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United States
Securities and Exchange Commission
Securities and Exchange Commission
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the
Securities Exchange Act of 1934
Pursuant to Rule 13a-16 or 15d-16
of the
Securities Exchange Act of 1934
For the month of
May 2011
Vale S.A.
Avenida Graça Aranha, No. 26
20030-900 Rio de Janeiro, RJ, Brazil
(Address of principal executive office)
20030-900 Rio de Janeiro, RJ, Brazil
(Address of principal executive office)
(Indicate by check mark whether the registrant files or will file annual reports under cover of
Form 20-F or Form 40-F.)
(Check One) Form 20-F þ Form 40-F o
(Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1))
(Check One) Yes o No þ
(Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7))
(Check One) Yes o No þ
(Indicate by check mark whether the registrant by furnishing the information contained in this Form
is also thereby furnishing information to the Commission pursuant to Rule 12g3-2(b) under the
Securities Exchange Act of 1934.)
(Check One) Yes o No þ
(If “Yes” is marked, indicate below the file number assigned to the registrant in connection with
Rule 12g3-2(b). 82-___.)
TABLE OF CONTENTS
| Press Release | ||||||||
| Signature Page | ||||||||
Table of Contents
1.1. Stament and Identification of the Responsible Individual
| Name of the individual responsible | ||
| for the content of the Reference Form | Murilo Pinto Ferreira | |
Position of responsible individual
|
Executive Director |
| Name of the individual responsible | ||
| for the content of the Reference Form | Guilherme Perboyre Cavalcanti | |
Position of responsible individual
|
Director of Relationships with Investors |
The above-mentioned directors stated that:
a. They have reviewed the Reference Form;
b. All the information contained in the Reference Form complies with InstructionCVM No. 480, in
particular Articles 14 thru 19;
c. All the information contained therein is an accurate, precise and complete representation of the
economic and financial situation of the issuer and of the risks inherent to its activities and the
securities issued by it.
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2.1 Independent Auditors:
2.2 Remuneration of auditors
Does it have auditor?
|
YES | |
CVM (Securities Commission) Code
|
3859 | |
Type of Auditor
|
Domestic | |
Name/Corporate name
|
Deloitte Touche Tohmatsu, Independent Auditors | |
CPF/CNPJ
|
49,928,567/0002-00 | |
Period of provision of services
|
From 02/27/2007 to 07/22/2009 | |
Description of the service contracted
|
Provision of professional services for auditing the annual report from Vale, its subsidiaries, and controlled companies; provision of services related to the audit; tax services related to legal requirements and other services unrelated with the audit. | |
Total amount of the remuneration of
independent auditors itemized per
service
|
For the fiscal year ended on December 31, 2008, the independent
auditors received fees for a total of R$4.5 million for
services rendered to Vale and its controlled companies. Accounting Auditing R$1.7 million Services related to the audit R$0.4 million Review of tax requirements (Brazil and abroad) R$2.4 million Service Total R$4.5 million |
|
Justification for replacement
|
The period of five years of validity for the contract signed with Deloitte Touche Tohmatsu Auditores Independentes (Deloitte Touche Tohmatsu, Independent Auditors) ended with the issuance of the report regarding the Quarterly Reports of March 31, 2009, and the management of Vale decided not to use the power of not replacing the independent auditors foreseen by Resolution CVM No. 549/2008, and in that way it voluntarily replaced its independent auditor with the consent of Deloitte Touche Tohmatsu Auditores. In agreement with Instruction CVM No. 308/99, Vale informed CVM about the change of auditor by mail Independentes. DICT/EXT-107/2009 dated 06/29/2009. | |
Reason submitted by the auditor in
case of disagreement with the issuer
justification |
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| Name of the supervisor | ||||||
| responsible | Period of provision of service | CPE | Address | |||
Marcelo Cavalcanti Almeida
|
02/27/2007 to 07/22/2009 | 335.905.597-72 | Av. Presidente Wilson, 231/ 22 andar, Centro, Rio de Janeiro, RJ, Brasil, CEP 20030-905 |
Does it have auditor?
|
YES | |
CVM (Securities Commission) Code
|
2879 | |
Type of Auditor
|
Domestic | |
Name/Corporate name
|
PricewaterhouseCoopers Auditores Independentes (PricewaterhouseCoopers Independent Auditors) | |
CPF/CNPJ
|
61.562.112/0002-01 | |
Period of provision of services
|
07/24/2009 | |
Description of the service contracted
|
Provision of professional services for auditing the annual report from Vale, its subsidiaries, and controlled companies, both for domestic and international purposes, comfort letters for issuance of debts and equities at the Brazilian and international market, certification of internal controls in order to comply with “Section 404” of Sarbanes-Oxley Act of 2002; provision of services related to the audit, and tax services related to legal requirements. | |
Total amount of the remuneration of
independent auditors itemized per
service
|
According to Instruction CVM 381/2003, the following were the services contracted for a
three-year period beginning June 2009, from the external auditors from
PriceWaterHouseCoopers Auditores Independentes, for the fiscal year 2010 for Vale and its
controlled companies: Financial audit: R$17,431.8 thousand [Seventeen billion, four hundred thirty-one million, eight hundred thousand] Audit — Sarbanes Oxley Act: R$2,795.8 thousand [Two billion, seven hundred ninety-five million, eight hundred thousand] Services related to the audit: R$2,855.7 thousand [Two billion, eight hundred fivety-five million, seven hundred thousand] (They referred mainly to services coming from the listing of Vale at Hong Kong Stock Exchange. Tax Services: R$235.6 thousand [Two hundred thirty-five million, six hundred thousand] Services not related with the Audit (including comfort letters for the issuance of debts and equities at the Brazilian and international market): R$691.9 thousandl Total for the services: : R$24,010.7 thousand [Twenty-four billion, ten million, seven hundred thousand] For the fiscal year ended on December 31, 2008, the independent auditors received fees for a total of R$20,773 million for services rendered to Vale and its controlled companies and R$331 for services rendered to companies jointly controlled by Vale. Accounting Auditing R$ R$17,158.2 million Auditing — Sarbanes Oxley Law: R$2,951.1 million Services related to the audit R$237.5 million Tax Services: R$704.0 million Services not related to the Audit: R$13.7 million Service Total R$21,064.5 million |
|
Justification for replacement Reason submitted by the auditor in case of disagreement of the issuer justification |
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| Name of the supervisor | ||||||
| responsible | Period of provision of service | CPE | Address | |||
Marcos Donizete Panassol
|
07/24/2009 | 063.702.238-67 | Rua da Candelaria, 65/ 11,14,15 andares, Centro, Rio de Janeiro, RJ, Brasil, CEP 20091-020 |
2.3 Other information that the Company deems relevant
Vale has developed and formalized specific rules and procedures for pre-approval of engagements for
their independent external auditors in order to avoid conflict of interest or loss of independence
and objectivity by the already mentioned independent external auditors.
According to the Regulation for Contracting of Services for Independent Audit, Advisory Services
and Other Services Unrelated to Audit Provided by External Auditors, approved by the Supervisory
Board, with the aim of reconciling the legal precepts and regulations for Brazil and America, the
following general principles have been established for the preservation of independence of external
auditors: (a) the auditor should not perform tasks which the administration of the Company should
carry out, (b) the auditor should not audit their own work, (c) the auditor must not carry out
advocacy activities for the Company. Under this regulation, in line with best corporate governance
practices, all services provided by the independent auditors of Vale are pre-approved by the
Supervisory Board.
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3.1 Selected Consolidated Financial Information
| Fiscal Year Ended December 31 | ||||||||
| 2010 | 2009 | |||||||
a. Shareholders’ equity (in R$ thousand) |
116,326,864 | 100,295,227 | ||||||
b. Total Assets (in R$ thousand) |
214,662,114 | 177,738,189 | ||||||
c. Net Revenue (R$ thousand) |
83,225,006 | 48,496,566 | ||||||
d. Gross Income (in R$ thousand) |
49,468,940 | 20,746,174 | ||||||
e. Net Income (in R$ thousand) |
30,070,051 | 10,336,950 | ||||||
f. Number of Shares, excluding treasury |
5,218,279,135 | 5,212,724,297 | ||||||
g. Asset Value of Share (in R$) |
22.29 | 19.24 | ||||||
h. Earnings per Share (in R$) |
5.76245 | 1.96614 | ||||||
i. Other selected financial information |
n/a | n/a | ||||||
3.2 Non-Accounting measurements
a. value of non accounting measurements
The Company uses LAJIDA (EBITDA) as a non-accounting measurement. In 2010, the EBITDA of the
Company was established in the amount of R$46,378,648 thousand (forty-six billion, three hundred
and seventy eight million and six hundred and forty-eight thousand reais). In 2009 and 2008, these
values were R$18,619,085 thousand (eighteen billion, six hundred and nineteen million, eighty-five
thousand reais) and R$34,959,255 thousand (thirty four billion, nine hundred and fifty-nine
million, two hundred and fifty-five thousand reais), respectively.
b. Reconciliations between amounts reported and the values of audited financial statements
| In R$ thousands | 2010 | 2009 | 2008 | |||||||||
Operating profit — EBIT |
40,490,339 | 13,173,034 | 27,399,809 | |||||||||
Depreciation / Amortisation of goodwill |
5,741,372 | 5,446,951 | 5,112,446 | |||||||||
Reduction in recoverable value of intangible assets |
— | — | ||||||||||
| 46,378,649 | 18,619,085 | 34,959,255 | ||||||||||
Dividends received |
146,938 | 21,318 | 63,260 | |||||||||
EBITDA (LAJIDA) |
46,378,649 | 18,641,303 | 35,022,515 | |||||||||
Depreciation / Amortisation of goodwill |
(5,741,372 | ) | (5,446,951 | ) | (5,112,446 | ) | ||||||
Dividends received |
(146,938 | ) | (21,318 | ) | (63,260 | ) | ||||||
Reduction in recoverable value of intangible assets |
— | — | ||||||||||
Corporate results |
(48,081 | ) | 98,697 | (1,324,580 | ) | |||||||
Proceeds from sale of investment |
93,139 | 138,879 | ||||||||||
Net financial income |
(2,763,399 | ) | 2,094,497 | (3,837,534 | ) | |||||||
Income and social contribution |
(7,035,659 | ) | (4,954,488 | ) | (664,728 | ) | ||||||
Minority interests |
(351,441 | ) | (167,929 | ) | (432,217 | ) | ||||||
Net income |
30,070,051 | 10,336,950 | 21,279,629 | |||||||||
c. Why the Company believes that this measurement is more appropriate for a correct understanding
of its financial situation and results of operations
EBITDA is a measure of the company’s cash generation, aiming to assist the assessment by the
Administration of the performance of operations. The analysis of operating results through EBITDA
has the benefit of canceling the effect of non-operating gains or losses generated by financial
transactions or the effect of taxes.
The consolidated cash generation measured by EBITDA (earnings before financial results, income from
corporate interests, income tax and social contributions, depreciation, depletion and amortization,
and plus dividends received) is not a BR GAAP/IFRS measurement and does not represent cash flow for
the periods presented and therefore should not be considered as an alternative to net income
(loss), as an isolated indicator of operating performance or as an alternative to cash flow as a
source of liquidity. The EBITDA definition used by Vale may not be comparable with EBITDA, by
definition, for other companies.
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3.3 Events subsequent to the latest financial statements for the closure of the fiscal year that
substantially alter them
Vale does not provide guidance in the form of quantitative predictions about its future financial
performance. The Company seeks to disseminate as much information about its vision of the various
markets where it operates, guidelines, and implementation strategies in order to provide investors
in the capital markets a basis for the formation of expectations about its performance in the
medium and long term.
The financial statements for the year ended December 31, 2010 were issued and filed with the CVM on
February 24, 2011. Below is a description of subsequent events, which were included in the
financial statements in compliance with the rules in IAS 24, approved by CVMº 593/09.
There is no subsequent event disclosed in our financial statements
3.4 Policy for allocation of results
| Fiscal Year Ended December 31 | ||||||
| 2010 | 2009 | 2008 | ||||
| a. Rules on retention of profits | Statutory Rule: According to Article 43 of the Bylaws, there should be a consideration in the proposal for distribution of profits of the formation of (i) Exhaust Reserve, to be constituted in the form of tax legislation, and (ii) Investment Reserve for the purpose of ensuring the maintenance and development of activities that constitute the main object of the company, in an amount not exceeding 50% (fifty percent) of net income distributable up to the maximum capital of the company. | |||||
| Practice adopted by the Company: Of the total of R$36,073,218,330.41, R$23,468,768,238.73 (65.1%) were destined to a Reserve for expansion /investment and R$1,022,135,742.36 (2.8%) for the Tax Incentive Reserve. Of the total reserve for the expansion /investment, 50% was allocated based on statutory authorization and 15.1% was destined for the reserve based on the capital budget approved at the AGM. | Practice adopted by the Company: Of the total R$10,287,467,859.00, R$6,653,281,672.35 (64.7%) destined to a Reserve for expansion /investment and R$119,652,582.99 (1.16%) for the Tax Incentive Reserve. Of the total for the Reserve expansion /investment, 50% was sent based on statutory authorization, and 14.7% was destined for the reserve based on the capital budget approved by the AGM. | Practice adopted by
the Company: Of the
total of
R$21,301,991,594.93,
R$15,178,507,589.28
(71.3%) was
destined to a
Reserve for Tax
Incentives and
R$14,219,808,364.43
(70.9%) was
destined to a
Reserve for
expansion /investment.
Of the total for the Reserve expansion /investment, 50% was based on statutory authorization and 21.3% was destined for the reserve based on the capital budget approved by the AGM. |
||||
| b. Arrangements for distribution of dividends | Statutory Rule: According to Article 44 of the bylaws, at least 25%
(twenty five percent) of annual net profits, adjusted according to the
law, will be provided for the payment of dividends. Pursuant to Art. 5, §5º of the bylaws, the holders of preferred shares of Class A and special class, shall have their right to participate in the dividend to be distributed and calculated as per Chapter VII of the Bylaws, according to the following criterion: (a) Priority in the reception of dividends corresponding to (i) 3% (three per cent) at least of the net asset value of the share, calculated based on the financial statements analyzed that served as reference for the payment of dividends or (ii) 6% (six per cent) calculated on the part of the capital to which that class of share belongs, whichever is the greatest of these. (b) Right to participate in the distributed incomes, under equal conditions with common shares, after them, guaranteeing a dividend equal to the priority minimum set up pursuant to “a” above |
|||||
| Practice adopted by the Company: 27% of annual net income was allocated to the payment of dividends | Practice adopted by the Company: 31% of annual net income was allocated to the payment of dividends | Practice adopted by the Company: 25% of annual net income was allocated to the payment of dividends | ||||
| c. Frequency of dividend distribution | In accordance with the Dividend Policy adopted by Vale, payments are made semiannually in the months of April and October. | |||||
d. Restrictions to dividend
distribution
|
n / a | n / a | n / a | |||
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3.5 Distributions of dividends and retention of net income.
| Fiscal Year Ended December 31 | ||||||||||||
| (Reais) | 2010 | 2009 | 2008 | |||||||||
Adjusted net income for dividend payments (in R$) |
36,073,218,330.41 | 9,655,367,895.00 | 20,238,010,119.00 | |||||||||
Percentage of dividend over the adjusted net profit |
29.0 | 31.0 | 25.0 | |||||||||
Rate of return in relation to equity (%) |
27.0 | 11.0 | 22.0 | |||||||||
Dividend distributed (total) |
9,778,653,432.80 | 3,002,086,223.00 | 5,059,502,530.00 | |||||||||
Net income retained (in R$) |
None | None | None | |||||||||
Date of approval of the retention |
None | None | None | |||||||||
| Payment | Payment | Payment | ||||||||||||||||||||||
| Net income retained | Amount (R$) | date | Amount (R$) | date | Amount (R$) | date | ||||||||||||||||||
Interest on Capital |
||||||||||||||||||||||||
Common |
1,029,923,339.00 | 10/30/2010 | 57,865,446.00 | 10/31/2009 | 1,281,510,820.00 | 10/31/2009 | ||||||||||||||||||
Common |
1,952,075,334.00 | 04/30/2011 | 1,341,608,462.00 | 04/30/2010 | ||||||||||||||||||||
Preferred Class A |
644,693,233.00 | 10/30/2010 | 36,937,363.00 | 10/31/2009 | 818,029,292.00 | 10/31/2009 | ||||||||||||||||||
Preferred Class A |
1,221,924,666.00 | 04/30/2011 | 856,391,538.00 | 04/30/2010 | ||||||||||||||||||||
Common |
1,013,746,000.00 | 1/31/2011 | 436,222,763.00 | 10/30/2010 | ||||||||||||||||||||
Preferred Class A |
656,354,000.00 | 1/31/2011 | 273,059,651.00 | 10/30/2010 | ||||||||||||||||||||
Other |
||||||||||||||||||||||||
Common |
2,004,928,273.00 | 10/31/2011 | ||||||||||||||||||||||
Preferred Class A |
1,255,008,588.00 | 10/31/2011 | ||||||||||||||||||||||
Mandatory Dividend |
||||||||||||||||||||||||
Common |
136,691,882.00 | 10/31/2008 | ||||||||||||||||||||||
Common |
1,669,089,703.00 | 04/30/2009 | ||||||||||||||||||||||
Preferred Class A |
88770536 | 10/31/2008 | ||||||||||||||||||||||
Preferred Class A |
1,065,410,297.00 | 04/30/2009 | ||||||||||||||||||||||
Common |
||||||||||||||||||||||||
Preferred Class A |
136,691,882.00 | 10/31/2008 | ||||||||||||||||||||||
3.6 Dividends declared on account of retained earnings or reserves set aside in the past 3 fiscal
years
| Fiscal Year Ended December 31 | ||||||||||||
| Dividends distributed to (in R$ thousands): | 2010 | 2009 | 2008 | |||||||||
Retained Earnings |
— | — | — | |||||||||
Constituted Reserves |
513,050 | 370,507 | 580,124 | |||||||||
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3.7 Debt
| Total amount of the debt | Index of description and reason for the use of another | |||||
| Fiscal year | (of any nature) | Type of index | index of indebtedness | |||
12/31/2010
|
98,337,000,000.00 | Debt ratio | 84.5 | |||
| 0.9 — Gross debt/EBITDA. Gross debt is the sum of “Loans and short-term debt,” “Portion of the stock of long-term loans” and “Loans and long-term financing.” EBITDA (EBITDA) is calculated as described in section 3.2.b of this reference form. | ||||||
12/31/2010
|
Other indexes | Vale adopts the debt ratio gross debt / EBITDA and
interest coverage ratio EBITDA / Interest expenses.
