OBJECTIVE

Establish guidelines for the EDP Brasil Group, to promote the management of potential (or involved) risks in EDP’s business and that may impact the Company and the stakeholders with whom we interact.

PURPOSES AND PRINCIPLES

Risk management within the EDP Brasil environment aims to align the risk appetite assumed with the company’s strategic objectives, to guarantee the achievement of results.

Risk management at the EDP Brasil Group considers the following principles:

• Risk management as everyone’s responsibility, from the Board of Directors to the individual employee. Risk, risk appetite and risk tolerance are key points in decision making for the execution of business activities, functions and processes;
• The ability to manage risks as a lever for the value of assets, projects and business opportunities, in addition to safeguarding human lives, the environment, the well-being of employees and reinforcing innovation;
• The transmission of trust in the business to shareholders, employees, customers, suppliers and the communities where the Company operates;
• The assessment of risks and opportunities for generating value in the short, medium and long term considers the direct and indirect economic, social and environmental impacts of the operations;
• The constant evolution and improvement to ensure compliance with the best international risk management practices; and
• Identification of efficient mitigators to ensure alignment of the Company’s strategy.

1.1. Lines of Defense

The risk management model adopted by EDP is based on the concept of three lines of defense, in which each agent in the organization has a specific role within the risk management process:

1st Line: Operates in operational risk management in the day-to-day routine, identifying, analyzing, evaluating, treating and controlling risks. It is responsible for the mapped risks and reports directly to the company’s senior management. It is made up of the company’s employees and business areas.

2nd Line: Consisting of the Risk and Control areas within the organization, its function is to provide guidance and methodological support to the company’s employees, in addition to ensuring the management and control of the risks mapped by the 1st line of defense.

3rd Line: Represented by the company’s Internal Audit. They provide independent assessments of the company’s risk methodology, bringing greater strength to the risk management system.

1.2. Risk Management Process  

Corporate risk management is based on the best governance models such as COSO and ISO 31,000.

• We have adopted a structure dedicated to corporate risk management with the objective of identifying, evaluating, controlling, treating and monitoring the risks associated with the companies described in the scope of this policy;
• We identify and assess the risks associated with the organization’s internal processes, identifying failures and deficiencies that may generate financial impacts materialized in losses, to mitigate and control risks, providing instruments for analysis and decision-making;
• We classify risk events considering their probability of occurrence and financial impact;
• We continuously monitor the risk management process, evaluating proposals for improvements;
• We establish rules and procedures for risk management, respecting cost-benefit ratios, including those associated with activities provided by third parties;
• According to pre-established criteria, the methodology allows the contracting of insurance to cover risks;
• We maintain a risk and loss basis observing the scope, consistency, integrity and reliability;
• We periodically prepare risk scenarios to assess exposure to external events;
• We periodically review and evaluate the model used in risk management, through quality and precision tests, carried out by a separate or outsourced area, based on the best market practices;
• We keep up-to-date documentation regarding risk management and senior management decisions related to risk management;
• We periodically make public disclosure of information to the market to allow investors and other interested parties to verify how risks are managed; and
• We disseminate a risk management culture through awareness, awareness and training programs.

 

OBJECTIVE

Establish guidelines for EDP Brazil to promote people’s care and appreciation through development and professional improvement and personal and encouraging diversity.

DESCRIPTION AND RESPONSIBILITIES

The guidelines for People Management at EDP Brasil, which direct the actions of the company, are:

• Consolidation and maintenance of EDP Culture;
• Appreciation of diversity;
• Non-discrimination, equal opportunities and transparency for all levels of positions;
• Remuneration practices to ensure the attraction and retention of professionals;
• Promotion of safety and well-being of its employees, in the company’s internal and external environment, and;
• Encourage vocational training and continuous development of employees.

1.1. Culture

A public purpose and 12 principles guide the EDP Brasil Group. The EDP Culture movement aims at “our energy always to take better care”, and 12 principles, namely: life always first, unconditional respect, ethics and the search for the best for everyone, responsibility for the whole, consistency in speaking and in doing justice inequality and difference, focus on solutions and the greater purpose, search for excellence by the human, team spirit and companionship, shared knowledge, constant innovation, and the customer our reason d ‘être. These guiding principles characterize the EDP way of being and define a behavioral profile that can generate sustainable social changes throughout its value chain.

With the practice of the purpose and the EDP Culture movement, we seek a healthy work environment for employees, where they can be themselves, encouraging them to develop and share knowledge with other groups and communities, voluntarily. The search for a balance between professional and personal life and the generation of value for customers and other stakeholders are considered. In other words, the creation of a more humane, sustainable, and fair environment for all.

1.2. Appreciation of diversity

The EDP Brasil Group recognizes human rights as fundamental and universal principles that guide its practice and commitment to a more just and inclusive society. In this way, it ensures its responsibility towards sustainable development and corporate citizenship, actively contributing to promoting a work environment free from discrimination, in which all people feel respected and safe to be who they are.

With the EDP Inclusion & Diversity Program, the EDP Brasil Group reaffirms diversity as a tool to promote human development and generate innovation and the engagement of its employees, while also representing an opportunity to drive positive results for the business. It also reiterates its commitment to promoting an inclusive environment based on the acceptance of gender, sexual, cultural, racial, religious, or any diversity.

1.3. Recruitment and Selection​

The EDP Brasil Group ensures the filling of vacancy demands by professionals in the different business units of the companion Grupo EDP Brasil, through the processes of Internal Recruitment and External Recruitment, in a way that encourages diversity and inclusion guarantees non-discrimination, equal opportunities and transparency for all levels of positions under CLT, internship and temporary, temporary vacancies, to select professionals who have profiles compatible with the EDP Culture and with the competencies, skills, and attitudes required by the company and the position.

1.4. Performance and Skills Management

The EDP Brasil Group is committed to monitoring performance and development, increasing employee performance, tools, and processes that promote learning, and establishing a competitive culture focused on results through the application of mechanisms that encourage meritocracy and a high school culture performance and high performance.

1.5. Remuneration

EDP Brasil strives for compensation practices to ensure external competitiveness and internal equity, attraction, and retention of professionals with effective management aligned with business strategy.

1.6. Benefits

EDP Brasil manages its benefits policy to provide its employees’ safety and well-being in the company’s internal and external environment. Also, it highlights your benefits package as a competitive advantage in attracting and retaining its employees. The company demonstrates its responsibility to its employees by adopting a package of benefits in line with market practices.

1.7. Learning Training and Development

The EDP Brasil Group encourages learning, professional training, and the continuous development of its employees through content with technical, behavioral, organizational, and management domains, which are essential to obtain the expected levels of performance and excellence. Professional development is also applied to the company’s value chain through assessment, monitoring, monitoring, and promotion of acceptable fundamental practices to achieve levels of learning, performance, and excellence in its suppliers and third parties.

1.8. People Planning and Succession Management

The EDP Brasil Group carries out the process, implements tools that ensure succession planning for management functions and critical positions, intending to provide the mapping of the existence of professionals’ internal availability to strategic positions, the development of new leaders, and the correct management of knowledge and business continuity.

OBJECTIVE

Formalization of the principles that guide the company’s relationship with stakeholders, which influence or are influenced by the company’s activities, aiming at the generation of shared value, identifying opportunities between the parties, and the management of social and relationship capital.

OPERATION PRINCIPLES

The Relationship with Stakeholders is a strategic priority for the EDP Brazil Group, in the means that, open and transparent dialogue with its interesting parts is fundamental to ensure:

• The viabilization of strategic planning and performance of excellence, the strengthening of corporate governance and the possibility of searching for innovative solutions;
• Strengthen the relationship of trust, sharing knowledge and relevant information, anticipating challenges and identifying new opportunities for cooperation with Stakeholders;
• The implementation of essential practices for accountability in the following dimensions: economic, social, environmental, and reputational, so as a reception of feedback, allowing EDP Brazil Group to reevaluate itself continually, and:
• The attendance to the legal requirement, especially at times of impact assessment from a new development of EDP Brazil Group and, if necessary, be an instrument for crisis management and conflicts.

1.1.1. Guiding Commitments

The relationship with interesting parts – EDP Brazil Group Stakeholders is based on four axes or guiding commitments: understanding, communicating, trusting, and collaborating.

1.1.2. Understanding

We dynamically and systematically identify the Stakeholders who influence and are influenced by the EDP Brazil Group, analyze and seek to understand their expectations and interests. How we should act:

• Map, identify and evaluate the risks and impacts generated in the local community, society or other Stakeholders resulting from the company’s activities;
• Be accountable to the agents over whom the organization has an impact and the agents who affect the organization, ensuring that minorities have the same capacity of involvement of the remaining Stakeholders;
• To identify dynamically systematically the Stakeholders that influence and influenced directly and indirectly by the EDP Brazil Group and its activities, as well as issues pointed out as relevant by the Stakeholders, and;
• Prioritize in a balanced and equitable manner the Stakeholders, and the subjects pointed out by them as relevant.

1.1.3. Communicating

We promote a two-way dialogue with Stakeholders, through information and consultative actions. We hear, inform, and respond to Stakeholders in a consistent, clear, rigorous, and transparent manner to build a closer, more robust, and lasting relationships. Ensuring that Stakeholders’ complaints are answered and managed appropriately. How we should act:

• Ensure that Stakeholders have access to information by establishing direct, efficient and direct bidirectional communication channels, actively providing clear, comprehensible and accurate information, ensuring dissemination and dissemination to the various stakeholders, promoting and providing appropriate means of engagement;
• To proactively consult and listen to the concerns, interests, and expectations of Stakeholders, to prepare auscultation plans and engagement strategies that consider the characteristics of the different stakeholders, and;
• Respond to the relevant issues identified by the Stakeholders within a reasonable time, considering the characteristics of the stakeholders involved.

1.1.4. Trusting

We believe that fostering a climate of trust with Stakeholders is crucial to establishing stable and long-term relationships. Our relationship with stakeholders is based on values such as transparency, integrity, and mutual respect. How we should act:

• Establish a transparent relationship with the Stakeholders, ensuring that they know and understand the objectives of the EDP Brazil Group;
• Inform the Stakeholders about the economic, environmental and social impacts and risks arising from the activity of the EDP Brazil Group or a specific project, which could significantly influence them;
• Respect the views and rights of Stakeholders, treating them fairly, without discrimination, respecting diversity and their legal rights, and;
• Ensure that the relationship actions are based on the values, policies, and ethical principles of the EDP Brazil Group.

1.1.5. Collaborating

We collaborate with Stakeholders in the construction of strategic partnerships that bring together and share knowledge, skills, and tools, thus promoting value creation in a differentiating way. How we should act:

• Integrate into the company’s strategy the relevant contributions identified by the Stakeholders;
• Share knowledge and skills with Stakeholders, aiming at risk management and identifying the set of opportunities;
• Work cooperatively in building solutions, establishing strategic partnerships that produce positive results for both parties, including prevention, mitigation and compensation of impacts generated by our operations and in cases where residual impacts remain, offset or neutralize the risks and impacts On the Stakeholders, and;
• Share the performance results of the EDP Brazil Group and the results of the different relationship processes with Stakeholders, providing, where appropriate, relevant performance information.

1.2. Stakeholders Segmentation Model

The Stakeholders of the EDP Group are all entities or persons that influence or are influenced by the Group’s activities, products, and services. They are organized into four segments:

• Value Chain: Employees, Trade Unions, Suppliers, Scientific Community, Clients, Consumer Associations, and Business Associations.
• Market: Competition, Financial Entities, Shareholders, and Investors.
• Democracy: Government, Public Organs, Regulation, National Congress, Assemblies, Political Parties, and International Institutions.
• Social and Territorial Organization: Civil Society Organizations, Local Communities, Municipalities, Municipalities, Media, and Leaders of Opinion.,

1.3. Main Highlights in the Relationship with Stakeholders

1.3.1. Union Relations

The EDP Brazil Group acts with transparency and respect in union relations. It is based on its Code of Ethics and the fundamental and universal principles of Human Rights.

