercial da terceira emisso depende
the rights conferred by such
de aprovao do respectivo titular.
securities

other relevant characteristics

None

Non-convertible Unsecured Debentures of First issuance of the Company

a Identification of securities

Non-convertible Unsecured Debentures of First issuance of the Company single tranche

b Quantity

27.000

c Total amount

Total amount of R$ 270.000.000,00

(i)

Issue date

April 18, 2011

(ii)

Maturity date

April 18, 2016

e Restrictions on trading

The debentures were the subject of public distribution with restricted placement efforts, pursuant to
CVM Instruction 476, under the firm commitment and, consequently, can only be traded between
qualified investors. The trading restriction period laid down in article 13 of that 90 days after the
statement expired date of issue

Not applicable.

Convertibility

g Possibility of redemption:
(i) Possibility of redemption

Not applicable.
Not applicable.

h if debt securities, indicate where

applicable:

(i) maturity date, including

conditions for acceleration

For more information on maturity date, please refer to item 18.10 below.

The face value of the debentures of the first issue will not be monetarily updated.
Interest paid semi-annually will account for 112.5% of the accumulated variation of the interest rate
of CDI.
(ii) interest

The remuneration provided above shall be paid every six months from the date of issue, being the
first payment on October 18, 2011, and the last payment of the maturity date, or on the date of any
settlement.
In case of payment after the deadline of any amount due in respect of any obligation under the
Commercial Papers, on any and all amounts in arrears would address, without notice, notification
or judicial or extrajudicial, and subject to the Remuneration, calculated pro rata from the date of
default to the date of actual payment, (i) fines of 2% (two percent), and (ii) interest of 1% (one

percent) per month or fraction of a month, calculated pro rata from the date of default until the date
of actual payment.
(iii)
guarantee and, if in the
form of collateral, description of Not applicable. The first issue of debentures does not have collateral or surety.
the goods used as collateral
(iv)
in the absence of a
guarantee, if the credit is The Debentures will be unsecured, in accordance with Article 58, caput of the Law No. 6,404/76.
secured or subordinate
(v)
possible restrictions
imposed on the issuer
the dividend distribution
the sale of certain assets

See terms of acceleration described in item 18.10 below.

the possibility of new debt

the issue of new securities
(vi)
the fiduciary agent,
indicating the key terms of the For more information on the fiduciary agent, please refer to item 18.10 below.
contract

During deliberations of the General Meetings of debenture holders for each of the series, for each
outstanding Debenture one vote will be granted, permitting the establishment of proxy, whether
Debenture holder or not. Except for the provisions below, all deliberations to be taken in the General
Meeting of debenture holders will depend on approval of debenture holders representing at least
conditions for amendment of the 75% of outstanding Debentures. Not included in the quorum above are: I. quorums expressly
rights conferred
by such provided for in other clauses of the deed of issue; and II. changes, which should be approved by
securities
debenture holders representing at least 90% of outstanding Debentures: (a) of the provisions of this
clause; (b) of the quorums for approval provided for in the Deed of issue; (c) the remuneration,
except as provided in Clause of the Deed of issuance; (d) any dates for payment of any amounts
provided for in the Deed of issuance; (e) of the term of the Debentures; (f) of the type of Debentures;
(g) creation of a repricing event; (j) of any Event of Default.

Other relevant characteristics

None

Non-convertible Unsecured Debentures of Second issuance of the Company

a

Identification of securities

Non-convertible Unsecured Debentures of Second issuance of the Company double series

Quantity

27.000

Total Amount

Total amount of R$270.000.000,00

Issue date

August 15, 2012

Maturity Date

1st Serie: August 15, 2017.

2ns serie: August 15, 2020.

Restrictions on trading
e

Yes. The debentures were subject of public distribution with restricted placement efforts, pursuant
to CVM Instruction 476, under the firm commitment to the placement of 20,000 debentures, and
under the best-efforts placement in relation to the remaining debentures. The debentures can only
be traded between qualified investors and after a 90 days period from the date of subscription or
purchase according to the articles 13 and 15 of CVM Instruction 476, and compliance by the
Company of its obligations under Article 17 of CVM Instruction 476.

Convertibility

Not applicable.

Possibility of redemption:

Not applicable.

Assumptions and method

Not applicable.
of calculating the
redemption value
(i)
Conditions for
acceleration

For more information on maturity date, please refer to item 18.10 below.

(ii)

Interest

The remuneration of each of the First Series Debentures will be as follows:

I. Monetary Adjustment: The nominal value of the debentures of the first issue will not be monetarily
updated.
II. Compensatory Interests: On the nominal value of each of the First Series Debentures will incur
interest corresponding to 100% of the cumulative variation of the DI rate plus surcharge of 0.88%
(eighty-eight per cent) per year.
Notwithstanding the payments due to early redemption of the First Series Debentures and/or
acceleration of the obligations under the Debentures, pursuant to the Deed of Issue, the First Series
Compensation will be paid semiannually from the Issue Date, with the first payment on February
15, 2013 and the last, on the maturity date of the First Series.
The remuneration of each of the Second Series Debentures will be as follows:
I. Monetary Adjustment: The nominal of each Second Series Debentures will be adjusted by the
National Index of Consumer Prices Broad, released by the Brazilian Institute of Geography and
Statistics ("IPCA"), since the Issue Date until the date of actual payment, being the update
incorporated into the Nominal value of each Second Series Debentures automatically ("Second
Series Monetary Adjustment"). Notwithstanding the payments due to early redemption of the
Debentures and/or acceleration of the obligations under the Debentures, pursuant to the Deed of
Issue, the Second Series Monetary Adjustment will be paid on the same dates and the same
amount of amortization of nominal value of each Second Series Debentures, as provided in the
Deed of Issue.

(iii) guarantee and, if in

the form of collateral,
description of the goods
used as collateral
(iv) in the absence of a
guarantee, if the credit is
secured or subordinate
(v) possible restrictions
imposed on the issuer
The dividend distribution
The sale of certain assets
The possibility of new
debt
The issue of new
securities
(vi) the fiduciary agent,
indicating the key terms
of the contract
Conditions for
amendment of the rights
conferred by such
securities

Not applicable. The second issue of debentures does not have collateral or surety.

The Debentures will be unsecured, in accordance with Article 58, caput of the Law No. 6,404/76.

See terms of acceleration described in item 18.10 below.

For more information on the fiduciary agent, please refer to item 18.10 below.

During deliberations of the General Meetings of first series debenture holders and General
Meetings of second series debenture holders, for each outstanding Debenture one vote will be
granted, permitting the establishment of proxy, whether Debenture holder or not. Except for the
provisions below, (i) all deliberations to be taken in the General Meeting of debenture holders will
depend on approval of debenture holders of the first series representing at least 75% of outstanding
First Series Debentures; and (ii) all deliberations to be taken in the General Meeting of debenture
holders will depend on approval of debenture holders of the second series representing at least
75% of outstanding Second Series Debentures.
Not included in the quorum above are: (i) quorums expressly provided for in other clauses of the
deed of issue; and (ii) changes, which should be approved by debenture holders of the first series
representing at least 90% of outstanding first series debentures and by debenture holders of the
second series representing at least 90% of outstanding second series debentures, (a) of the
provisions of this clause; (b) of the quorums for approval provided for in the Deed of issue; (c) the
remuneration, except for changes resulting from extinction, limitation and / or non-disclosure of the
DI rate or IPCA, as provided in Clause of the Deed of issuance; (d) any dates for payment of any

amounts provided for in the Deed of issuance; (e) of the term of the Debentures; (f) of the type of
Debentures; (g) creation of a repricing event; (h) the provisions relating to optional early
redemption; (i) the provisions relating to early amortization (j) of any Event of Default.

Other relevant
characteristics

None.

Non-convertible Unsecured Debentures of Third issuance of the Company

Identification of
securities
Quantity
b
a

Non-convertible Unsecured Debentures of third issuance single series

20.000

Total Amount

Total amount of R$ 200.000.000,00

Issue date

May 30, 014

Maturity Date

Single series: May 30, 2019

Restrictions on trading
e

f
g

Convertibility
Possibility of
redemption:
Assumptions and
method of calculating
the redemption value

Yes. The debentures were subject of public distribution with restricted placement efforts, pursuant to
CVM Instruction 476, under the firm commitment to the placement of 20,000 debentures, and under
the best-efforts placement in relation to the remaining debentures. The debentures can only be traded
between qualified investors and after a 90 days period from the date of subscription or purchase
according to the articles 13 and 15 of CVM Instruction 476, and compliance by the Company of its
obligations under Article 17 of CVM Instruction 476.
Not applicable.
Yes
The Company may, at its sole discretion, make, at any time, optional early redemption offer, total or
partial, of the outstanding Debentures, with the consequent cancellation of such Debentures, which
will be sent to all Bondholders, without distinction, assured equal conditions to all Bondholders to
accept the early redemption of the Debentures held by them, through an Optional Early Redemption
Offer. The amount to be paid in respect of each Debenture indicated by their respective holders into
joining the Optional Early Redemption Offer will be equal to the outstanding balance of the Par Value,
plus (a) Remuneration, calculated pro rata from the date issuance or payment date immediately
preceding Compensation, as appropriate, until the date of actual payment; and (b) if applicable, the
redemption premium to be offered to the Bondholders, at the sole discretion of the Company, which
cannot be negative redemption.

if debt securities,
indicate where
applicable:
Conditions for
acceleration
For more information on maturity date, please refer to item 18.10 below.

(ii) interest

I. Monetary Adjustment: The nominal value of the debentures of the third issue will not be monetarily
updated.
II. Compensatory Interest: on the outstanding balance of the Nominal Value of the Debentures
outstanding focus interest corresponding to 108.75% (one hundred and seventy-eight point five
percent) of the accumulated variation of average daily DI - Interbank Deposits one day, calculated
and published daily by CETIP in the daily bulletin on its website (http:// www.cetip.com.br) calculated
exponentially and cumulatively pro rata by days elapsed from the Issue Date or payment date
immediately preceding Compensation form as the case until the date of actual payment. Without
prejudice to the payments related to early redemption of the Debentures and / or early maturity of
obligations on the Debentures, the remuneration will be payable semiannually from the Issue Date,

on the 30th of May and November of each year, with the first payment on November 30, 2014 and
the last on the Maturity Date.

(iii) guarantee and, if in

the form of collateral,
Not applicable. The third issue of debentures does not have collateral or surety.
description of the goods
used as collateral
(iv) in the absence of a
guarantee, if the credit is The Debentures will be unsecured, in accordance with Article 58, caput of the Law No. 6,404/76.
secured or subordinate
(v) possible restrictions
imposed on the issuer
The dividend distribution
The sale of certain
assets
The possibility of new
debt
The issue of new
securities
(vi) the fiduciary agent,
indicating the key terms
of the contract
Conditions for
amendment of the rights
conferred by such
securities

See terms of acceleration described in item 18.10 below.

For more information on the fiduciary agent, please refer to item 18.10 below.

During deliberations of the General Meetings of debenture holders, for each outstanding Debenture
one vote will be granted, permitting the establishment of proxy, whether Debenture holder or not.
Except for the provisions below, (i) all deliberations to be taken in the General Meeting of debenture
holders will depend on approval of debenture holders of the first series representing at least 75% of
outstanding First Series Debentures; and (ii) all deliberations to be taken in the General Meeting of
debenture holders will depend on approval of debenture holders of the second series representing at
least 75% of outstanding Second Series Debentures.
Not included in the quorum above are: (i) quorums expressly provided for in other clauses of the deed
of issue; and (ii) changes, which should be approved by debenture holders representing at least 90%
of outstanding debentures, (a) of the provisions of this clause; (b) of the quorums for approval provided
for in the Deed of issue; (c) the remuneration, except for changes resulting from extinction, limitation
and / or non-disclosure of the DI rate or IPCA, as provided in Clause of the Deed of issuance; (d) any
dates for payment of any amounts provided for in the Deed of issuance; (e) of the term of the
Debentures; (f) of the type of Debentures; (g) creation of a repricing event; (h) the provisions relating
to optional early redemption; (i) the provisions relating to early amortization (j) of any Event of Default.