These indexes are widely used by the market (rating
agencies and financial institutions) and serve as a
benchmark to assess the financial situation of Vale.
The debt ratio Gross Debt / EBITDA shows the approximate time necessary for a company to pay all its debt with its cash flow. |
||||
12/31/2010
|
22.86. EBITDA/Interest expenses. The EBITDA (LAJIDA)
is calculated as described in section 3.2.b of this
reference form. Interest expenses include the sum of
all the capitalized or accrued interest, paid or not,
at any given time, which is a result of the debt of
the beneficiary. Vale adopts the debt ratio gross debt / EBITDA and interest coverage ratio EBITDA / Interest expenses. These indexes are widely used by the market (rating agencies and financial institutions) and serve as a benchmark to assess the financial situation of Vale. The interest coverage ratio (EBITDA / Interest expenses) is used to determine the ability of business to generate cash flow to service its debt |
3.8 Obligations according to the nature and maturity date:
Fiscal year (12/31/2010)
| Less than 1 year | Between 1 and 3 | Between 3 and 5 | ||||||||||||||||||
| Type of debt | (R$) | years (R$) | years (R$) | Over 5 years (R$) | Total (R$) | |||||||||||||||
Collateral |
3,025,071.00 | 10,151,120.00 | 19,151,691.00 | 272,955,987.00 | 305,283,869.00 | |||||||||||||||
Floating Guarantee |
0.00 | 0.00 | 0.00 | 0.00 | 0.00 | |||||||||||||||
Unsecured obligations |
31,380,974,929.00 | 4,047,979,657.00 | 0.00 | 62,602,761,545.00 | 98,031,716,131.00 | |||||||||||||||
Total |
31,384,000,000.00 | 4,058,130,777.00 | 19,151,691.00 | 62,875,717,532.00 | 98,337,000,000.00 | |||||||||||||||
Note: The value shown at 3.7 and 3.8 does not represent the level of indebtedness of the Company,
but represents the total of the obligations based on the addition of the outstanding and non
outstanding liabilities.
For the categorization of the debts, it was taken into account the burdensome of the guaranty
before the Company and not before third parties. A debt without collateral or floating guarantee,
notwithstanding the fact of having a personal guarantee, has been classified as unsecured
obligation.
The information herein given, refers to the Consolidated Financial Statements of the Company.
3.9 Other information that the Company deems relevant
As of January 1, 2010, and with retroactivity to January 1, 2009, Vale adopted all the
pronouncements issued by the CPC. For this reason, the Financial Statements corresponding to the
Fiscal Year ended December 31, 2010 are the first consolidated accounting statements submitted by
the Company pursuant to the International Financial Reporting Standards — IFRS. Thus, as the
financial Statements regarding the fiscal year ended December 31, 2008 have been performed pursuant
to several accounting patterns, they are not any more comparable to the financial statements of
December 31, 2009 and December 31, 2010. For this reason, accounting information for the year 2008
has not been included in 3.1.
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4.1 Risk factors which may influence investment decisions, especially related risks:
Risks relating to the Company
We may not be able to adjust our production volume to changes in demand in a timely or
cost-efficient manner.
During periods of high demand, our ability to rapidly increase production capacity is limited,
which will render us unable to satisfy our customers’ demand. Moreover, we may be unable to
complete expansions and greenfield projects in time to take advantage of the steady global demand
for iron ore. When customer demand exceeds our production capacity, we may meet excess customer
demand by purchasing iron ore, iron ore pellets or nickel from joint ventures or unrelated parties
and reselling it, which would increase our costs and reduce our operating margins. If we are unable
to satisfy excess customer demand in this way, we may lose customers. In addition, operating close
to full capacity may expose us to higher costs, including demurrage fees due to capacity restraints
in our logistics systems.
On the other hand, operating at significant idle capacity during periods of weak demand may expose
us to higher unit production costs since a significant portion of our cost structure is fixed in
the short-term due to the high capital intensity of mining operations. In addition, efforts to
reduce costs during periods of weak demand could be limited by some labor regulations or collective
bargaining or government agreements.
Our governance and compliance processes may fail to prevent regulatory penalties and
reputational harm.
We operate in a global environment, and our activities straddle multiple jurisdictions and complex
regulatory frameworks with increased enforcement activities worldwide. Our governance and
compliance processes, which include the review of internal control over financial reporting, may
not prevent future breaches of law, accounting or governance standards. We may be subject to
breaches of our Code of Ethical Conduct or business conduct protocols and to fraudulent and
dishonest behavior by our officers, contractors or other agents. Our failure to comply with
applicable laws and other standards could expose us to fines, loss of operating licenses and
reputational harm.
Some of our operations depend on joint ventures or consortia or even on the participation
of our investors, and our business may be adversely affected if our partners fail to
observe their commitments.
We currently operate important parts of our pelletizing, bauxite, nickel, coal, copper and steel
businesses through joint ventures with other companies. Important parts of our electricity
investments and all of our oil and gas projects are operated through consortia. Our forecasts and
plans for these joint ventures and consortia assume that our partners will observe their
obligations to make capital contributions, purchase products and, in some cases, provide skilled
and competent managerial personnel. If any of our partners fails to observe its commitments, the
affected joint venture or consortium may not be able to operate in accordance with its business
plans, or we may have to increase the level of our investment to implement these plans. For
example, the company that owns our nickel project in New Caledonia has a minority shareholder,
Sumic Nickel Netherlands B.V., with a put option to sell us 25%, 50%, or 100% of its shares. Sumic
may exercise the put option if the cost of the project exceeds a certain value agreed between part
of the shareholders and certain other conditions are met.
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Our projects are subject to risks that may result in increased costs or delays that can
prevent their successful implementation.
We are investing to increase our production and logistics capabilities and to expand the scope of
the minerals that we produce. Our projects are subject to some risks that may affect growth and
profitability prospects, including the following:
| • | We may encounter delays or higher than expected costs in obtaining the necessary
equipment or services as well as to implement new technologies to design and operate a
project. |
| • | Our efforts to develop projects according to schedule may be hampered by a lack of
infrastructure, including a reliable power supply. |
| • | We may fail to obtain in a timely or in any possible way the licenses required for
the projects, or also incur higher than expected costs to obtain such licenses. |
| • | Changes in regulations or in market conditions may render our projects less
profitable than expected at the initial planning stage. |
| • | Adverse mining conditions may delay or hamper our ability to produce the expected
quantities of minerals. |
| • | Some of our development projects are located in regions where tropical diseases,
AIDS, malaria, yellow fever and other contagious diseases are a major public health
issue and pose health and safety risks to our employees. If we fail to guarantee the
health and safety conditions of our employees, our business may be affected. |
More frequent natural disasters may impose serious damage on our operations and projects in
the countries where we operate and may cause a negative impact on our sales in countries
adversely affected by such disasters.
The frequency of natural disasters such as storms, floods, earthquakes and tsunamis has been
increasing all over the world and may adversely affect our operations and the projects that we
operate, therefore leading to a drop in sales in the countries affected as a result of power
outages and destruction of industrial facilities and infrastructure, among other factors. In the
last quarter of 2010 and in the first quarter of 2011, our coal operations in Australia were
adversely affected by floods in the state of Queensland. Our mining product sales in Japan will
have to withstand the negative impact of the earthquake that affected the north-eastern area of the
country.
Our reserve estimates may materially differ from the mineral quantities that we may be able
to actually recover; our estimates of mine life may prove inaccurate; and market price
fluctuations and changes in operating and capital costs may render certain ore reserves
uneconomical to mine.
Our reported ore reserves are estimated quantities of ore and minerals that can be economically
mined and processed under present and anticipated conditions to extract their mineral content.
There are numerous uncertainties inherent in estimating quantities of reserves and in projecting
potential future rates of mineral production, including factors beyond our control. Reserve
engineering involves estimating deposits of minerals that cannot be measured in an exact manner,
and the accuracy of any reserve estimate is a function of the quality of available data and
engineering and geological interpretation and judgment. As a result, no assurance can be given that
the indicated amount of ore will be recovered or that it will be recovered at the rates we
anticipate. Estimates may vary, and results of our mining and production subsequent to the date of
an estimate may lead to revisions of estimates. Reserve estimates and estimates of mine life may
require revisions based on actual production experience and other factors. For example,
fluctuations in the market prices of minerals and metals, reduced recovery rates or increased
operating and capital costs due to inflation, exchange rates or other factors may render proven and
probable reserves uneconomical to exploit and may ultimately result in a restatement of reserves.
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We may not be able to replenish our reserves, which could adversely affect our mining
prospects.
We engage in mineral exploration, which is highly speculative in nature, involves numberless risks
and is frequently non-productive. Our exploration programs, which involve significant capital
expenditures, may fail to result in the expansion or replenishment of reserves depleted by current
production. If we do not develop new reserves, we will not be able to sustain our current level of
production beyond the remaining lives of our existing mines.
Drilling and production risks could adversely affect the mining process.
Once mineral deposits are discovered, it can take a number of years from the initial phases of
drilling until production is possible, during which the economic feasibility of production may
change. Substantial time and expenditures are required to:
| • | Establish mineral reserves through drilling; |
| • | Determine appropriate mining and metallurgical processes for optimizing the recovery of
metal contained in ore; |
| • | Obtain environmental and other licenses; |
| • | Construct the necessary mining and processing facilities apart from creating the
infrastructure required for greenfield properties; and |
| • | Obtain the ore or extract the minerals from the ore. |
If a project proves not to be economically feasible by the time we are able to exploit it, we may
sustain significant damages and be compelled to make reductions. In addition, potential changes or
complications involving metallurgical and other technological processes arising during the life of
a project may result in delays and cost overruns that may render the project not economically
feasible.
We face rising extraction costs over time as reserves deplete.
Reserves are gradually depleted in the ordinary course of a given mining operation. As mining
progresses, distances to the primary crusher and to waste deposits become longer, pits become
steeper and underground operations become deeper. As a result, over time, we usually experience
rising unit extraction costs with respect to each mine. Several of our mines have been operating
for long periods, and we will likely experience rising extraction costs per unit in the future at
these operations in particular.
Labor disputes may disrupt our operations from time to time.
A substantial number of our employees and some of the employees of our subcontractors are
represented by labor unions and are covered by collective bargaining agreements, which are subject
to periodic negotiation. Negotiation may become more difficult in times of higher prices and
ensuing higher profits for metal and mining industries, as unions may claim salary raises and other
forms of additional compensation.
Strikes or work interruptions in any one of our operations could adversely affect the development
of our operations as well as the duration and cost of new projects. We may also be affected by work
interruptions involving the supply of goods or services:
We may face shortages of equipment, services and skilled personnel.
The mining industry has faced worldwide shortages of mining and construction equipment, spare
parts, contractors and other skilled personnel during periods of high demand for minerals and
metals and intense development of mining projects. We may experience long lead-times for mining
equipment and problems with the quality of contracted engineering, construction and maintenance
services. We compete with other mining companies for highly skilled executives and staff with a
large industrial and technical experience, and we may not be able to attract and retain such
people. Shortages during peak periods could negatively impact our operations, resulting in higher
production or capital expenditure costs, production interruptions, higher inventory costs, project
delays and potentially lower production and revenues.
Higher energy costs or energy shortages would adversely affect our business.
Energy costs are a significant component of our cost of production, representing 17.4% of our total
cost of goods sold in 2010. To meet our energy needs, we depend on the following sources, all
measured in tons of oil equivalent (TOE): oil by-products, which represented 42% of total energy
needs in 2010, electricity (29%), coal (15%), natural gas (10%) and other sources of energy (4%).
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Fuel costs represented 10.7% of our cost of goods sold in 2010. Increases in oil and gas prices
adversely affect our logistics services, mining, iron ore pellets, nickel and aluminum businesses.
Electricity costs represented 6.6% of our total cost of goods sold in 2010. If we are unable to
secure reliable access to electricity at acceptable prices, we may be forced to curtail production
or may experience higher production costs, either of which would adversely affect our results of
operations. There is risk of shortage in countries where we have operations or projects, due to
excessive demand or climate conditions such as floods or droughts.
Electricity shortages have occurred in Brazil and there can be no assurance that the increase of
power generation capacity in the countries where we operate will be enough to meet our future
consumption increases. Future shortages and government efforts to respond to or prevent shortages
may adversely impact the cost or supply of electricity in our operations.
Through our subsidiary PT International Nickel Indonesia Tbk (PTI), we process lateritic nickel
ores by using a pyrometallurgical process, which is energy-intensive. Although PTI currently
generates a majority of the electricity for its operations from its own hydroelectric power plants,
low rainfall or other hydrological factors could adversely affect electricity production at PTI’s
plants in the future, which could significantly fuel the risk of higher costs or lower production
volume at PTI.
Price volatility—relative to the U.S. dollar—of the currencies in which we conduct
operations could adversely affect our financial condition and results of operations.
A substantial portion of our revenues and debt is denominated in U.S. dollars, and changes in
exchange rates may result in (i) losses or gains on our net U.S. dollar-denominated indebtedness
and accounts receivable and (ii) fair value losses or gains on our currency derivatives used to
stabilize our cash flow in U.S. dollars. In 2010, we had currency gains of US$102 million; in 2009,
we had currency gains of US$665 million; and in 2008, we had currency losses of US$1.011 billion.
In addition, the price volatility of the Brazilian real, the Canadian dollar, the Indonesian rupiah
and other currencies against the U.S. dollar affects our results since most of our costs of sold
goods are denominated in currencies other than the U.S. dollar, principally the real (64% in 2010)
and the Canadian dollar (11% in 2010), while our revenues are mostly U.S. dollar-denominated. We
expect currency fluctuations to continue to affect our revenues, financial expenses and cash flow
generation.
Significant volatility in currency prices may also result in disruption of foreign exchange markets
and may limit our ability to transfer or to convert certain currencies into U.S. dollars and other
currencies for the purpose of making timely payments of interest and principal on our indebtedness.
The central banks and governments of the countries in which we operate may institute restrictive
exchange rate policies in the future.
We may not have adequate insurance coverage for some business risks.
Our business is generally subject to a number of risks and hazards, which could result in damage
to, or destruction of, mineral properties, facilities and equipment. The insurance we maintain
against risks that are typical in our business may not provide adequate coverage. Insurance against
some risks (including liability for environmental pollution or certain hazards or interruption of
certain business activities) may not be available at a reasonable cost. As a result, accidents or
other negative developments involving our mining, production or transportation facilities could
have an adverse effect on our operations.
We are involved in several legal claims that may adversely affect our business if their
result is unfavorable to us.
We are involved in a number of legal claims in which the plaintiff demands significant amounts.
Although we have answered them firmly, the result of the claims is uncertain and may lead to
obligations that may cause a substantial negative effect on our business and the value of our
shares, American Depositary Shares (ADSs) e Hong Kong Depositary Shares (HDSs).
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Concessions, authorizations, licenses and permits depend on renewal, which is uncertain,
and we can only renew some of our mining concessions a limited number of times and for a
certain period.
Some of our mining concessions outside Brazil have an expiration date and can only be renewed a
limited number of times, for a limited period. Apart from mining concessions, we may need to obtain
several authorizations, licenses and permits from governmental or regulatory agencies in connection
with the operation of our mining properties, which can be subject to fixed expiration dates or to renewal or
periodic revision. Although we expect that renewals will be granted as and when required, it cannot
be asserted that such renewals will be actually granted and, besides, it cannot be assured that new
conditions will not be imposed to obtain such renewals. Mining concession fees may substantially
increase due to the period of time elapsed since the granting of each exploration license. If that
were the case, our business targets may be affected by the cost of maintaining or renewing our
mining concessions. In this respect, we must continuously assess the mining potential of each
concession, mainly at the time of renewal, to define whether mining concession maintenance costs
are justified by the results of operations up to now and, as the case might be, to let some of our
concessions expire. It cannot possibly be assured that said concessions will be obtained in
favorable terms, or even that they will be obtained at all, in line with the future mining and/or
exploration aims that we pursue.
Inefficient project management and other operational problems could adversely affect our
business and our financial performance.
Inefficient project management and operational problems may force us to suspend or reduce
production, which could generally result in a drop of our productivity. Inefficient project
management may mean that logistics, including power plants, machinery and transportation, is not
working as required to enable the ongoing operation of our activities. Operational failures may
cause significant power plant and machinery failures. It cannot be assured that inefficient project
management or other operational problems will not occur. Any damage to our projects or delay in our
operations caused by inefficient project management or operational problems may adversely affect
our business and the results of our operations.