Also, it promotes the free trade union association. It maintains a permanent channel of negotiation and dialogue with the union representation of collaborators, aiming to resolve conflicts of a labor nature, the regulation of labor relations, and the conditions of employment resulting in normative agreements.

To guarantee this process, the management of the EDP Brazil Group attributes to the People Management area:

• Receive claims, clarify doubts and provide access to composition and collective bargaining;
• Conduct collective negotiations at a local level and can be carried out by third parties duly accredited by the companies;
• Recognize the legitimacy of trade union representation;
• Ensure compliance with the Collective Labor Agreement.

1.3.2. Illicit Acts

The EDP Brazil Group acts with transparency and respect in its relationship with all stakeholders, as it is based on its Code of Ethics and the fundamental and universal principles of Human Rights.

The EDP Brazil Group adopts and disseminates measures to combat all forms of Corruption, Administrative Improbity, Money Laundering, Free Competition, Predatory Prices, Conflict of Interests, Bribery and Cartel formation, to avoid the occurrence of acts, omission, Or the creation and maintenance of situations of favor or unstable conditions characterized by illicit acts.

The EDP Brazil Group guarantees the implementation of these measures by creating adequate internal structures, planning, and continuous evaluation of the Anti-Bribery Management System. In addition to promoting corporate oversight through the Ethics Committee, which is responsible for receiving and monitoring communications regarding any evidence of illicit acts by the company and its third parties.

The EDP Brazil Group provides a communication channel in which its employees and all interested parties can indicate conduct that they deem inappropriate to this policy’s principles and the EDP Brazil Group Code of Ethics. All retaliation is repudiated.

1.3.3. Human Rights

The EDP Brazil Group acts with full respect for Human Rights, within national and international legislation, participating in several international agreements to protect these rights, and incorporating in its strategic and operational activities all the necessary measures to ensure that there is no direct or indirect relationship with slave and child labor, with sexual exploitation independent of form, with restrictions on human freedom and condition, with violence, torture, and arbitrary detention, moral and sexual harassment, or discrimination in all its forms.

The EDP Brasil Group promotes Human Rights through freedom of opinion and expression, the diversity of cultures and ethnicities, the health and well-being of all Stakeholders affected by its activities, free organization and association, and freedom of conscience and religion.

To ensure respect for Human Rights in its operations and its value chain, the EDP Group establishes management guidelines and procedures, including assessing, preventing, and mitigating risks and impacts.

1.3.4. Public Agents

Public Agents are important Stakeholders in the relationship with EDP Brazil Group. Due to the public/ sector exposure of this stakeholder and the legislation governing the relationship with the Public Agent, it is necessary to ensure the alignment and compliance with the ethical principles established in the company’s Code of Ethics, internal policies, norms, and procedures, and current legislation. In this way, the EDP Brazil Group shows:

• The entire relationship with public agents is ethical and transparent as provided in the Code of Ethics, which regulates any behavior of exchange of privileged information, the benefit of parties interested in gaining an advantage directly or indirectly.
• All situations that may cause a perception of obtaining an undue advantage due to the exercise of the position, mandate, function, employment or activity of the public agent, are reported for the appropriate treatment.
• Special guidance to mitigate risks of anticompetitive conduct, for higher risk functions.
• Provides for collecting contributions to expand and ensure compliance.
• Provides for a periodic review of the Code of Conduct and Corporate Policy.

The realization of these relationships, in the various spheres of Public Agents, respects the legislation and procedures in force, to document the subjects dealt with and ensuring the suitability of the process.

1.3.5. Gifts and Presents

The exchange of courtesies is common practice in many countries and is part of the relationship between Stakeholders. In the EDP Group, courtesies respect amounts and values within acceptable parameters and within limits aligned with best market practices and that respect, the ethical principles described in the Code of Ethics and the Internal Standard for Gifts, Presents, and Events, to avoid situations that constitute undue benefits for any of the parties involved.

1.3.6. Social Investment

Social Investment is understood as the “voluntary transfer” of companies’ resources in planned, systematic, and monitored way, for public purposes, thus representing a form of corporate contribution directed at meeting community needs and priorities, with a focus on Transformation of their social reality. EDP Brasil systematically evaluates the positive and negative impacts its activities generate on people and society, including human capital (experience and knowledge), social capital (shared value, institutions), and relational capital (connections and network). Measuring these concepts, associated with well-being and socioeconomic impact, can facilitate the analysis of social capital flows, in parallel with the flows of financial and natural capital.

Social Investment practices represent the company’s commitment to the communities’ social, environmental, and cultural development where the company operates and contributes to the following objectives:

• Promote the insertion of the company in the communities surrounding the premises, enterprises and prospecting new business;
• Contribute to the generation of economic, social and environmental value for society;
• Contribute to the social license to operate;
• Contribute to the management of socio-environmental impacts;
• Contribute to the development of public policies and collective agendas for sustainable development;
• Strengthen the image and public recognition of the company, and;
• Contribute to the quality of life and preserve the socio-environmental balance of the regions of their enterprises.

1.3.7. Supplier Management

The EDP Brazil Group promotes Sustainability and Relationship in the Supply Chain according to the following 12 commitments:

• To develop practices of corporate responsibility and integrity with suppliers, ensuring compliance with the law and other obligations and procedures adopted by EDP Brazil Group and establishing a Code of Conduct for Suppliers;
• Establish environmental requirements in contracting and promote the adoption of the Environmental Policy of the EDP Group, preventing and mitigating adverse impacts arising from activities;
• Ensure equal treatment, transparency, and impartiality by ensuring a fruitful dialogue respecting mutual agreements with suppliers;
• Establish consultation and communication channels with suppliers, promoting initiatives that improve economic, ethical, social and environmental performance;
• Promote and adopt conduct of integrity and moral and ethical elevation in the supply chain, by applying the Code of Ethics of the EDP Group, refraining from any practices of bribery, corruption, extortion or fraud;
• Promote the confidentiality of all shared information, ensuring that it is not transmitted to third parties and that it respects the rights of all parties involved;
• Eliminate conflicts of interest that may impair the objectivity and independence of the decision process;
• To promote respect for human dignity and human rights and to reject any form of forced labor or child labor, persecution, discrimination, abuse or other forms of physical or psychological violence;
• Establish social, work and safety, hygiene and health requirements in contracting and subcontracting, ensuring compliance and permanent monitoring;
• To support the economic, ethical, social and environmental development of the local communities in which the EDP Brazil Group operates and cooperate with sectoral and international organizations for the joint promotion of Sustainability in the supply chain;
• Encourage continuous improvement, innovation and the sharing of acceptable practices in terms of Sustainability, efficiency, quality of goods and services and to promote new business solutions/opportunities;
• Define organizational, negotiation, and contracting models that value Sustainability throughout the value chain, establishing objectives and verifying the fulfillment of its goals.

1.3.8. Interaction with stakeholders

Bearing in mind that the relationship with stakeholders is a strategic priority for the EDP Brasil Group, the Institutional Relations and Stakeholder Management Department, guides employees who play this role of interacting with external stakeholders, seeking guidance from the area on the main procedures adopted by the board. It also informs the relationship with this stakeholder for the area within its scope, the responsibility to carry out the management of information regarding the interested parties.

The EDP Brasil Group manages its business with the objective of being an integrated company of reference in the Brazilian energy sector, ensuring full compliance with applicable standards and legislation.

The EDP Brasil Group considers that it is an ethical and civic duty to respect and follow the Constitution and the laws of the country in the execution of its business activities, contributing to the well-being of its citizens, to the sustainable development of the Group’s businesses and to the Creation of value for all stakeholders.

The EDP Brasil Group Code of Ethics integrates the values ​​promoted by the Company in business management and defines the principles and behavioral values ​​expected and required from employees and suppliers.

1.1. Strategic Business Planning

As a business management tool, strategic planning guides decisions at all hierarchical levels, directing the use of available resources efficiently, ensuring the continuity and growth of the business, reinforcing its competitive position in the market.

The elaboration of the strategic planning is an institutionalized process, approved in the scope of the Board of Directors, permeates the entire Company, considers the challenges and the context of the EDP Brasil Group, regional market conditions, economic, financial, management and technical conditions, As well as the interests of its stakeholders.

1.2. Resource Management

The EDP Brasil Group establishes the guidelines and responsibilities to be observed in order to minimize the financial, operational, legal and regulatory impacts resulting from the unavailability of human, material and technological resources essential for the operation of its operations.

Faced with the commitment to be permanent, EDP Brasil Group seeks to ensure the sustainability of the business, ensuring that the processes and the support infrastructure are able to operate efficiently.

1.3. Operational Structure

The EDP Brasil Group aims to:

• Ensure that business conduct is based on ethical principles, with transparency and equity, respecting human rights, internal rules and law;
• Adopt socially responsible business practices, contributing to the development and well-being of the community;
• Contribute to the development of individual and organizational skills, promoting the professional growth of employees;
• Provide services to clients with safety, quality, efficiency, respect and integrity;
• Encourage suppliers and contractors to adopt these guidelines;
• Adopt asset management practices throughout its life cycle, aiming to continuously improve the level of reliability, safety, effectiveness and efficiency, to maximize the value invested in a sustainable way, mitigating associated risks and in compliance with legal requirements , Statutory, regulatory, financial and other applicable laws.

1. PURPOSE

1.1. The purpose of this Dividend Policy (“Policy”) is to consolidate the rules and guidelines applicable to EDP – Energias do Brasil S.A. (“Company”) as concerns the distribution of dividends to facilitate the understanding of the matter by shareholders and other stakeholders.

2. REFERENCES

2.1. The present Policy is based on (i) Law 6,404, of December 15, 1976, as amended (“Brazilian Corporations Law”); (ii) the general rules issued by the Brazilian Securities and Exchange Commission – CVM governing the subject; (iii) the Company’s bylaws (“Bylaws”); and (iv) the resolutions of the Board of Directors and/or the Company’s General Shareholders’ Meeting.

3. DEFINITIONS

For the purposes of this Policy, the following definitions shall apply:

“Net Debt”: the sum of the Company’s interest-bearing debt, represented by loans and financing agreements with financial institutions or the capital markets, whether domestic or international, as recognized in current and non-current liabilities, minus cash and cash equivalents (corresponding to the sum of “cash and cash equivalents”, “financial investments”, “escrow” and “securities”), in any case, as shown in the consolidated balance sheet provided with the Company’s Consolidated Financial Statements;

“Adjusted Net Income”: adjusted Net Income calculated as the balance of the deductions and additions provided for in items I, II and III of article 202 of the Brazilian Corporations Law, and income realized as Long-Term Cash such as: (i) Transmission Companies’ EBITDA, whose contribution to adjusted EBITDA is recognized in accordance with regulatory EBITDA; (ii) the VNR (New Replacement Value) of the Distribution Companies; (iii) plus or minus the Capital gain/loss from M&A operations, business combinations or impairments, and not associated with effective cash gains or losses; (iv) Contingencies; (v) post-employment benefits; and (vi) deferred income tax.

“Transmission Companies’ Regulatory EBITDA”: Transmission Companies’ EBITDA calculated according to the Electric Sector Accounting Manual as prepared by the National Electric Energy Agency and/or the applicable sectoral law in force.

4. GUIDELINES

4.1. The Brazilian Corporations Law and the Bylaws require the Annual General Shareholder’s Meeting to be held by April 30 of each year, in which, among other matters, shareholders must decide on the distribution of annual dividends based on the Board of Directors’ proposed allocation of net income for the previous year.