Other relevant
characteristics

None

18.6 Description of the Brazilian markets where the company's securities are admitted for
trading
Shares
The Companys common shares are traded at the BM&FBOVESPA.
Commercial Paper
The Companys first, second, third and fourth issuance of commercial paper, described in table
18.5 of this Reference Form, were registered for trading in the secondary market, through
CETIP21 - Ttulos e Valores Mobilirios, managed and operated by CETIP, trading being settled
through CETIP and electronic custody of the commercial paper by CETIP. The second issue of
commercial papers were already fully redeemed on November 30, 2012. The third issue of
commercial papers were already fully redeemed on December 3, 2012. The fourth issuance of
commercial paper was fully redeemed in June 20, 2014.

Debentures

The debentures issued by the Company, first, second and third issuance, described at table
18.5 of this Reference Form, were registered for trading in the secondary market and electronic
custody SND Mdulo Nacional de Debntures, managed and operated by CETIP.
18.7 Description of the securities admitted to trading in foreign markets
a. Country
United States of America.
b. Market
The ADRs of Mills are traded in the over-the-counter market (OTC) under CUSIP 60114T103,
ISIN BRMILSACNOR2 and ticker MILTY.
c. Administrative entity for the market in which securities are listed for trading
OTC (Over-The-Counter)
d. Date of listing for trading
Trading on OTC started on December 18, 2013.
e. Trading segment, if any
The ADRs of Mills are traded in the over-the-counter (OTC) market in the OTC Pink Current
Information segment.
f. Date of first listing on trading segment
On October 29, 2013, the Board of Directors approved the decision to establish the Sponsored
Level 1 American Depositary Receipt Program (Level I ADR Program), having Mills shares as
underlying assets.
The Level I ADR Program was approved by the Brazilian Securities and Exchange Commission
(CVM) on December 9, 2013 and by the U.S. Securities and Exchange Commission (SEC) on
December 11, 2013, with start of trading on December 18, 2013.
g. Percentage of trading volume overseas when compared to the total trading volume
for each class and type of security last year
There were no ADR trading in 2013. During 2014, 68,500 Mills ADRs were issued and 68,500
Mills ADRs were cancelled, according to total volume of trades of 68,500 ADRs.

h.

Proportion of certificates of deposit overseas, if any, when compared to each

class and type of shares

1:1 (one ADR for each common share).

i.
Depositary bank, if any
JPMorgan Chase Bank
j.

Trust agent, if any

Ita Unibanco S.A.

18.8 Securities issued abroad
None.

18.9
Description of the public offerings made by the Company or by third parties,
including controlling companies and subsidiaries, relating to the Companys securities
Public offerings of distribution of commercial promissory notes and debentures, with restricted
placement efforts
Promissory notes of first, second, third and fourth issue and the debentures of the first, second
and third issue were subject of public offerings, with restricted efforts of placement, in accordance
with CVM Instruction No. 476, of January 16, 2009, intended exclusively for qualified investors.
The first issue of commercial papers were already fully redeemed on April 28, 2011. The second
issue of commercial papers were already fully redeemed on November 30, 2012. The third issue
of commercial papers were already fully redeemed on December 3, 2012. The third issue of
commercial papers were already fully redeemed on June 20, 2014. All relevant characteristics of
these securities are described in section 18.5 of this Reference Form.
[18.10 If the issuer has made a public offering of securities, indicate: (a) how the proceeds
from the offering were used; (b) if there were relevant differences between the effective
use of resources and the proposals disclosed in the prospectus of distribution; (c) if there
were deviations, reasons for such deviations]
18.11

Description of takeover bids made by Company for shares issued by third parties

Not applicable, as the Company did not make takeover bids for shares issued by third parties.
18.12

Other information which the Company deems relevant

Promissory notes of the first issue, issued in a single series, now fully redeemed
a Identification of securities Forth issuance of commercial papers in a single series, now fully redeemed.
b Quantidade

20 Commercial Notes

c Total amount

Total Amount of R$200,000,000.00.

Issue Date

April 11, 2014

Maturity Date

August 8, 2014

e Restrictions on trading

The commercial notes were the subject of public distribution with restricted placement
efforts, pursuant to CVM Instruction 476, under the firm commitment and, consequently,
can only be traded between qualified investors. The trading restriction period laid down
in article 13 of that 90 days after the statement expired date of issue.

Not applicable. The fourth issue of promissory notes are not convertible into shares
issued by the company.

Convertibility

g Possibility of redemption:

(i)
Possibility
redemption

The Company shall, unilaterally, and that, for the purposes of the paragraph 2, article
7, CVM Instruction 134, the holders will have given their express prior consent,
irrevocably and irreversibly, at the moment of the subscription of the Notes in the primary
market or acquisition in the secondary market, as appropriate, perform, at any time, from
of the 31st (thirty first) day counted from the Issue Date. In case of partial early redemption,
the same will take place by lot, pursuant paragraph 4, article 7, CVM Instruction 134,
and all the steps in this process, such as license, qualification, verification and validation
of the number of Notes to be redeemed will be held outside of CETIP. The Company
shall communicate the holders, the Payment Agent and CETIP, about the redemption
with at least 2 (two) business days of the date of the event.

(ii) Assumptions and The amount to be paid by the Company to the holder of each commercial note of the
method of calculating the fourth issue corresponds to the nominal value of the commercial notes plus the
redemption value
remuneration, calculated pro rata temporis since the date of issue until the date of

effective payment, but without payment of prize or penalty, according to the terms and
conditions set forth in the notes.
h

if debt securities, indicate

where applicable:
Regular maturity August 8, 2014, when should be paid the value of the principal and the
remuneration (interest).
Subject to the provisions of the cartouches in Commercial Notes, the holder could
declare early maturity of the obligations under the Commercial Paper, and may demand
immediate payment of the Nominal Amount plus the remuneration, the occurrence of
any of the following events, provided in addition to other cartouches and those provided
by law (each event, an "Event of Default"): (i) declaration of acceleration of any other
Commercial Paper; (ii) default by the Company of any monetary obligation due under
the Commercial Paper; (iii) default by the Company of any non-pecuniary obligation due
(i)
maturity
date, under the Commercial Paper; (iv) sale, assignment or pledge any form of transfer or
including conditions for promise to transfer to third parties in whole or in part, by the Company of any of the
Obligations, without the prior consent in writing of the Holder; (v) transformation of the
acceleration
Company into a privately held Company or any other social arrangement; (vi) approval
of any corporate reorganization involving the Company, without the prior consent in
writing of the Holder; (vii) change in the Company's Control; (viii) Changing the corporate
purpose, unless such change does not result in changing the company's main activity;
(ix) acceleration of any financial obligation of the Company and/or any Subsidiary of the
Company, the value of which, individually or in aggregate, be less than R$ 5,000,000.;
(x) default by the Company due to mandatory early redemption of subscription and
payment of the Debentures, as provided under "Early Redemption" above, or (xi) the
Company does not use the net proceeds of the offering as described under "Use of
Proceeds" in the cartouche.
The Principal of each of the Notes shall not be subject to monetary adjustment. The
outstanding balance of the Principal of each Note shall bear interest at the rate of 106%
(one hundred and six percent) of accumulated variation of daily average rates of the
Interbank Deposits DI (DI Depsitos Interfinanceiros) for one day, over extra-group,
denominated in percentage form per annum, based on 252 (two hundred and fifty-two)
business days, calculated and disclosed by CETIP in its daily report available at its
website (http://www.cetip.com.br) ("DI Rate") ("Interest"), calculated on an exponential
and cumulative basis, pro rata temporis based on the number of business days elapsed
from the Date of Issuance to the effective payment date, and shall comply with the
calculation criteria of the "Caderno de Frmulas de Notas Comerciais e Obrigaes
CETIP21", available at CETIP's website (http://www.cetip.com.br). The Interest shall be
fully paid on the Maturity Date or on the date of the eventual early maturity, according to
the terms and conditions set forth in the Notes.

(ii) interest

(iii) guarantee and, if in

the form of collateral,
Not applicable. The fourth issue of promissory notes does not have collateral or surety.
description of the goods
used as collateral
(iv) in the absence of a
guarantee, if the credit is The credit of the promissory note is unsecured.
secured or subordinate
(v) possible restrictions
imposed on the issuer
The dividend distribution
The sale
assets

of

certain
See accelerated maturity conditions described above.

The possibility of new

debt
Tthe issue
securities

of

new

(vi) the fiduciary agent,

indicating the key terms Not applicable.
of the contract

Conditions
for
amendment of the rights The amendment of any rights conferred by each note issuance depends on commercial
conferred
by
such second holder approval.
securities

Other
characteristics

relevant

None.

Non-convertible Unsecured Debentures of First issuance of the Company

a

Identification of securities

Non-convertible Unsecured Debentures of First issuance single tranche

Quantity

27.000

Total amount

Total amount of R$270.000.000,00

(i) Issue date

April 18, 2011

(ii) Maturity date

April 18, 2016

Restrictions on trading

Yes. The debentures were the subject of public distribution with restricted placement efforts,
pursuant to CVM Instruction 476, under the firm commitment and, consequently, can only be traded
between qualified investors. The trading restriction period laid down in article 13 of that 90 days
after the statement expired date of issue

Convertibility

Not applicable.

Possibility of redemption

Not applicable.

(i) Assumptions and method

of
calculating
the Not applicable.
redemption value
h

If debt securities, indicate

where applicable:
Maturity date on April 18, 2016.
Payment of the nominal value of each debenture in 3 (three) successive yearly instalments, in the
following order: (i) 2 (two) instalments, each corresponding to matured 33.3333% of nominal value
(without considering any amortization) of each of the debentures, being the first installment of this
sub-item due in April 18, 2014 and the second installment of this sub-item due in April 18, 2015;
and (ii) 1 (one) installment, in the amount of the outstanding amount, due on the maturity date.
The obligations may be declared mature in advance, if the terms and conditions set forth in the

(i) Conditions
acceleration

Deed of Issue are maintained, in the occurrence of any of the events summarized below: I. Default
by non-payment of the Nominal Value, of Remuneration, premium, or any other amounts owed to
the debenture holders; V. assignment or pledge any form of transfer or promise of transfer to third
parties in whole or in part by the Company, any of its obligations under the Deed, without the prior
consent in writing of Debenture Holders representing at least 75% of the outstanding; VI. invalidity,
unenforceability or invalidity of the deed and / or the Distribution Agreement, is not remedied within
for 10 days from the date of the respective event; VII. (a) bankruptcy of the Company, and /or any of
its subsidiary or controlling Company; (b) voluntary bankruptcy application made by the Company
and / or any of its subsidiary or controlling Company; (c) bankruptcy filing by the Company, and /or
any of its subsidiary or controlling Company, formulated by others, not elided within legal; (d) petition
for judicial or extrajudicial recovery of the Company and /or any of its subsidiary or controlling
Company, regardless of approval of the request; or (e) liquidation, dissolution or extinction of the
Company, and /or any of its subsidiary or controlling Company, unless the liquidation, dissolution
and / or extinction during the course of a corporate transaction which does not constitute an Event
of Default; VIII. changing the company into a limited liability company, pursuant to articles 220 to
222 of Law No. 6,404/76;IX. approval of incorporation, merger or split of the company or sale, by
the company, of all or substantially all of its assets or its mining properties, with some exceptions:
(a) if the transaction has been approved in advance by the Debenture Holders representing at least
75% of the outstanding Debentures; or (b) if the Debenture Holders that wish to do so, be assured
that, during the minimum period of six months from the date of publication of the minutes of
corporate acts in the transaction, the redemption of the Debentures held by them, by paying the
outstanding balance of the Nominal Value, plus Remuneration, calculated pro rata from the Issue
Date or the date of payment of compensation immediately preceding, whichever is applicable until
the date of actual payments; or (c) by the incorporation of the Company (so that the Company is

the remaining entity), of any Subsidiary; or (d) if the operation is carried out solely between
Subsidiaries; X. capital reduction, except if previously approved by Debenture Holders representing
at least 75% of the outstanding Debentures, pursuant to Article 174, paragraph 3, of Law No.
6,404/76; XI. change or transfer of control (as defined under Article 116 of Law No. 6,404/76), direct
or indirect, of the Company, from any Controlling Company and / or any Subsidiary, except if
previously approved by Debenture Holders representing at least 75% of the outstanding
Debentures; XV. early maturity of any financial obligation of the Company and / or any Subsidiary,
which amount, individual or aggregate, is equal to or greater than R$ 5,000,000.00 or its equivalent
in other currencies, and/or occurrence of any event or default of any obligation which, after the
expiration of any period provided in their document, or in other cases, within 10 days from the date
of their default, give rise to the declaration of acceleration any financial obligation of the Company
and / or any Subsidiary, which amount, individual or aggregate, is equal to or greater than R$
5,000,000.00 or its equivalent in other currencies.
The face value of the debentures of the first issue will not be monetarily updated.
Interest paid semi-annually will account for 112.5% of the accumulated variation of the interest rate
of CDI.

