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CORPORATION STRUCTURES ADMITTED IN BRAZIL

The Brazilian Civil Code of 2002 (Articles 1039-1092) admits the following corporate formats for a company established and operative in Brazil:

• Private Limited Company (LTDA) – Limited Liability Company is the most common format of society used in Brazil. These company format must be composed by a minimum of 02 (two) partners (individuals or companies – both national of foreigners) who are jointly and severally liable to the companies obligations up to the amount (subscribed and paid) corresponding to their shares of the Social Capital of the company.

• Corporation or Joint Stock Company (S/A) – (Law nº 6.404/76) - The Corporation is a legal entity of private law consisting by two or more shareholders, in which the Social Capital is divided into nominal shares of equal values, which are free for negotiability. The responsibility of the shareholder is merely to the issue price of the shares subscribed or acquired. The Corporation can be classified as open capital or closed capital. Article 4th of the Corporation Law distinguishes them: "For the purposes of this law, the company is open or closed if their social statute admits or not the trading of shares in the securities market." The open is one in which the securities (shares, debentures, participation certificates etc.) are admitted to trading on the stock exchanges or over the counter market and should therefore be registered and have their securities registered with the CVM (Commission Securities), while closed does not issue marketable securities.

• Simple Limited Commandite Company – A society with different responsibilities for each partner, who can be unlimitedly responsible or partially responsible for company’s obligations.

• Limited Commandite Company by Shares  - (Law nº 6.404/76 and articles 1090-1092 of the Brazilian Civil Code of 2002) – A society in which the Share Capital is divided into shares, and the shareholders respond only by the amount subscribed or purchased, with administrators (that must necessarily be a shareholder) with subsidiary liability, unlimited, joint and several, due its social obligations. The director is appointed for an undetermined time in the constitutive act and its responsibility is subsidiary and unlimited forward to the obligations of the company.

• Society in Collective Name - All shareholders shall be necessarily individuals and joint and several responsible for any obligations of the company, up to their Social Capital participation.

• S.P.E. – The special purpose entity (SPE) is a business company whose activity is very limited, and in some cases has given life term usually used to isolate financial risk of the activity, or to a specific venture, incorporation, etc.

There are also some specific structures of companies focused in small ventures:

• M.E.I. - Individual micro entrepreneur (LC nº 123/2006) - annual revenues of up to R$ 120.000,00 reais.

• M.E. - Micro company - annual revenues of up to R$ 900.000,00 reais.

• E.P.P. – Small business company (LC nº 139/2011) - annual revenues of up to R$ 14.400.000,00 reais.

• E.I. – Private entrepreneur (single shareholder) – no limitation in regard of revenues, the private entrepreneur is liable towards any company debts with his own individual patrimony.

• EIRELE - Individual Limited Liability Company (single shareholder) – This corporate is similar to EI, but unlike it the EIRELI private entrepreneur responds only until the subscribed capital stock of the Company. Minimum registered capital stock of 100 times the minimum wage (aprox. R$ 7.500,00 reais).