VOTING RIGHTS POLICY AT SHAREHOLDER MEETINGS
1. OBJECT
| 1.1. | FRAM Capital Gestão de Ativos, in accordance with ANBIMA’S (National Association of Investment Banks) Self-Regulation Code for Investment Funds, hereby presents its Voting Rights Policy for Shareholders. |
| 1.2. | This Voting Policy applies to all Investment Fund shares and Fund of Funds shares managed by FRAM Capital Gestão de Ativos (the Manager) whose investment policy allows for the allocation in financial assets that include the right to vote in shareholder meetings, except in the cases provided for in Item 2 below; |
| 1.3. | The purpose of this policy is to clarify to shareholders the voting criteria used by the Manager in such meetings in order to ensure its fiduciary duty. |
2. EXCLUSIONS
This Policy does not apply to investment funds that:
| I. | Have exclusive or restricted target investors, as long as the approved wording in the fund’s prospectus states that the fund will not adopt a voting policy; |
| II. | Invest in financial assets whose issuers are based outside Brazil; |
| III. | Invest in certificates of deposit of financial securities - "Brazilian Depositary Receipts (BDR); |
3. GENERAL PRINCIPLES
The Manager will exercise the right to vote at shareholder meetings as a representative of the Investment Funds under its management in the best interests of shareholders and funds, using its best efforts to vote favorably for the resolutions it deems to be beneficial or that add value to shareholders and funds.
4. POTENTIAL CONFLICT OF INTERESTS SITUATIONS
The Manager shall exercise the right to vote, in accordance with this Voting Policy, always guided by the principles of transparency, ethics and loyalty, respecting the segregation of activities required by law. If there are situations of potential conflict of interest, the following procedures will be adopted:
| 4.1. | Conflicts of interest will be reviewed by Manager’s compliance area that will evaluate every aspect and issue a conclusive opinion of the situation, subject to the following provisions: | |
| I. | If a conflict of interest is confirmed, the Manager will adopt internal procedures to resolve the conflict in time for its participation in the shareholder meeting, or | |
| II. | If the adoption of procedures in a timely manner is not possible, the Manager will forfeit its right to vote in the Assemblies of the Companies or of the Investment Funds issuing the assets of the funds portfolios, and its formal justification will be made available to shareholders upon request. | |
| 4.2. | The Manager can exercise its voting rights in a potential conflict of interest situation, as long as it informs the Funds shareholders of the content of the vote to be entered within a period of at least 4 (four) days from the date of the meeting. | |
5. COMPULSORY MATTERS
The following matters require compulsory voting by the Manager on behalf of its investment funds and are therefore covered by this Policy Vote:
| a. In the case of equities, its rights and splits: | ||
| I. | Election of representatives of minority shareholders on the Board, if applicable; | |
| II. | Adoption of option plans for compensation of the managers of the company, if it includes "in the money" stock options (exercise price of the option is less than the price of underlying stock, on the date of the shareholder meeting); | |
| III. | Acquisitions, mergers, incorporations, splits, control changes, partnership reorganizations, changes or conversions of shares and other changes in by-laws, which may, in the opinion of the Manager, generate relevant impact on the value of the assets held by the fund; | |
| IV. | Other matters involving differential treatment; | |
| b. In the case of fixed income or hybrid financial assets, changes in conditions or time limit for payments, guarantees, anticipated maturities, acceleration, anticipated redemption, repurchase and/or compensation originally agreed on for the operation. | ||
| c. In the case of investment funds shares: | ||
| I. | Changes in investment policy that result in a change of the investment fund CVM classification or ANBIMA type; | |
| II. | Changes of administrator or manager, when not a member of its conglomerate or financial group; | |
| III. | Increase in management fee or creation of entry or exit fees; | |
| IV. | Changes in the redemption conditions resulting in an increase in the redemption term; | |
| V. | Mergers, incorporations, splits which trigger changes in the conditions listed in the preceding paragraphs; | |
| VI. | Fund liquidation; | |
| VI. | Shareholders Meetings in the cases determined by Article 16 of CVM Resolution 409. | |
6. OPTIONAL MATTERS
| I. | In the cases listed below, the right to vote by the MANAGER is optional: |
| II. | If the shareholder meeting occurs in any city other than the State capital and absentee voting is not available. |
| III. | If the cost related to the exercise of voting is not consistent with the participation of the financial asset in the Fund. |
| IV. | If the total contribution of the Investment Funds overseen by the Manager in the voting fraction of the matter, subject to the same voting policy, is less than 5% (five percent) and the Fund does not own more than 10% (ten percent) of the portfolio in the asset at stake; |
| V. | If the information provided by the issuer of the asset is not sufficient even after a request for additional information and clarifications; |
Without prejudice to the exercise of voting rights for compulsory matters, the MANAGER may choose to attend general meetings of the issuing companies and exercise its right to vote on other matters which, of its discretion, are in the interest of the funds and the shareholders.
7. DECISION MAKING PROCESS
Upon receiving formal notice of the shareholder meetings, the Manager shall adopt the following procedures:
| I. | The MANAGER’s Investment Committee will determine the vote to be entered in the Shareholder meeting and will define the matters to be discussed, their relevance to the funds, possible conflicts of interest and the cost to exercise the voting rights; |
| II. | If the MANAGER opts not to participate in the Shareholder meeting, which will result in not exercising the right to vote in an issue of an Investment Fund under its management, this decision must be included in the minutes of the above-mentioned Committee as well as the reasons that support it. |
The Investment Management area, under the responsibility of Mr. Henry Gonzalez, coordinates the decision making process, the recording and formalities of the right to vote on any Fund and Fund of Funds managed by FRAM Capital Gestão de Ativos or FRAM Capital Equities Gestão de Ativos.
8. VOTE NOTICES TO SHAREHOLDERS
The votes cast by the Manager will be available to investors in the MANAGER’S website http://www.framcapital.com within 2 (two) working days of the Meeting.
9. ACCESS TO POLICY VOTE
This voting policy is registered at ANBIMA in its full and updated version.
Henry Singer Gonzalez - CIO