(iii)

interest

The remuneration provided above shall be paid every six months from the date of issue, being the
first payment on October 18, 2011, and the last payment of the maturity date, or on the date of any
settlement.
In case of payment after the deadline of any amount due in respect of any obligation under the
Commercial Papers, on any and all amounts in arrears would address, without notice, notification
or judicial or extrajudicial, and subject to the Remuneration, calculated pro rata from the date of
default to the date of actual payment, (i) fines of 2% (two percent), and (ii) interest of 1% (one
percent) per month or fraction of a month, calculated pro rata from the date of default until the date
of actual payment

(iii) guarantee and, if in the

form
of
collateral,
Not applicable. The first issue of debentures does not have collateral or surety.
description of the goods
used as collateral
(iv) in the absence of a
guarantee, if the credit is The Debentures will be unsecured, in accordance with Article 58, caput of the Law No. 6,404/76.
secured or subordinate
(v) possible
restrictions
imposed on the issuer
The dividend distribution
The sale of certain assets

See terms of acceleration

The possibility of new debt

The issue of new securities
Name: Pentgono S.A. Distribuidora de Ttulos e Valores Mobilirios.
Remuneration: The performance of duties and tasks assigned to compete in accordance with the
law and its deed of issue, the fiduciary agent, or the institution which will replace him in that capacity,
he shall receive a remuneration: (i) R$13,000.00 per year, due from the company, being the first
instalment of remuneration payable within 30 days from the date of conclusion of the deed of issue,
and the other, on the same day of subsequent years; (ii) Additionally, in the event of a close-out
netting of obligations of the company under the debentures of the first emission, equivalent to
R$500.00 per hour-working man devoted to activities related to the issue and the debentures, to be
paid within 5 days from the date of attestation of delivery by the trustee and approval by the
(vi) the fiduciary agent, company, of the report, concerning hours of activities (a) advice to debenture holders in the process
indicating the key terms of of renegotiation required by the company; (b) attendance at formal meetings with the company
and/or debenture holders and/or general meetings of debenture holders; and (c) implementation of
the contract
the decisions taken by the debenture holders (iii) brought out yearly since the date of payment of
the first annual instalment by the change in the general price index-market, published by Fundao
Getlio Vargas, or by any other that eventually is replaced, calculated pro rata temporis, if
necessary; (iv) plus the sales tax of any kind TAXES, contributing to the Social Integration
Program PIS, Social contribution on net income CSLL, contributing to the financing of Social
Security COFINS and any other taxes that may relate to the remuneration payable to the trustee,
except for tax on income and proceeds of Any Nature GOunder existing rates for the dates of
each payment; (v) due to maturity, redemption or cancellation of debentures of the first issue, and
even after its maturity, redemption or cancellation in the event of actions of the trustee in charge of
any defaults on bonds not remedied by the company, in cases where the remuneration payable to
the trustee shall be calculated in proportion to the months of operation of the fiduciary agent, based

on the value specified in item i, readjusted as the paragraph iii; and (vi) plus, where lives in your
payment, regardless of notice, judicial or extrajudicial notification or notification, on the values
arrears, (a) fine 2 moratorium; and (b) interest on arrears of 1 month, calculated pro rata temporis
since the date of default until the payment date.
Reimbursement of expenses: the Trustee shall be repaid by the company for all reasonable costs
incurred that have proven to protect the rights and interests of the debenture holders or to perform
their claims within 30 (thirty) days from the delivery of the evidentiary documents accordingly,
provided that, where possible, the costs have been approved in advance by the company, which
shall be deemed to be approved if the company does not appear within 2 (two) working days from
the date of receipt of their request by fiduciary agent.
Obligations: The fiduciary agent, as provided for in the deed of issue, will have the functions laid
down in the law and in accordance with the rules and regulations of the Securities and Exchange
Commission, and use of any action to protect rights or defend interests of the debenture holders.
Replacement: In case of absence, temporary impediments, renunciation, intervention, judicial or
extrajudicial settlement, bankruptcy, or any other case of vacancy in the fiduciary agent, the
following rules shall apply: (i) is provided to debenture holders, after the closing of the offer of the
debentures of the first issue, proceed with the replacement of the trustee and the indication of his
replacement, general meeting of debenture holders especially convened for this purpose; (ii) if the
Trustee is unable to continue to perform their duties by supervening circumstances to the deed of
issue, shall immediately communicate the fact to debenture holders, requesting his replacement
and convene a general meeting of debenture holders for this purpose; (iii) if the fiduciary agent,
renounces functions, should remain in the exercise of their duties until a replacement is indicated
by the institution and approved by general meeting of debenture holders, and assume their functions
effectively; (iv) shall be performed, within the maximum period of 30 (thirty) days from the date of
the event that determine, general meeting of debenture holders, for choosing the new fiduciary
agent; (v) replacement, on a permanent basis, the fiduciary agent (a) shall be subject to prior
notification to the CVM and its manifestation on the attendance to the requirements provided for in
article 9 of CVM Instruction No. 28, November 23, 1983, as amended, and (b) shall be subject to
the addition to the deed of issue; payments to the trustee replaced shall be effected in accordance
with the proportionality to the period of effective service delivery; (vi) the trustee will be entitled to
the same salary replacement perceived by the previous, if (a) the company has not agreed with the
new value of the remuneration of the trustee proposed by general meeting of debenture holders, or
(b) the general meeting of debenture holders does not act on the matter; (vii) the fiduciary agent
should substitute, immediately after his appointment, communicate it to the company and to
debenture holders; and (viii) shall apply to cases of substitution of Trustee the norms and precepts
from the Securities and Exchange Commission.
During deliberations of the General Meetings of debenture holders for each of the series, for each
outstanding Debenture one vote will be granted, permitting the establishment of proxy, whether
Debenture holder or not. Except for the provisions below, all deliberations to be taken in the General
Meeting of debenture holders will depend on approval of debenture holders representing at least
75% of outstanding Debentures.
i

Conditions for amendment

of the rights conferred by Not included in the quorum above are: I. quorums expressly provided for in other clauses of the
deed of issue; and II. changes, which should be approved by debenture holders representing at
such securities
least 90% of outstanding Debentures: (a) of the provisions of this clause; (b) of the quorums for
approval provided for in the Deed of issue; (c) the remuneration, except as provided in Clause of
the Deed of issuance; (d) any dates for payment of any amounts provided for in the Deed of
issuance; (e) of the term of the Debentures; (f) of the type of Debentures; (g) creation of a repricing
event; (j) of any Event of Default.
Other
characteristics

relevant

None.

Non-convertible Unsecured Debentures of Second issuance of the Company

a

Identification of securities

Non-convertible Unsecured Debentures of second issuance double series

Quantity

27.000

Total amount

Total amount of R$270.000.000,00

(i) Issue date

15 de agosto de 2012
1st series: August 15, 2017.

(ii) Maturity Date

2nd series: August 15, 2020.
e

Restrictions on trading

Yes. The debentures were subject of public distribution with restricted placement efforts, pursuant
to CVM Instruction 476, under the firm commitment to the placement of 20,000 debentures, and

under the best-efforts placement in relation to the remaining debentures. The debentures can only
be traded between qualified investors and after a 90 days period from the date of subscription or
purchase according to the articles 13 and 15 of CVM Instruction 476, and compliance by the
Company of its obligations under Article 17 of CVM Instruction 476.
f

Convertibility

Not applicable.

Possibility of redemption

Not applicable.

(i) Assumptions and method

of
calculating
the Not applicable.
redemption value
h

If debt securities, indicate

where applicable:
Maturity date of the first series on August 15, 2017.
Payment of the nominal value of each first series debenture in 2 (two) successive yearly
installments, each one corresponding to matured 50% (fifty percent) of nominal value of each of
the debentures of the first series, being the first installment due in August 15, 2016 and the second
installment on the maturity date of the first series.
The obligations may be declared mature in advance, if the terms and conditions set forth in the
Deed of Issue.
Maturity date of the second series on August 15, 2020.
Payment of the nominal value of each second series debenture in 3 successive yearly installments,
in the following order: (a) 2 installments, each corresponding to matured 33.33% of nominal value
of each of the debentures of the second series monetarily adjusted, due to August 15, 2018 and
August 15, 2019; and (b) 1 installment, in the amount of the outstanding amount of nominal value
of each of the debentures of the second series monetarily adjusted, due to the maturity date of
second series debenture.

(i) Conditions
acceleration

The obligations may be declared mature in advance, on the terms and conditions set forth in the
Deed of Issue, in the occurrence of any of the events summarized below: I. Default by the Company
of any financial obligation on the Debentures, due under the Deed of Issue, at the date of payment
provided for in the Deed of Issue; II. Default by the Company of any non-financial obligation on the
Debentures foreseen in the Deed of Issue (a) that is not properly solved within specific remedy; or
(b) not having specific term remediation, if it is not properly solved within 15 days from the date of
such default, being the period provided in this subsection does not apply to obligations to which it
has a deadline stipulated or specific cure for which the period of cure has been expressly excluded;
III. judicial questioning by the Company for any controlling company, directly or indirectly (controlling
as defined in article 116 of the Corporate Law) of the Company (Controlling), and / or controlled
company (controlled as defined in article 116 of the Corporate Law) by the Company (Controlled),
for
of the Issue of Deed; IV. judicial questioning by any person not mentioned in section III above, the
Issue of Deed, suspended or not remedied within 15 days from the date on which the Company
becomes aware of the judging of such legal challenge; V. assignment or pledge any form of transfer
or promise of transfer to third parties in whole or in part by the Company, any of its obligations
under the Deed, without the prior consent in writing of Debenture Holders representing at least 75%
of the outstanding; VI. invalidity, unenforceability or invalidity of the Deed and/or the Distribution
Agreement, is not remedied within 15 days from the date of the respective event; VII. (a) bankruptcy
of the Company, and/or any of its subsidiary or controlling Company; (b) voluntary bankruptcy
application made by the Company and / or any of its subsidiary or controlling Company; (c)
bankruptcy filing by the Company, and/or any of its subsidiary or controlling Company, formulated
by others, not suppressed within the legal deadline; (d) petition for judicial or extrajudicial recovery
of the Company and /or any of its subsidiary or controlling Company, regardless of approval of the
request; or (e) liquidation, dissolution or extinction of the Company, and/or any of its subsidiary or
controlling Company, unless the liquidation, dissolution and/or extinction during the course of a
corporate transaction which does not constitute an Event of Default, pursuant to section IX below;
VIII. changing the company into a limited liability company, pursuant to articles 220 to 222 of Law
No. 6,404/76; IX. approval of incorporation, merger or split of the company or sale, by the company,
of all or substantially all of its assets or its mining properties, with some exceptions: (a) if the
transaction has been approved in advance by the Debenture Holders representing at least 75% of
the outstanding Debentures; or (b) if the Debenture Holders that wish to do so, be assured that,
during the minimum period of 6 months from the date of publication of the minutes of corporate acts
in the transaction, the redemption of the Debentures held by them, by paying the outstanding
balance of the Nominal Value, plus Remuneration, calculated pro rata from the Issue Date or the
date of payment of compensation immediately preceding, whichever is applicable until the date of
actual payments; or (c) by the incorporation of the Company (so that the Company is the remaining
entity), of any Subsidiary; or (d) if the operation is carried out solely between Subsidiaries; X. capital
reduction, except if previously approved by Debenture Holders representing at least 75% of the
outstanding Debentures, pursuant to Article 174, paragraph 3, of Law No. 6,404/76; XI. change or
transfer of control (as defined under Article 116 of Law No. 6,404/76), direct or indirect, of the
Company, from any Controlling Company and / or any Subsidiary, except if previously approved by