4.2. Pursuant to the Company’s Bylaws, a minimum 25% (twenty-five percent) of net earnings calculated on the balance of the deductions and additions provided for in items I, II and III of article 202 of the Brazilian Corporations Law must be distributed as a mandatory dividend.

4.3. Several factors in addition to the legal minimum shall be analyzed for the purposes of proposing and resolving the payment of dividends, such as: operating income; the Company’s financial condition, cash needs and future prospects; reinvestments needs at the base and regulatory obligations; investment opportunities with appropriate returns; among other factors analyzed by the Board of Directors and that the Company’s shareholders may deem relevant. This analysis shall identify the risks inherent to the Company’s activities and the attainment of the goals established in its strategic planning.

4.4. Pursuant to the foregoing and other provisions hereunder, the purpose of the present Policy is to formalize the Company’s management’s intent to propose, from the General Shareholders Meeting that approves the accounts for the fiscal year ending December 31, 2020, the distribution of dividends and interest on shareholders’ equity, which shall be the highest among:

(a) twenty-five (25%) percent of net income, calculated on the balance of the deductions and additions provided for in items I, II and III of Article 202 of the Brazilian Corporations Law, pursuant to article 31 of the Company’s Bylaws;

(b) fifty (50) percent of Adjusted Net Income, as defined hereunder; or

(c) R$ 1.00 (one Brazilian Real) per share.

4.4.1. The criterion of item “c” above shall be adjusted in the event of a change in the number of equity shares arising from share splits, reverse splits, or similar events.

4.5. Without prejudice of the foregoing, the Board of Directors is commit to propose the distribution of any remaining free cash flow, that is, free cash generated in the previous fiscal year and not reinvested, as supplementary dividends and/or use thereof if a share buyback program, subject to: (i) the legal limitations and regulations, notably those imposed by the Brazilian Corporations Law and CVM Instruction No. 567, of September 17, 2015; (ii) the Company’s financial leverage (Net Debt-to-Adjusted EBITDA) ratio, calculated based on the financial statements for the respective fiscal year. The result of this formula after the distribution of dividends and/or interest on shareholders’ equity and/or buybacks shall target an index range 2.5x and 3.0x with a minimum of 2.0x; and (iii) the provisions of item 4.3, above.

4.6. The amounts in item 4.4, above, shall consider proceeds distributed as intermediate dividends, interim dividends, or interest on shareholders’ equity paid during the relevant year.

4.7. The respective proposals for the allocation of net income by the Company’s management shall be subject, in any case, to the General Shareholders’ Meeting endorsement and/or approval and may, at any time, be reviewed based on the Company’s plans and needs.

4.8. The Board of Directors, considering the circumstances of the market in which the Company operates, may propose, ad referendum the Company’s shareholders, the payment of dividends in amounts and under conditions other than those determined by the previous items.

5. FINAL DISPOSITIONS

5.1. The Board of Directors shall consider, as appropriate, the need for any revisions to this Policy, in accordance to statutory, legal or regulatory changes to which the Company may be subject, as well as to improve the corporate governance practices concerning the herein rules and procedures. Additionally, the Company’s Executive Board of Officers may, at any time, suggest a revision of the present Policy to the Board of Directors.

5.2. The provisions contained in the Company’s Bylaws, the Brazilian Corporations Law and the regulations issued by the Brazilian Securities and Exchange Commission – CVM, shall prevail over the present Policy in the event of omission or inconsistency.

5.3. This Policy was approved at a meeting of the Board of Directors held on August 28, 2020, and entering into force on the same date for an undetermined period, until otherwise resolved.

OBJECTIVE

Formalize the commitments of EDP Brazil to establish policies and guidelines concerning:

• Integration of sustainability principles and innovation in all areas processes within the organization, optimizing performance and creating shared value;
• Environmental management of the company ensuring responsible operations, considering the impacts of our activities along the value chain on biodiversity and ecosystem services, the sustainable use of natural resources and climate change;
• Establish principles inherent to the management of risks to health and safety at work;
• Management of intangible assets, aiming to generate shared and differential value to the organization’s core business, considering human, social, environmental and intellectual capital.

PRINCIPLES OF ACTING

1. Principles of sustainable development

Based on the vision of being a global energy company, a leader in value creation, innovation and sustainability and in line with the Organization’s Principles of Sustainable Development, EDP Brazil is committed to:

A. Economic and social value

• Create, ongoing basis value for shareholders;
• Increase efficiency in the use of resources and decrease exposure to risk;
• Contribute to improving competitiveness, namely through the provision of excellent services and predicting customer’s expectations and needs;
• Integrate environmental and social aspects into the plan and decision-making processes, including investments, activities of the company and its value chain, especially in the project’s designs and developments, changing current working conditions and supplier’s critics and customers;
• Contribute to the improvement of the population’s quality of life.

B. Eco-efficiency and environmental protection

• Promote the use of renewable energy sources, cleaner and more efficient energy technologies;
• Promote the improvement of energy efficiency consumption;
• Manage the impacts of activities in search of a positive environmental balance and thus assess, control, mitigate, compensate for the social-economic and environmental impacts of the projects and activities, with emphasis on the issues of waste and climate change, adapting to international standards corporate social responsibility;
• Increase operational efficiency and establish, whenever applicable, targets for reducing or improving efficiency related to the preservation of biodiversity and ecosystem services, efficient use of natural resources and energy, emissions of Greenhouse Gases (GHG), wastes and effluents;
• Contribute actively to the preservation of the biodiversity environment;
• Promote the improvement of environmental management practices in the value chain.

C. Innovation

• Support research, development, innovation (RDI) projects that contribute to the value generation and reduce the negative impacts caused by the company’s operations. All based on the concepts of smart grids, clean energy, customer-focused solutions, energy storage, data processing technologies, and operational efficiency;
• Foster entrepreneurship through initiatives aimed at the entrepreneurial ecosystem;
• Promote intrapreneurship at EDP Brazil through programs focused on the dissemination of innovation culture and new forms of work;
• Promote innovation and creativity, looking for new market opportunities and improving processes;
• Promote collaborative practices in the design phase, production phase, and service delivery;
• Promote research and technological development and knowledge management in the energy field.

D. Integrity and good governance

• Comply with legislation and established ethical and deontological standards.
• Respect and promote respect, for human rights, within our sphere of influence.
• Ensure a business governance that is integral, participatory, and competent.
• Adopt best market practices concerning ethics, human rights, corporate governance, anti-corruption, and other illicit acts maintaining diversified and integrated reporting, accountability for shareholders and customers, and other members of the value chain.

E. Transparency and dialogue

• Ensuring an open and trusting relationship with stakeholders.
• Promote consultation and communication channels with stakeholders, considering their contributions and expectations.
• Report transparently and objectively on economic, environmental, and social performance.

F. Human capital and diversity

• Promote integrity, rigor, individual responsibility, and teamwork, promoting diversity.
• Promote the development of employee skills and recognize excellence and merit.
• Improve the health, safety, well-being of employees.
• Disapprove of abusive, discriminatory practices, and guaranteeing equal opportunities.
• Promote employee satisfaction and motivation.

G. Energy Access

• Promote access to energy, a reliable, safe, and quality manner.
• Adapt commercial policies to specific social characteristics of the market.
• Ensure equity in energy access and energy systems.

H. Social development and citizenship

• Promote social innovation, maximizing the positive social impact of the activity.
• Support social responsibility actions based on transparent criteria evaluating the social return of invested resources.
• Cooperate in the sustainable development of societies.

2. Occupational environment

EDP Brazil, a company that operates in all segments of the electricity sector, recognizes that the environment and sustainable use of natural resources is essential for the sustainability of the Group’s operations. Therefore, it works promoting respect for the environment, in search of sustainable development, and establishes the following commitments regarding the continuous improvement of environmental management and the reduction of the impacts of its activities:

• Ensure compliance with legal requirements regarding current environmental legislation and the non-authorization to carry out any potentially polluting activities without the necessary authorizations and necessary controls;
• Identify and monitor the aspects of the occupational and environmental impacts, and establish controls for the significant aspects, and risks;
• Manage risks to eliminate, reduce, control, prevent incidents, prevent accidents, prevent environmental or material losses, and ensuring the communication of risks and mitigation measures;
• Promote the use of technologies and process that contribute to the protection of the environment and environmental pollution risks, contributing to the rational use of natural resources and the reduction of emissions, waste, and effluents;
• Demonstrate commitment to continuous improvement environment processes, based on the establishment and review of periodic objectives, goals and action plans;
• Promote initiatives aimed at disseminating knowledge about the efficient use of environmental resources and ecosystems, GHG emissions and the consequences of climate change, in addition to their implications for the company’s business;
• Identify risks, opportunities and implement measures to improve the environmental quality on located sites, minimize and mitigate impacts on the environment and climate change and adapt to their effects;
• Ensure the investigation of environmental incidents, identifying their cause and determining actions to prevent their repetition;
• Promote formal communication, consultation and stakeholder engagement processes related to the impacts on the environment;
• Contribute to the adoption of best practices in the value chain, through the establishment of specific procedures, especially for critical stages of the chain;
• Maintain a perceived leadership in the environment so that all employees are encouraged to behave sustainably.

A. Efficient use of resources

EDP Brazil understands the sustainable use of available natural resources is extremely important for the company and society and is committed to:

• Promote the efficient use of natural resources in its activities and within the framework of a circular economy, in particular:
  • In use and sustainable management of water in all the company’s processes, operations, and facilities.

B. Climate changes

EDP Brazil closely monitors international and national regulations on climate change and its impacts on its operations and commits to:

• Support and encourage projects, products, and services that make it possible to reduce greenhouse gas (GHG) emissions and promote social and environmental benefits in the value chain, covering education and investment measures in equipment and new technologies;
• Promote the internal energy efficiency and with partner suppliers in final consumption;
• Deliver low carbon products and services to customers.

C. Biodiversity and ecosystem services

EDP Brazil is aware of the sensitivity of natural ecosystems and the pressures to which they are exposed, as well as the inherent value of initiatives aimed at protecting biodiversity. In this way, it establishes the commitments related to biodiversity and ecosystem services and the management of the impacts of its activities along its value chain.

EDP Brazil, aiming to play an active role in the conservation and preservation of biodiversity, commits itself to:

• Integrate the impact valuation on biodiversity in the Distribution, Transmission, Commercialization and Generation units on, plan, construction, and operation;
• Contribute to avoid or reduce the loss of biodiversity, minimizing the negative impacts resulting from its activity, privileging a dynamic, comprehensive management, locally participated and with a long-term vision, aiming at a globally positive balance;
• Promote appropriate use of ecosystem services and natural resources and support initiatives for the conservation of nature and the enhancement of biodiversity, considering cultural and regional characteristics;
• Contribute to deepen scientific knowledge about the different aspects of biodiversity, namely through the establishment of partnerships;
• Regularly and transparently disseminate their biodiversity performance.

3. Occupational safety and health

In EDP Brazil’s undertakings, any task is more important or urgent that is should be performed without security. We believe that any accident or occupational disease is preventable and encourage the commitment of all employees in this principle, considering:

• Leadership as a promoter of Security management;
• No situation or urgency of service can justify endangering someone’s life;
• Ensuring a safe and healthy work environment, ensuring compliance with legislation as a minimum level of adequacy;
• Promote the knowledge and information of employees about the risks inherent in the activities, making them aware of compliance with safety standards;
• Provide consultation and participation of workers in prior recognition, control, and reduction of all risks associated with processes, as well as the elimination of hazards;
• Seek continuous improvement in the Security area with the involvement of all levels of management and the support of all employees, business partners, suppliers, and stakeholders.