Integrating our company and our acquisition assets, a key aspect in the strategy of our
company, may be more difficult than initially expected.
We may not succeed in integrating the businesses acquired by us. We have partly expanded our
business by means of acquisitions and part of our future growth may also rely on acquisitions. The
integration process after completing any acquisition by the company may be more difficult than
initially expected. Besides, if the focus on this post-acquisition process affects the performance
of our current operations, the results and operations of the Group may be adversely affected.
Integrating acquisition assets may take longer than expected and the costs related to acquisition
assets integration may be higher than expected. Completed acquisitions may not result in increased
revenues, cost economy or operational benefits as initially foreseen. Acquisitions may lead to a
substantial increase of costs as a result, for example, of inconsistent standards, checks,
procedures and policies between the Group and acquisition assets, which may adversely affect our
financial condition and the results of operations. Management focus may be deviated from day-to-day
responsibilities to integration-related issues.
It may be difficult for investors to enforce any judgment rendered outside Brazil against
us or any one of our partners.
Our investors can be located in jurisdictions outside Brazil and can attempt to file claims against
us or our board members or officers with courts within their jurisdictions. Our company is
Brazilian and most of our officers and board members are Brazilian residents. Most of our assets
and the assets of our officers and board members will be probably located in jurisdictions other
than the jurisdictions of our investors. Our investors may find it impossible to issue summons or
to serve notices connected with suits dealt with in their jurisdictions to our board members and
officers residing outside their jurisdictions. Additionally, judgments rendered abroad will be
applicable in Brazilian courts, without reconsidering the merits of the case, provided that the
judgment is previously confirmed by the Higher Court of Justice, whose confirmation will be granted
as long as such judgment: (a) meets all the formal requirements to be enforced pursuant to the
legislation in force in the country where it was rendered; (b) has been rendered by a competent
court after due process against the company or after sufficient evidence of contempt of court by
the company, pursuant to the legislation in force; (c) is not subject to appeal; (d) has been
authenticated by the Brazilian consulate in the country where it was rendered and is accompanied by
a sworn translation into Portuguese; (e) establishes the payment of a fixed amount; and (f) is not
contrary to the sovereignty of Brazil, its public policy or morality. Therefore, investors may not
enforce against our board members or officers the judgments passed by courts in their countries on
the basis of the legislation in force in those jurisdictions.
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Risks relating to our controlling shareholder or parent group
Our controlling shareholder exerts considerable influence over Vale and the Brazilian
government holds certain veto rights.
On March 31, 2011, Valepar S.A. (Valepar) owned 53.5% of the outstanding common shares and 33.3% of
our total outstanding capital. As a result of its stock ownership, Valepar can control the outcome
of some actions requiring shareholder approval.
The Brazilian government owns 12 golden shares of Vale, including limited veto powers over certain
company resolutions such as changes of corporate name, location of main office and corporate
purpose relating to mining activities.
Risks relating to our subsidiaries and related companies
We have a large number of subsidiaries and related companies (pursuant to 8.1), and many of
them are subject to operational and market risks similar to ours, which may exert adverse
effects on consolidated results.
A significant number of our subsidiaries and related companies is subject to risks similar to the
ones that we are subject to, which may exert a substantial adverse effect on their individual
results and may even render it difficult or impossible to distribute dividends to us. Besides,
potential adverse effects on the results of our subsidiaries and related companies may affect our
results and even reduce the amount to be distributed to shareholders as dividends.
Risks relating to our suppliers
For information about risks relating to our suppliers, please see Risk Factors under “We may face
shortages of equipment, services and skilled personnel” and “Higher energy costs or energy
shortages would adversely affect our business” above.
Risks relating to our customers
Our business could be adversely affected by a lower demand for products manufactured by our
customers, including steel (for our iron ore operations), stainless steel (for our nickel
operations), and agricultural commodities (for our fertilizer operations).
Demand for iron ore and nickel depends on global demand for steel. Iron ore and pellets, which
together accounted for 70.5% of our operating revenues in 2010, are used to produce carbon steel.
Nickel, which accounted for 8.3% of our operating revenues in 2010, is mainly used to produce
stainless and alloy steels. Demand for steel depends heavily on global economy conditions as well
as on a series of regional and sectorial factors. The prices of the different types of steel and
the performance of the steel industry as a whole are highly cyclical and volatile and the business
cycles of this industry affect the demand for and the prices of our products. Besides, the vertical
backward integration of the steel industry could reduce the global seaborne trade of iron ore.
The global seaborne trade of iron ore could also be affected by competition from metallics, such as
semi-finished steel and scrap. In some cases, it is more economical for steel makers to charge more
scrap in basic oxygen furnaces (BOF) and electric arc furnaces (EAF) instead of producing pig iron.
Semi-finished products such as billets and slabs may also be available from fully integrated steel
mills at low cost, reducing overall demand for seaborne iron ore.
Demand for fertilizers is affected by the prices of agricultural commodities in the world market. A
steady decline in the price of one or more agricultural commodities could have a negative impact on
the fertilizer business.
Risks relating to the fields of economy in which we operate
The mining sector is highly exposed to the cyclicality of global economic activity and also
requires significant investments of capital.
Mining provides raw materials for industries. Industrial production tends to be the most cyclical
and volatile component of global economic activity, which affects demand for minerals and metals.
At the same time, investment in mining requires a substantial amount of funds to replenish
reserves, expand
production capacity, build the necessary infrastructure and preserve the environment. These
structural features are the most significant financial risk factors for the mining industry.
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The change of iron ore prices based on quarterly short-term rates and the ensuing
volatility of prices could adversely affect our iron ore operations.
We have closed agreements with our customers in the iron ore sector during the first half of 2010
to convert annual contacts to contracts with their values adjusted on a quarterly basis to better
reflect market parameters. The previous annual price system for the iron ore sector was replaced by
a new system, according to which iron ore prices are established every quarter, based on a
quarterly average of price indices corresponding to the period closed one month prior to the
commencement of the new quarter. Although the new price system defines the price more accurately
according to the quality of the product, rewarding our iron ore products with a bonus over the
price of standard iron ore, increased volatility based on the impact of quarterly price changes
could adversely affect our cash flow.
The prices of nickel, copper and aluminum, which are actively traded on world commodity
exchanges, are subject to significant volatility.
Nickel, aluminum and copper are sold in an active global market and traded on commodity exchanges
such as the London Metal Exchange and the New York Mercantile Exchange. Prices for these metals are
subject to significant fluctuations and are affected by several factors, including actual and
expected macroeconomic and political conditions, levels of demand and supply, availability and cost
of substitutes, inventory levels, investments by commodity funds and other actions of participants
in the commodity market.
Increased availability of alternative nickel sources or substitution of nickel in end use
applications could negatively affect our nickel business.
Scrap nickel competes directly with primary nickel as a source of nickel to be used for the
production of stainless steel and the choice between them is largely driven by their relative
prices and availability. In 2010, the stainless steel scrap ratio remained unchanged, at 42% by
comparison with 2009. Nickel pig iron, a product developed by Chinese steel and alloy makers which
uses lateritic nickel ores, competes with other sources of nickel in the production of stainless
steel. In 2010, estimated nickel pig iron production increased 61%, representing 11% of global
nickel output. Demand for primary nickel may be adversely affected by direct substitution of
primary nickel with other materials in current applications. In response to high nickel prices or
other factors, producers and consumers of stainless steel may partially shift from the production
of stainless steel with high nickel content (series 300) to the production of stainless steel with
lower nickel content (series 200) or with no nickel content (series 400), which would adversely
affect demand for nickel.
Risks relating to the regulation of the sectors in which we operate
Regulatory, political, economic and social conditions in the countries in which we have
operations or projects could adversely affect our business and the market prices of our
securities.
Our financial performance may be negatively affected by regulatory, political, economic and social
conditions in the countries where we have significant operations or projects, mainly in Argentina,
Australia, Brazil, Canada, Colombia, Guinea, Indonesia, Liberia, Malawi, Mozambique, New Caledonia,
Oman and Peru.
Our operations rely on authorizations and concessions from regulatory agencies in the countries
where we operate. For further details about the authorizations and concessions that our operations
rely on, please refer to Company information — Regulatory issues. We are subject to laws and
regulations in several jurisdictions that can experience changes at any time, and changes of laws
and regulations may require modifications in our technologies and operations and result in
unexpected capital expenditures.
Actual or potential political changes and changes in economic policy may undermine investor
confidence and affect investments, therefore reducing economic growth and also generating a
specific negative effect on our business.
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Demonstrators have already taken actions to disrupt our operations and projects and they may
continue to do so in future. Although we defend ourselves vigorously against illegal acts and, at
the same time, support the communities living near our operations, future attempts by protestors to
cause harm to our operations could have a material adverse effect on our business.
Some of our operations and reserves are located next to or within indigenous, aboriginal or other
community territories. These indigenous and aboriginal groups are entitled to take part in the
management of natural resources and we negotiate with them access to their territories. Any
disagreement or dispute with an indigenous or aboriginal group could affect our capacity to develop
our reserves and to conduct our operations.
We may experience the adverse effect of changes in government policies, including the
imposition of new taxes or royalties on our mining activities.
Mining is subject to government regulations in the form of specific taxes and royalties, which can
have a significant impact on our operations. In the countries where we operate, governments may
impose or change taxes or royalties, or modify the basis on which they are calculated, in a manner
unfavorable to us.
Environmental, health and safety laws may adversely affect our business.
Our operations involve the use, handling, discharge and disposal of hazardous materials into the
environment and the use of natural resources and almost all the aspects of our operations,
products, services and projects all over the world are subject to environmental, health and safety
laws, which may expose us to increased litigation and higher costs. These regulations require us to
obtain environmental licenses, permits and other authorizations and to conduct environmental impact
assessments in order to obtain approval for our projects and permission to start construction.
Besides, all the changes required in existing operations must also undergo the same procedure. The
difficulty to obtain operating licenses may cause construction delays or cost increases and, in
some cases, lead us to postpone or even abandon a project. Environmental regulations also impose
control standards on activities relating to exploration, mining, pelletizing, railway and maritime
transportation services, decommissioning, refining, distribution and marketing of products. These
regulations may give rise to significant costs and liabilities. Besides, activist groups and other
stakeholders may increase their demands for environmentally sustainable and socially responsible
development, which could entail significant cost increases and reduce our profitability. Litigation
relating to these or other matters may adversely affect our financial condition or cause harm to
our reputation.
In recent years, environmental regulations in many of the countries in which we operate have become
stricter and more regulations or a more aggressive application of the regulations already in force
are likely to affect us adversely by imposing restrictions on our activities and products and by
establishing new requirements relating to the emission of pollutants and the renewal of
environmental licenses, therefore increasing costs or demanding expensive regeneration ventures.
Concern over the climate change and efforts to comply with international undertakings under the
Kyoto Protocol could lead governments to impose limits on carbon emissions applicable to our
operations, which could adversely affect our operating costs and our capital expenditure
requirements. For example, the Brazilian government issued a decree within the scope of the
National Climate Change Policy that foresees specific limits on carbon emissions to be determined
at the end of 2011 and enforced up to 2020.
Risks relating to the foreign countries in which we operate
An unfavorable economic scenario in China could cause a negative impact on our revenues,
cash flow and profitability.
Over the last few years, China has been the main driver of global demand for minerals and metals.
In 2010, Chinese demand represented 59% of global demand for seaborne iron ore, 37% of global
demand for nickel, [sic] 38% of aluminum and 41% of global demand for aluminum. The percentage of
our operating revenues attributable to sales to customers in China was 33.1% in 2010. Although
China has not been affected by the recent global recession, the contraction of its economic growth
could result in lower demand for our products, therefore leading to lower revenues, cash flow and
profitability. The poor performance of the real estate sector, the main consumer of steel in China,
could also cause a negative impact on our results.
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Risks relating to our ADSs and HDSs (American Depositary Shares and Hong Kong Depositary Shares)
When exchanging ADSs or HDSs for underlying shares, ADS or HDS holders can lose their
capacity to transfer foreign currencies abroad.
The custodian of the shares underlying our ADSs and HDSs is registered with the Central Bank of
Brazil as authorized to transfer U.S. Dollars abroad by way of payment of dividend and other
distributions relating to the shares underlying ADSs and HDSs or to the disposal of the underlying
shares. In the event that an ADR or HDR holder decides to exchange ADSs or HDSs for underlying
shares, he or she will be authorized to continue using the custodian’s registration for only five
business days starting from the date of exchange. From then on, the ADR or HDR holder may become
unable to procure and transfer foreign currency abroad at the time of disposing of or distributing
the underlying shares, unless he or she obtains a registration of his or her own, pursuant to the
terms of Resolution No. 2,689 of the National Monetary Council (CMN), which confers on registered
foreign investors the right to buy and sell securities at BMF&BOVESPA. In the event that an ADR or
HDR holder tries to obtain a registration of his or her own, he or she may incur expenses and
experience delays to receive dividend or distributions relating to the underlying shares or the
timely return on his or her capital.
It is impossible to assure that the registration of an ADR or HDR holder or any other registration
will not be affected by future legal modifications or even that in future additional and applicable
restrictions will not be applied to ADR or HDR holders apart from taxation on underlying shares or
on the repatriation of the proceeds from disposal.
It may not be possible for ADR and HDR holders to exercise their pre-emptive rights
relating to their ADSs and HDSs.
ADR and HDR holders may not be able to exercise their pre-emptive or other rights relating to the
underlying shares. It cannot be assured that ADR and HDR holders will be able to exercise their
pre-emptive rights, especially if the legislation in force in the jurisdiction of the holder (for
example, the Securities Act in the United States or the Companies Ordinance in Hong Kong) demands
that a registration declaration be effective or that an exemption from requirements for
registration be available relating those rights, as is the case in the United States, or for any
document enabling pre-emptive rights to be registered as a prospectus, as is the case in Hong Kong.
We are not bound to file a registration declaration relating to pre-emptive rights attached to
underlying shares in the United States or to take any measures to enable exemption from
registration and we cannot guarantee to ADR and HDR holders that we will notarize registration or
adopt applicable measures. Nor are we bound to increase the offering of pre-emptive rights to HDR
holders through the depositary.
ADR may encounter difficulties to exercise their voting rights.
ADR and HDR holders do not hold the same rights as shareholders. They only hold the contract rights
established in their favor under deposit contracts. ADR and HDR holders cannot take part in
shareholders meetings and can only vote by means of instructions delivered to the depositary. ADR
and HDR holders will not be able to vote in the event that it is altogether impossible to provide
the depositary, in a timely manner, with the material required to vote or even in the event that
ADR and HDR holders do not have sufficient time to submit voting instructions. Regarding those ADSs
and HDSs for which instructions have not been received, the depositary can, subject to certain
limitations, empower a person appointed by us.
Legal protections for holders of our securities differ from one jurisdiction to another and
may be inconsistent, unknown or less effective than investors expect.
We are a global company with shares traded on different markets and with investors in different
countries. The legal system for investors’ protection varies worldwide, sometimes in material
aspects, and investors holding our securities must be aware that the protections and recourses
available to them may be different from the ones to which they are accustomed in their local
market. We are subject to securities legislation in different countries, with different rules,
supervision and performance practices. The only applicable corporations law is the one in force in
Brazil, with its specific rules and judicial procedures. We are subject to corporate governance
rules in several jurisdictions where our shares are listed, but as a foreign private issuer, we are
not bound to follow many of the corporate governance rules applied to domestic issuers in the
United States relating to securities listed in the New York Stock Exchange (NYSE). Similarly,
waivers and exemptions have been granted from some requirements contained in the rules governing
the listing of securities with Hong Kong Limited Stock Exchange (HKEx Listing Rules), Codes on
Mergers and Acquisitions and Repurchase of Shares, Securities and Futures generally applicable to
issuers registered in Hong Kong.
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4.2 Vale’s expectations for reduction or increase in exposure to the above-mentioned risks, if
relevant
We constantly analyze the risks that the company is exposed to and which may adversely affect our
business, financial situation and results of our operations. We permanently monitor changes in the
macro-economic and sectorial scenario which might impact our activities, by tracking the main
performance indicators. Our policy is one of continuous focus on financial discipline and
conservative cash management. At present we do not identify any scenario which would lead to a
reduction or increase in the risks mentioned in section 4.1.
4.3 Legal, administrative or arbitral suits in which Vale or its subsidiaries are a party,
organized by labor, tax, civil and other suits: (i) which are not confidential, and (ii) which are
significant for Vale’s business and that of its subsidiaries.
(I) Labor
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The tables below present an individual description of labor suits relating to the business of the
Company and/or its subsidiaries.