Debenture Holders representing at least 75% of the outstanding Debentures; XII. amendment of
the Company's purposes and / or any Subsidiary, as provided in its bylaws or social contract as
applicable, in effect on the Issue Date, unless such amendment: (a) if the transaction has been
approved in advance by the Debenture Holders representing at least 75% of the outstanding
Debentures; (b) does not lead to a change in the principal activity of the Company or its Subsidiary;
XIII. non-renewal, cancellation, revocation or suspension of licenses and permits, including
environmental, required by the competent bodies to carry out regular activities of the Company,
since its effects have not solved or suspended within 15 days from the date of its non-renewal,
cancellation, revocation or suspension respective (s) permit (s) or license (s); XIV. occurrence of
any event that causes (a) in relation to the Company, (i) any material adverse effect on the condition
(financial or of any nature), business, property, results of operations and/or prospects; (ii) any
adverse effect on the powers or legal capacity and/or economic-financial to fulfill any of the
obligations under the Deed of Issue, and/or (iii) any event or condition that, after the deadline,
formal notice, or both, may result in a Default event, or (b) with respect to Deed of Issue, any
adverse effect on (i) the proper execution, legality, validity and / or enforceability of the obligations
documents, and / or (ii) the rights contained in the Debenture Deed of Issue, since it has not solved
its effects or suspended within 15 days from the date of knowledge of event the Company ("Material
Adverse Effect"); XV. non maintenance by the Company and/or any Subsidiary, insurance, as the
current best practices in the market segment of the Company with respect to its material operating
assets, not solved within 15 days from whatever happens first: (a) the date on which the Company
becomes aware of the event, and promptly notifies the Fiduciary Agent or (b) the date on which the
Company receives written notice from the Fiduciary Agent; XVI. early maturity of any financial
obligation of the Company and/or any Subsidiary, which amount, individual or aggregate, is equal
to or greater than R$ 10,000,000.00, annually updated, from the Issue Date, by the positive
variation of the IPCA, or its equivalent in other currencies, and / or the occurrence of any event or
default of any obligation which, after the expiration of any cure period provided for in the respective
document, may give rise, immediately the declaration of acceleration of any financial obligation of
the Company and/or any Subsidiary, which amount, individual or aggregate, is equal to or greater
than R$ 10,000,000.00, annually updated, from the Issue Date, by the positive variation of the
IPCA, or its equivalent in other currencies XVII. securities protest against the Company and / or
any Subsidiary, which amount, individual or aggregate, is equal to or greater than R$
10,000,000.00(ten million reais), annually updated, from the Issue Date, by the positive variation of
the IPCA, or its equivalent in other currencies, unless, within 10 (ten) days from the date of their
protest has been proven that (a) the protest has been made in error or bad faith of the third and
was taken to the appropriate judicial order restraining or cancellation of their effects; b) the protest
was canceled, or (c) the value (s) of title (s) protested (s) was deposited in court; XVIII. default by
the Company and / or any subsidiary of any decision or final court judgment or any judgment or
arbitral award not subject to appeal against the Company and / or any Subsidiary, which amount,
individual or aggregate, is equal to or greater than R$ 10,000,000.00, annually updated, from the
Issue Date, by the positive variation of the IPCA, or its equivalent in other currencies, not paid within
the stipulated payment for their decision or judgment XIX. attachment or sequestration of assets of
the Company and / or any Subsidiary, which amount, individual or aggregate, is equal to or greater
than R$ 10,000,000.00, annually updated, from the Issue Date, by the positive variation of the
IPCA, or its equivalent in other currencies, unless, within ten days from the date of their arrest or
abduction, has been proven that the arrest or abduction was challenged or replaced by other
security; XX. expropriation, confiscation or any other measure of any governmental entity in any
jurisdiction that results in loss by the Company and / or any Subsidiary of the property and / or the
direct or indirect ownership of a substantial portion of its assets; XXI. sale, assignment, or alienation
in any form or constitution of mortgage, pledge, lien, Fiduciary assignment agreement, usufruct,
trust, promise to sell, purchase option, right of first refusal, charge, encumbrance or onus, judicial
or extrajudicial, voluntary or involuntary, or any other action which has the practical effect similar to
any of the above expressions ("Onus"), whether in a single transaction or a series of transactions,
related or not, on assets of the Company and/or any subsidiary amounting more than 15% of the
total assets of the Company, based on the latest Company's Consolidated Financial Statements
(as defined in Section 7.1 of Deed of Issue), unless (a) if the transaction has been approved in
advance by the Debenture Holders representing at least 75% of the outstanding Debentures; or (b)
the establishment of liens on any asset acquired by the Company or any Subsidiary, provided that
the lien consists exclusively on assets acquired and to finance the acquisition of such asset; XXII.
verifying that any of the statements made by the Company in the Issue Deed and / or the
Underwriting Agreement is false, inconsistent, inaccurate, incomplete, insufficient or incorrect in
any material respect, not cured within ten (10) days from the earlier of (a) the date upon which the
Company is aware of the incorrectness or (b) the date upon which the Company receives written
notice from the Fiduciary Agent; XXIII. non-use by the Company, the net resources obtained of the
Issue strictly in terms the Deed of Issue; XXIV. distribution and/or payment by the Company of
dividends, interest on capital or other distributions of profits to shareholders, if the Company is in
default of any of its obligations under the Issuance Deed, except for the payment of dividend must
not exceed 25% of net income under Article 202 of the Corporations Act, except for the payment of
the mandatory dividend of no more than 25% of net income under Article 202 of the Law No.
6,404/76, and XXV. non-compliance by the Company of any financial ratios below ("ndices
Financeiros"), to be determined by the Company under the Deed of Issue and verified by the
Fiduciary agent within 10 days from the date of receipt by the Fiduciary agent, the information
referred to the Deed of Issue based on the Consolidated Financial Statements of the Company for
each quarter of the calendar year, from and including the Consolidated Financial Statements of the
Company on December 31, 2012: (a) the financial index due to the quotient of dividing Net Debt
(as defined in the Issue Deed) to EBITDA (as defined in the Issue Deed), which must be less than

or equal to 3 and (b) the financial index due to the quotient of dividing EBITDA by Net Financial
Expenses (as defined in the Issue Deed), which should be equal or higher than 2.

The remuneration of each of the First Series Debentures will be as follows:

I. Monetary Adjustment: The nominal value of the debentures of the first issue will not be monetarily
updated.
II. Compensatory Interests: On the nominal value of each of the First Series Debentures will incur
interest corresponding to 100% of the cumulative variation of the DI rate plus surcharge of 0.88%
(eighty-eight per cent) per year.

(ii) interest

Notwithstanding the payments due to early redemption of the First Series Debentures and/or
acceleration of the obligations under the Debentures, pursuant to the Deed of Issue, the First Series
Compensation will be paid semiannually from the Issue Date, with the first payment on February
15, 2013 and the last, on the maturity date of the First Series.
The remuneration of each of the Second Series Debentures will be as follows:
I. Monetary Adjustment: The nominal of each Second Series Debentures will be adjusted by the
National Index of Consumer Prices Broad, released by the Brazilian Institute of Geography and
Statistics ("IPCA"), since the Issue Date until the date of actual payment, being the update
incorporated into the Nominal value of each Second Series Debentures automatically ("Second
Series Monetary Adjustment"). Notwithstanding the payments due to early redemption of the
Debentures and/or acceleration of the obligations under the Debentures, pursuant to the Deed of
Issue, the Second Series Monetary Adjustment will be paid on the same dates and the same
amount of amortization of nominal value of each Second Series Debentures, as provided in the
Deed of Issue.

(iii) guarantee and, if in the

form
of
collateral,
Not applicable. The first issue of debentures does not have collateral or surety.
description of the goods
used as collateral
(iv) in the absence of a
guarantee, if the credit is The Debentures will be unsecured, in accordance with Article 58, caput of the Law No. 6,404/76.
secured or subordinate
(v) possible
restrictions
imposed on the issuer
The dividend distribution
The sale of certain assets
The possibility of new debt
The issue of new securities

See terms of acceleration.

Name: Pentgono S.A. Distribuidora de Ttulos e Valores Mobilirios.

Compensation: The performance of duties and tasks assigned to compete in accordance with the
law and its deed of issue, the fiduciary agent, or the institution which will replace him in that capacity,
shall receive a remuneration: (i) R$3,500.00 per year, due from the company, being the first
installment of remuneration payable on the fifth business day following the date of celebration of
the deed of issue, and the remaining, on the same day of subsequent years, until the maturity of
the issue, or as long as the fiduciary agent is representing the debentures holders interests;(ii)
monetary adjustment yearly from the date of payment of the first annual instalment by the change
in the general price index-market, published by Fundao Getlio Vargas, or by any other that
eventually is replaced, calculated pro rata temporis, if necessary; (iii) plus the sales tax of any kind
TAXES, contributing to the Social Integration Program PIS, Social contribution on net income
CSLL, contributing to the financing of Social Security COFINS and any other taxes that may
relate to the remuneration payable to the trustee, except for tax on income and proceeds of Any
Nature go under existing rates for the dates of each payment; (iv) due to maturity, redemption or
cancellation of debentures, and even after its maturity, redemption or cancellation in the event of
actions of the trustee in charge of any defaults on debentures not remedied by the Company, in
cases where the remuneration payable to the fiduciary agent shall be calculated in proportion to
the months of operation of the fiduciary agent, based on the value specified in item i, readjusted as
the paragraph ii above; (v) plus, in cases of delay in payment, regardless of notice, judicial or
extrajudicial notification, on the delinquent amounts, without prejudice to monetary restatement, (a)
interest for late payment of 1% per month, calculated pro rata temporis since the date of default
until the date of actual payment; (b) moratorium fine of 2%, non-compensatory and rigid; (c)
restatement by IGPM variation, calculated pro rata from the date of default until the date of actual
payment; and (vi) realized upon deposit held in the current account to be specified in writing by the
Fiduciary Agent to the Company, serving the receipt as settlement of payment.
Reimbursement of expenses: the Fiduciary Agent shall be refunded by the company for all
reasonable costs incurred that have proven to protect the rights and interests of the debenture
holders or to perform their claims within 30 days from the delivery of the evidentiary documents
accordingly, provided that, where possible, the costs have been approved in advance by the
company, which shall be considered approved if the company does not appear within 2 working
days from the date of receipt of their request by the Fiduciary Agent.
(vi) the fiduciary agent,
indicating the key terms of Obligations: The Fiduciary Agent, as provided for in the deed of issue, will have its duties
established in the law and in accordance with the rules and regulations of the Securities and
the contract
Exchange Commission of Brazil (CVM), and use of any action to protect rights or defend interests
of the debenture holders.
Replacement: In case of absence, temporary impediments, renunciation, intervention, judicial or
extrajudicial settlement, bankruptcy, or any other case of vacancy in the fiduciary agent, the
following rules shall apply: (i) is provided to debenture holders, after the closing of the offer, to
proceed with the replacement of the fiduciary agent and the indication of its replacement at general
meeting of debenture holders especially convened for this purpose; (ii) if the fiduciary agent is
unable to continue to perform its duties by supervening circumstances to the deed of issue, shall
immediately communicate the fact to debenture holders, requesting its replacement and convene
a general meeting of debenture holders for this purpose; (iii) if the fiduciary agent, renounces its
functions, should remain in the exercise of its duties until another institution is indicated by the
Company for its replacement and approved by general meeting of debenture holders, and assume
their functions effectively; (iv) shall be performed, within the maximum period of 30 days from the
date of the event that determine, general meeting of debenture holders, for choosing the new
fiduciary agent, that may be called by the fiduciary agent to be replaced, by the Company, by
debenture holders of the first series representing at least 10% of the debentures of the first series
in circulation, or for debenture holders of the second series representing at least 10% of the second
series ' debentures in circulation, or by CVM; in the event of convocation notice do not occur within
15 days before the expiration of the time limit here predicted, it will be up to the Company making
it, being sure that the CVM may appoint interim replacement pending consummating the process
of choosing the new trustee; (v) replacement, on a permanent basis, of the fiduciary agent (a) shall
be subject to prior notice to the CVM and its manifestation on the attendance to the requirements
provided for in article 9 of CVM Instruction No. 28, November 23, 1983, as amended, and (b) shall
be subject to the addition to the deed of issue; (vi) payments to the fiduciary agent replaced shall
be effected in accordance with the proportionality to the period of effective service delivery; (vii) the
fiduciary agent will be entitled to the same compensation of the perceived by the previous, if (a) the
company has not agreed with the new value of the remuneration of the fiduciary agent proposed
by general meeting of the debenture holders, referred to in item iv above, or (b) the general
meeting of debenture holders referred to in item iv above does not act on the matter; (vii) the
fiduciary agent should replace, immediately after his appointment, communicate it to the company
and to debenture holders; and (viii) shall apply to cases of substitution of fiduciary agent the norms
and precepts from the Brazilian Securities and Exchange Commission (CVM).