4. Quality

EDP Brazil, a company that operates throughout the Energy Value Chain, recognizes that the quality of the service provided is essential for the sustainability of the Group’s operations. Therefore, it establishes as its commitments:

• Comply with the requirements of our customers and partners to satisfy their needs and expectations with the offer of services and products of recognized quality, continuously improved and at a competitive cost within the standards of the market where it operates;
• Seek customer satisfaction through the appropriate treatment of their claims, establish processes that comply with customer and regulation requirements, having basic guidelines to a systematic evaluation of complaints, identify fundamental causes, and continually seek to process improvement;
• Create long-term partnership relationships with suppliers, which favor the development of future business opportunities for both parties;
• Ensuring a safe working environment to provide our employees with the opportunity for professional and personal development, in a work environment compatible with the requirements of people’s performance and fostering innovation;
• Continuously evolve the company’s processes and organizational structure through the definition of objectives, measurement and temporal, quantitative and qualitative monitoring, respecting legal and regulatory requirements;
• Ensure the commitment of the leadership in the development of the quality process, achieving positive results that correspond to the return on investments and sustainability to ensure the continuity of the company in the market where it operates.

5. Intangible Assets

EDP Brazil, in alignment with their business strategies, considers that it should prioritize intangible assets that generate and share differential value to the business core of the organization, which are:

• Human Capital: results from the EDP Brazil Culture, the skills and technical knowledge of the staff and the employee’s satisfaction with the Company;
• Intellectual Capital: the set of intangible assets that differentiate the Company in the market and support the business strategy, such as innovation and research and development;
• Social Capital: results from the brand’s reputation, resulting from the relationships established with customers, suppliers, and communities;
• Natural Capital: through the management of natural resources and ecosystem services which EDP Brazil maintains impact or dependence relationship.

EDP Brazil establishes guidelines and methods to identify, evaluate, protect, develop, manage and measure these assets to maintain organizational knowledge to achieve its strategic vision.

1. OBJECTIVE

1.1. The purpose of this Policy is to establish guidelines and procedures to be observed by the Company and Persons Subject to the Policy (as defined below) for the disclosure of Relevant Act or Fact, pursuant to CVM Resolution No. 44/21, in order to avoid the use of Privileged Information and ensure equitable treatment of the Company’s investors.

1.2. This Policy is in accordance with the following basic principles:

(a) Compliance with current legislation and regulations issued by the CVM;

(b) Commitment to the best corporate governance practices; and

(c) Transparency and equity of treatment.

1.3. Within the scope of internal information management, the Company has an internal control system based on the classification of information according to the confidentiality of the data and its necessary protections, at the following levels: Restricted, Confidential, Internal, and Public. For this, the needs related to the business, the sharing or restriction of access, and the impacts in case of improper use of the information must be considered.

2. PERSONS SUBJECT TO THE POLICY

2.1. The following persons (“Persons Subject to the Policy”) are required to observe the rules and guidelines set forth in this Policy:

(a)   the Company;

(b)   the Controlling Shareholders;

(c)   shareholders who elect a member of the Company’s Board of Directors or Audit Committee;

(d)   the Directors, members of the Other Management Bodies, such as members of the Audit Committee (if installed);

(e)   Relevant Employees; and

(f)   Suppliers and Service Providers.

2.2. The persons indicated in sub-items “b”, “d”, “e”, and “f” above shall, upon hiring, election, promotion, or transfer, sign a Term of Adhesion pursuant to paragraph 1 of article 17 of CVM Resolution No. 44/21, according to the model contained in Annex 1 of the Company’s Securities Trading Policy, by which they will also declare that they are aware of all the terms of this Policy and will be obliged to abide by them.

2.2.1. The Term of Adhesion must remain filed at the Company’s headquarters while its signatory maintains a relationship with the Company and for at least five (5) years after its termination.

2.3. As a guarantee of compliance with all the terms contained in this Policy, it will be possible to enter into a confidentiality agreement with Suppliers and Service Providers. In the case of Suppliers and Service Providers who work in a profession subject to confidentiality and professional secrecy rules, under the terms of the rules applicable to the exercise of the profession, at the Company’s discretion, the execution of a confidentiality agreement may be waived.

2.4. The Company, in an act of discretionary management of the Policy, may request that other persons not expressly mentioned in item 2.1 above, but who may have knowledge of a Relevant Act or Fact not yet disclosed to the market, sign the Term of Adhesion and/or confidentiality.

3. DEFINITIONS

3.1. Whenever used in this Policy, terms with capital letters will have, both in the singular and in the plural, the following meanings:

Controlling Shareholder(s): shareholder or group of shareholders that exercises, directly or indirectly, the Power of Control of the Company, even if they are not bound by a shareholders’ agreement.

Managers: members of the Board of Directors and the Statutory Board of Executive Officers.

Relevant Act or Fact: has the meaning assigned to it in item 4 of this Policy.

B3: B3 S.A. – Brasil, Bolsa, Balcão.

Relevant Employees: anyone who, by virtue of their function or position held in the Company, Controlling Shareholders, Affiliates, or Subsidiaries, has knowledge, or may come to know, of a Relevant Act or Fact about the Company’s corporate business not yet disclosed to the market, or related to the Company’s quarterly and annual financial statements that have not yet been disclosed to the market.

Affiliates: companies in which the Company has significant influence, pursuant to the Brazilian Corporate Law.

Company: EDP – Energias do Brasil S.A., headquartered in the City and State of São Paulo, registered with the CNPJ/ME under No. 03.983.431/0001-03.

Spouse, Partner, or Dependent: spouses or partners and/or any other dependent included in the annual income tax return.

Subsidiaries: companies in which the Company holds the Power of Control.

CVM: Brazilian Securities and Exchange Commission.

Other Company Bodies: Members and respective alternates of the Audit Committee, Statutory or Non-Statutory Audit Committee, Advisory Committees of the Board of Directors, and any other bodies with technical or advisory functions, created or to be created by the Company.

Non-Statutory Executive Officers: those officers or managers who occupy high positions in the administration and management of the Company, in Affiliates or Subsidiaries, but who do not hold a statutory position.

DRI: Investor Relations Officer of the Company.

Market Management Entities: stock exchanges and, as the case may be, entities of the organized over-the-counter market in which the Company’s Securities are or will be admitted to trading, as applicable, in Brazil or abroad.

Former Directors: means the former officers and former members of the Company’s Board of Directors.

Suppliers and Service Providers: all individuals or legal entities that have a commercial, professional, or trusting relationship with the Company, such as independent auditors, consultants, financial institutions, Securities analysts, institutions in the distribution system, advisors, lawyers, accountants, outsourced workers, and suppliers hired by the Company, its Subsidiaries or Affiliates, who have knowledge, or may become aware, of a Relevant Act or Fact not yet disclosed to the market or, still, related to the Company’s quarterly and annual financial statements that have not yet been released to the market.

Privileged Information: information relating to a Relevant Act or Fact until it is disclosed to regulatory bodies, Market Management Entities, and other similar entities and, simultaneously, to shareholders and investors in general. Privileged information is also considered to be information related to quarterly or annual financial statements not yet disclosed to the market.

Corporate Law: means Law No. 6404, of December 15, 1976, as amended.

Relevant Trading: means the business or set of businesses through which the participation of a particular shareholder or group of shareholders acting together or representing the same interest, directly or indirectly, exceeds, up or down, the levels of five percent (5%), ten percent (10%), fifteen percent (15%), and so on, of the type or class of shares representing the Company’s capital stock, extending to (i) acquisition of any rights on shares and other Securities; (ii) execution of any derivative financial instruments referenced to Shares, even if there is no provision for physical settlement. The classification of a transaction as a Relevant Trading must observe the criteria established by article 12 of CVM Resolution No. 44/21.

Persons Subject to the Policy: persons identified in item 2.1 above.

Control Power: power effectively used to direct the social activities and guide the operation of the Company’s bodies, directly or indirectly, in fact or in law. There is a relative presumption of ownership of control in relation to the shareholder or group of Shareholders who own shares that have assured them of an absolute majority of the votes of the shareholders present at the last three general meetings of the Company, even if they do not own the shares that guarantee them the absolute majority of the voting capital.

Policy: means this Relevant Act or Fact Disclosure Policy of EDP – Energias do Brasil S.A.

CVM Resolution 44/21: means CVM Resolution No. 44, of August 23, 2021.

Term of Adhesion: term of adhesion to the Policy is the document to be signed pursuant to article 17, § 1 of CVM Resolution No. 44/21, according to the model in Annex 1 of the Company’s Securities Trading Policy.

Securities: any assets that, by law, are considered securities, issued by the Company or referenced thereto, including shares, debentures, certificates of real estate receivables, subscription bonuses, receipts and subscription rights, promissory notes issued by the Company, call or put options, indexes and derivatives of any kind backed by any of the instruments mentioned in this definition regardless of the form of settlement (physical and/or financial), or any other securities or collective investment contracts including, but not limited to agribusiness receivables certificates backed by the Company’s corporate debt, and any securities convertible into shares and share deposit certificates issued in Brazil and abroad, such as American Depositary Receipts – ADRs. The defined term “Securities” may also include those referenced in Securities of Subsidiaries, Affiliates, or Parent Companies, when expressly mentioned in the terms of the Policy.

4. DEFINITION OF RELEVANT ACT OR FACT

4.1. For the purposes of this Policy, in accordance with the provisions of CVM Resolution No. 44/21, it is considered a relevant act or fact any decision of the Controlling Shareholder, resolution of the general meeting or of the Company’s management bodies, or any other act or fact of a political-administrative, technical, business, or economic-financial nature occurred or related to its business that may significantly influence:

(a)   in the quotation of Securities issued by the Company or referenced thereto;

(b)   in investors’ decision to buy, sell, or hold the Securities; or

(c)   in the decision of investors to exercise any rights inherent to the condition of holder of Securities.

4.1.1. Observing the definition above and the provisions of item 4.1.2 below, the following are examples of potentially Relevant Act or fact, among others:

(a)   execution of an agreement or contract for the transfer of the Company’s shareholding control, even if under a suspensive or resolutive condition;

(b)   change in the Company’s control, including through the execution, amendment, or termination of a shareholders’ agreement;

(c)   execution, amendment, or termination of a shareholders’ agreement in which the Company is a party or an intervening party, or which has been recorded in the Company’s own book;

(d)   entry or exit of a partner who has an operational, financial, technological, or administrative contract or collaboration with the Company;

(e)   authorization to trade the Securities issued by the Company in any market, national or foreign;

(f)   decision to cancel the Company’s registration as a publicly-held company;

(g)   incorporation, merger, or spin-off involving the Company or related companies;

(h)   transformation or dissolution of the Company;

(i)    change in the composition of the Company’s equity;

(j)    change in accounting criteria;

(k)   debt renegotiation;

(l)    approval of the stock option plan;

(m)  change in the rights and benefits of the Securities issued by the Company;

(n)   split or grouping of shares or bonus attribution;

(o)   acquisition of Company shares to be held in treasury or cancellation, and sale of shares thus acquired;

(p)   profit or loss of the Company and the allocation of cash proceeds;

(q)   execution or termination of a contract, or failure to carry it out, when the expectation of completion is of public knowledge;

(r)    approval, alteration, or withdrawal of the project or delay in its implementation;

(s)   commencement, resumption, or interruption of the manufacture or sale of a product or the provision of a service;

(t)    discovery, change, or development of the Company’s technology or resources;

(u)   modification of projections disclosed by the Company; and

(v)   request for judicial or extrajudicial recovery, petition for bankruptcy or filing of legal action, administrative or arbitration procedure that may affect the economic and financial situation of the Company.