Jurisdiction
|
6a Turma do TST | |
Instance
|
3rd Instance | |
Date of filing
|
11.27.2006 | |
Parties in the suit
|
Public Prosecutor for Labor matters (plaintiff) and Vale (defendant) | |
Amounts, goods or rights involved
|
R$520.4 million | |
Main facts
|
The Public Prosecutor for Labor matters of Minas Gerais filed a civil suit, questioning Vale’s outsourced activities. An unfavorable decision was given to Vale in the second instance, forcing the company in the region of Minas Gerais, to refrain from outsourcing some services allegedly linked to its main activity. Furthermore, it was decided that by way of indemnity for collective damage, the amount of R$100,000 should be paid. Vale presented an appeal the Supreme Labor Tribunal, which has not yet been assessed. | |
Chances of loss
|
Probable | |
Analysis of impact in the case
of losing the suit/ Reasons for
importance for the Company
|
In case of maintenance of the unfavorable decision, Vale is obliged, in Minas Gerais, to refrain from outsource services for operation of machinery and equipment for mining, such as back-hoes, excavators and drilling equipment, monitoring and reading of instruments at dams and waste stacks, drafting and implementation of the blasting plan — detonation, thus having to perform such activities through its own employees; and to provide for the termination of contracts of outsourcing which may have as their purpose the services mentioned above. | |
Amount provisioned (if any)
|
R$161.9 million |
Court
|
1a Vara Federal de Parauapebas — Pará | |
Instance
|
1st Instance | |
Date of filing
|
07.03.2008 | |
Parties in the suit
|
Public Prosecutor for Labor matters (plaintiff), Vale and the following companies (defendants): Accentum Manutenção e Serviços Ltda., ALTM S.A Tecnologia e Serviços de Manutenção, Atlântica Serviços Gerais Ltda., BMT- Engenharia Ltda., BRITAP — Britagem Azevedo Ltda., Comau do Brasil Industria e Comercio Ltda., Consorcio Canaã, Consorcio Sossego, Consorcio VFC, Construtora Brasil Novo Ltda., Construtora Camilo e Empreendimentos Ltda., Construtora Mineira de Engenharia Ltda., Construtora Norberto Odebrecht S A, Construtora Queiroz Galvão S/A, CRM Construtora Ltda., D Service Ltda., Dan Hebert S/A, Dinex Engenharia Mineral Ltda., E. S. Neres Transportes ME, 20. EME Serviços Gerais Ltda., Engepar Engenharia Ltda., Flapa Mineração e Incorporação Ltda., Geocret Engenharia e Tecnologia Ltda., Gesman Ltda., Integral Construções e Comercio Ltda., Intertek do Brasil Inspeções Ltda., Julio Simões Transportes e Serviços Ltda., Kaserge Serviços Gerais Ltda., Lubrin Lubrificacao Industrial Ltda., Metso Brasil Industria E Comercio Ltda., MIP Engenharia S/A, MSE-Servicos de Operação, Manutenção e Montagem Ltda., Progeo — Engenharia Ltda., Rio Maguari Serviços e Transportes Rodoviario Ltda., Rip Serviços Industriais S/A, Salosergel Vigilância Ltda., Sital - Sociedade Itacolomi de Engenharia Ltda., Sodexho do Brasil Comercial Ltda., T Q M Service Ltda., U & M Mineração e Construção S/A, and Vessoni Transportes Ltda. | |
Amounts, goods or rights involved
|
R$108.6 million | |
Main facts
|
Public Civil Action proposed by the
public prosecutor for labor matters
against Vale and another 42 companies
which provide services, requiring that
defendants be condemned to pay for
hours spent in transit
(Carajás/Sossego), under the claim
that the workplaces are difficult to
access and not served by public
transport. The action also asks for
collective damages. Vale has presented
its defense alleging the existence of
public transport, that the locations
are easily accessible and the validity
of their collective agreements.
In 12.03.2010, the decree was published condemning only Vale to pay indemnity for damages to the amount of R$100,000,000.00 and another R$200,000,000.00 for practicing social dumping. Temporary relief was granted so that Vale could determine, immediately, how many hours travelling each of its employees used, with a penalty of a fine of R$100,000.00 per worker if not done, as well as refrain from allowing contractors for Vale including on their cost worksheet expenses with hours paid travelling and allied costs. As a result of a request for decisions by Odebrect, one of the 42 defendants in this lawsuit, in the Request for Corrective Judgment filed by Vale as a response, the Inspector General of the Supreme Labor Tribunal in Brasilia, recognized the allegations and reversed the temporary relief order granted by the local judge, so that Vale and the other companies may appeal without having to comply immediately with the sentence passed. Requests to amend the decision were filed by Vale and other defendants. The requests to amend the decision of Vale lost their objective, and those of other companies were rejected. Some companies filed an appeal that is not in the second instance yet. |
19
Table of Contents
| We stress that in July 2010 Vale
reached an agreement to put an end to
this suit, assuming obligations much
lower than the amounts claimed in the
suit, pursuant to the following terms: |
||
| (i) Relating to ‘in itinere’ hours: Vale will proceed to pay part of the
time claimed, that is, 44 minutes/day
for the employees of Carajás mine, 80
minutes/day for the employees of Azul
mine, and 54 minutes/day for the
employees of Sossego mine. Besides,
following the same criteria, Vale will
pay an amount equivalent to 42 months
of ‘in itinere’ hours. Term for
implementation: 6 (six) months. Vale
made the payment for the 42 months to
the active employees and is taking
steps to make the payments to the
inactive employees. (ii) Relating to moral damages and alleged social dumping: claims were withdrawn by Vale undertaking to engage in social work in the area of Parauapebas in an amount of R$26,000,000.00. Term for implementation: by March 2012. |
||
Chances of loss
|
Possible | |
Analysis of impact in the case of
losing the suit/ Reasons for
importance for the Company
|
In the event of acceptance of all the claims submitted, Vale would be compelled to pay: (i) ‘in itinere’ hours for all the employees working at Carajás, Azul and Sossego mines, (ii) ‘in itinere’ hours retroactively to March 2003 and (iii) group moral damages in an amount of R$100,000,000.00. | |
Amount provisioned (if any)
|
R$79.5 million |
Jurisdiction
|
2a Vara do Trabalho de Vitória — Espírito Santo | |
Instance
|
1st Instance | |
Date of filing
|
09.19.2001 | |
Parties in the suit
|
Vale S.A. (defendant) and SINDFER — Railroad union of ES and MG (plaintiff) | |
Amounts, goods or rights involved
|
Guarantee of the operational activities at the Tubarão Complex. | |
Main facts
|
In 2001, the SINDFER union filed a public civil action, whose object was the compliance of areas of the Tubarão Complex with the dictates of NR-10 (safety of premises and services in electricity). After production of expert evidence, Vale was ordered to implement in their operational facilities, located in the State of Espírito Santo, all technical measures for the protection of work against risks by electricity provided for in the NR. The judge granted Vale temporary relief, with a period of six months for compliance, ending 19/11/09, with payment of a daily fine of R$100,000.00 for non-compliance. After rounds of negotiation, and several inspections of areas of the Complex, a legal agreement was signed between the parties, establishing a timeline for implementation of technical measures, with a deadline of 31.12.2011, which was duly approved by the court on 11 March 2010. In 24.01.11, SINDFER took part in a meeting with Vale Representatives where the substitution certificate of the previously filed revitalization schedules was signed accepting the new schedules submitted by the Company where the term for revitalization of the Complex was extended until 31/03/2012. | |
Chances of loss
|
Probable | |
Analysis of impact in the case
of losing the suit/ Reasons for
importance for the Company
|
Any violation of the adjusted schedule between the parties may risk an embargo on Tubarão Complex activities, as well as the application of a monetary penalty. | |
Amount provisioned (if any)
|
None |
20
Table of Contents
Jurisdiction
|
Juízo do Trabalho de Maruim — Sergipe | |
Instance
|
3rd Instance (TST) | |
Date of filing
|
08.18.2006 | |
Parties in the suit
|
Vale S.A. (defendant) and Union for workers extracting iron, basic and precious metals-Sindimina (plaintiff) | |
Amounts, goods or rights involved
|
Guarantee of the operational activities at the potassium chlorate mine in Sergipe. | |
Main facts
|
Lawsuit brought by SINDIMINA union in the State of Sergipe, aiming to improve the suitability of the working conditions of employees in the underground mine to bring them up to regulatory standard NR 15, especially as regards the temperature of the mine. In the first instance, it was decided on the closing of the underground mine, but such determination was suspended by writ. Subsequently, partial success was granted to Vale’s appeal to withdraw the order closing the mine, and determine the suitability of the working conditions of mine in relation to NR-15. Vale is still contesting the decision, to demonstrate compliance with the legal standards applicable to the activity. The increased risk of a conviction would be the closing of the mine, as determined by the 1st Degree Judge and rejected through an ordinary appeal. Vale is awaiting the result of an appeal before the TST, with the purpose of changed the decision as to the parts that were unfavorable. Evaluation of the appeal started in April 2011, though judgment was deferred because of the request to summon the Ministers of the Appellate Court. The process has been suspended for the time being. | |
Chances of loss
|
Probable | |
Analysis of impact in the case
of losing the suit/ Reasons for
importance for the Company
|
Any unfavorable decision may risk imposing an obligation to do so, fines and, in the final analysis the embargo of the activities of the underground mine for exploitation of Potassium Chlorate/Sergipe, as well as enforcement of a monetary penalty. | |
Amount provisioned (if any)
|
None |
(II) Tax
The tables below present a description of individual tax cases considered relevant to the business
of the company and/or its subsidiaries.
Jurisdiction
|
Administrative Council of Fiscal Resources | |
Instance
|
2nd administrative instance | |
Date of Filing
|
03.28.2008 | |
Parties in the suit
|
Federal Revenue Secretariat (plaintiff) and Vale (defendant) | |
Amounts, goods or rights involved
|
R$9,178 billion | |
Main facts
|
In 2003 Vale filed a judicial claim to challenge the provisions of section 74 of Provisional Measure 2,158-34/2001, which establishes payment in Brazil of Income and Social Contribution Tax on Net Profit relating to profits of foreign subsidiaries. Our defense is based on the following grounds: (i) section 74 of the Provisional Measure overlooks the treaties against double taxation signed between Brazil and the countries in which some of our subsidiaries are based; (ii) the National Tax Code forbids the aforementioned taxation as set forth by the Provisional Measure; (iii) even if section 74 of the Provisional Measure were valid, exchange variation should be excluded from the assessment of due taxes (according to the new accounting principles in force in Brazil and IFRS); and (iv) violation of the principle of prior taxation, in the event of taxation prior to December 2001. The first instance judgment was unfavorable to the Company and the recourse of appeal was received with suspensive effect. In March 2011, the Federal Regional Court of the 2nd Region objected to the prosecution of Vale’s appeal. The court decision is awaited to be published to submit new recourses to the Higher Court of Justice and Federal Supreme Court. In April 2011, the Higher Court of Justice issued a favorable decision in a suit in which similar grounds to the ones proclaimed by Vale were submitted. The direct action for unconstitutionality (ADIN, according to the initials in Portuguese) proposed by the National Confederation of Industry (CNI, according to the initials in Portuguese) challenging the constitutionality of section 74 of the Provisional Measure is still awaiting judgment by the Federal Supreme Court. Even if ADIN is determined to be unfounded, we will continue challenging the requirement on legal terms based on other existing defense arguments. Vale was notified of IRPJ and CSLL requirements relating to profits earned by related and subsidiary companies abroad, enforcing a 75% penalty despite the suspensive effect granted to the appeal filed. At present, the decision issued by the Taxpayers Council is awaited to be published. | |
Chances of loss
|
Remote | |
Analysis of impact in the case of
losing the suit/ Reasons for importance
for the Company
|
In the event of a final unfavorable decision, the profits earned and retained by Company subsidiary or related companies based abroad will proceed to be charged with taxes. | |
Amount provisioned (if any)
|
None |
21
Table of Contents
Jurisdiction
|
Administrative Council of Fiscal Resources | |
Instance
|
2nd administrative instance | |
Date of filing
|
10.12.2007 | |
Parties in the suit
|
Federal Revenue Secretariat (plaintiff) and Vale (defendant) | |
Amounts, goods or rights involved
|
R$2,673 billion | |
Main facts
|
In 2003 Vale filed a judicial claim to challenge the
provisions of section 74 of Provisional Measure
2,158-34/2001, which establishes payment in Brazil of
Income and Social Contribution Tax on Net Profit relating
to profits of foreign subsidiaries. Our defense is based on
the following grounds: (i) section 74 of the Provisional
Measure overlooks the treaties against double taxation
signed between Brazil and the countries in which some of
our subsidiaries are based; (ii) the National Tax Code
forbids the aforementioned taxation as set forth by the
Provisional Measure; (iii) even if section 74 of the
Provisional Measure were valid, exchange variation should
be excluded from the assessment of due taxes (according to
the new accounting principles in force in Brazil and IFRS);
and (iv) violation of the principle of prior taxation, in
the event of taxation prior to December 2001. The first
instance judgment was unfavorable to the Company and the
recourse of appeal was received with suspensive effect. In
March 2011, the Federal Regional Court of the
2nd Region objected to the prosecution of Vale’s
appeal. The court decision is awaited to be published to
submit new recourses to the Higher Court of Justice and
Federal Supreme Court.
In April 2011, the Higher Court of Justice issued a favorable decision in a suit in which similar grounds to the ones proclaimed by Vale were submitted. The direct action for unconstitutionality (ADIN, according to the initials in Portuguese) proposed by the National Confederation of Industry (CNI, according to the initials in Portuguese) challenging the constitutionality of section 74 of the Provisional Measure is still awaiting judgment by the Federal Supreme Court. Even if ADIN is determined to be unfounded, we will continue challenging the requirement on legal terms based on other existing defense arguments. Vale was notified of IRPJ and CSLL requirements relating to profits earned by related and subsidiary companies abroad, enforcing a 75% penalty despite the suspensive effect granted to the appeal filed. At present, the decision issued by the Taxpayers Council is awaited to be published. |
|
Chances of loss
|
Remote | |
Analysis of impact in the case
of losing the suit/ Reasons for
importance for the Company
|
In the event of a final unfavorable decision, the profits earned and retained by Company subsidiary or related companies based abroad will proceed to be charged with taxes. | |
Amount provisioned (if any)
|
None |
Jurisdiction
|
Federal Revenue Secretariat | |
Instance
|
1st administrative instance | |
Date of filing
|
12.02.2010 | |
Parties in the suit
|
Federal Revenue Secretariat (plaintiff) and Vale (defendant) | |
Amounts, goods or rights involved
|
R$3,095 billion | |
Main facts
|
In 2003 Vale filed a judicial claim to challenge the provisions of section 74 of Provisional Measure 2,158-34/2001, which establishes payment in Brazil of Income and Social Contribution Tax on Net Profit relating to profits of foreign subsidiaries. Our defense is based on the following grounds: (i) section 74 of the Provisional Measure overlooks the treaties against double taxation signed between Brazil and the countries in which some of our subsidiaries are based; (ii) the National Tax Code forbids the aforementioned taxation as set forth by the Provisional Measure; (iii) even if section 74 of the Provisional Measure were valid, exchange variation should be excluded from the assessment of due taxes (according to the new accounting principles in force in Brazil and IFRS); and (iv) violation of the principle of prior taxation, in the event of taxation prior to December 2001. The first instance judgment was unfavorable to the Company and the recourse of appeal was received with suspensive effect. In March 2011, the Federal Regional Court of the 2nd Region objected to the prosecution of Vale’s appeal. The court decision is awaited to be published to submit new recourses to the Higher Court of Justice and Federal Supreme Court. In April 2011, the Higher Court of Justice issued a favorable decision in a suit in which similar grounds to the ones proclaimed by Vale were submitted. The direct action for unconstitutionality (ADIN, according to the initials in Portuguese) proposed by the National Confederation of Industry (CNI, according to the initials in Portuguese) challenging the constitutionality of section 74 of the Provisional Measure is still awaiting judgment by the Federal Supreme Court. Even if ADIN is determined to be unfounded, we will continue challenging the requirement on legal terms based on other existing defense arguments. Vale was notified of IRPJ and CSLL requirements relating to profits earned by related and subsidiary companies abroad, enforcing a 75% penalty despite the suspensive effect granted to the appeal filed. At present, the decision issued by the Taxpayers Council is awaited to be published | |
Chances of loss
|
Remote | |
Analysis of impact in the case
of losing the suit/ Reasons for
importance for the Company
|
In the event of a final unfavorable decision, the profits earned and retained by Company subsidiary or related companies based abroad will proceed to be charged with taxes. | |
Amount provisioned (if any)
|
None |
22
Table of Contents
Jurisdiction
|
Federal Revenue Secretariat | |
Instance
|
1st administrative instance | |
Date of filing
|
11.01.2010 | |
Parties in the suit
|
Federal Revenue Secretariat (plaintiff) and Vale (defendant) | |
Amounts, goods or rights involved
|
R$11,763 billion | |
Main facts
|
In 2003 Vale filed a judicial claim to challenge the provisions of section 74 of Provisional Measure 2,158-34/2001, which establishes payment in Brazil of Income and Social Contribution Tax on Net Profit relating to profits of foreign subsidiaries. Our defense is based on the following grounds: (i) section 74 of the Provisional Measure overlooks the treaties against double taxation signed between Brazil and the countries in which some of our subsidiaries are based; (ii) the National Tax Code forbids the aforementioned taxation as set forth by the Provisional Measure; (iii) even if section 74 of the Provisional Measure were valid, exchange variation should be excluded from the assessment of due taxes (according to the new accounting principles in force in Brazil and IFRS); and (iv) violation of the principle of prior taxation, in the event of taxation prior to December 2001. The first instance judgment was unfavorable to the Company and the recourse of appeal was received with suspensive effect. In March 2011, the Federal Regional Court of the 2nd Region objected to the prosecution of Vale’s appeal. The court decision is awaited to be published to submit new recourses to the Higher Court of Justice and Federal Supreme Court. In April 2011, the Higher Court of Justice issued a favorable decision in a suit in which similar grounds to the ones proclaimed by Vale were submitted. The direct action for unconstitutionality (ADIN, according to the initials in Portuguese) proposed by the National Confederation of Industry (CNI, according to the initials in Portuguese) challenging the constitutionality of section 74 of the Provisional Measure is still awaiting judgment by the Federal Supreme Court. Even if ADIN is determined to be unfounded, we will continue challenging the requirement on legal terms based on other existing defense arguments. Vale was notified of IRPJ and CSLL requirements relating to profits earned by related and subsidiary companies abroad, enforcing a 75% penalty despite the suspensive effect granted to the appeal filed. At present, the decision issued by the Taxpayers Council is awaited to be published. | |
Chances of loss
|
Remote | |
Analysis of impact in the case
of losing the suit/ Reasons for
importance for the Company
|
In the event of a final unfavorable decision, the profits earned and retained by Company subsidiary or related companies based abroad will proceed to be charged with taxes. | |
Amount provisioned (if any)
|
None |
(III) Civil
The tables below present a description of individual civil nature processes considered relevant to
the business of the company and/or its subsidiaries.