During deliberations of the General Meetings of first series debenture holders and General
Meetings of second series debenture holders, for each outstanding Debenture one vote will be
granted, permitting the establishment of proxy, whether Debenture holder or not. Except for the
provisions below, (i) all deliberations to be taken in the General Meeting of debenture holders will
depend on approval of debenture holders of the first series representing at least 75% of outstanding
First Series Debentures; and (ii) all deliberations to be taken in the General Meeting of debenture
holders will depend on approval of debenture holders of the second series representing at least
75% of outstanding Second Series Debentures.
i

Conditions for amendment

of the rights conferred by Not included in the quorum above are: (i) quorums expressly provided for in other clauses of the
deed of issue; and (ii) changes, which should be approved by debenture holders of the first series
such securities
representing at least 90% of outstanding first series debentures and by debenture holders of the
second series representing at least 90% of outstanding second series debentures, (a) of the
provisions of this clause; (b) of the quorums for approval provided for in the Deed of issue; (c) the
remuneration, except for changes resulting from extinction, limitation and / or non-disclosure of the
DI rate or IPCA, as provided in Clause of the Deed of issuance; (d) any dates for payment of any
amounts provided for in the Deed of issuance; (e) of the term of the Debentures; (f) of the type of
Debentures; (g) creation of a repricing event; (h) the provisions relating to optional early redemption;
(i) the provisions relating to early amortization (j) of any Event of Default.
Other
characteristics

relevant

None.

Non-convertible Unsecured Debentures of Third issuance of the Company

Securities
Identification
securities

Debentures
Non-convertible
of Unsecured Debentures of
third issuance single
series

Quantity

20,000

Total amount

R$ 200,000,000.00

Issue date

May 30, 2014

Maturity date

May 30, 2019

Restrictions
trading

Yes. The debentures were

subject
of
public
distribution with restricted
placement
efforts,
pursuant
to
CVM
Instruction 476, under the
firm commitment to the
placement
of
20,000
debentures, and under the
best-efforts placement in
relation to the remaining
on debentures.
The
debentures can only be
traded between qualified
investors and after a 90
days period from the date
of
subscription
or
purchase according to the
articles 13 and 15 of CVM
Instruction
476,
and
compliance
by
the
Company of its obligations
under Article 17 of CVM
Instruction 476.

Convertibility
Possibility
redemption

Not applicable
of

Yes

The Company may, at its

sole discretion, make, at
Assumptions and any time, optional early
method
of redemption offer, total or
calculating
the partial, of the outstanding
redemption value
Debentures, with the
consequent cancellation
of
such
Debentures,

which will be sent to all

Bondholders,
without
distinction, assured equal
conditions
to
all
Bondholders to accept the
early redemption of the
Debentures held by them,
through an Optional Early
Redemption Offer. The
amount to be paid in
respect
of
each
Debenture indicated by
their respective holders
into joining the Optional
Early Redemption Offer
will be equal to the
outstanding balance of the
Par Value, plus (a)
Remuneration, calculated
pro rata from the date
issuance or payment date
immediately
preceding
Compensation,
as
appropriate, until the date
of actual payment; and (b)
if
applicable,
the
redemption premium to be
offered
to
the
Bondholders, at the sole
discretion
of
the
Company, which cannot
be negative redemption.
If debt securities,
indicate
where
applicable:
i. Conditions for
acceleration

ii.

Interest

For more information on

maturity date, please refer
to item 18.10 below.
I. Monetary Adjustment:
The nominal value of the
debentures of the third
issue
will
not
be
monetarily updated.
II. Compensatory Interest:
on
the
outstanding
balance of the Nominal
Value of the Debentures
outstanding focus interest
corresponding to 108.75%
(one
hundred
and
seventy-eight point five
percent)
of
the
accumulated variation of
average
daily DI
Interbank Deposits one
day,
calculated
and
published daily by CETIP
in the daily bulletin on its
website
(http://
www.cetip.com.br)
calculated exponentially
and cumulatively pro rata
by days elapsed from the
Issue Date or payment
date
immediately
preceding Compensation
form as the case until the
date of actual payment.
Without prejudice to the
payments related to early
redemption
of
the
Debentures and / or early
maturity of obligations on
the
Debentures,
the

remuneration
will
be
payable
semiannually
from the Issue Date, on
the 30th of May and
November of each year,
with the first payment on
November 30, 2014 and
the last on the Maturity
Date.
iii.
guarantee
and, if in the form of
collateral,
description of the
goods used as
collateral
iv.
in
the
absence
of
a
guarantee, if the
credit is secured or
subordinate
v.
possible
restrictions
imposed on the
issuer

dividend
distribution

Not applicable. The third

issue of debentures does
not have collateral or
surety.
The Debentures will be
unsecured, in accordance
with Article 58, caput of
the Law No. 6,404/76.

the

See terms of acceleration

the sale described in item 18.10

of certain assets
below.

the
possibility of
debt

new

the issue
of new securities
vi the fiduciary
For more information on
agent, indicating
the fiduciary agent, please
the key terms of the
refer to item 18.10 below.
contract
During deliberations of the
General
Meetings
of
debenture holders, for
each
outstanding
Debenture one vote will
be granted, permitting the
establishment of proxy,
whether Debenture holder
or not. Except for the
provisions below, (i) all
deliberations to be taken
in the General Meeting of
debenture holders will
depend on approval of
Conditions
for
debenture holders of the
amendment of the
first series representing at
rights conferred by
least 75% of outstanding
such securities
First Series Debentures;
and (ii) all deliberations to
be taken in the General
Meeting of debenture
holders will depend on
approval of debenture
holders of the second
series representing at
least 75% of outstanding
Second
Series
Debentures.
Not included in the
quorum above are: (i)

quorums
expressly
provided for in other
clauses of the deed of
issue; and (ii) changes,
which should be approved
by debenture holders
representing at least 90%
of
outstanding
debentures, (a) of the
provisions of this clause;
(b) of the quorums for
approval provided for in
the Deed of issue; (c) the
remuneration, except for
changes resulting from
extinction, limitation and /
or non-disclosure of the DI
rate or IPCA, as provided
in Clause of the Deed of
issuance; (d) any dates for
payment of any amounts
provided for in the Deed of
issuance; (e) of the term
of the Debentures; (f) of
the type of Debentures;
(g) creation of a repricing
event; (h) the provisions
relating to optional early
redemption;
(i)
the
provisions relating to early
amortization (j) of any
Event of Default.
Other
relevant
None
characteristics
a

Identification of securities

Non-convertible Unsecured Debentures of third issuance single series

Quantity

20.000

Total Amount

Total amount of R$ 200.000.000,00

(i) Issue date

May 30, 2014

(ii) Maturity date

May 30, 2019

Restrictions on trading

Yes. The debentures were subject of public distribution with restricted placement
efforts, pursuant to CVM Instruction 476, under the firm commitment to the
placement of 20,000 debentures, and under the best-efforts placement in relation to
the remaining debentures. The debentures can only be traded between qualified
investors and after a 90 days period from the date of subscription or purchase
according to the articles 13 and 15 of CVM Instruction 476, and compliance by the
Company of its obligations under Article 17 of CVM Instruction 476.

Convertibility

Not applicable.

Possibilidade de resgate,
Como descrito no item 18.5.
indicando:
(i) hipteses de resgate e
forma de clculo do valor Como descrito no item 18.5.
de resgate

Quando
os
valores
mobilirios
forem
de
dvida, indicar, quando
aplicvel:

O prazo das Debntures ser de 5 (cinco) anos, contados da Data de Emisso,

vencendo-se, portanto, em 30 de maio de 2019.
Pagamento do Valor Nominal das Debntures e ser amortizado em 3 (trs)
parcelas anuais e sucessivas, cada uma no valor correspondente a 33,33% (trinta
e trs inteiros e trinta e trs centsimos por cento) do Valor Nominal, devidas em
30 de maio de 2017, 30 de maio 2018 e 30 de maio 2019Podero ser declaradas
antecipadamente vencidas as obrigaes da Cia, observados os termos e
condies estabelecidos na Escritura de Emisso, na ocorrncia de quaisquer dos
alguns eventos resumidos a seguir: I. Inadimplemento, pela Companhia, de
qualquer obrigao pecuniria relativa s Debntures, devida nos termos da
Escritura de Emisso, na respectiva data de pagamento prevista na Escritura; II.
inadimplemento, pela Companhia, de qualquer obrigao no pecuniria prevista
na Escritura, que (a) no seja devidamente sanado no prazo de remediao
especfico; ou (b) em no havendo prazo de remediao especfico, no seja
devidamente sanado no prazo de 15 (quinze) dias contados da data do respectivo
inadimplemento, sendo que o prazo previsto neste inciso no se aplica s
obrigaes para as quais tenha sido estipulado prazo de cura especfico ou para as
quais o prazo de cura tenha sido expressamente excludo; III. Questionamento
judicial, pela Companhia, por qualquer sociedade controladora, direta ou indireta
(conforme definio de controle prevista no artigo 116 da Lei das Sociedades por
Aes) da Companhia ("Controladora"), e/ou por qualquer sociedade controlada
(conforme definio de controle prevista no artigo 116 da Lei das Sociedades por
Aes) pela Companhia ("Controlada"), da Escritura de Emisso; IV.
questionamento judicial, por qualquer pessoa no mencionada no inciso III acima,
da Escritura de Emisso, no sanado ou suspenso no prazo de at 15 (quinze) dias
contados da data em que a Companhia tomar cincia do ajuizamento de tal
questionamento judicial; V. cesso, promessa de cesso ou qualquer forma de
transferncia ou promessa de transferncia a terceiros, no todo ou em parte, pela
Companhia, de qualquer de suas obrigaes nos termos da Escritura de Emisso,
sem a prvia anuncia, por escrito, de Debenturistas representando, no mnimo,
75% (setenta e cinco por cento) das Debntures em circulao; VI. Invalidade,
nulidade ou inexequibilidade da Escritura de Emisso e/ou do Contrato de
Distribuio, no sanada no prazo de 15 (quinze) dias contados da data do
respectivo evento; VII. (a) decretao de falncia da Companhia, de qualquer
Controladora e/ou de qualquer Controlada; (b) pedido de autofalncia formulado
(i) vencimento, inclusive pela Companhia, por qualquer Controladora e/ou por qualquer Controlada;
as
condies
de (c) pedido de falncia da Companhia, de qualquer Controladora e/ou de qualquer
vencimento antecipado
Controlada, formulado por terceiros, no elidido no prazo legal; (d) pedido de
recuperao judicial ou de recuperao extrajudicial da Companhia, de qualquer
Controladora e/ou de qualquer Controlada, independentemente do deferimento do
respectivo pedido; ou (e) liquidao, dissoluo ou extino da Companhia, de
qualquer Controladora e/ou de qualquer Controlada, exceto se a liquidao,
dissoluo e/ou extino decorrer de uma operao societria que no constitua
um Evento de Inadimplemento, nos termos do inciso IX abaixo; VIII. transformao
da forma societria da Companhia de sociedade por aes para sociedade limitada
ou outro tipo societrio, nos termos dos artigos 220 a 222 da Lei das Sociedades
por Aes; IX. ciso, fuso, incorporao ou qualquer forma de reorganizao
societria envolvendo a Companhia e/ou qualquer Controlada, exceto (a) se a
operao tiver sido previamente aprovada por Debenturistas representando, no
mnimo, 75% (setenta e cinco por cento) das Debntures em circulao; ou (b) se
tiver sido assegurado aos Debenturistas que o desejarem, durante o prazo mnimo
de 6 (seis) meses contados da data de publicao das atas dos atos societrios
relativos operao, o resgate das Debntures de que forem titulares, mediante o
pagamento do saldo devedor do Valor Nominal, acrescido da Remunerao,
calculada pro rata temporis desde a Data de Emisso ou a data de pagamento de
Remunerao imediatamente anterior, conforme o caso, at a data do efetivo
pagamento; ou (c) pela incorporao, pela Companhia (de modo que a Companhia
seja a incorporadora), de qualquer Controlada; ou (d) se a operao for realizada
exclusivamente entre Controladas; X. reduo de capital social da Companhia,
exceto se previamente aprovada por Debenturistas representando, no mnimo, 75%
(setenta e cinco por cento) das Debntures em circulao, conforme disposto no
artigo 174, pargrafo 3, da Lei das Sociedades por Aes; XI. mudana ou
transferncia de controle acionrio (conforme definio de controle prevista no
artigo 116 da Lei das Sociedades por Aes), direto ou indireto, da Companhia, de
qualquer Controladora e/ou de qualquer Controlada, exceto se a operao tiver sido
previamente aprovada por Debenturistas representando, no mnimo, 75% (setenta
e cinco por cento) das Debntures em circulao; XII. alterao do objeto social da
Companhia e/ou de qualquer Controlada, conforme disposto em seu estatuto social
ou contrato social, conforme o caso, vigente na Data de Emisso, exceto se tal
alterao (a) tiver sido previamente aprovada por Debenturistas representando, no
mnimo, 75% (setenta e cinco por cento) das Debntures em circulao, ou (b) no
resultar em alterao da atividade principal da Companhia ou da respectiva
Controlada; XIII. no renovao, cancelamento, revogao ou suspenso das
autorizaes e licenas, inclusive ambientais, exigidas pelos rgos competentes