 

4.1.2. It is clarified that, in any case, the events related to the Relevant Act or Fact must have their materiality analyzed in the context of ordinary activities and the size of the Company or Affiliates or Subsidiaries, as well as the information previously disclosed and not in the abstract, in order to avoid trivializing the disclosure of Relevant Acts or Facts to the detriment of the quality of the analysis, by the market, of the Company’s perspectives.

5. FORM OF DISCLOSURE OF RELEVANT ACT OR FACT

5.1. The communication of a Relevant Act or Fact to the CVM, the Market Management Entities, and the market in general must be made immediately, by means of a written document, in a clear and precise manner, in a language accessible to the investing public. Whenever a technical concept is used that, at the discretion of the DRI, is considered to be of greater complexity, an explanation of its meaning must be included in the information disclosed.

5.2. The Relevant Act or Fact must be disclosed to the investing public through the following channels: (i) electronic system available on the CVM and B3 website; (ii) in one (1) news portal with a page on the world wide web, which makes available, in a section available for free access, the information in its entirety (as informed in the Company’s Registration Form); and on the Company’s Investor Relations page on the world wide web.

5.3. The file with the text of the Relevant Act or Fact must be sent to the CVM through the CVM Information Disclosure System, category “Material Fact.”

5.4. The Company will disclose the Relevant Act or Fact simultaneously in Portuguese and English, without prejudice to the use of other languages, pursuant to the applicable regulations or if the Company’s Investor Relations Department deems it necessary. The Company will use its best efforts to avoid potential divergences between languages, however, in case of divergence of interpretation between Portuguese and other languages, the information in Portuguese shall prevail.

5.5. Whenever a Relevant Act or Fact is published by any means of communication, including information to the press or at meetings of class entities, investors, analysts, or opinion makers, in Brazil or abroad, the Relevant Act or Fact will be disclosed and sent in advance or simultaneously with the CVM, Market Management Entities, and the investing public.

5.6. The Relevant Act or Fact should, preferably, be disclosed after the closing of business in the Entities Managing the Markets. If disclosure is necessary before the opening of the trading session, such disclosure should be made whenever possible, one (1) hour before the start or after, prevailing, in the event of incompatibility of trading hours in markets of different countries, the opening hours of the Brazilian market.

5.7. If it is imperative that the disclosure of a Relevant Act or Fact occurs during trading hours, the DRI must always request, simultaneously to the Brazilian and Foreign Market Management Entities, the suspension of trading in the Securities issued by the Company for the necessary time to adequate dissemination of relevant information.

5.8. The Company may, exceptionally, fail to disclose a Relevant Act or Fact when the Controlling Shareholder or the Company’s Managers understand that the disclosure of the Relevant Act or Fact at that time may jeopardize the Company’s legitimate interest. If the Relevant Act or Fact is linked to operations directly involving the Controlling Shareholder and the Controlling Shareholder decides not to disclose it, the Controlling Shareholder must inform the Company’s DRI and/or the Investor Relations Department.

5.9. Even if the Controlling Shareholder or the Company’s Managers decide not to disclose a Relevant Act or Fact, in the event that the Relevant Act or Fact kept in secrecy escapes control, or, in the event of an atypical fluctuation in the quotation, price, or traded quantity of the Securities, the Controlling Shareholders or the Managers are obliged, through the DRI or directly, to ensure that the Relevant Act or Fact is immediately communicated to the CVM, the Market Management Entities, and the investing public.

5.10. The Controlling Shareholders or the Managers may submit to the CVM the need to provide information that has not been disclosed pursuant to item 5.8.

5.11. In the event of participation in any events, including “lives” (live transmissions carried out by electronic means), Persons Subject to the Policy must ensure that all the terms and conditions of this Policy are observed and respect all provisions of the regulation in force on the participation of events of this nature.

5.11.1. Whenever applicable, pursuant to the regulations in force, the participation of Managers and other Company executives in events, including “lives”, aimed at discussing Company information related to the capital market and of interest to shareholders and investors in general, it must be preceded by a communication to the market, informing the date, time, and internet address where the “live” will be broadcast. Persons Subject to the Policy undertake to notify the DRI as far in advance as possible, at least two days in advance of the holding of events, including “lives”, about participation in events, so that the DRI can instruct the participant on the legal requirements and prepare the communication materials to the market that are legally necessary.

6. MECHANISMS FOR CONTROL AND RESTRICTION OF ACCESS TO PRIVILEGED INFORMATION

6.1. For the purpose of preserving the confidentiality of Privileged Information, which are those related to a Relevant Act or Fact, or even to quarterly or annual financial statements not yet disclosed to the market, as defined above, it is recommended that Persons Subject to the Policy observe the following procedures, without prejudice to the adoption of other measures that may be appropriate in the face of each specific situation:

(a)   disclose the Privileged Information strictly to those people directly involved with the matter in question;

(b)   not to discuss the Privileged Information (i) in public places or in the presence of third parties who are not aware of it, or (ii) in telephone conferences in which it is not possible to be sure who actually are the people who can participate in it;

(c)   secure the environment in which the Privileged Information is stored and transmitted, restricting any unauthorized access; and

(d)   not to comment on such Privileged Information with third parties, including Spouses, Partners, or Dependents.

6.2. Access to information on a Relevant Act or Fact prior to its public disclosure is limited to professionals directly involved with the subject in question. For this reason, the Company will maintain controls identifying people who are aware of Material Facts not disclosed to the market, such as, for example, a list of those present at meetings of Committees, Executive Board, and Board of Directors.

6.3. If there are indications of violation of the confidentiality of the Material Fact, the DRI, immediately after becoming aware of the possible breach of confidentiality, must assess the necessary measures to ensure the availability to the market, in a timely manner, of the information that constitutes the Material Fact, clarifying any rumors of the which he became aware of.

7. ASSISTANCE TO INVESTORS

7.1. Assistance to investors and market analysts will always be carried out by the DRI and/or by a representative of the Investor Relations Department, and such persons may be accompanied by other Directors of the Company, at the discretion of the DRI.

8. DISCLOSURE ABOUT ACQUISITION OR DISPOSAL OF RELEVANT SHAREHOLDINGS

8.1. Persons Subject to the Policy who carry out Relevant Trades must send the Company, in the person of the DRI, immediately after the transaction, a notice covering all the information requested by article 12, caput and items, of CVM Resolution No. 44/21.

8.2. The DRI, through the Company’s Investor Relations area, is responsible for transmitting information related to Relevant Trades, as soon as it is received by the Company, to the CVM and the Market Management Entities.

8.3. In the communication on Relevant Negotiations that involve the acquisition of rights over the Securities, or the execution of derivative financial instruments referenced in shares, the following rules must be observed:

8.3.1.     The shares directly held and those referenced by derivative financial instruments of physical settlement must be considered together for the purpose of verifying the percentages of the Relevant Trades;

8.3.2.     Shares referenced by derivative financial instruments with an exclusively financial settlement forecast must be computed independently of the shares mentioned in item 8.3.1 for the purpose of verifying the percentages of Relevant Trades;

8.3.3.     The number of shares referenced in derivative instruments that confer economic exposure to the shares cannot be offset against the number of shares referenced in derivative instruments that produce inverse economic effects.

8.4. The obligations provided for in item 8.3. do not extend to Structured Operations Certificates (“COE”), securities index funds, and other derivative financial instruments in which the shares issued by the Company have a weight of less than twenty percent (20%).

8.5. In cases where the Relevant Trading results or has been carried out with the objective of changing the composition of control or the administrative structure of the Company, as well as in cases where the Relevant Trading generates an obligation to carry out a public offering, under the terms of the applicable regulations, the acquirer must also promote the disclosure of a notice containing the information provided for in items I to V of the caput of article 12 of CVM Resolution No. 44/21, at least, through the same communication channel usually adopted by the Company indicated in item 5.2 of this Policy.

9. PUBLIC OFFER OF DISTRIBUTION

9.1.      In the event of a public offering for the distribution of the Company’s Securities, decided or planned, the Company and the Persons Subject to the Policy shall, without prejudice to other obligations provided for in the regulations issued by the CVM, and the disclosure by the Company of the periodic and eventual information required by CVM:

(a)   until the public offer is disclosed to the market, limit: (i) the disclosure of information related to the offer to what is necessary for the purposes of the offer, advising recipients about the reserved nature of the information transmitted; and (ii) the use of the reserved information strictly for purposes related to the preparation of the offer;

(b)   refrain from expressing itself in the media about the offer or the offeror until the announcement of the termination of distribution in the sixty (60) days prior to the filing of the request for registration of the offer or from the date on which the offer was decided or projected, whichever occurs last; and

(c)   from the moment the offer becomes public, when disclosing information related to the Company or the offer: (i) observe the principles related to quality, transparency, and equal access to information; and (ii) clarify their connections with the Company or their interest in the offer, in their manifestations on matters involving the offer, the Company or its Securities.

9.2.      The prohibition provided for in item 9.1(b) above does not apply (i) to the disclosure of periodic and occasional information by the Company, which must be carried out within the deadlines established by the applicable legislation and regulations; and (ii) information usually disclosed in the normal course of the Company’s activities. If the Company promotes communication actions on the occasion of the disclosure of results, such as collective or individual interviews with the press, teleconference with analysts, publication of official and publicity pieces, meetings with investors and disclosure of guidance, any and all events or actions of communication shall be accompanied by a notice alerting the public to:

(a)   the existence of a public distribution offer in progress or in the process of being carried out, if the operation has already been disclosed to the market and within the limits of what has been disclosed; and

(b)   the need for any interested person to carefully read the prospectus disclosed or to be disclosed, especially the section on risk factors, before making any decision regarding the offer.

9.3.      The Company and the Persons Subject to the Policy must also observe (i) the rules of conduct established by the local legal advisor in the context of public offerings for the distribution of Securities carried out in accordance with CVM Instruction No. 400, of December 29, 2003, as amended, or with CVM Instruction No. 476, of January 16, 2009, as amended, as the case may be; and (ii) the rules of foreign law relating to the prohibitions and other limitations on the disclosure of information in the context of a public offering for the distribution of the Company’s Securities, in accordance with the guidelines of a legal advisor in foreign law, whenever applicable.

10. RELEASE OF QUARTERLY AND ANNUAL RESULTS

10.1. The disclosure of the Company’s quarterly and annual results will be made outside the trading hours of the Management Entities of the Markets in which the Company’s Securities are admitted to trading.

10.2. Information related to quarterly and annual results will be (i) filed with the CVM and Market Management Entities, as applicable, (ii) made available on the Company’s website; and, subsequently, (iii) made available to analysts and investors who are part of the Company’s register.

10.3. On these occasions, the Company must carry out, within five (5) business days after the disclosure, a public presentation on the information disclosed with analysts and investors, in accordance with the applicable regulations, and may also, at its discretion, hold press conferences with the specialized company, in order to provide a broad knowledge of quarterly and annual results without, however, disclosing other information not widely disclosed to the capital market.

10.4. The Company adopts the System of Quiet Period in the fifteen (15) days prior to the date of disclosure of the quarterly information (“ITR“) and annual information (“DFP“) of the Company to the CVM regulators, to the Market Management Entities, as well as its public disclosure.

10.5. The Company will inform the market through its annual calendar of the date of disclosure of the ITR and DFP and, at the same time, will internally disclose the beginning of the Quiet Period.

10.6. Persons Subject to the Policy are subject to the Quiet Period.

10.7. Information that is characterized as a Relevant Act or Fact, and that does not directly concern the content of the financial information not yet disclosed, must continue to be disclosed normally to the market in the form of this Policy.