Jurisdiction
|
41a Vara Cível do Tribunal de Justiça do Rio de Janeiro | |
Instance
|
1st Instance | |
Date of filing
|
03.17.2008 | |
Parties in the suit
|
Vale (plaintiff) and Movimento dos Sem Terra — MST (defendant) | |
Amounts, goods or rights involved
|
Protection of the company’s assets and guarantee of its operations | |
Main facts
|
Vale filed a common suit with a request for anticipated relief
obliging the defendant to cease attacks, violent acts or
incitements which cause the operational stoppage of the company
by the MST. Relief was granted, as soon as the case was judged in the year 2008, establishing that the MST must refrain from such acts. |
|
Chances of loss
|
Remote | |
Analysis of impact in the case
of losing the suit/ Reasons for
importance for the Company
|
The lawsuit was initiated in order to ensure the protection of the assets of the company and its operational activities. A possible unfavorable decision can increase the exposure of the company to MST attacks. | |
Amount provisioned (if any)
|
None. |
23
Table of Contents
Jurisdiction
|
30a Vara Federal da Justiça Federal do Rio de Janeiro | |
Instance
|
1st Instance | |
Date of filing
|
08.18.2006 | |
Parties in the suit
|
Federal Rail Network (Rede Ferroviária Federal S.A.), succeeded by the Federal Union (plaintiff) and Vale (defendant) | |
Amounts, goods or rights involved
|
R$2.4 billion | |
Main facts
|
The plaintiff filed a claim for reparation from the Company to receive contractual amounts, damages, lost profits, among other amounts, for alleged breach of contractual obligations on the part of Vale. The contract concluded between the parties involved railway transposition in the city of Belo Horizonte. The lawsuit is at the phase of legal discovery. | |
Chances of loss
|
Remote | |
Analysis of impact in the case
of losing the suit/ Reasons for
importance for the Company
|
Any unfavorable decision could generate a financial loss for the company, in the light of the amounts involved. | |
Amount provisioned (if any)
|
None |
Jurisdiction
|
19a Câmara Civel do Tribunal de Justiça do Rio de Janeiro | |
Instance
|
2nd Instance | |
Date of filing
|
08.07.2009 | |
Parties in the suit
|
Vit Shoes Calçados (plaintiff) and Vale (defendant) | |
Amounts, goods or rights involved
|
Ownership rights over the new logo launched by the company in December 2007. | |
Main facts
|
The plaintiff brought a compensation suit with request for early relief, requesting an injunction to make the company refrain from using the logo of the Vale and its variations, and compensate for moral and material damages when the judgment is given. The preliminary injunction was rejected. Vale was awarded a favorable judgment of the merits, against which the plaintiff submitted a recourse to the Court of Justice of Rio de Janeiro. Said recourse was rejected by unanimous decision. The pertinent decision is currently awaited to be published. | |
Chances of loss
|
Remote. | |
Analysis of impact in the case
of losing the suit/ Reasons for
importance for the Company
|
Any unfavorable decision in the lawsuit would generate financial losses for the Company and would harm its image, since Vale would lose the right to use its logo which is already widely known in Brazil and abroad. | |
Amount provisioned (if any)
|
None. |
Jurisdiction
|
5a Turma do TRF da 2a Região | |
Instance
|
2nd Instance | |
Date of filing
|
10.11.1997 | |
Parties in the suit
|
Federal Public Prosecutor — Espírito Santo (plaintiff) and Federal Union, Gerdau, Açominas S.A., Companhia Siderúrgica de Tubarão, Usinas Siderúrgicas de Minas Gerais S.A., Vale, Odacir Klein, Luis Andre Rico Vicente, Jorge Eduardo Brada Donato, José Armando Figueiredo Campos, Rinaldo Campos Soares, João Jackson Amaral, Claudio José Anchieta de Carvalho Borges, Ivo Costa Serra and Companhia Docas do Espírito Santo — CODESA (defendants) | |
Amounts, goods or rights involved
|
Incalculable amount — application for annulment of the concession contract for use of port terminals for the Tubarão Complex. | |
Main facts
|
This is a Public Civil Action which aims to annul the authorization by which Vale and some of the other defendants operate the Port Terminal at Praia Mole, in the State of Espírito Santo. In November 2007, after 10 years of conducting the proceedings, Vale obtains a favorable decision judging the requests to be without foundation and recognizing the validity of contracts of accession that allow exploitation of port terminals located in Praia Mole. The Federal Public Prosecutor appealed on 01.04.08 and the lawsuit awaits judgment in the Federal Regional Tribunal. | |
Chances of loss (probable, possible,
remote)
|
Remote | |
Analysis of impact in the case of
losing the suit/ Reasons for
importance for the Company
|
Incalculable amount | |
Amount provisioned (if any)
|
None |
24
Table of Contents
(IV) Environmental
The tables below present a description of individual environmental nature processes considered
relevant to the business of the company and/or its subsidiaries.
Jurisdiction
|
2a Vara Cível da Comarca de Itabira — Minas Gerais | |
Instance
|
1st Instance | |
Date of filing
|
09.26.1996 | |
Parties in the suit
|
Town Hall of Itabira (plaintiff) and Vale (defendant) | |
Amounts, goods or rights involved
|
R$2.8 billion | |
Main facts
|
The municipality of Itabira seeks compensation for expenses that it alleges to have incurred with public services rendered as a consequence of Vale’s mining activities. The case was suspended, pending judgment of a writ filed by Vale to be used in this lawsuit, so that favorable evidence produced in another lawsuit could be used. Although the writ has been judged against Vale, the case continues to be suspended because the court in the first degree has not yet received from the Court of Justice of Minas Gerais information on the writ. After this communication, the lawsuit may resume its normal course. | |
Chances of loss
|
Total amount divided into possible loss (15%) and remote loss (85%). | |
Analysis of impact in the case
of losing the suit/ Reasons for
importance for the Company
|
Any unfavorable decision in the lawsuit would generate financial losses for the Company. | |
Amount provisioned (if any)
|
None. |
Jurisdiction
|
1a Vara Cível da Comarca de Itabira — Minas Gerais | |
Instance
|
1st Instance | |
Date of filing
|
08.22.1996 | |
Parties in the suit
|
Town Hall of Itabira (plaintiff) and Vale (defendant) | |
Amounts, goods or rights involved
|
R$2.4 billion | |
Main facts
|
State in which the plaintiff claims that the operations of the iron mines in Itabira caused environmental and social damage and requires the restoration of the site and the implementation of environmental programs in the region. Expert witnesses were used in this case, and the report issued jointly by IBAMA and FEAM was favorable to Vale. Nevertheless, the Municipality requested the production of new expert evidence, which was accepted by the judge. The final outcome of this case is awaited. | |
Chances of loss
|
Total amount divided into possible loss (15%) and remote loss (85%). | |
Analysis of impact in the case
of losing the suit/ Reasons for
importance for the Company
|
Any unfavorable decision in the lawsuit would generate financial losses for the Company. | |
Amount provisioned (if any)
|
None. |
4.4 Judicial, administrative or arbitral awards, which are not under confidentiality, in which the
company or its subsidiaries are a party and whose Appellees are administrators or former
administrators, owners or ex-owners or investors of the company or its subsidiaries
Jurisdiction
|
Appeals Council of the National Financial System — CRSFN | |
Instance
|
2nd Instance | |
Date of filing
|
08.23.2005 | |
Parties in the suit
|
This suit was initiated by CVM, as a result of a complaint from the investment club of SUDFER Railway Workers, minority shareholder of MRS Logística S.A. (“MRS”), against: Vale (successor of Ferteco Mineração S.A.); Companhia Siderúrgica Nacional — CSN; Minerações Brasileiras Reunidas S/A — MBR; and the directors of MRS who were involved from 1998 to 2002, namely: Alberto Régis Távora, Andreas Walter Brehm, Chequer Hanna Bou-Habib, Delson de Miranda Tolentino, Estela Maria Praça de Almeida, Henrique Ache Pillar, Hugo Serrado Stoffel, Georg Josef Schmid, Godofredo Mendes Vianna. Guilherme F. Escalhão, Inácio Clemente da Silva, João Paulo do Amaral Braga, Joaquim de Souza Gomes, José Paulo de Oliveira Alves, Julio César Pinto, Julio Fontana Neto, Klaus Helmut Schweizer, Lauro H. Campos Rezende, Luiz Antonio Bonagura, Marcus Jurandir de A. Tabasco, Marianne Von Lachmann, Mauro Rolf Fernandes Knudsen, Oscar Augusto de Camargo Filho, Otávio de Garcia Lazcano, Pablo Javier Q. Bruggemann, Rinaldo Campos Soares, Roberto Gottschalk, Valter Luis de Sousaand Wanderlei Viçoso Fagundes. | |
Amounts, goods or rights involved
|
Assessment of possible irregularities related to tariff model of MRS between 1998 and 2002. | |
Main facts
|
The lawsuit was initiated by CVM to verify (I) the
conduct of MRS directors for alleged tariff
mismanagement, characterized by undervalued tariffs for
the benefit of captive customers or owners; and (ii) the
conduct of the MRS shareholders for contracts signed
directly with MRS on allegedly non-equitable terms.
The suit was judged by the CVM on 05.05.2009, which acquitted all those involved. In December 2009, the CVM offered an automatic appeal to CRFSN, which has not yet been judged. |
|
Chances of loss
|
Remote. | |
Analysis of impact in the case
of losing the suit/ Reasons for
importance for the Company
|
The eventual reversal of the decision at the first instance can result in the application of a warning or fine for the company. | |
Amount provisioned (if any)
|
None. |
25
Table of Contents
Jurisdiction
|
Prosecution in progress before 48a Vara Cível do Tribunal de Justiça do Rio de Janeiro. Special Recourse under way before 3a Turma do STJ and Extraordinary Recourse still not delivered to STF. | |
Instance
|
3rd Instance | |
Date of filing
|
09.05.2007 | |
Parties in the suit
|
Petros (plaintiff) and Vale (defendant) | |
Amounts, goods or rights involved
|
A judicial deposit was made by Vale on 08.03.2010 for R$346,773,920.20 for the provisional execution by Petros. Until judgment has become final and binding, the amount will continue judicially deposited and may not be withdrawn. | |
Main facts
|
Petros claims receipt of purges made because of inflation arising from the economic plans called Plano Verão and Plano Collor on amounts paid under forward contracts for buying and selling gold concluded with Vale from 1988. Contracts under discussion in this brief were paid up and settled by Petros at that time. However, Petros started legal proceedings aimed at applying the decision on a matter taken in the STJ for savings accounts books, to contracts concluded with Vale. Vale maintains that the inflationary adjustments are not due; however, all decisions have been unfavorable to the company. Currently the original process is in the implementation stage, but the decision is not yet firm. Vale has a Special Recourse filed with STJ, which was rejected by the Turma on a unanimous basis. However, recourses can still be filed against this decision. There is also a Special Recourse to be dealt with and decided by STF. | |
Chances of loss (probable,
possible, remote)
|
Probable | |
Analysis of impact in the case of
losing the suit
|
Any unfavorable decision could generate significant financial damage to Company, in light of the amounts under discussion. Additionally, such a decision can open a precedent for similar judgments in other cases where future contracts for sale of gold are in dispute (total of 11 cases). | |
Amount provisioned (if any)
|
R$381.4 million |
Jurisdiction
|
18a Vara Federal de Belo Horizonte — Minas Gerais | |
Instance
|
1st Instance | |
Date of filing
|
02.18.2004 | |
Parties in the suit
|
Transger S/A(plaintiff) and Ferrovia Centro Atlântica S/A, Mineração Tacumã Ltda, KRJ Participações S/A, CPP Participações S/A, Carmo Administração e Participações Ltda, Fundação Vale do Rio Doce de Seguridade Social — Valia and Companhia Siderúrgica Nacional — CSN (defendants) | |
Amounts, goods or rights involved
|
Incalculable — Request for annulment of the General Meeting. | |
Main facts
|
The plaintiff brought a lawsuit requesting compensation and annulment of the General Meeting authorizing the capital increase of Ferrovia Centro-Atlântica S.A. (“FCA”) in early 2003 on the grounds of alleged practice of abusive acts by FCA’s controlling group. The request was initially judged well founded, but the judgment was reversed by the Court of Justice of Minas Gerais, which annulled all the judicial proceedings instituted up to then and therefore determined the production of new expert evidence. During the preparation of the new expert evidence, the National Agency of Land Carriage (ANTT, according to the initials in Portuguese) stated its interest in participating in the case and, for this reason, the jurisdiction in this procedure was transferred to the Federal Justice of Minas Gerais. New expert evidence is in progress. | |
Chances of loss (probable,
possible, remote)
|
Possible | |
Analysis of impact in the case
of losing the suit
|
Incalculable amount | |
Amount provisioned (if any)
|
None |
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Procedure No. 0529364272010.8.13.0145
Jurisdiction
|
7a Vara Cível de Juiz de Fora/MG | |
Instance
|
1st Instance | |
Date of filing
|
August 2010 | |
Parties in the suit
|
SUDFER (plaintiff), and MRS Logística S.A., Companhia Siderúrgica Nacional S.A., Minerações Brasileiras Reunidas S.A., Usiminas — Usinas Siderúrgicas de Minas Gerais, Gerdau S.A. and Vale S.A. (defendants) | |
Amounts, goods or rights involved
|
Incalculable | |
Main facts
|
Plaintiff asserts that MRS
Logística adopted a tariff policy
aiming to favor its controlling
group, specifically the
defendants’; a complaint was even
filed before CVM, which through the
appointed Committee of Inquiry-
acknowledged that the complaint
filed by Clube SUDFER on the
irregularities of the group was
true. Plaintiff requested: 1)
Temporary relief determining that
the Defendants hire with a
subsidiary on equal terms, taking
into consideration the maximum
allowable tariff; 2) To order the
Defendants to pay any and all
direct material damages imposed on
MRS Logística until the improper
practice has been stopped, due to
the unfair reduction of the profits
of the company, due to the non
payment of dividends, and due to
the payment of less dividends in
view of the reduced tariffs charged
to the controlling group. In January 2011, the defendants filed their pleas. Main proceedings will be suspended until judgment of dismissal for lack of jurisdiction also filed by the defendants is passed, thus, aiming at determining in the mining trial, if the court is competent to hear the case or whether in fact the competent forum is Rio de Janeiro. |
|
Chances of loss (probable, possible,
remote)
|
Possible | |
Analysis of impact in the case of
losing the suit
|
Any unfavorable decision in the lawsuit would generate financial losses for the Company and would damage its image. | |
Amount provisioned (if any)
|
None |
Procedure No. 0497166342010.8.13.0145
Jurisdiction
|
8th Civil Court of Juiz de Fora — Minas Gerais | |
Instance
|
1st Instance | |
Date of filing
|
August 2010. | |
Parties in the suit
|
SUDFER (plaintiff) and Júlio Fontana Neto, Henrique Aché Pillar, José Paulo de Oliveira Alves, Pablo Javier de La Quintana Bruggemann, Lauro Henrique Campos Rezende, Wanderlei Viçoso Fagundes, Hugo Serrado Stoffel, Guilherme Frederico Escalhão, Delson de Miranda Tolentino, Marcus Jurandir de Araújo Tambasco, Chequer Hanna Bou-Habib, Roberto Gottschalk, Joaquim de Souza Gomes, Luiz Antônio Bonaguara, Companhia Siderúrgica Nacional S.A., Minerações Brasileiras Reunidas S.A., Usiminas — Usinas Siderúrgicas de Minas Gerais, Gerdau S.A., and Vale S.A. (defendant) | |
Amounts, goods or rights involved
|
Incalculable | |
Main facts
|
Plaintiff requires payment for moral damage based on the fact that the image of Clube SUDFERwas enormously damaged for 9 years, and that said company did not receive dividends, and thus, was in pre-insolvency status. Plaintiff also requires shares to be sold under same conditions as it had the right to purchase at the time of the 2nd offer of shares made by MRS Logística, besides the loss of earnings by the dividends not received. MBR is also involved. Given the great number of defendants, not all of them have been summoned; therefore, the parties do not have a legal period yet to file their pleas | |
Chances of loss (probable,
possible, remote)
|
Possible | |
Analysis of impact in the case
of losing the suit
|
Any unfavorable decision in the lawsuit would generate financial losses for the Company and would damage its image. | |
Amount provisioned (if any)
|
None |
4.5 Impact analysis in case of loss of any relevant and sensitive cases that have not been
disclosed in items 4.3 and 4.4 above, informing values involved
Not applicable. Vale is not a party in any relevant and sensitive cases.