para o regular exerccio das atividades desenvolvidas pela Companhia, desde que
no tenha seus efeitos sanados ou suspensos no prazo de 15 (quinze) dias
contados da data de no renovao, cancelamento, revogao ou suspenso da(s)
respectiva(s) autorizao(es) ou licena(s); XIV. ocorrncia de qualquer evento
que cause (a) em relao Companhia, (i) qualquer efeito adverso relevante na
situao (financeira ou de outra natureza), nos negcios, nos bens, nos resultados
operacionais e/ou nas perspectivas; (ii) qualquer efeito adverso nos poderes ou
capacidade jurdica e/ou econmico-financeira de cumprir qualquer das obrigaes
nos termos da Escritura de Emisso; e/ou (iii) qualquer evento ou condio que,
aps o decurso de prazo ou envio de notificao, ou ambos, possa resultar em um
Evento de Inadimplemento; ou (b) em relao a Escritura de Emisso, qualquer
efeito adverso (i) na correta formalizao, legalidade, validade e/ou exequibilidade
dos Documentos das Obrigaes; e/ou (ii) nos direitos dos Debenturistas
constantes da Escritura de Emisso, desde que no tenha seus efeitos sanados ou
suspensos no prazo de 15 (quinze) dias contados da data de cincia do evento pela
Companhia ("Efeito Adverso Relevante"); XV. no manuteno, pela Companhia
e/ou por qualquer Controlada, de seguro, conforme as melhores prticas correntes
no mercado de atuao da Companhia, com relao a seus ativos operacionais
relevantes, no sanado no prazo de at 15 (quinze) dias contados do que ocorrer
primeiro entre (a) a data em que a Companhia tenha conhecimento do evento, e
tempestivamente notifique o Agente Fiducirio; ou (b) a data em que a Companhia
receba aviso por escrito neste sentido do Agente Fiducirio; XVI. vencimento
antecipado de qualquer obrigao financeira da Companhia e/ou de qualquer
Controlada, cujo valor, individual ou agregado, seja igual ou superior a
R$10.000.000,00 (dez milhes de reais), atualizados anualmente, a partir da Data
de Emisso, pela variao positiva do IPCA, ou seu equivalente em outras moedas,
e/ou ocorrncia de qualquer evento ou inadimplemento de qualquer obrigao que,
aps o decurso de qualquer prazo de cura previsto no respectivo documento, possa
ensejar, imediatamente, a declarao de vencimento antecipado de qualquer
obrigao financeira da Companhia e/ou de qualquer Controlada, cujo valor,
individual ou agregado, seja igual ou superior a R$10.000.000,00 (dez milhes de
reais), atualizados anualmente, a partir da Data de Emisso, pela variao positiva
do IPCA, ou seu equivalente em outras moedas; XVII. protesto de ttulos contra a
Companhia e/ou qualquer Controlada, cujo valor, individual ou agregado, seja igual
ou superior a R$10.000.000,00 (dez milhes de reais), atualizados anualmente, a
partir da Data de Emisso, pela variao positiva do IPCA, ou seu equivalente em
outras moedas, exceto se, no prazo de at 10 (dez) dias contados da data do
respectivo protesto, tiver sido comprovado que (a) o protesto foi efetuado por erro
ou m-f de terceiro e tenha sido tomada medida judicial adequada para a anulao
ou sustao de seus efeitos; (b) o protesto foi cancelado; ou (c) o valor do(s)
ttulo(s) protestado(s) foi depositado em juzo; XVIII. inadimplemento, pela
Companhia e/ou por qualquer Controlada, de qualquer deciso ou sentena judicial
transitada em julgado ou de qualquer deciso ou sentena arbitral no sujeita a
recurso contra a Companhia e/ou qualquer Controlada, em valor, individual ou
agregado, igual ou superior a R$10.000.000,00 (dez milhes de reais), atualizados
anualmente, a partir da Data de Emisso, pela variao positiva do IPCA, ou seu
equivalente em outras moedas, no sanado no prazo para pagamento estipulado
na respectiva deciso ou sentena; XIX. arresto ou sequestro de bens da
Companhia e/ou de qualquer Controlada, cujo valor, individual ou em conjunto, seja
igual ou superior a R$10.000.000,00 (dez milhes de reais), atualizados
anualmente, a partir da Data de Emisso, pela variao positiva do IPCA, ou seu
equivalente em outras moedas, exceto se, no prazo de 10 (dez) dias contados da
data do respectivo arresto ou sequestro, tiver sido comprovado que o arresto ou o
sequestro foi contestado ou substitudo por outra garantia; XX. desapropriao,
confisco ou qualquer outra medida de qualquer entidade governamental de
qualquer jurisdio que resulte na perda, pela Companhia e/ou por qualquer
Controlada, da propriedade e/ou da posse direta ou indireta de parte substancial de
seus ativos; XXI. venda, cesso, ou alienao, de qualquer forma, ou constituio
de hipoteca, penhor, alienao fiduciria, cesso fiduciria, usufruto, fideicomisso,
promessa de venda, opo de compra, direito de preferncia, encargo, gravame ou
nus, judicial ou extrajudicial, voluntrio ou involuntrio, ou outro ato que tenha o
efeito prtico similar a qualquer das expresses acima ("nus"), seja em uma nica
operao ou em uma srie de operaes, relacionadas ou no, sobre ativos da
Companhia e/ou de qualquer Controlada cujo valor represente mais de 15% (quinze
por cento) do valor total dos ativos da Companhia, tendo por base as
Demonstraes Financeiras Consolidadas da Companhia (conforme definido na
Clusula 7.1 da Escritura de Emisso) mais recentes, exceto se (a) a operao tiver
sido previamente aprovada por Debenturistas representando, no mnimo, 75%
(setenta e cinco por cento) das Debntures em circulao; ou (b) pela constituio
de nus sobre qualquer ativo adquirido pela Companhia ou por qualquer
Controlada, desde que o nus seja constitudo exclusivamente sobre o ativo
adquirido e para financiar a aquisio de tal ativo; XXII. comprovao de que
qualquer das declaraes prestadas pela Companhia na Escritura de Emisso e/ou
no Contrato de Distribuio falsa, inconsistente, imprecisa, incompleta, incorreta
ou insuficiente em qualquer aspecto relevante, no sanado no prazo de at 10 (dez)
dias contados do que ocorrer primeiro entre (a) a data em que a Companhia tenha

conhecimento da incorreo; ou (b) a data em que a Companhia receba aviso por

escrito neste sentido do Agente Fiducirio; XXIII. no utilizao, pela Companhia,
dos recursos lquidos obtidos com a Emisso estritamente nos termos da Escritura
de Emisso; XXIV. distribuio e/ou pagamento, pela Companhia, de dividendos,
juros sobre o capital prprio ou quaisquer outras distribuies de lucros aos
acionistas da Companhia, caso a Companhia esteja em mora com qualquer de suas
obrigaes estabelecidas na Escritura de Emisso, exceto pelo pagamento do
dividendo obrigatrio no superior a 25% (vinte e cinco por cento) do lucro lquido
ajustado previsto no artigo 202 da Lei das Sociedades por Aes; e XXV. no
observncia, pela Companhia, de qualquer dos ndices financeiros abaixo (em
conjunto, "ndices Financeiros"), a serem apurados pela Companhia, nos termos da
Escritura de Emisso e verificados pelo Agente Fiducirio no prazo de at 10 (dez)
dias contados da data de recebimento, pelo Agente Fiducirio, das informaes a
que se refere a Escritura de Emisso tendo por base as Demonstraes Financeiras
Consolidadas da Companhia relativas a cada trimestre do ano civil, a partir,
inclusive, das Demonstraes Financeiras Consolidadas da Companhia relativas a
31 de dezembro de 2013: (a) do ndice financeiro decorrente do quociente da
diviso da Dvida Lquida (conforme definido na Escritura de Emisso) pelo EBITDA
(conforme definido na Escritura de Emisso), que dever ser igual ou inferior a
3 (trs); e (b) do ndice financeiro decorrente do quociente da diviso do EBITDA
pela Despesa Financeira Lquida (conforme definido na Escritura de Emisso), que
dever ser igual ou superior a 2 (dois).

I. Atualizao monetria: o Valor Nominal Unitrio das Debntures no ser

atualizado monetariamente; e
II. Juros Remuneratrios: sobre o saldo devedor do Valor Nominal Unitrio das
Debntures em circulao incidiro juros remuneratrios correspondentes a
108,75% (cento e oito inteiros e setenta e cinco centsimos por cento) da variao
acumulada das taxas mdias dirias dos DI Depsitos Interfinanceiros de um dia,
"over extra-grupo", expressas na forma percentual ao ano, base 252 (duzentos e
cinquenta e dois) dias teis, calculadas e divulgadas diariamente pela CETIP, no
informativo dirio disponvel em sua pgina na Internet (http://www.cetip.com.br)
("Taxa DI") ("Remunerao"), calculados de forma exponencial e cumulativa pro
rata temporis por dias teis decorridos, desde a Data de Emisso ou a data de
pagamento de Remunerao imediatamente anterior, conforme o caso, at a data
do efetivo pagamento. Sem prejuzo dos pagamentos em decorrncia de resgate
antecipado das Debntures e/ou de vencimento antecipado das obrigaes
decorrentes das Debntures, nos termos previstos nesta Escritura de Emisso, a
Remunerao ser paga semestralmente a partir da Data de Emisso, nos dias 30
dos meses de maio e novembro de cada ano, ocorrendo o primeiro pagamento em
30 de novembro de 2014 e o ltimo, na Data de Vencimento.

(ii) juros

(iii) garantia e, se real, No aplicvel. As Debntures de terceira emisso no contam com garantia real ou
descrio do bem objeto
fidejussria.
(iv) na
ausncia
de
garantia, se o crdito As Debntures sero da espcie quirografria, nos termos do artigo 58, caput, da
quirografrio
ou Lei das Sociedades por Aes.
subordinado
(v) eventuais restries
impostas ao emissor em Vide condies de vencimento antecipado descritas acima.
relao:

distribuio
dividendos

de

alienao
determinados ativos

de

contratao de novas
dvidas
emisso de novos
valores mobilirios

Identificao: Pentgono S.A. Distribuidora de Ttulos e Valores Mobilirios.