11. PROJECTIONS

11.1. The disclosure of projections is information of a material nature, subject to the provisions of CVM Resolution No. 44/21. The disclosure of projections and estimates is optional, under the terms of the regulations issued by the CVM and, when the Company decides to disclose them, they must be: (a) included in the Reference Form; (b) identified as hypothetical data that do not constitute a promise of performance; (c) reasonable; and (d) be accompanied by the relevant assumptions, parameters, and methodology adopted, and, if these are modified, the Company must disclose, in the appropriate field of the Reference Form, that it made changes in the relevant assumptions, parameters, and methodology of projections and estimates previously disclosed.

11.2. If disclosed, the projections and estimates must be periodically reviewed, at an appropriate time interval for the object of the projection, which, under no circumstances, must exceed one (1) year. The Company must also compare, on a quarterly basis, in the “Comment on the behavior of business projections” of the ITR and DFP Forms, the projections disclosed in the Reference Form with the results actually obtained in the quarter, indicating the reasons for any differences.

11.3. Whenever the assumptions for projections and estimates are provided by third parties, the sources must be indicated.

11.4. If the disclosed projections are discontinued, this fact must be informed in the proper field of the Reference Form, accompanied by the reasons that led to their loss of validity, as well as disclosed in the form of a Material Fact.

11.5. The projections must always be accompanied by the usual reservations stating that they are forecasts subject to risks and uncertainties, having been made based on the beliefs and assumptions of the Company’s management, in accordance with the information available in the market at that time.

12. RESPONSIBILITIES

12.1. It is the duty of Persons Subject to the Policy, in addition to the other obligations provided for in this Policy, to:

(a)   know, have access, and understand this Policy, as well as have full knowledge of their respective obligations in relation to its application;

(b)   keep confidential all information related to a Relevant Act or Fact of the Company to which it has privileged access due to the position they hold, until its disclosure to the market, and the use of such information for the purpose of obtaining an advantage, for itself or for others, subject to the application of the penalties provided for in the applicable legislation and at the discretion of the Company;

(c)   ensure that their subordinates and trusted third parties keep confidential all information related to a Relevant Act or Fact and that they are not used;

(d)   subject to the provisions of item 2 above, adhere to the Policy by signing the Term of Adhesion or, alternatively, enter into a confidentiality agreement, as applicable;

(e)   communicate to the DRI and/or the Investor Relations Department any information that they understand to characterize a Relevant Act or Fact, who will be responsible for deciding on the need to disclose the matter to the market and on the level of detail of disclosure; and

(f)   promptly respond to requests for clarification made by the DRI regarding the verification of the occurrence of a Relevant Act or Fact.

12.1.1. The duty to maintain secrecy, provided for in item 12.1 “b” above, also applies to former Managers, former members (effective and alternates) of the Company’s Audit Committee, and former members of the Other Management Bodies who have left the Company prior to public disclosure of Privileged Information. The duty to maintain secrecy will extend to the disclosure, by the Company, of the Relevant Act or Fact to the market.

12.2.    It is the duty of the DRI, in addition to the other obligations provided for in this Policy, to:

(a)   send to the CVM, by means of an electronic system available on the CVM page on the world wide web, and, if applicable, to the Market Management Entities any Relevant Act or Fact that has occurred or is related to the Company’s business;

(b)   ensure the wide and immediate dissemination of the Relevant Act or Fact disclosed or communicated, simultaneously in all markets where such Securities are admitted to trading;

(c)   cause the disclosure of a Relevant Act or Fact to precede or be made simultaneously with the dissemination of the information by any means of communication, including information to the press, or at meetings of class entities, investors, analysts, or with a selected public, in Brazil or abroad;

(d)   ask persons with access to a Relevant Act or Fact, with the aim of ascertaining whether they are aware of information that must be disclosed to the market, in the event of an unusual fluctuation in the quotation, price, or traded quantity of the Securities, or in the event of the need to provide additional clarifications to the CVM and, if applicable, to the Market Management Entities;

(e)   disclose Relevant Act or Fact, subject to the provisions of items 5.6. and 5.7. above;

(f)   immediately disclose a Relevant Act or Fact that, exceptionally, has not been disclosed because the Controlling Shareholders or Managers understand that its disclosure would jeopardize the Company’s legitimate interest, in the event that the information escapes control or if there is an atypical fluctuation in the quotation, price, or quantity of the Securities;

(g)   provide the requested information, in case the CVM or the Market Management Entities require clarification on the communication and disclosure of a Relevant Act or Fact;

(h)   analyze any rumors or speculations about the Company and assess whether an official communication from the Company to the market is necessary;

(i)    once the publication of news in the press involving Privileged Information or the publication of news that adds a new fact about information already disclosed is verified, analyze the potential impact of the news on the negotiations and, if applicable, express immediately on the referred news, through the CVM Information Disclosure System;

(j)    administer this Policy, as well as transmit to the CVM and/or the Management Entities of the Markets in which the Company’s Securities are admitted to trading the information received in accordance with this Policy, as required under the applicable legislation;

(k)   transmit to the CVM and, if applicable, to the Management Entities of the Markets in which the Company’s shares are admitted to trading, information related to the ownership report and negotiations carried out with Securities of the Company, its Parent Companies and Subsidiaries, provided to the Company pursuant to item 6 of the Company’s Securities Trading Policy; and

(l)    transmit the information referred to in item 8 above, as soon as it is received by the Company, to the CVM and, if applicable, to the managing entities of the markets in which the Company’s shares are admitted to trading.

12.3. Without prejudice to item 12.2, it is incumbent upon the Controlling Shareholders, Statutory Officers, members of the Board of Directors, and Other Management Bodies to:

(a)   immediately notify the CVM and, if applicable, the Market Management Entities of any Relevant Act or Fact of which they are aware, in case the DRI has failed to comply with its duty of communication and disclosure, including in the event of item 5.9;

(b)   previously inform the DRI of the content of any interview or press statement involving the Company, which may constitute a Relevant Act or Fact; and

(c)   appoint the employees and third parties who must formally adhere to the Policy, in accordance with the guidelines of the Investor Relations Department.

12.3.1. If any Administrator intends to comment in the media, by any means of communication, including the internet or social networks, any information to which they have had access and that there is any doubt about its qualification as Privileged Information, the DRI must be previously communicated in a way that the latter can assess whether the information constitutes a Relevant Act or Fact and must be simultaneously disclosed to the market.

12.4. It is the duty of the Company, in the person of the DRI, in addition to the other obligations provided for in this Policy, to:

(a)   formally communicate the terms of this Policy to the Persons Subject to the Policy, obtaining their formal adhesion by signing the Adhesion Term, which must be filed at the Company’s headquarters while the person maintains a relationship with it, and for five (5) years, at least, after their termination;

(b)   maintain at its headquarters, at the disposal of the CVM, a list with an updated list of Persons Subject to the Policy, as well as those persons who violate this Policy, and their respective qualifications, indicating position or function, address, and registration number in the National Registry of Legal Entities or in the Register of Individuals; and

(c)   identify Relevant Employees and Suppliers and Service Providers who must formally adhere to the Policy, in accordance with the guidelines of the Investor Relations Department.

12.5. It is the duty of the Investor Relations Department, in addition to the other obligations provided for in this Policy, to:

(a)   report to the DRI and the Company’s Ethics Committee the identified cases of violation of the Policy; and

(b)   advise the DRI on compliance with this Policy.

12.5.1. The Investor Relations Department, under the supervision of the DRI, is allowed to disclose a Relevant Act or Fact.

12.6. It is the duty of the Human Resources Department to act in order to assist the Investor Relations Department to, in addition to the other obligations provided for in this Policy, assist in obtaining the Terms of Adhesion of Relevant Employees and Suppliers and Service Providers, as well as other persons not expressly mentioned in item 2.1 above, and forward them to the Investor Relations Department, be responsible for filing and controlling such adhesions, keeping them filed for at least five (5) years.

12.7. It is the duty of all Relevant Employees, in addition to the other obligations provided for in this Policy, to:

(a)   sign the Term of Adhesion, forwarding it to the Investor Relations Department for proper filing;

(b)   arrange for the signature of the confidentiality agreement by any persons it identifies as Suppliers and Service Providers, and deliver said agreement to the Investor Relations Department for filing;

(c)   keep confidential information related to Relevant Act or Fact to which they have privileged access, until their disclosure to the market, as well as ensure that subordinates and third parties they trust also do so, responding jointly with them in the event of non-compliance; and

(d)   not grant an interview or press statement involving a Relevant Act or Fact of the Company, without being previously authorized to do so by the DRI or the Investor Relations Department.

12.9. It is up to the Investor Relations Department, without prejudice to its other attributions, to determine the referral of cases of violation to the DRI and the Company’s Ethics Committee, as the case may be, for knowledge and deliberation.

12.10. The Company’s Ethics Committee is responsible for analyzing cases of violation referred by the Investor Relations Department or the DRI or received through the other contact channels made available by the Company, and deciding or recommending, when applicable, appropriate disciplinary measures.

13. POLICY VIOLATION

13.1. Failure to comply with this Policy subjects the violator to disciplinary sanctions, in accordance with the Company’s internal rules, such as guidance sanctions, warnings, suspension, or dismissal for just cause, according to the seriousness of the infraction, without prejudice to administrative, civil, and criminal sanctions applicable.

13.2. Any person who becomes aware of a violation of this Policy must immediately report the fact to the Investor Relations Department or the Company’s Ethics Committee, through the contact channels provided by the Company, so that the necessary measures are taken.

14. CONFLICT BETWEEN PROVISIONS

14.1. In the event of a conflict between the provisions of this Policy and the Company’s Bylaws, the provisions of the Bylaws shall prevail, and in the event of a conflict between the provisions of this Policy and the legislation or regulations in force, the provisions of the current legislation shall prevail. Once the conflict has been identified, the Board of Directors must make the necessary changes to the Policy, in order to make it compatible with statutory, legal, or regulatory provisions, as the case may be.

15. APPROVAL

15.1. This Policy comes into force, for an indefinite period, on the date of its approval by the Board of Directors, replacing the Policy previously in force.

15.2. The Company’s Board of Directors is the Company’s body that has exclusive authority to amend, in any event, this Policy.

15.3. Any change to this Policy must be communicated by the DRI to the CVM and to the Management Entities of the Markets in which the Company’s Securities are admitted to trading, and the communication must be accompanied by a copy of the resolution and the entire content of the documents that govern and integrate the Policy.

15.4. Persons Subject to the Policy will be formally communicated about the terms of the resolution of the Board of Directors that approves the revision or amendment of the Policy.

15.5. No revision or amendment of this Policy can be approved pending a Relevant Act or Fact not yet disclosed.

1. PURPOSE

1.1       The purpose of this Policy is to establish guidelines and procedures to be observed by the Company and by Persons Subject to the Policy (as defined below), for the trading of Securities issued by the Company or referenced thereto, pursuant to CVM Resolution No. 44/21.

2. PERSONS SUBJECT TO THE POLICY

2.1       The following persons (“Persons Subject to the Policy”) are required to observe the rules and guidelines set forth in this Policy:

(a)     the Company;

(b)     the Controlling Shareholders;

(c)     shareholders that elect a member of the Company’s Board of Directors or Audit Committee;

(d)     the Administrators, members of the Other Bodies of the Company, such as members of the Audit Committee (if installed);

(e)     Relevant Collaborators; and

(f)      Suppliers and Service Providers.

2.2       The persons indicated in sub-items “b”, “d”, “e”, and “f” above must, at the time of their hiring, election, promotion, or transfer, sign a Term of Adhesion, by which they declare they know all the terms of the Policy and will undertake to abide by them.

2.2.1 The Term of Adhesion must remain filed at the Company’s headquarters while its signatory maintains a relationship with the Company and for at least five (5) years after its termination.