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4.6 Judicial, administrative or arbitral lawsuits, repetitive or related, based on similar legal
facts and causes, which are not under secrecy and which together are relevant, in which the company
or its subsidiaries are a party, itemized as labor, tax, civil and other.
(i) Labor
Fact and/or legal cause
|
The more recurring objects are responsibility, subsidiary/joint liability, overtime, additional payment for hazardous/unhealthy conditions, hours “in itinere” and penalty. | |
Amounts involved
|
R$4.1 billion | |
Amount provisioned (if any)
|
R$688.8 million | |
Company practice or that of subsidiary
which caused the contingency
|
Difference of interpretation given by the company, employees and unions to various facts, legal and regulatory instruments concerning the issues above. |
(ii) Tax
Fact and/or legal cause
|
Determining the basis for the calculation of financial compensation for exploitation of mineral resources — CFEM, which in a simple way means mining royalties. | |
Amounts involved
|
R$7,880 billion for various collections of Financial Compensation for Mineral Resources Exploitation — CFEM. | |
Amount provisioned (if any)
|
R$225 million | |
Company practice or that of subsidiary
which caused the contingency
|
Differences in values resulting from tax deductions and travel expenses, arbitration and prescription term for collection. Vale also questions non-compliance with the duly legal procedure, the incidence of CFEM on the sale of pellets and payment by CFEM on revenues generated by our subsidiaries abroad. We state that collections are inappropriate. The decisions pronounced in the 1st Instance were partially favorable to the Company, particularly as to the grounds on deduction of taxes, prescription term for collection, and arbitration. |
(iii) Civil
Fact and/or legal cause
|
Eleven pension funds claim receipt of purges made because of inflation arising from economic plans called Plano Verão and Plano Collor on amounts paid amounts paid under forward contracts for buying and selling gold concluded with Vale from 1988. | |
Amounts involved
|
R$495.4 million | |
Amount provisioned (if any)
|
R$395.1 million | |
Company practice or that of subsidiary
which caused the contingency
|
The contingency has been generated according to the edition of economic plans called Plano Verão and Plano Collor, both created by the Federal Government between 1989 and 1991. The contracts in discussion around these were all paid and given as settled by the plaintiffs at the time. However the plaintiffs started legal proceedings aimed at applying the decision on a matter judged in the STJ for savings accounts books, to contracts concluded with Vale. Vale maintains that repayment of inflationary purges is not due. |
4.7 Other significant contingencies
Not applicable. There are no other significant contingencies involving Vale and its subsidiaries.
4.8 Rules of the country of origin of foreign issuer and rules of the country in which the foreign
Company’s securities are held in custody, if different from the country of origin
Not applicable to the Company, as it is not a foreign issuer.
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5.1 Description, both quantitative and qualitative, of the main market risks to which the Company
is exposed, including foreign exchange risk and interest rates
Considering the nature of the business and operations of Vale, the main factors of market risk to
which the company is exposed are: (i) product prices, (ii) exchange rates, (iii), interest rates
and (iv) inputs and other costs.
Risk of product prices
Vale is exposed to market risks associated with price volatility for its products in the
international market. The Company’s main products are: iron ore and pellets, nickel, copper
products, aluminum products, fertilizers and coal.
Nickel, aluminum, and copper are sold in an active global market and traded on commodity
exchanges such as the London Metal Exchange and the New York Mercantile Exchange. The prices of
these metals are subject to significant fluctuations and are affected by many factors, including
macroeconomic conditions and real and expected policies, levels of supply and demand, availability
and cost of substitutes, inventory levels, investments by commodity funds, and other actions by
participants in the commodities market.
Exchange risk and interest rate
Vale’s cash flow is subject to price volatility in various currencies. While commodity prices are
mostly indexed to the U.S. dollar, most of the costs, expenses and investments are indexed to
currencies other than U.S. dollar, mainly the Brazilian real and Canadian dollar.
Vale’s cash flow is also exposed to interest rates on loans and financing. The debt linked to
variable interest rates of the U.S. dollar consists mainly in loans including pre-payment of
exports operations, loans at commercial banks and multilateral organizations. In general, these
debts are indexed to the Libor rate (London Interbank Offered Rate). The natural hedge between
fluctuations in interest rates and U.S. prices of metals reduces the volatility of Vale’s cash
flow.
The percentages of the costs tied to various currencies are given in table below:
SUMMARY OF CONSLIDATED COST — PER CURRENCY
| 2010 | BRL | USD | CAD | IDR | AUD | POC | TOTAL | |||||||||||||||||||||
BRGAAP |
69 | % | 15 | % | 11 | % | 1 | % | 2 | % | 1 | % | 100 | % | ||||||||||||||
USGAAP |
64 | % | 21 | % | 11 | % | 1 | % | 2 | % | 0 | % | 100 | % | ||||||||||||||
As regards revenue, 17.8% is denominated in Brazilian Reais and 82.2% are denominated in foreign
currency, mainly U.S. dollars.
Regarding exposure to interest rate, after completion of hedge operations the company has 34% of
its debt indexed to floating interest rates.
In December 31, 2010, the value of principal and interest on debt denominated in Brazilian Reais,
and converted by swaps into U.S. dollars was R$9.7 billion (US$5.8 billion), and the value of the
principal and interests of the debt denominated in euros and converted by swaps into U.S. dollars
was €500 millions (US$682 million.) The average cost of these transactions was 3.35% after the swap
transactions. Due to market liquidity conditions, the average term of swap transactions may be
lower than the average term of the debt.
Risk of inputs and other costs
Vale is exposed in various markets to risk factors related to cost items. Among them, the most
important are: energy and purchase of intermediate or final products. For more details about risks
to supply of equipment, services and labor, see item “4.1”.
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Rising costs of energy or power failure can adversely affect the Company’s business.
Energy costs are a major component of our production costs and represent 17.4% of our total cost of
goods sold in 2010. To meet our energy demands, we depend on the following sources, measured in
tons of oil equivalent (TOE): petroleum products, which accounted for 42% of total energy demand in
2010, electricity (29%), coal (15%), natural gas (10%), and other sources of energy (4%).
Costs with fuel represented 10.7% of the cost of goods sold in 2010. Price rises for oil and gas
adversely affect our business interests in logistics, mining, pellets, nickel, and alumina.
Electrical energy costs represented 6.6% of the total cost of goods sold in 2010. If it is not
possible to guarantee a reliable access to electricity at reasonable prices, we may be forced to
reduce production or face higher production costs. Any of these alternatives would negatively
affect the results of operations. There is the risk of shortage in countries where we operate and
have projects, due to the excess of demand or weather conditions, such as flood or dry seasons.
There has been shortage of electricity in the world, and there is no assurance that the growth of
power generation capacity in the countries where we operate, will be enough to meet our future
increase of consumption. A future shortage and government policies to combat or avoid shortages can
negatively affect the cost and supply of electricity in our operations.
In our subsidiary PT International Nickel Indonesia Tbk (PTI), we process lateritic nickel ore
through a pyrometallurgical process, which requires high energy consumption. Although PTI currently
generates most of the electricity used in their operations in their own hydroelectric power plants,
some hydrological factors such as low rainfall are likely to negatively affect the production at
PTI electric power plants, which may considerably increase the risk of increased costs or reduced
production by PTI.
5.2 Policy for Management of market risks, including objectives, strategies, and instruments.
Vale has developed its risk management strategy with the objective of providing an integrated view
of risks to which it is exposed. To do this, it not only assesses the impact of interest rates,
exchange rates, commodity prices, and supplies and other costs on business results (market risk),
but also the risk from the obligations assumed by third parties to the Company (credit risk) and
those inherent to production processes (operational risk).
Vale believes that risk management is essential to support its growth strategy and financial
flexibility. The risk reduction with regard to future cash flows improves the Company’s credit,
facilitating access to various markets, and reducing the cost of any borrowings. As a result, the
Board established a policy of corporate risk management and an Executive Committee for Risk
Management, to advise the Board on these issues.
The politicies of corporate risk management determine that Vale regularly assess the risk
associated with cash flow, as well as proposals for risk mitigation. As already highlighted, these,
when necessary, will be implemented in order to reduce the risks in relation to the implementation
of commitments made by the Company, both with third parties as to their shareholders.
a. Risks for which protection is sought
Vale conducts hedge operations with the goal of reducing the risk to commodity prices, foreign
exchange, interest rates, costs, among others. These risks are detailed in item “5.2 c”.
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b. Asset protection strategy (hedge)
Integrated risk management, which incorporates the various types of risk, as well as the relations
between the various market risk factors (correlations), seeks to assess the impact that such events
would have, considering the so-called hedges naturally occurring in the company’s portfolio. Thus,
in assessing the risk associated with Vale’s business, one can observe the positive effect
associated with the diversification of its portfolio of products and currencies. This
diversification implies a natural reduction of risk levels for the company. Any strategy to
mitigate risk, when necessary, will be implemented when it significantly contributes to reducing
the volatility of cash flow beyond the levels initially observed and desired.
Hedge programs seek to reduce the volatility of cash flow and reduce the likelihood of a breach of
contract.
c. Instruments used for asset protection (hedge)
Protection programs and hedge programs employed by Vale, and their objectives include:
| • | Protection program of loans and financing in reais: In order to reduce
the volatility of the cash flow, swap transactions have been made in order to
convert the cash flow of debt denominated in Reais, indexed to the CDI and / or
TJLP (long term interest rates) to U.S. dollars, in loans and financing contracts.
In these operations, Vale pays fixed and / or floating rates in U.S. dollars and
receives remuneration linked to the CDI, TJLP and / or fixed rates in Reais. |
| • | Currency cash flow hedge program: In order to reduce the volatility of
the cash flow, swap transactions were made to mitigate the exchange rate exposure
originated by the currency mismatch between revenues in U.S. dollars and costs of
investments in reais. |
| • | Program of exchange protection of cash flow: In order to reduce the
volatility of the cash flow, non deliverable forwards transactions were made to
mitigate the exchange rate exposure originated by the currency mismatch between
revenues in U.S. dollars and costs of investments in reais. |
| • | Protection Program for loans and financing in Euros: In order to reduce
the volatility of the cash flow, a swap transaction was made to convert the cash
flow of debts in euros and/or indexed debts into Euribor for U.S. dollars and/or
indexed to the Libor Rate (London Interbank Offered Rate). |
| • | Protection program for loans and financing subject to floating rate in U.S.
dollars: In 2004, in order to reduce the volatility of cash flow, a swap
transaction was made to convert the cash flow of a unionized debt issued by Vale
Canadá Ltd, a subsidiary of Vale. The initial face value was US$200 million,
indexed at a floating rate (Libor) for fixed rates. In the protection transaction,
Vale pays a fixed rate to the counterparty and receives a remunaration linked to
the floating rate (Libor) |
| • | Exchange Protection program for selling coal at a fixed price: The goal
is to reduce volatility of cash flows associated with sales contracts for coal at
fixed prices in order to equalize the currencies of cost and revenue. To do so,
Vale carries out forward operations to buy Australian dollars in order to equalize
the cost and revenue currencies. |
| • | Hedge program for cash flow of aluminum: In order to protect cash flow
for the year 2010, Vale carried out protection operations where it fixed the
pricing of part of the sales of aluminum in the period. In this program, the
Company used options and forwards contracts strategies. |
| • | Strategic Protection program for cash flow of nickel: The objective of
this program is the protection of cash flows for the year 2010, whereby Vale
carries out protection operations fixing the pricing of part of the sales of nickel
in the period. In this program, the Company used forwards contracts. |
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| • | Hedge program for the selling of nickel: The objective of this program
is the protection of cash flows for the years 2010 and 2011, whereby Vale carries
out protection operations fixing the pricing of part of the sales of nickel in the
period. In this program, the Company used forwards contracts |
| • | Sales program for nickel at a fixed price: aiming to maintain its
exposure to fluctuations in the price of nickel, it has been carried out derivative
transactions to convert to a floating-price basis commercial nickel contracts with
those clients seeking to fix the price. The operations are intended to ensure that
prices for these sales are equivalent to the average price of the London Metal
Exchange — LME upon physical delivery to the customer. Typically, operations made
within this program are purchases of nickel for future liquidation, either in the
Stock Market (London Metal Exchange) or over-the-counter. These operations are
reverted before the original maturity date in order to match with the dates of
liquidation of the commercial contracts that had a fixed price. When the “Strategic
Protection program for cash flow of nickel” or the “Hedge program for selling of
nickel” are performed, the “Sales program for nickel at a fixed price” is
discontinued. In this program, Vale used future contracts. |
| • | Protection Program for purchase transactions of nickel: Protection
operations were made in order to reduce the volatility of the cash flow and
eliminate the mismatching between the pricing period of the purchase of nickel
(concentrated, cathode, sinter and other types) and the reselling period of the
processed product. The products purchased are raw material used in the process of
production of refined nickel. In this case, operations usually made are the selling
of nickel for future liquidation either in the Stock Market (London Metal Exchange)
or over-the-counter. |
| • | Protection Program for purchase of fuel oil — Bunker Oil: The objective
of this program is to reduce the impact of fluctuations in the price of fuel oil
(Bunker Oil) when procuring freight, and hence reduce the volatility of Vale’s cash
flow. The operations were made by the contracting of future fuel oil purchases. |
| • | Protection program for the contracting of freight charges: The objective
of this program is to reduce the impact of price fluctuations of sea freight
contracted to make viable the sale of products in CIF — Cost, insurance and freight
and CFR — Cost and freight modalities, and hence reduce the volatility of the
Company’s cash flows. The transactions are made through FFA contracting — Forward
Freight Agreement (hedging transaction price for shipping). |
| • | Protection program for the selling of coal: The objective of this
program is the protection of cash flows for the year 2010, whereby Vale carried out
protection operations fixing the pricing of part of the sales of coal in the
period. In this program, the Company used forwards contracts. |
| • | Protection program for selling of copper scrap: Hedge operations were
made in order to reduce the volatility of the cash flow and eliminate the
mismatching between the pricing period of the purchase of copper scrap. Copper
scrap bought is combined with other inputs in order to manufacture copper for
Vale’s final customers. In this case, operations usually made are sales for future
liquidation either in the Stock Market (London Metal Exchange) or over-the-counter |
d. Parameters used for managing those risks
The parameters used to check the qualification or disqualification of the Company’s exposure are:
(i) verification of execution of the programs mentioned in “c”; (ii) analysis of the contracted
volumes, and (iii) adjustment to the adequacy of maturity dates, taking into account their
corresponding protection or hedge strategies, guaranteeing the framing of our exposures. The
monthly monitoring based on our consolidated position, allows for the accompaniment of the
financial results with the impact on the cash flow.
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e. If the Company uses various financial instruments with various objectives for asset protection
(hedge) and what these goals are
The Company has no financial instruments with other goals than asset protection (hedge).
f. Organizational structure for risk management control
Beyond the normative framework of risk management, Vale also has a corporate structure with well
defined responsibilities.
The Board is responsible for the evaluation and approval of risk mitigation strategies that were
recommended by the Executive Committee for Risk Management. The Committee is responsible for
issuing opinions on the principles and tools for risk management, as well as regularly reporting to
the Executive Board on the process of managing and monitoring risks and on the major risks to which
the Company is exposed, as well as the impact of these on cash flow.
The recommendation and implementation of the operations are carried out by independent areas. It is
the responsibility of the area of risk management to define and propose to the Executive Committee
for Risk Management operations or measures to mitigate market risk consistent with Vale’s strategy
and its subsidiaries. It is the responsibility of the financial area to carry out the transactions
involving derivative contracts. The independence between areas ensures effective control over these
operations.
At Vale, the area that formally answers for the risk management is the Department of Corporate Risk
Management, that reports directly to the Executive Board of Finance and Relationships with
Investors.
g. Adequacy of the operational structure and internal controls to verify the effectiveness of the
policy adopted
The monitoring and monthly assessment of Vale’s consolidated position allow it to keep pace with
the financial results and the impact on cash flow and ensure that the goals originally outlined are
met. The fair value calculation of the positions is made available weekly for management
monitoring.
Several areas act as compliance in the process of risk management: the back-office, part of the
General Board of Financial Department, is responsible for confirming the financial characteristics
of transactions as well as the counter-parties with which the operations were performed, report the
fair value of the positions. This area, along with the area of market risk management, part of the
Department of Corporate Risk Management, also assesses whether the operations were performed
according to approval given. As well as these areas, the area of internal controls, which is also
part of the Department of Corporate Risk Management, acts to verify the integrity of the controls
that mitigate risks in the contracted transactions within the above mentioned governance criteria.
5.3 Compared to last fiscal year, an indication of significant changes in key market risks to which
the Company is exposed or the risk management policy adopted
There were no events that significantly alter the main market risks to which the Company is
exposed.
5.4 Other information that the Company deems relevant
There is no further relevant information about this item “5”.
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6.1/6.2/6.4 Establishment of the Company. Company Lifetime and Date of Filing with CVM
Date of Establishment of Issuer
|
11.01.1943 | |
Legal Form of the Issuer
|
Mixed economy company | |
Country of Establishment
|
Brazil | |
Company Lifetime
|
Undetermined | |
Date of Filing with CVM
|
02.01.1970 |
6.3 Brief Company History
Vale was initially founded by the Brazilian Federal Government (Government of Brazil) on
01.06.1942, through Decree-Law No. 4352, and definitively on 11.01.1943, by the Assembly for the
Definitive Constitution of the Companhia Vale do Rio Doce SA, in the form of mixed economy company,
aiming to mine, trade, transport and export iron ore from the Itabira mines, and run the
Vitória-Minas Railroad (EFVM), which carried iron ore and agricultural products from Vale do Rio
Doce, in south-eastern Brazil, to the port of Victoria, located in Espírito Santo.