Remunerao: Pelo desempenho dos deveres e atribuies que lhe competem, nos
termos da lei e da Escritura de Emisso, o Agente Fiducirio, ou a instituio que
vier a substitu-lo nessa qualidade, receber uma remunerao: (i) de R$ 3.000,00
por ano, devida pela Companhia, sendo a primeira parcela da remunerao devida
no 5 (quinto) Dia til contado da data de celebrao da Escritura de Emisso, e as
demais, no mesmo dia dos anos subsequentes, at o vencimento da Emisso, ou
enquanto o Agente Fiducirio representar os interesses dos Debenturistas; (ii)
reajustada anualmente, desde a data de pagamento da primeira parcela, pela
variao do ndice Geral de Preos Mercado, divulgado pela Fundao Getlio
Vargas ("IGPM"), ou do ndice que eventualmente o substitua, calculada pro rata
temporis, se necessrio; (iii) acrescida do Imposto Sobre Servios de Qualquer
Natureza ISSQN, a Contribuio ao Programa de Integrao Social PIS,
Contribuio Social sobre o Lucro Lquido CSLL, a Contribuio para o
Financiamento da Seguridade Social COFINS e de quaisquer outros tributos que
venham a incidir sobre a remunerao devida ao Agente Fiducirio, exceto pelo
Imposto Sobre a Renda e Proventos de Qualquer Natureza IR; (iv) devida at o
vencimento, resgate ou cancelamento das Debntures e mesmo aps o seu
vencimento, resgate ou cancelamento na hiptese de atuao do Agente Fiducirio
na cobrana de eventuais inadimplncias relativas s Debntures no sanadas pela
Companhia, casos em que a remunerao devida ao Agente Fiducirio ser
calculada proporcionalmente aos meses de atuao do Agente Fiducirio, com
base no valor indicado no inciso "i" acima, reajustado conforme o inciso "ii" acima;
(v) acrescida, em caso de mora em seu pagamento, independentemente de aviso,
notificao ou interpelao judicial ou extrajudicial, sobre os valores em atraso, sem
prejuzo da atualizao monetria, (a) juros de mora de 1% ao ms, calculados
pro rata temporis desde a data de inadimplemento at a data do efetivo pagamento;
(b) multa moratria, irredutvel e de natureza no compensatria, de 2%;
(c) atualizao monetria pela variao do IGPM, calculado pro rata temporis
desde a data de inadimplemento at a data do efetivo pagamento; e (vi) realizada
mediante depsito na conta corrente a ser indicada por escrito pelo Agente
Fiducirio Companhia, servindo o comprovante do depsito como prova de
quitao do pagamento.
Reembolso de despesas: o Agente Fiducirio ser reembolsado pela Companhia
(vi) o agente fiducirio, por todas as despesas que comprovadamente incorrer para proteger os direitos e
indicando os principais interesses dos Debenturistas ou para realizar seus crditos, no prazo de at
30 (trinta) dias contados da entrega dos documentos comprobatrios neste sentido,
termos do contrato
desde que as despesas tenham sido, sempre que possvel, previamente aprovadas
pela Companhia, as quais sero consideradas aprovadas caso a Companhia no
se manifeste no prazo de 2 (dois) Dias teis contados da data de recebimento da
respectiva solicitao pelo Agente Fiducirio.
Obrigaes. O Agente Fiducirio, conforme previsto na Escritura de Emisso, ter
as funes estabelecidas em lei e na regulamentao da Comisso de Valores
Mobilirios, devendo usar de toda e qualquer ao para proteger direitos ou
defender interesses dos Debenturistas.
Substituio: Em caso de ausncia, impedimentos temporrios, renncia,
interveno, liquidao judicial ou extrajudicial, falncia, ou qualquer outro caso de
vacncia do Agente Fiducirio, aplicam-se as seguintes regras: (i) facultado aos
Debenturistas, aps o encerramento da Oferta, proceder substituio do Agente
Fiducirio e indicao de seu substituto, em assembleia geral de Debenturistas
especialmente convocada para esse fim; (ii) caso o Agente Fiducirio no possa
continuar a exercer as suas funes por circunstncias supervenientes Escritura
de Emisso, dever comunicar imediatamente o fato aos Debenturistas, solicitando
sua substituio e convocar assembleia geral de Debenturistas para esse fim;
(iii) caso o Agente Fiducirio renuncie s suas funes, dever permanecer no
exerccio de suas funes at que uma instituio substituta seja indicada pela
Companhia e aprovada pela assembleia geral de Debenturistas e assuma
efetivamente as suas funes; (iv) sero realizadas, dentro do prazo mximo de
30 (trinta) dias, contados do evento que a determinar, assembleia geral de
Debenturistas da Primeira Srie e assembleia geral de Debenturistas da Segunda
Srie, para a escolha do novo agente fiducirio, que podero ser convocadas pelo
prprio Agente Fiducirio a ser substitudo, pela Companhia, por Debenturistas da
Primeira Srie representando, no mnimo, 10% (dez por cento) das Debntures em
circulao,; na hiptese da convocao no ocorrer em at 15 (quinze) dias antes
do trmino do prazo aqui previsto, caber Companhia efetu-la, sendo certo que
a CVM poder nomear substituto provisrio enquanto no se consumar o processo
de escolha do novo agente fiducirio; (v) a substituio, em carter permanente, do
Agente Fiducirio (a) est sujeita comunicao prvia CVM e sua
manifestao acerca do atendimento aos requisitos previstos no artigo 9 da
Instruo CVM n. 28, de 23 de novembro de 1983, conforme alterada, e (b) dever
ser objeto de aditamento Escritura de Emisso; (vi) os pagamentos ao Agente
Fiducirio substitudo sero efetuados observando-se a proporcionalidade ao

perodo da efetiva prestao dos servios; (vii) o agente fiducirio substituto far
jus mesma remunerao percebida pelo anterior, caso (a) a Companhia no
tenha concordado com o novo valor da remunerao do agente fiducirio proposto
pelas assembleias gerais de Debenturistas a que se refere o inciso "iv" acima, ou
(b) as assembleias gerais de Debenturistas a que se refere o inciso "iv" acima no
deliberem sobre a matria; (viii) o agente fiducirio substituto dever,
imediatamente aps sua nomeao, comunic-la Companhia e aos Debenturistas
nos termos da Escritura de Emisso; e (ix) aplicam-se s hipteses de substituio
do Agente Fiducirio as normas e preceitos emanados da Comisso de Valores
Mobilirios.
Nas deliberaes das assembleias gerais de Debenturistas a cada Debnture em
circulao caber um voto, admitida a constituio de mandatrio, Debenturista ou
no. Exceto pelo disposto abaixo, todas as deliberaes a serem tomadas (i) em
assembleia geral de Debenturistas dependero de aprovao de Debenturistas
representando, no mnimo, 75% das Debntures da Primeira Srie em circulao.
No esto includos no qurum acima: (i) os quruns expressamente previstos nas
clusulas da Escritura de Emisso; e (ii) as alteraes, que somente podero ser
aprovadas por Debenturistas representando, no mnimo, 90% das Debntures, (a)
das disposies da Escritura de Emisso; (b) de qualquer dos quruns previstos na
Escritura de Emisso; (c) da Remunerao, exceto no caso de alterao decorrente
de extino, limitao e/ou no divulgao da Taxa DI ou do IPCA, conforme
previsto na Escritura de Emisso; (d) de quaisquer datas de pagamento de
quaisquer valores previstos na Escritura de Emisso; (e) do prazo de vigncia das
Debntures; (f) da espcie das Debntures; (g) da criao de evento de
repactuao; (h) das disposies relativas a resgate antecipado facultativo; (i) das
disposies relativas a amortizaes antecipadas facultativas; ou (j) da redao de
qualquer Evento de Inadimplemento.

Condies para alterao

dos direitos assegurados
por
tais
valores
mobilirios

Outras
caractersticas
No h.
relevantes

19.1

Meeting
date

Provide the following information about issuers stock buyback plans

Buy-back

Outras caracter.
11/10/2014
11/10/2014
to
11/09/2014

Available
reserves
and profits
(Reais)

Type

Common

Class

Quantity
envisaged
(units)

4.000.000

Percentage
in relation to
outstanding

5.069199%

Approved
amount
purchased
(units)

2,285,300

Weighted
Average
Price

8.65

Quote
factor

R$ per
unit

%
purchased

57%

For the purposes of article 8 of CVM Instruction 10/80 the Directors determined and clarify that: (a) the Companys objective in the Repurchase Program is to
acquire shares of the Company's issuance, for treasury and subsequent cancellation or alienation, including in the context of any exercise of options under the
Company's stock option plan; (b) up to 4,000,000 common shares of the Companys issuance, all book-entry and without par value, may be acquired under the
Repurchase Program, subject to maintaining the minimum float of 25% of the shares (as required by the BM&FBovespa Novo Mercado Listing Regulations)
and to the requirement under article 3 of CVM Instruction 10/80 that the number of shares held in treasury shall not exceed 10% of the shares in circulation in
the market; (c) the deadline for effecting transactions in the context of the Program is 365 days as of the date hereof; (d) the number of common shares of the
Companys issuance that are in circulation in the market, as defined by CVM Instruction 10/80, is 82,907,932 (eighty-two million, nine hundred seven thousand,
nine hundred thirty-two), according to the registry for the share deposit account on November 3, 2014, as reported by the depositary institution; and (e) the
purchases in the context of the Repurchase Program will be effected over the exchange at market prices, with the intermediation of any of the following brokers:
(i) Votorantim Corretora de Ttulos e Valores Mobilirios Ltda., headquartered in the City and State of So Paulo at Avenida das Naes Unidas 14171, Torre
A, 14 andar, CEP 04794-000, registered with the CNPJ/MF under n. 01.170.892/0001-31; (ii) J.P. Morgan Corretora de Cmbio e Valores Mobilirios S.A.,
headquartered in the City and State of So Paulo at Avenida Brigadeiro Faria Lima 3.729, 13 andar, CEP 04538-905, registered with the CNPJ/MF under n.
32.588.139/0001-94; (iii) Bradesco S.A. Corretora de Ttulos e Valores Mobilirios, headquartered in the City and State of So Paulo at Avenida Paulista 1.450,
7 andar, CEP 01310-100, registered with the CNPJ/MF under n. 061.855.045/0001-32; (iv) BTG Pactual Corretora de Ttulos e Valores Mobilirios S.A.,
headquartered in the City and State of So Paulo at Avenida Brigadeiro Faria Lima 3.477, 14 andar, CEP 04538-133, registered with the CNPJ/MF under n.
43.815.158/0001-22; (v) Ita Corretora de Valores S.A., headquartered in the City and State of So Paulo at Avenida Brigadeiro Faria Lima 3.500, 3 andar,
parte, CEP 04538-132, registered with the CNPJ/MF under n. 61.194.353/0001-64; (vi) Credit Suisse (Brasil) S.A. CTVM, headquartered in the City and State
of So Paulo at Rua Leopoldo Couto de Magalhes Jr. 700, 12 andar, CEP 04542-000, registered with the CNPJ/MF under n. 42.584.318/0001-07; and (vii)
J. Safra Corretora de Valores e Cmbio Ltda., headquartered in the City and State of So Paulo at Avenida Paulista 2.100, 19 andar, CEP 01310-930,
registered with the CNPJ/MF under n. 60.783.503/0001-02.

19.2 In relation to securities held in treasury, in tabular form, segregating by type and
class, indicate: (a) the initial amount; (B) quantity purchased; (C) the weighted average
purchase price; (D) amount sold; (E) weighted average price of alienation
Fiscal year endend on December 31, 2015.
Class of stock: Common
Quantity
(Units)
1.276.300
1.009.000
(6.878)
2.278.422

Movement
Beginning balance
Acquisitions
Disposal
Cancellations
Ending balance
Relationship outstanding
securities

Total amount
(R$ thousand)
7.910
-

Weighted average price

(R$)
7,84
-

4,73

Fiscal year ended on December 31, 2014.

Quantity
(Units)
1.276.300
1.276.300

Movement
Beginning balance
Acquisitions
Disposal
Cancellations
Ending balance
Relationship outstanding
securities

Total amount
(R$ thousand)
11.856
11.856

1,61%

Fiscal year ended on December 31, 2013.