2.3.      As a guarantee of compliance with all the terms contained in this Policy, it will be possible to enter into an agreement of confidentiality and non-negotiation of Securities with the Suppliers and Service Providers mentioned in sub-item “f” above. In the case of Suppliers and Service Providers who work in a profession subject to confidentiality and professional secrecy rules, under the terms of the rules applicable to the exercise of the profession, at the Company’s discretion, the execution of a confidentiality agreement may be waived.

2.4.      The Company, in an act of discretionary management of the Policy, may request that other persons not expressly mentioned in item 2.1. above, but who may have knowledge of a Relevant Act or Fact not yet disclosed to the market, sign the Term of Adhesion and/or confidentiality agreement and non-trading of Securities.

2.5.      The natural persons indicated in sub-items “b”, “d”, “e”, and “f” above must ensure that the Policy is observed by their Spouses, Partners, or Dependents. For the purposes of the Policy, the negotiations carried out by the Spouses, Partners, or Dependents will be considered as carried out by the Persons Subject to the Policy to which they are related.

2.6.      The presumptions, prohibitions, and communication obligations established in this Policy apply to trades carried out (i) inside or outside regulated Securities market environments; (ii) directly or indirectly, either through subsidiaries or third parties with whom a trust or portfolio management agreement is maintained; (iii) for its own account or for third parties; (iv) the negotiations carried out by the respective Spouses, Partners, or Dependents of the persons indicated in sub-items b”, “d”, “e”, and “f” above; and (v) the leasing operations of Securities issued by the Company carried out by Persons Subject to the Policy.

2.6.1. For the purposes of the provisions of item 2.6, those negotiations carried out by investment funds in which the Persons Subject to the Policy are shareholders are not considered indirect or on behalf of third parties negotiations, provided that the negotiation decisions of the administrator or fund manager cannot be influenced by the shareholders.

3. DEFINITIONS

3.1       Whenever used in this Policy, terms with capital letters will have, both in the singular and in the plural, the following meanings:

Controlling Shareholder(s): shareholder or group of shareholders that exercises, directly or indirectly, the Power of Control of the Company, even if they are not bound by a shareholders’ agreement.

Administrators: members of the Board of Directors and the Statutory Board of Executive Officers.

Relevant Act or Fact: has the meaning assigned to it in item 4 of this Policy.

B3: B3 S.A. – Brasil, Bolsa, Balcão.

Relevant Collaborators: anyone who, by virtue of their function or position held in the Company, Controlling Shareholders, Affiliates, or Subsidiaries, has knowledge, or may become aware, of a Relevant Act or Fact about the Company’s corporate business not yet disclosed to the market, or related to the Company’s quarterly and annual financial statements that have not yet been disclosed to the market.

Affiliates: companies in which the Company has significant influence, pursuant to the Brazilian Corporate Law.

Company: EDP – Energias do Brasil S.A., with its principal place of business in the city and State of São Paulo, enrolled with the Corporate Taxpayers’ Register (CNPJ/MF) under No. 03.983.431/0001-03.

Spouse, Partner, or Dependent: Spouses or partners and/or any other dependent included in the annual income tax return.

Subsidiaries: companies in which the Company holds the Power of Control.

CVM: Brazilian Securities and Exchange Commission.

Other Company Bodies: Members and respective alternates of the Audit Committee, Statutory or Non-Statutory Audit Committee, Advisory Committees of the Board of Directors, and any other bodies with technical or advisory functions, created or to be created by the Company.

Non-Statutory Executive Officers: those officers or managers who occupy high positions in the administration and management of the Company, in Affiliates or Subsidiaries, but who do not hold a statutory position.

DRI: Investor Relations Officer of the Company.

Market Management Entities: stock exchanges and, if applicable, entities of the organized over-the-counter market in which the Company’s Securities are or will be admitted to trading, as applicable, in Brazil or abroad.

Former Administrators: means the former officers and former members of the Company’s Board of Directors.

Suppliers and Service Providers: all individuals or legal entities that have a commercial, professional, or trusting relationship with the Company, such as independent auditors, consultants, financial institutions, securities analysts, institutions in the distribution system, advisors, lawyers, accountants, outsourced workers, and suppliers hired by the Company, its Subsidiaries or Affiliates, who have knowledge, or may become aware, of the Relevant Act or Fact not yet disclosed to the market or, still, related to the Company’s quarterly and annual financial statements that have not yet been released to the market.

Privileged Information: information regarding the Relevant Act or Fact until it is disclosed to regulatory bodies, Market Management Entities and, simultaneously, to shareholders and investors in general. Privileged information is also considered to be information related to quarterly or annual financial statements not yet disclosed to the market.

Corporate Law: means Law No. 6404, of December 15, 1976, as amended.

Private Trading: transactions that are carried out outside the stock exchanges and the organized over-the-counter market.

Blocking Periods: has the meaning assigned to it in item 5.2 of this Policy.

Persons Subject to the Policy: persons identified in item 2.1. above.

Control Power: power effectively used to direct the social activities and guide the operation of the Company’s bodies, directly or indirectly, in fact or in law. There is a relative presumption of ownership of control in relation to the shareholder or group of Shareholders who own shares that have assured them of an absolute majority of the votes of the shareholders present at the last three general meetings of the Company, even if they do not own the shares that guarantee them the absolute majority of the voting capital.

Policy: means this Policy for Trading Securities of EDP – Energias do Brasil S.A.

Individual Investment Program: has the meaning assigned to it in item 7 of this Policy.

CVM Resolution No. 44/21: means CVM Resolution No. 44, of August 23, 2021.

SEC: Securities and Exchange Commission of the United States of America.

Term of Adhesion: term of adhesion to the Policy is the document to be signed pursuant to article 17, § 1, of CVM Resolution No. 44/21, according to the model in Annex 1.

Securities: any assets that, by law, are considered securities, issued by the Company or referenced thereto, including shares, debentures, certificates of real estate receivables, subscription bonuses, receipts and subscription rights, promissory notes issued by the Company, call or put options, indexes and derivatives of any kind backed by any of the instruments mentioned in this definition regardless of the form of settlement (physical and/or financial), or even any other securities or collective investment contracts, certificates of agribusiness receivables backed by the Company’s corporate debt, and any securities convertible into shares and share deposit certificates issued in Brazil and abroad. The defined term “Securities” may also include those referenced in Securities of Subsidiaries, Affiliates, or Parent Companies, when expressly mentioned in the terms of the Policy.

4. DEFINITION OF RELEVANT ACT OR FACT

4.1.      For the purposes of this Policy, in accordance with the provisions of CVM Resolution No. 44/21, any decision of the Controlling Shareholder, resolution of the general meeting or of the Company’s Management bodies, or any other act or fact of a political-administrative, technical, business, or economic-financial nature that occurred or related to its business that could significantly influence:

(a)     with the quotation of Securities issued by the Company or referenced thereto;

(b)     with investors’ decision to buy, sell, or hold those Securities; or

(c)     with the decision of investors to exercise any rights inherent to the condition of holder of Securities.

4.1.1 Abiding by the above definition, the following are examples of potentially relevant act or fact, among others:

(a)     signing of an agreement or contract for the transfer of the Company’s shareholding control, even if under a suspensive or resolutive condition;

(b)     change in the Company’s control, including through the execution, amendment, or termination of a shareholders’ agreement;

(c)     execution, amendment, or termination of a shareholders’ agreement in which the Company is a party or an intervening party, or which has been recorded in the Company’s own book;

(d)     entry or exit of a partner who has an operational, financial, technological, or administrative contract or collaboration with the Company;

(e)     authorization to trade the Securities issued by the Company in any market, national or foreign;

(f)      decision to cancel the Company’s registration as a publicly-held company;

(g)     merger, consolidation, or spin-off involving the Company or affiliated companies;

(h)     transformation or dissolution of the Company;

(i)      change in the composition of the Company’s equity;

(j)      change to accounting criteria;

(k)     debt renegotiations;

(l)      approval of the stock option plan;

(m)    change in the rights and benefits of the Securities issued by the Company;

(n)     splitting or grouping of shares or attribution of bonus;

(o)     acquisition of Company shares to be held in treasury or cancellation, and sale of shares thus acquired;

(p)     profit or loss of the Company and the allocation of cash proceeds;

(q)     execution or termination of agreement, or failure to carry it out, when the expectation of completion is of public knowledge;

(r)      approval, alteration, or withdrawal of a project or delay in its implementation;

(s)      beginning, resumption, or interruption of the manufacture or sale of a product or the provision of a service;

(t)      discovery, change, or development of the Company’s technology or resources;

(u)     modification of projections disclosed by the Company;

(v)     request for judicial or extrajudicial reorganization, petition for bankruptcy or filing of legal action, administrative or arbitration procedure that may affect the economic and financial situation of the Company.

 

5. PERIODS OF PROHIBITION TO TRADING

5.1       Persons Subject to the Policy may not trade Securities of the Company, Subsidiaries, and Affiliates (in the latter two cases, as long as they are publicly-held companies) from the date of knowledge of the Privileged Information until its disclosure to the market of the Relevant Act or Fact.

5.1.1    The prohibitions set forth above do not apply (i) to cases of acquisitions, through private negotiation, of shares held in treasury, resulting from the exercise of a call option in accordance with an approved stock option plan at a general meeting or when granting shares to administrators, employees, or service providers as part of remuneration previously approved at a general meeting; (ii) negotiations involving fixed income securities, when carried out through operations with combined repurchase commitments by the seller and resale by the buyer, for settlement on a pre-established date, prior to or equal to the maturity of the securities object of the operation, carried out with profitability or predefined remuneration parameters; and (iii) negotiations carried out by financial institutions and legal entities that are part of its economic group, provided that they are carried out in the normal course of their business and within the parameters pre-established in this Policy. Notwithstanding, the prohibitions provided for must be verified, if any, upon the subsequent sale of shares acquired as a result of the exercise of the stock option in accordance with the stock option plan approved at the general meeting or when dealing with of granting shares to administrators, employees, or service providers as part of remuneration previously approved at the general meeting.

5.1.2    In line with paragraph 1 of article 13 of CVM Resolution No. 44/21, for the purposes of the prohibition set forth in item 5.1., it is assumed that: (i) the person who traded Securities having material information not yet disclosed made use of such information in said negotiation; (ii) Direct or indirect Controlling Shareholders, Officers, members of the Board of Directors and the Audit Committee, and the Company itself, in relation to trading with Securities of its own issuance, have access to all relevant information not yet disclosed; (iii) the persons listed in item “ii” above, as well as those who have a commercial, professional, or trusting relationship with the Company, having had access to material information not yet disclosed, they know that it is Privileged Information; (iv) the administrator who leaves the Company with relevant and not yet disclosed information makes use of such information if he trades Securities issued by the Company within a period of three (3) months from his departure; (v) from the moment in which studies or analyzes related to the matter are initiated, information about merger operations, total or partial spin-off, merger, transformation, or any form of corporate reorganization or business combination, change in control of the Company, including through the execution, amendment, or termination of a shareholders’ agreement, decision to cancel the registration of the publicly-held company or change in the environment or trading segment of the shares issued by it; and (vi) the information about the request for judicial or extrajudicial reorganization and bankruptcy made by the Company itself is relevant, from the moment in which studies or analyzes related to such request are initiated.

5.2       The DRI may, regardless of justification or the existence of a Relevant Act or Fact not yet disclosed, establish “Blocking Periods” in which Persons Subject to the Policy may not trade Securities issued by the Company, Subsidiaries, and Affiliates upon disclosure of a notice in which it will expressly indicate the initial term of the Blocking Period, being certain that the Blocking Period will last until a new notice is published expressly informing its final term.

5.2.1    The Blocking Periods may be extended even after the disclosure to the market of the Relevant Act or Fact, and this additional restriction must be expressly stated in the notice issued by the DRI.