The privatization process was initiated by the Company in 1997. Under Privatization Decree
PND-A-01/97/VALE and the Resolution of the National Privatization Council — CND paragraph 2, of
05.03.1997, the Extraordinary General Assembly approved on 18.04.1997 the issue of 388,559,056
participatory non-convertible debentures, with a view to guaranteeing its pre-privatization
shareholders, including the Federal Government itself, the right to participation in revenues from
Vale’s and its subsidiaries’ mineral deposits, which were not valued for purposes of fixing the
minimum price in the auction for the privatization of Vale. The Participatory Debentures were
allocated to the shareholders of Vale in payment of the redemption value of preferred class “B
shares” issued as bonus, in the proportion of one share owned by holders of class “A” common and
preferred shares at the time, through the part capitalization of Vale’s revenue reserves. The
Participatory Debentures could only be traded with prior authorization of CVM, as of three months
from the end of Secondary Public Offering of Shares under the privatization process.
On 06.05.1997 the privatization auction was held, when the Brazilian government sold 104,318,070
Vale common shares, equivalent to 41.73% of the voting capital for Valepar SA (Valepar), for
approximately R$3.3 billion.
Later, under the terms of the Bid, the Brazilian government sold another 11,120,919 shares
representing approximately 4.5% of the outstanding common shares and 8,744,308 class “A” preferred
shares, representing 6.3% of class “A” shares in circulation, through a limited offer to the
employees of Vale.
On 20.03.2002 a Secondary Public Offering of Shares issued by Vale was held, in which the Brazilian
Government and the National Bank for Economic and Social Development (BNDES) each sold 34,255,582
Vale common shares. The demand by investors in Brazil and abroad was substantial, exceeding supply
by about three times, which led to the sale of the entire batch of 68,511,164 shares. A portion of
about 50.2% was posted in the Brazilian market and the remainder was sold to foreign investors.
Later, on 04.10.2002, the proper certification of the Participatory Debentures was obtained from
CVM, the Securities Commission, allowing their trading on the secondary market.
The following describes the most significant historical events in the history of the Company since
its incorporation:
1942
| • President Getulio Vargas, by Decree-Law nº 4352 of 01.06.1942, sets out the basis on which Companhia Vale do Rio Doce SA would be organized. By Decree-Law, the Brazilian Company for Mining and Metallurgy and Mining Company Itabira would be expropriated. |
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1943
• Vale is constituted on 11.01.1943, as mixed economy company, pursuant to Decree-Law nº 4.352/42.
• Listing of Vale shares on the Rio de Janeiro Stock Market (BVRJ) in October 1943.
1944
• First business with Vale shares on the BVRJ occurred in March 1944.
1952
• The Brazilian Government takes definitive control of Vale’s operational system.
1953
• First shipment of iron ore to Japan.
1954
• It revises its business practices abroad, and proceeds to contact directly steel mills, without
the intermediation of traders.
1962
• Signed long-term contracts with Japanese and German steel mills.
1964
• Opening of Vale’s first office outside of Brazil in Dusseldorf, Germany.
1966
• Opening of the Port of Tubarão, in Vitória, in Espírito Santo, which is connected to the iron ore
mines by the Vitoria a Minas Railroad.
1967
• Geologists of the Southern Mining Co., a subsidiary of United States Steel Corp. (U.S. Steel),
record the occurrence of iron ore in Carajás, Pará State.
1968
• Vale shares become part of the IBOVESPA index.
1969
• Inauguration of Vale’s first Pellet Plant in Tubarão, in Espírito Santo, with capacity for 2
million tons/year.
1970
• Agreement makes Vale the majority shareholder of the Carajas venture in Para State, along with
U.S. Steel.
1972
• Vale signs agreement with Alcan Aluminum Ltd. of Canada for a project to mine bauxite in the Rio
Trombetas, where Mineração Rio do Norte (MRN) was set up.
1974
• It becomes the largest exporter of iron ore in the world, with 16% of seaborne iron ore market.
1975
• For the first time, Vale issues bonds in the international market, worth 70 million marks, with
the intermediation of Dresdner Bank.
1976
• Decree No. 77.608/76 grants Vale the concession to construct, use and operate the railroad
between Carajás and São Luís, in Pará and Maranhão states, respectively.
1977
• Vale announces priority for the Carajas Project, in order, from 1982, to start the export of iron
ore through the Port of Itaqui (MA).
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1979
• Beginning of the effective implementation of the Carajás Iron Ore Project, adopted as the main
goal of Vale’s business strategy.
1980
• Federal Government approves the Carajas Iron Project and gives financial backing.
1982
• With the start of Valesul Aluminio SA in Rio de Janeiro operations, Vale joins the aluminum
sector and helps to reduce imports of the metal into Brazil.
1984
• Inauguration of Vale office in Japan.
1985
• On February 28, the Carajás railroad (EFC) is inaugurated and handed over to Vale.
• Inauguration of the Carajás Iron Ore Project, which increases the productive capacity of the
company, now organized in two separate logistic systems (North and South).
1986
• Start of operation of the Port Terminal of Ponta da Madeira, in São Luís in the state of
Maranhao.
1987
• The EFC begins operating on a commercial scale.
1989
• Implementation of the Profit Sharing Program for Vale employees.
1994
• In March, Vale launches its program for American Depositary Receipts (ADR) Level 1, negotiable on
the OTC market of the United States.
1995
• Vale is included in the National Privatization Program by Decree No. 1510 of June 1, signed by
the President.
1996
• On October 10, the National Privatization Council (CND) approves the model for privatization of
Vale.
1997
• BNDES releases on March 6, the terms of the bidding for the privatization of VALE.
• On April 18, Vale issues 388,559,056 Participatory Debentures that can only be traded with prior
authorization of the CVM, as of three months from the end of Secondary Public Offering of Shares
under the terms of the privatization process.
• On May 6, Vale is privatized in an auction held at the Stock Exchange of Rio de Janeiro. Valecom
consortium, put together by the Votorantim Group, and the Brazil Consortium, led by Companhia
Siderurgica Nacional (CSN) took part in the auction. The Brazil Consortium buys 41.73% of common
shares of VALE for US$3,338 million at present-day values.
1998
• In the first year after privatization, Vale reaches 46% growth in profit over 1997.
1999
• It has the largest profit in its history so far: US$1.251 billion.
2000
• On February 2, Vale opened the Container Terminal of the Port of Sepetiba.
• In May, Vale acquires Mineração Socoimex S.A. and S.A. Mineração da Trindade (Samitri), companies
producing iron ore, initiating the consolidation of the market for Brazilian iron ore.
• On June 20, Vale announced the listing of its American Depositary Receipts (ADRs), representing
preferred shares of the Company on the Stock Exchange of New York (NYSE) in a “DR” Level II program
approved by the CVM.
• On August 31, the Extraordinary General Meeting approves the merger of a wholly owned subsidiary
Mineração Socoimex S.A, without issuing new shares, aiming to add to the assets of the Company the
Gongo Soco mine, with reserves of high grade hematite in the iron quadrangle in Minas Gerais.
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2001
• In February, the Board of Directors of Vale authorizes the start of the process of divesting its
holdings in the sector of pulp and paper.
• On February 19, the shares of S.A. Mineração da Trindade (Samitri) are incorporated by Vale, with
no increase of capital and without issuing new shares, by using shares held in treasury, as
authorized by the CVM.
• In March, shareholdings involving Vale and CSN are unwound.
• In April, Vale acquires 100% shareholding in Ferteco Mining SA, the third largest producer of
iron ore in Brazil at the time.
• In October 2001, the General Assembly of Shareholders approves the incorporation of wholly owned
subsidiary Samitri, without issuing new shares and with no capital increase in Vale, in line with
guidelines for administrative and financial streamlining.
2002
• In March, the pellet plant in Sao Luis, in Maranhão state, is officially opened.
• On March 21, the comprehensive sale offer of 68,511,164 Vale common shares owned by the Brazilian
Government and BNDES is concluded, of which approximately 50.2% was placed in the Brazilian market
and the remainder sold to outside investors. The selling price in Brazil was R$57.28 per share and
abroad US$24.50 per ADR.
• Vale common shares start to be traded on the NYSE in the form of ADRs.
• The Company’s common shares also start to be traded on the Madrid Stock Exchange — Latibex.
• The foundation stone of the Sossego Copper Project, State of Pará, is laid
• In October 2004, VALE obtains from the CVM registration of Publicly Traded Participatory
Debentures.
• On December 16, the General Assembly of Shareholders approves Vale’s Dividend Policy in order to
increase both transparency and financial flexibility, taking into account the expected path of the
Company’s cash flow.
• On December 27, the Extraordinary General Meeting approves the Amendment to the Bylaws in order
to (i) expand the Company’s activities in energy and logistics, (ii) adjust the Statutes to the new
rules introduced by Law No. 10303 of 10.31.2001 and (iii) introduce the principles of best
corporate governance practices.
2003
• On February 14, Vale completes the acquisition of 100% stake in Elkem Rana AS (Rana), a Norwegian
producer of ferroalloys, for the price of US$17.6 million.
• On March 31, Vale acquires 50% stake in Caemi Mineracao e Metalurgia SA (Caemi) for US$426.4
million.
• On August 29, Vale incorporates the wholly owned subsidiaries Celmar SA — Indústria de Celulose e
Papel SA and Ferteco Mining
• On November 7, Vale completes the restructuring of shareholdings in logistics companies, which
was aimed at the elimination of the relationship between Vale and CSN in the shareholding structure
of the Ferrovia Centro-Atlantica SA (FCA), Companhia Ferroviária do Nordeste (CFN) and CSN Aceros
S.A. (CSN Aceros).
• On December 12, Vale adheres to Level 1 of the Program for Differentiated Corporate Governance
Practices established by the BM&F Bovespa Exchange.
• Continuing the process of simplifying its operating structure, on December 30, Vale incorporates
the following wholly owned subsidiaries: Rio Doce Geologia e Mineração S.A. — Docegeo (Docegeo),
Mineração Serra do Sossego S.A. (MSS), Vale do Rio Doce Alumínio S.A. — Aluvale (Aluvale) and
Mineração Vera Cruz S.A. (MVC).
2004
• On July 02, the Sossego mine opens, the first copper mine in Brazil, in the State of Pará. This
project, completed in record time.
• In November Vale wins an international bidding for coal mining in the Moatize region of northern
Mozambique.
• In December, Vale signed a memorandum of understanding with ThyssenKrupp Stahl AG (ThyssenKrupp)
for the construction of an integrated steel slab plant with a capacity of 5 million tons in the
State of Rio de Janeiro.
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2005
• Vale is the first Brazilian company to achieve a risk score greater than the host country and the
only one to have this recognition for three different rating agencies: i.e. Investment Grade, given
by Moody’s, and confirmed by Standard & Poor’s and Dominion Bond.
• In July, Vale signs an agreement with two Australian mining companies to carry out studies to
exploit the Belvedere Underground Coal Project, located in the State of Queensland, Australia.
• On September 22, it launches Vale Investir, a program that allows investors to automatically
reinvest Brazilian funds from shareholders payments — dividends and/or interest on capital — to buy
shares of the Company.
• In November, Vale agrees to acquire a minority stake in Ceara Steel, a steel slab project aimed
at exporting from the state of Ceará, with a nominal capacity of 1.5 million tons of slabs per
year.
• The Company consolidates its entry into the copper concentrate industry, with the first full year
of operation of the Sossego Mine and sales to 13 customers in 11 different countries.
• In the last quarter of 2005, Vale acquires 99.2% of Canico Resources Corp. (Canico), which owns
the lateritic nickel project Onça Puma, located in Para State, for approximately US$800 million.
2006
• In January, Vale acquires mineral resources, land and mining equipment from the Rio Verde
Mineração (Rio Verde) for US$47 million.
• In February, the acquisition of all shares of Canico is completed, these being removed from
trading on the Toronto Stock Exchange.
• In March, it inaugurated the expansion of production capacity is inaugurated of alumina refinery
Alunorte — Alumina do Norte do Brazil SA (Alunorte), located in Barcarena in the state of Pará
• On May 3, Vale completes incorporation of shares of Caemi, now holding 100% of the shares.
• On July 3, Vale buys 45.5% stake in Valesul Aluminio SA and now owns 100% of the shares.
• On August 11, the Company announces that it intends to offer to acquire all common shares of
Inco Limited (Toronto Stock Exchange — TSX Stock Exchange and New York — NYSE under the symbol N)
(Inco). The offer is consistent with long-term corporate strategy and strategy for the non-ferrous
metals business of Vale.
• In the third quarter, Vale divides the administration of former Southern System for production
and distribution of iron ore into two departments: the South-eastern System and the Southern
System, and began to report production separately for each system.
• In September, Mineracoes BR Holdings GmbH buys 25% stake in a joint venture, Zhuhai YPM, to build
a new pellet plant in Zhuhai, in the region of Guandong, China.
• On October 5, Vale opens the Brucutu Project, the largest mine/plant complex in the world for
initial production capacity of iron ore, located in São Gonçalo do Rio Abaixo in Minas Gerais.
• On October 26, Vale concludes the financial settlement of a major part of the acquisition of
Canadian miner Inco Ltd., the second largest nickel producer in the world, effecting payment of
US$13.3 billion for the purchase of 174,623,019 shares issued by Inco. On November 6, Vale joins
the control group of Usiminas steel company in Minas Gerais — (Usiminas).
2007
• In January, Vale completed the expansion of iron ore production capacity in Carajás, which now
reaches 100 million tons per year.
• On January 30, the acquisition of Inco (now Vale Inco Limited) is ratified at Vale Extraordinary
General Meeting. The nickel business is now managed from Toronto as well as activities related to
marketing and sales of metals. With the completion of its acquisition of Inco, Vale becomes the
second largest mining and metals company in the world by market value.
• On February 16, Vale announces secondary public offering of shares of Log-In Logistica Intermodal
SA (Log In).
• On February 26, Vale signs a sale and purchase agreement to acquire Australian AMCI Holdings
Australia Pty Ltd. (AMCI), which operates and controls coal assets through holdings in joint
ventures.
• In March, Vale acquires an 18% stake in Ferro-Gusa Carajás S.A. (FGC), which belonged to Nucor do
Brasil S.A for 20 million dollars, and now holds a 100% stake in FGC.
• In May, Vale signs a usufruct contract, and now controls the entire capital of the MBR, for the
following 30 years.
• On May 2, Vale signs a freight contract for 25 years with Bergesen Worldwide (B.W. Bulk), which
provides for the construction of the four largest bulk carriers in the world, each with a capacity
of 388 thousand tons.
• On June 28, the Government of Mozambique approved the mining contract for the operation, by Vale,
of the Moatize coal project in the province of Tete in the northwest of the country.
• On August 30, shareholders meeting at an Extraordinary General Meeting, ratify the acquisition of
control of AMCI by the Company.
• On November 29, Vale begins to use the brand “Vale” in all countries where it operates and at the
same time takes on a new global identity.
• On December 21, Vale signs an agreement for commercial exploitation for 30 years of 720 km of the
Norte-Sul railroad (FNS).
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2008
• In the first half of 2008, Vale launches operations to increase capacity in the production of
pellets in Samarco, a (50% -50%) joint venture with BHP Billiton in the Brazilian State of Espírito
Santo.
• Vale leases three pellet plants in the Tubarão complex, in Vitória, State of Espírito Santo,
owned by the JV’s in which it participates (Itabrasco, Kobrasco and Nibrasco).
• On May 5, Vale signs a sale and purchase agreement to acquire the mining and surface rights in
the municipalities of Rio Acima and Caeté, State of Minas Gerais.
• In July, Vale makes a global offering of 256,926,766 ordinary shares and 189,063,218 preferred
shares, including ADSs, in order to promote investment and strategic acquisitions as well as
maximizing the financial flexibility of the Company. The aggregate value of Vale’s global offer,
after underwriting discounts and commissions, including the values of the exercise of further stock
options, was US$12.2 billion. In August, exercising the option of complementary lot, Vale issues
24,660,419 class A preferred shares.
• In connection with the offer above, Vale lists and trades its common and preferred ADSs on
Euronext Paris.
• On August 3, Vale orders the building of 12 large ships for carrying iron ore, buys used vessels
and signs long term freight contracts. The total investment was US$1.6 billion for the construction
of new ships and US$74 million for the purchase of used ships.
• On August 14, Vale announces its intention to invest in building a new steel plant in Marabá in
Para State, with an annual production capacity of 2.5 million metric tons of semi-finished steel.
• On October 31, Vale announces a reduction in its rate of production of iron ore, pellets, nickel,
manganese, ferro-alloys, aluminium and kaolin, in the face of the impact of global economic crisis
on the demand for minerals and metals.
• On December 16, Vale signs with African Rainbow Minerals Limited (ARM) and its subsidiary TEAL
Exploration & Mining Incorporated (TEAL) a contract providing for the acquisition of 50% of the
capital of a joint venture to hold TEAL subsidiaries for CAD $81 million, therefore increasing the
strategic options for Vale to grow in the copper business in Africa for CAD $81 million.
• On December 23, Vale signs a sale and purchase agreement to acquire 100% of the coal exporting
assets of Cementos Argos SA (Argos) in Colombia for US$306 million.