Class of stock: Common
Movement
Beginning balance
Acquisitions
Disposal
Cancellations
Ending balance

19.3.

Quantity
(Units)
-

Total amount
(R$ thousand)
-

Weighted average
price (R$)
-

Other information that the Company considers relevant

Fiscal year ended on December 31, 2015.

Class of stock: Common
Movement
Beginning balance
Acquisitions
Disposal
Cancellations
Ending balance

Quantity
(Units)
1.009.000
(6.878)
-

Fiscal year ended on December 31, 2014.

Total amount
(R$ thousand)
7.910
-

Weighted average
price (R$)
7,84
-

Weighted average price

(R$)
9,29
9,29

Movement
Beginning balance
Acquisitions
Disposal
Cancellations
Ending balance

Quantity
(Units)
1.276.300
1.276.300

Total amount
(R$ thousand)
11.856
11.856

Weighted average
price (R$)
9,29
9,29

Total amount
(R$ thousand)
-

Weighted average
price (R$)
-

Fiscal year ended on December 31, 2013.

Class of stock: Common
Movement
Beginning balance
Acquisitions
Disposal
Cancellations
Ending balance

Quantity
(Units)
-

On November 10, 2014, the Board of Directors approved the establishment of a buyback program
of common shares issued by the Company and authorized the directors to determine the
opportunity and the number of shares to be effectively acquired under the Repurchase Program
.
The Company's objective with the buyback program was to acquire up to 4,000,000 shares issued
within a maximum of 365 (three hundred and sixty five) days to the date of approval by the Board
of Directors, to be held in treasury and subsequent disposal or cancellation, including under the
Company's stock option program, in case of exercise of such options. Until March 31, 2015,
2,285,300 shares were purchased in the amount of R $ 19,777, recorded in the capital reserve.
The minimum cost, weighted average and maximum of these shares acquired by the first quarter
of 2015 were, respectively, R $ 5.32 R $ 8.65 and R $ 11.30.
On May 21, 2015, the Board of Directors approved the sale of 5,434 Company's treasury shares
to meet the exercise of stock option beneficiaries under the Plan Granting of Share Purchase
Options (for more information on the plan, see item 13 of this Form).
On June 17, 2015 the Board of Directors approved the sale of 1,444 Company's treasury shares
to meet the exercise of stock option beneficiaries under the Stock Option Plan of the Company's
Stock Options (for more information on the plan, see item 13 of this Form).
Acquisition date

4th quarter 2014

1st quarter 2015
Total amount

Approved purchased
(units)

1.276.300
1.009.000
2.285.300

Approved
purchased (R$
thousands)

11.856
7.910
19.777

Weighted Average
Price (R$/share)

9,29
7,84
8,65

20.1
Description of the Companys policy for trading of securities by major
shareholders, direct or indirect, directors, members of the Board of Directors, or of any
body with consultative or technical functions, created by any statutory provision
a. Date of approval
February 8, 2010
b. Related parties
The Company, the Controlling Shareholder, the Administrators, members of the Fiscal Council,
employees (when they have insider information regarding the Company) and any person who
adopted this trading policy (Securities Trading Policy) due to their title, job or position in
companies that control or are controlled by the Company (Persons Bound to the Trading Policy).
c. Main characteristics
The main characteristics of the Trading Policy are:
I.

prohibiting the trading of securities issued by the Company by Bound Persons who have
material information about the Company;

II.

prohibiting the trading of securities issued by the Company by Bound Persons who leave
board positions, for the period of six months after they leave the position or until the
material information is disclosed;

III.

prohibiting the trading of securities issued by the Company by Related Parties whenever
a purchase or sale of shares issued by the Company is in progress, or execution of any
agreement or contract for the transfer of Companys share control, existence of intention
of promoting amalgamation, total or partial spin-off, transformation or corporate
restructuring involving the Company. This restriction only applies to controlling
shareholders, direct or indirect, and administrators when the ongoing purchase or sale of
shares of the Company by the Company; and

IV.

prohibiting on trading in securities issued by the Company by persons linked to negotiating

policy within fifteen days prior to the release of quarterly and annual required by the CVM.

d. Prohibitions on trading and description of monitoring procedures

When Material Fact not yet disclosed is pending; after the disclosure of material fact, provided
that negotiations could adversely affect business conditions described in the act or fact in
question; Related Parties may not trade securities over a 15-day period prior to the disclosure, as
applicable, of Company's quarterly information (ITR) or standard financial statements (DFP); by
former Administrators, for the period of six months after they leave the position or until the material
information is disclosed;.
All trading activities with securities issued by the Company carried out by Bound Persons shall
only be performed through one of the accredited brokers included in the list sent by the
Company to CVM, updated on a regular basis.
20.2

Other information that the Company considers relevant Trading Policy

The full version of Mills Securities Trading Policy can be obtained in the following address:
http://mills.infoinvest.com.br/static/enu/arquivos/Politica_de_Negociacao_MILL_RCA_2010_02_
08_i.pdf

21.1
Rules, bylaws or procedures adopted to ensure that information to be disclosed
publicly is collected, processed and reported accurately and in a timely manner
It is incumbent on the Investor Relations Officer to report and communicate the Material
Information to CVM and Market Entities, through the institutional media, as well as adopting the
procedures described under this policy.
Material Information will be disclosed to the public, as permitted by CVM Instruction 358/02, in
the news portal of the newspaper Valor Econmico (www.valor.com.br/valor-ri) and at the
Companys Investor Relations website (www.mills.com.br/ri), both on the world wide web
(Internet), without prejudice to its communication to the CVM and BM&FBOVESPA, in the form
required by current regulations.
At the discretion of the Investor Relations Officer, the announcement referred to at paragraph
above can be made in addition, upon publication in newspapers of wide circulation normally used
by the company, provided, in this case, the adoption of a summary indicating that the full report
can be accessed at the electronic address www.mills.com.br/ri.
At the discretion of the Investor Relations Officer, the announcement referred to in item above
can be a summarized description of the information in question in which case reference shall be
made to the webpage www.mills.com.br/ri, where a full description of the Material Information can
be found.
The information should be presented in a clear and precise manner, in language accessible to
the investing public. Whenever a technical concept that used at the discretion of the Investor
Relations Officer, is considered more complex, an explanation of its meaning must be on the
information disclosed.
Whenever Material Information is released by any means of communication, including information
to the press or in meetings with professional associations, investors, analysts or selected public,
in the Country or abroad, that Investor Relations Officer shall release the Material information
simultaneously to the market.
The controlling shareholders, the members of the Board of Directors and Fiscal Council, and any
employee, who have knowledge of the information related to the Material Information, and signed
the adherence instrument containing the policy on disclosure of Material Information, shall
immediately notify the Investor Relations Officer about such Material information, in case the
Officer is not yet aware of the information, as well as verify that the Investor Relations Officer
have taken the measures described in this document.
The communication to the Investor Relations Officer mentioned in item 4.4 above, must be carried
out by email, to the email address ri@mills.com.br.
If the groups mentioned in item above certify that there has been omission in the disclosure of
that Material Information by the Investor Relations, and the terms provided by the policy on
disclosure of Material Information, such group must immediately communicate the Material
information to CVM for their exemption from liability imposed by non-compliance with the rules on
disclosure.
Whenever the CVM or any market entity require further explanation from the Investor Relations
Officer about the disclosed Material Information, or if an atypical variation in price or trading
volume of securities issued by the Company or related thereto, the Investor Relations Officer
should inquire persons with access to Material Information, in order to establish whether they are
aware of information that must be disclosed to the market.

The administrators and employees inquired in item above, should respond to the request of the
Investor Relations Officer immediately. If not able to meet personally or talk on telephone with the
Investor Relations Officer on the same day of the request, administrators and employees in
question should send an email with the information to the address ri@mills.com.br regarding the
information relevant to.
The disclosure of any Material information, should be simultaneously to CVM and Market entities,
and shall take place before the opening or after the closing of trading on the Stock Exchanges,

and in case of hour incompatibility with other markets, the Brazilian market trading hours shall
prevail.
If, exceptionally, it is imperative that the communication of Material information occurs during
trading hours, the Investor Relations Officer when disclosing the Material information, may
simultaneously request the Market entities in Brazil and abroad, the suspension of trading of
securities issued by the Company or related thereto, the time necessary to properly disclose their
information. The Investor Relations Officer must prove to Brazilian Market entities that the
requested suspension of trading also was accomplished in foreign Market entities.
The Company can disclose to the market expectations of future performance (guidance), for short
and long term, especially with regard to financial and operational figures of their businesses, by
decision of the board of directors, noted that such guidance shall be in accordance with CVM
regulations, paragraph 4 of article 13 of CVM Instruction No. 358/02.

In the event that disclosure of such expectations, should be subject to the following
assumptions:

(i) The anticipated dissemination of results may be accepted in the case of preliminary
information, not yet audited, clearly presented for each of the items and timeframes,
memories of the assumptions and calculations used;
(ii) The results or information prepared in accordance with foreign accounting standards
should provide a reconciliation to the Brazilian accounting practices, as well as
reconciliation with the accounting items expressed directly in the financial statements of
the Company and, therefore, obtained by the accounting principles adopted in Brazil;
(iii) If disclosures involves the preparation of projections, a comparison with the actual
results must be submitted, on the occasion of the release of Form ITR of the Company;
(iv) If the projections are discontinued, it should be informed, together with the reasons that
led to its loss of validity in the form of Material Information.
(v) to disclose full information to shareholders and investors;
(vi) to ensure prompt widespread dissemination of Material information;
(vii) to allow equity access to public information on the Company by every shareholder and
investor;
(viii)
to protect secrecy of any undisclosed Material information;
(ix) to contribute to the stabilization and fostering of the Brazilian capital market; and
(x) to strengthen the Companys good corporate governance practices.
The controlling shareholder, directors, members of the board of directors and the fiscal council,
as well as other employees and agents of the Company, shall preserve the confidentiality of the
information pertaining Material Information to which they have privileged access due to the
position they hold, until their actual release to the market and ensure that subordinates and third
parties they trust to do the same, being jointly responsible with them in case of noncompliance.

For the purpose of maintaining confidentiality referred to in item 6.1 above, the individuals
mentioned therein shall observe and ensure observance of the following, without prejudice to
the adoption of other measures that are appropriate in front of each situation:

(i)
(ii)

(iii)
(iv)

disclose the confidential information strictly to those people who absolutely need
to know it;
not discuss confidential information in the presence of third parties who are not
aware of such information, though if expected that third party cannot understand
the meaning of the conversation;
not to discuss confidential information in conference calls in case one cannot be
sure of who actually will participate in it;
maintain documents of any kind relating to confidential information, including
handwritten personal notes in a safe, locked cabinet or file, to which only
authorized persons have access to the information;

(v)
(vi)
(vii)

(viii)

create documents and electronic files related to confidential information always

with password protection systems;
to circulate internally documents containing confidential information in sealed
envelopes, which should always be delivered directly to the recipient;
not to send confidential documents through facsimile, unless there is certainty
that only authorized personnel to take notice of such information will have access
to the receiver, and
without prejudice to the responsibility of those who are transmitting confidential
information, require a third party outside the Company who need access to
information to sign a confidentiality agreement, which shall specify the nature of
information and include in the statement that it recognizes its confidential nature,
pledging not to disclose it to anyone else and do not trade securities issued by
the Company prior to disclosure of information to the market.

When confidential information needs to be disclosed to any employee of the Company or other
person holding title, function or position in the Company, its controlling shareholders,
subsidiaries or affiliates, other than a director, member of the Board of directors or the Fiscal
Council of the Company, the individual responsible for the transmission of information should
make sure that the person receiving it is aware of the Policy Disclosure of Material Information
of the Company, requiring even to sign the Policy Disclosure of Material Information before
providing access to information.
21.3
Administrators responsible for implementation, maintenance, evaluation and
supervision of the information disclosure policy
Investor Relations Officer.
21.4

Other information that the Company deems relevant

The full version of Mills Policy on Disclosure of Material Information can be obtained in the
following address:
http://ir.mills.com.br/fck_temp/12_4/file/Politica%20de%20Divulga%C3%A7%C3%A3o_2016_0
3_28_i.pdf