5.2.2    The Persons Subject to the Policy, in any case, must maintain the confidentiality of the Privileged Information during the Blocking Periods.

5.3       Persons Subject to the Policy may not trade the Company’s Securities within a period of fifteen (15) days prior to the date of disclosure of the quarterly and annual financial statements, as well as on the day of disclosure, before the information becomes public, regardless of the knowledge, by such persons, of the content of the information contained in the quarterly and annual financial statements. The estimated disclosure dates for the quarterly and annual financial statements are provided for in the corporate events calendar, available on the Company’s and CVM’s Investor Relations website. If the disclosure of the financial statements is anticipated, the DRI will inform the aforementioned persons, as soon as possible, so that they are aware of the anticipation of the restriction period.

5.3.1 Without prejudice to the provisions of item 5.3 above, those who are aware of the content of the financial statements before their disclosure, which may be characterized as relevant information, will not be able to trade Securities of the Company, its Subsidiaries, and its Affiliates (in these two latter cases, provided they are publicly-held companies).

5.4       Without prejudice to the provisions of item 5.1 above, until the respective notices or announcements are published, the Persons Subject to the Policy may not trade in the Company’s Securities when they are aware of a decision taken by the competent corporate body to increase or reduce the capital stock, distribute earnings (dividends, interest on equity, and bonuses), split shares, or issue Company Securities.

5.5       The Company will not be able to acquire shares of its own issue while the Public Offer for Acquisition of Shares issued by the Company is in progress.

5.6       Former Directors and former Non-Statutory Executive Officers of the Company who have resigned from their position before certain material information in relation to the Company’s business has become public must refrain from trading the Company’s Securities: (a) for the period of three (3) months from the date of officialization of their removal; or (b) until the disclosure by the Company of the Relevant Act or Fact to the market, whichever occurs first.

6          MONTHLY REPORT ON OWNERSHIP AND TRADING

6.1       For the purposes of controlling and supervising this Policy, the Company must be informed about the ownership and trades carried out with Securities of the Company, its Parent Companies or Subsidiaries, and securities referenced thereto, pursuant to article 11 of CVM Resolution No. 44/21 and article 30 of the Novo Mercado Regulation, by: (a) Administrators, members of the Audit Committee, and any bodies with technical or advisory functions created or to be created by statutory provision; and (b) Controlling Shareholders.

6.1.1    The persons indicated in sub-item “a” above must forward the communication referred to in item 6.1 above to the DRI within a period of up to five (5) days after the completion of each business, and/or on the first business day after the investiture in the respective position, by completing the specific form in Annex 2.

6.1.2    The persons referred to in sub-item “a” above must also indicate to the Company the Securities held by directly or indirectly controlled companies, as well as by Spouse, Partner, or Dependent to whom they are related and companies controlled by them, directly or indirectly, provided that such obligations will be reported by the Company to the extent required under the applicable regulations.

6.1.3    With respect to the persons indicated in sub-items “a” and “b”, for the purposes of item 6.1, trading in Securities of the Company, Parent Companies, or Subsidiaries, investing, redeeming, and trading investment fund shares whose regulation provides that its stock portfolio is composed exclusively of shares issued by the Company, its Controlling Shareholder, or its Subsidiaries.

6.1.4    The persons indicated in sub-item “b” above must forward the communication referred to in item 6.1 above to the DRI by the third business day of the subsequent month in which the negotiation took place, by completing the specific form in Annex 2.

6.1.5    The persons indicated in sub-item “b” above must, in addition, indicate the negotiations carried out, directly or indirectly, by themselves and by other natural or legal persons, fund or universality of rights, which act with them representing the same interest.

6.1.6    The DRI will report or disclose the information received in accordance with item 6.1 and following of this Chapter to the extent that the Company is required to do so by applicable legislation and regulations, notably pursuant to article 11 of CVM Resolution No. 44/21 and article 30 of the Novo Mercado Regulation, in the form and term provided therein.

6.1.7    Together with the communication delivered on the occasion of the investiture in the position, a list must be presented containing the name and registration number with the CNPJ or CPF, as the case may be, of a Spouse, Partner or Dependent, and companies controlled by them, directly or indirectly, and any change in this information must be informed to the Company within fifteen (15) days of its occurrence.

6.2       The Persons Subject to the Policy must observe, for the purpose of disclosing material trades, as provided for in article 12 of CVM Resolution No. 44/21, the specific procedures established in the Company’s Relevant Act or Fact Disclosure Policy.

7. INDIVIDUAL INVESTMENT PLANS

7.1       Persons Subject to the Policy or, whoever, by virtue of their function or position in the Company, its parent company, its Subsidiaries, or affiliates, has a relationship with a publicly-held company that makes it potentially subject to the presumptions described in article 13, § 1 of CVM Resolution No. 44/21, may formalize individual investment or divestment plans (“Individual Plans”), regulating their trading with shares issued by the Company, subject to the provisions of article 16 of CVM Resolution No. 44/21, with the purpose of ruling out the applicability of the presumptions provided for in item 5.1.2 above.

7.2       The Individual Plans shall:

(a)     be formalized in writing;

(b)     be verifiable, including with regard to its institution and the carrying out of any change in its content;

(c)     establish, irrevocably and irreversibly, the dates and amounts or quantities of trades to be carried out by the participants; and

(d)     provide for a minimum period of three (3) months for the plan itself, its eventual modifications, and cancellation to take effect.

 

7.3       The Individual Plans may allow trading in the period provided for in item 5.3 above (i.e., referring to the prohibition period in the period prior to the disclosure of financial information) provided that, in addition to observing the provisions of the items of item 7.2 above:

(a)     the Company has approved a schedule defining specific dates for the disclosure of quarterly accounting information and annual financial statements; and

(b)     oblige the participant to revert to the Company any avoided losses or potential gains obtained in trading with Securities arising from any change in the disclosure dates of the quarterly accounting information and annual financial statements, determined by reasonable and verifiable criteria defined in the investment.

7.4.      Individual Plan participants are prohibited from:

(a)     keeping more than one Individual Plan in effect at the same time; and

(b)     carrying out any operations that nullify or mitigate the economic effects of the operations to be determined by the Individual Plan.

7.5. The Company’s Securities acquired on the basis of the Individual Plan cannot be sold before one hundred and eighty (180) days have elapsed from the end of the Individual Investment Program.

8. LOANS OF SECURITIES OF THE COMPANY

8.1       Persons Subject to the Policy are prohibited from operating in the securities lending market issued by the Company, either as donors or borrowers.

9. RESPONSIBILITIES

9.1       It is the duty of Persons Subject to the Policy, in addition to the other obligations provided for in this Policy, to:

(a)     know, have access, and understand this Policy, as well as have full knowledge of their respective obligations in relation to its application;

(b)     keep confidential all information related to the Relevant Act or Fact of the Company to which it has privileged access due to the position they hold, until its disclosure to the market, and the use of such information for the purpose of obtaining an advantage, for itself or for others, subject to the application of the penalties provided for in the applicable legislation and at the discretion of the Company;

(c)     ensure that their subordinates and trusted third parties keep confidential all information related to the Relevant Act or Fact and that they are not used; and

(d)     subject to the provisions of items 2.2 and 2.3 above, adhere to the Policy by signing the Term of Adhesion or, alternatively, enter into a confidentiality agreement and non-trading of Securities, as applicable.

9.2       It is the duty of the DRI, in addition to the other obligations provided for in this Policy, to administer this Policy, as well as to transmit it to the CVM and/or the Stock Exchange or the entities of the organized over-the-counter market in which the Company’s Securities are admitted to trading the information received.

9.3       It is the duty of the Board of Directors, in addition to the other obligations set forth in this Policy, to verify, at least every six months, the adherence to the negotiations carried out by the participants of the Individual Plans.

9.4       It is the duty of the [Investor Relations Department], in addition to the other obligations provided for in this Policy, to:

(a)        identify Relevant Collaborators, who must formally adhere to this Policy, as well as the Suppliers and Service Providers who must sign the confidentiality and non-trading agreement for Securities;

(b)       formally communicate the terms of this Policy to the Persons Subject to the Policy, obtaining their formal adherence by signing the Term of Adhesion, which must be filed at the Company’s headquarters while the person maintains a relationship with it, and for five (5) years, at least, after its dismissal;

(c)        maintain at its headquarters, at the disposal of the CVM, a list with an updated list of Persons Subject to the Policy, as well as of those persons who violate this Policy, and their respective qualifications, indicating position or function, address, and registration number in the National Registry of Legal Entities or in the Register of Individuals;

(d)       maintain control of the monthly movement of shareholding held by the Controlling Shareholders, Administrators, members of the Other Bodies of the Company, and Relevant Collaborators;

(e)        make best efforts to control the movement of Securities of Persons Subject to the Policy; and

(f)        report to the DRI and to the Company’s Ethics Committee the identified cases of violation of the Policy.

9.5       It is the duty of the [Human Resources Department], in addition to the other obligations provided for in this Policy, to act in an auxiliary manner with the Investor Relations Department, in order to provide the Terms of Adhesion of the Relevant Collaborators and of the Suppliers and Service Providers, as well as of other persons not expressly mentioned in item 2.1. above and forward them to the Investor Relations Department, and be responsible for filing and controlling such adhesions, keeping them filed for at least five (5) years.

9.6       It is the duty of all Relevant Collaborators, in addition to the other obligations set forth in this Policy, to:

(a)        sign the Term of Adhesion prior to trading in the Company’s Securities, forwarding it to the Investor Relations Department for proper filing; and

(b)       subject to the provisions of item 2.3 above, arrange for the signature of a confidentiality agreement and non-trading of Securities by any persons identified as Suppliers and Service Providers, and deliver said agreement to the Investor Relations Department for filing.

9.7       The Company’s Ethics Committee is responsible for analyzing cases of violation received through the contact channels made available by the Company, and deciding or recommending, when applicable, appropriate disciplinary measures.

10        POLICY VIOLATION

10.1     Failure to comply with this Policy subjects the violator to disciplinary sanctions, in accordance with the Company’s internal rules, such as guidance sanctions, warnings, suspension, or dismissal for just cause, according to the seriousness of the infraction, without prejudice to applicable administrative, civil, and criminal sanctions.

10.2     Any person who becomes aware of a violation of this Policy must immediately report the fact to the Investor Relations Department or the Company’s Ethics Committee, through the contact channels made available by the Company, so that the necessary measures are taken.

11        CONFLICT BETWEEN PROVISIONS

11.1     In the event of a conflict between the provisions of this Policy and the Company’s Bylaws, the provisions of the Bylaws shall prevail, and in the event of a conflict between the provisions of this Policy and the legislation or regulations in force, the provisions of the current legislation shall prevail. Once the conflict has been identified, the Board of Directors must make the necessary changes to the Policy, in order to make it compatible with statutory, legal, or regulatory provisions, as the case may be.

12        APPROVAL

12.1     This Policy comes into force, for an indefinite period, on the date of its approval by the Board of Directors, replacing the Policy previously in force.

12.2     The Company’s Board of Directors is the Company’s body that has exclusive authority to amend, in any event, this Policy.

12.3     Any change to this Policy must be communicated by the DRI to the CVM and the Market Management Entities in which the Company’s Securities are or will be admitted to trading, as applicable, and the communication must be accompanied by a copy of the resolution and the entire content of the documents that discipline and integrate the Policy.

12.4     Persons Subject to the Policy will be formally communicated about the terms of the resolution of the Board of Directors that approves the revision or amendment of the Policy.

12.5     No revision or amendment to this Policy can be approved pending a Relevant Act or Fact not yet disclosed.

13        ANNEXES

ANNEX 1 – TERM OF ADHESION

ANNEX 2 – TRADING COMMUNICATION