2009
• On January 30, Vale signs with Rio Tinto plc (Rio Tinto) a sale and purchase agreement for the
acquisition, through cash payment, of iron ore and potash assets, located in Brazil, Argentina and
Canada.
• On March 24, Vale completes the previously announced transaction, and creates a 50%-50% joint
venture with ARM for future development and operation of the assets of TEAL, expanding in December
2008 the strategic options for growth in the copper business in Africa.
• On March 27, Vale initiates the construction of the Moatize project, in Tete province,
Mozambique. The project involves investments of US$1.3 billion and has a nominal production
capacity of 11 million metric tons (Mt) of coal, comprising 8.5 Mt of metallurgical coal and 2.5 Mt
of thermal coal.
• On April 1, the Company concluded the acquisition of the assets of export thermal coal with Argos
in Colombia.
• On April 16, Vale completes the sale of all of its 14,869,368 common shares issued by Usiminas
and linked to the steel mill’s existing shareholders agreement.
• On May 21, the Board of Directors of Vale approve the revised 2009 investment budget for US$9.035
billion as compared with the US$14.235 billion announced on October 16, 2008.
• On May 22, the Extraordinary General Meeting of Vale approves the proposal to change its name
from Companhia Vale do Rio Doce SA to Vale SA
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• On June 23, Vale launches a project to produce biodiesel to fuel its operations and projects in
northern Brazil, from 2014, using palm oil (dende oil) as feedstock, which will be produced by a
consortium between Vale and Biopalma Amazonia SA (Biopalma).
• On July 13, the Company announces that its unionized employees in Sudbury and Port Colborne in
Ontario, Canada, are on strike. The same happens on the 1st of August, with the unionized employees
of its operation in Voisey’s Bay in the province of Newfoundland and Labrador, Canada.
• On July 22, Vale signs a memorandum of understanding (MOU) with ThyssenKrupp to raise its stake
in ThyssenKrupp CSA Siderurgica do Atlantico Ltda. (TKCSA) from 10% to 26.87% through a capital
injection of EUR $965 million.
• On September 18, Vale completes the acquisition of the operations of iron ore in Corumbá, located
in Mato Grosso do Sul, owned by Rio Tinto PLC (Rio Tinto) and other controlled entities.
• On October 19, the Board of Directors of Vale approves the investment budget for 2010, including
expenditures of US$12.9 billion dedicated to sustaining existing operations and promoting growth
through research and development (R & D) and project execution.
2010
• On January 22, integrated subsidiary Valesul Alumínio S.A. (Valesul) enters intro an agreement to
sell its aluminum assets located in Rio de Janeiro to Alumínio Nordeste S.A., a Metalis group
company, for US$31.2 million.
• On the same date, Vale approves at a Special Shareholders Meeting the incorporation of integrated
subsidiaries Sociedade de Mineração Estrela de Apolo S.A. (Estrela de Apolo) and Mineração Vale
Corumbá S.A. (Vale Corumbá).
• During the first half of the year, Vale closes agreements with its customers in the iron ore
business to shift from annual contracts to contracts with values adjusted on a quarterly basis. The
new contracts offer more efficiency and transparency for iron ore prices and make it possible to
differentiate qualities, which helps stimulate long-term investment. Besides, customers can learn
in advance the price to be paid in the following quarter.
• In the second quarter, Vale acquires a 51% interest in VBG — Vale BSGR Limited (formerly BSG
Resources (Guinea) Limited), which holds iron ore concession rights in Simandou South (Zogota) and
iron ore exploration permits in Simandou North (Blocks 1 & 2), Guinea.
• Through a series of transactions in 2010, Vale acquires the phosphate operations of Vale
Fertilizantes S.A. (formerly Fertilizantes Fosfatados S.A. — Fosfertil) and Vale Fosfatados S.A.
(formerly Bunge Participações and Investimentos S.A.). The total cost of these acquisitions was
US$5.829 billion. The sellers included Bunge Ltd., The Mosaic Company (“Mosaic”), Yara Brasil
Fertilizantes S.A. and other Brazilian companies.
• In May, Vale enters into an agreement with Oman Oil Company S.A.O.C. (OOC), an integrated
subsidiary of the government of the sultanate of Oman, for the sale of a 30% interest in Vale Oman
Pelletizing Company LLC (VOPC), for US$125 million.
• In July, Vale sells to Imerys S.A. 86.2% of its interest in Pará Pigmentos S.A. (PPSA), a kaolin
producer, along with other kaolin mining rights, for US$74 million.
• In July, Vale concludes the transaction announced on March 31, 2010, by virtue of which it sells
35% of the total capital of MVM Resources International B.V. (MVM) to Mosaic for US$385 million,
and 25% of the total capital of MVM to Mitsui, for US$275 million. MVM manages and operates Bayóvar
phosphate rock project in Peru.
• In the fourth quarter, Vale lists Depositary Receipts representing its common and preferred Class
A shares (HDRs) on Hong Kong Limited Stock Exchange (HKEx). The HDRs start to be traded on December
8, 2010.
2011
• On February 28, Vale announces the completion of the operation announced on 02.05.2010 with Norsk
Hydro ASA (Hydro) to transfer all its interests in Albras — Alumínio Brasileiro S.A. (Albras),
Alunorte — Alumina do Norte do Brasil S.A. (Alunorte) and Companhia de Alumina do Pará (CAP),
receiving in return 22% of the outstanding common shares of Hydro and US$503 million in cash.
• In February 2011, Vale pays US$173.5 million to acquire the control of Biopalma, in the state of
Pará, to produce palm oil (dende oil) as feedstock to manufacture biodiesel.
• On April 8, Vale and Metorex Limited (“Metorex”) agree on the terms of Vale’s offer to acquire
the total capital of Metorex for US$1.125 billion. Metorex produces copper and cobalt, has
operations in the African copper belt, and operates two mines in Zambia and Ruashi. Moreover,
Metorex has three projects in the Democratic Republic of Congo, one of them at a development stage
and the other two at an exploration stage.
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| • On April 28, the Board of Directors approves the acquisition, subject to certain conditions, of up to 9% of the capital of Norte Energia S.A. (NESA), a stake currently held by Gaia Energia e Participações S.A (Gaia). NESA is a company whose sole purpose is the implementation, operation and management of Belo Monte hydroelectric power plant in Pará. |
6.5 Description of main corporate events such as incorporations, mergers, split-offs, incorporation
of shares, disposal and acquisition of corporate control, acquisition and disposal of major assets,
undergone by the Company, its subsidiaries and related companies
2008
Jubilee Mines
On 12.02.2008, Vale sold its minority stake in Jubilee Mines, a nickel producing company in
Australia, for US$130 million (R$232 million on the date of receipt), received in a one-time
payment.
Incorporation of Ferro Gusa Carajás S.A. (FGC) and Mineração Onça Puma S.A. (MOP)
On 29.04.2008 and 29.12.2008 respectively, the incorporation of wholly owned FGC and MOP by Vale
was approved, without issuing new shares and with no change in the capital of Vale. The asset
values of FGC and MOP were evaluated, on 03.28.2008 and 28.11.2008 respectively, by Deloitte Touche
Tohmatsu and ACAL Consulting and Audit S/S, for R$386,733,909.42 and R$2,916,326.00 respectively.
The incorporations were intended to strengthen the strategic positioning of Vale to simplify and
streamline administrative and financial operations.
Acquisition of Mining Rights of Mineração Apolo
On 05.05.2008 we acquired mining and surface rights belonging to Apolo in the municipalities of Rio
Acima and Caeté, state of Minas Gerais. The total cost of acquisition, which added to Vale
resources estimated at 1.1 billion metric tons of iron ore, was US$154.3 million (equivalent to
R$255.8 million at the date of disclosure of acquisition), of which US$9.3 million (equivalent to
R$15.4 million on the date of disclosure of the acquisition) was paid as a purchase option in May
2005 and US$145 million (equivalent to R$240.4 million at the date of disclosure of the
acquisition) in 2008, in a one-time payment.
Global Offering
On 05.08.2008, Vale a held Primary Public Offering (recorded under Nº CVM/SRE/REM/2008/010) of
256,926,766 common shares and 189,063,218 preferred class A shares, all nominative, without par
value issued by Vale, including in the form of American Depositary Shares (ADSs), represented by
American Depositary Receipts (ADRs), at the price of R$46.28 per common share and US$29.00 or
€18.25 per ADS ordinary, and at R$39.90 per class A preferred share and US$25.00 and €15.74 per ADS
or preferred, totalling R$19,434,193,128.68. Under the International Offering were placed
63,506,751 preferred class A shares and 80,079,223 common shares in the form of ADSs represented by
ADRs. The total number of shares contemplated in the Offer, also included 24,660,419 Class A
preferred shares issued by Vale in respect of the exercise of the Supplementary Lot Option by the
Lead Coordinator of the Offer, this option having been granted under Article 24 of CVM Instruction
400.
The implementation of the Global Offer, its terms and conditions and the capital increase for Vale
were authorized at Vale Board meetings held on June 12, 2008, July 1, 2008, July 17, 2008 and
August 5, 2008 and setting of the price per share was approved at a meeting of Vale Board held on
July 16, 2008 and the issuance of shares for the Supplementary Lot Option was approved at a meeting
of Vale Board held on August 5, 2008.
There was no significant impact on equity as the Global Offering was pulverized.
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2009
Acquisition of potash assets
On 30.01.2009, Vale signed with Rio Tinto plc (Rio Tinto) a contract of sale and purchase for the
acquisition, on a cash basis, of potash assets. The assets, purchased for US$850 million
(equivalent to approximately R$1.995 billion at the time of payment), represented 100% of the
Colorado River project, located in the provinces of Mendoza and Neuquen, Argentina, and 100% of the
Regina project, Province of Saskatchewan, Canada. The Rio Colorado project includes the development
of a mine with an initial production capacity of 2.4 Mtpy of potash (potassium chloride, KCl) and
potential for expansion up 4.35 Mtpy, with construction of a railway branch of 350 km, port and
power-station. The estimated mineral resources amount to 410 Mt. Regina is at the exploration
stage, with potential for an estimated annual production of 2.8 Mt of KCI. The project area
includes infrastructure for water supply, energy and logistics services, allowing the transport of
the final product to Vancouver on the west coast of Canada, which will facilitate access to the
Asian market. Approval of the acquisition by the Argentine antitrust authority is pending.
Acquisition of iron ore assets
On 30.01.2009, Vale enters into an agreement to acquire Corumbá iron ore operations located in Mato
Grosso do Sul, belonging to Rio Tinto Plc (Rio Tinto) and other subsidiaries for US$750 million
(equivalent to R$1,473 billion on the date of payment), by means of a one-time payment. Iron ore
assets represented 100% of open-pit iron ore mining operations at Corumbá, in the State of Mato
Grosso do Sul, Brazil, and included logistic assets including river port and barges. Logistics
assets enable Vale to be 70% self-sufficient in the carriage of iron ore along Paraguay river.
Approval of the acquisition by the Argentine antitrust authority is pending.
Acquisition of copper mining assets in Africa
On 24.03.2009, Vale finished creating a 50%-50% joint venture with African Rainbow Minerals Limited
(ARM) for the development and operation of the copper assets of TEAL Exploration & Mining
Incorporated (TEAL), expanding the strategic options for growth in the business in Africa. The
operation involved a series of stages through which Vale has acquired a 50% stake in the capital of
a joint venture to hold the subsidiaries of TEAL for CAD $81 million (equivalent to R$139 million
on the date of payment), in a one-time payment, as well as an offer to close TEAL’s own capital
held by ARM at a price of CAD $3.00 per share in cash. As a result of this transaction, the assets
of TEAL are owned directly or indirectly by the new joint venture controlled by Vale and ARM.
Acquisition of coal assets in Colombia
On 01.04.2009, Vale completed the acquisition of the coal mining assets of Cementos Argos SA
(Argos) in Colombia for US$306 million (equivalent to R$695 million on the date of payment), in a
one-time payment, including the coal mine El Hatillo, located in the department of Cesar, a coal
deposit in the exploration stage, Cerro Largo, a minority stake in the Fenoco consortium, which
holds the concession and operation of the railroad that links the coal operations to the Rio
Cordoba port — SPRC, and 100% of the concession for this port, which is located on the Caribbean
coast in the department of Magdalena. As Colombia is the third largest exporter of thermal coal of
high quality in the world, given the low sulphur content and high calorific value, Vale aims to
build a new platform for coal assets in the country in order to expand their options for growth in
this segment. The acquired assets are managed by its subsidiary Vale Coal Ltd. Sucursal Colombia
(Vale Columbia).
Increased participation by ThyssenKrupp CSA Siderurgica do Atlantico Ltda. (TKCSA)
On 21.09.2009, Vale concluded an agreement with ThyssenKrupp Steel AG (ThyssenKrupp) to increase
its 10% stake in CSA to 26.87% through a capital contribution of EUR $965 million (equivalent to
R$2.532 billion at the time of payment). By the end of 2010, capital contributions to CSA resulted
in the payment by Vale of US$2,069 million (equivalent to R$3,794 million on the date of payment).
CSA built an integrated steel slab mill, with a nominal capacity of five million metric tons of
slab steel per year in Rio de Janeiro. The power plant started to operate in 2010. As a strategic
partner of ThyssenKrupp, Vale is the sole and exclusive supplier of iron ore to CSA.
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Sale of nickel assets
As a result of the strategic review of operations of nickel, Vale sold its indirect participation
in International Metals Reclamation Company, Inc. (Inmetco) on 31.12.2009 for US$34 million
(equivalent to R$59 million), received in a one-time payment, and 65% of Jinco Nonferrous Metals
Co., Ltd (Jinco) on 09.12.2009 for US$6.5 million (equivalent to R$11 million), received in a
one-time payment. Inmetco, formerly a wholly owned subsidiary of Vale Inco in Ellwood City,
Pennsylvania, USA, is dedicated to the recycling of nickel, chromium and other metal by-products
generated by the production of stainless steel and specialty metals. Jinco operates Chinese nickel
facilities and produces nickel sulphate and nickel chloride. That same month, Vale entered into
agreements to sell its stake of 76.7% in Inco Advanced Technology Materials (Dalian) Co. Ltd.
(Iatm-D) and 77% of Inco Advanced Technology Materials (Shenyang) Co. Ltd. (Iatm-S), which operates
manufacturing facilities for nickel foam in China for US$7 million (equivalent to R$16 million),
received in a one-time payment, to partners of the remaining shareholders. Due to the above
transactions, Vale no longer has any equity interest in Inmetco, in Jinco, in IATM-D and in IATM-S.
2010
Incorporation of the Sociedade de Mineração Estrela de Apolo S.A. (Estrela de Apolo) and Mineração
Vale Corumbá S.A. (Vale Corumbá)
On 22.01.2010 Vale approved the incorporation of its wholly owned subsidiaries Estrela de Apolo and
Vale Corumbá, without issuing new shares and with no change in Vale capital, at their respective
book asset value, with the release of their assets to Vale. According to the Appraisal Reports,
produced by Domingues e Pinho Accountants on 31.10.2009, the asset value of Estrela de Apolo was
R$4,160.00 and the net worth of Vale Corumbá was R$354,766,285.89. The main objective of the
incorporations was to simplify corporate structure and optimize resources and costs.
Sale of assets of Valesul
On 22.01.2010, integrated subsidiary Valesul Alumínio S.A. (Valesul) entered into an agreement to
sell its aluminum assets, located in Rio de Janeiro, to Alumínio Nordeste S.A., a member company of
Metalis group, for US$31.2 million (equivalent to R$55,9 million on the date of receipt), received
in a one-time payment.
The assets of Valesul included in the agreement are: (i) anode factory, (ii) reduction, (iii)
foundry, (iv) industrial and administrative service area, and (v) inventories.
Disposal of minority interests in Bayóvar
On 07.07.2010, Vale completed the transaction announced on 31.03.2010, by virtue of which it sold
to The Mosaic Company (Mosaic) and Mitsui & Co. Ltd. (Mitsui) minority stakes in the Bayovar
phosphate rock project located in Peru, through newly created MVM Resources International B.V.
(MVM), which manages and operates the project.
Vale sold 35% of the total capital of MVM to Mosaic for US$385 million (equivalent to R$682 million
on the date of transaction), in a one-time payment, and 25% of the total capital of MVM to Mitsui
for US$275 million (equivalent to US$487 million on the date of transaction), in a one-time
payment. Vale maintains control of the Bayóvar project, with 51% of the voting capital and 40% of
the total capital of MVM.
Acquisition of iron ore deposits (Simandou)
On 30.04.2010, Vale acquired from BSG Resources Ltd. (BSGR) a 51% stake in BSG Resources (Guinea)
Ltd., which holds concessions for iron ore in Guinea, Simandou South (Zogota) and exploration
permits for Simandou North (Blocks 1 & 2). Vale will pay US$2.5 billion for the acquisition of
these assets, of which $500 million (equivalent to R$865 million on the date of transaction) has
already been paid in cash, and the remaining US$2 billion will be paid in tranches subject to the
achievement of specific milestones.
The joint venture between Vale and BSGR started the implementation of the Zogota project and is
conducting feasibility studies for Blocks 1 & 2, with the creation of a logistics corridor for the
flow of materials through Liberia. For the right to move goods through Liberia, the joint venture
is committed to renew 660 km of the Trans-Guinea railway for passenger and light cargo. Vale will
be responsible for asset management, marketing and sales of the joint venture with the exclusive
off-take of the iron ore produced.
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Acquisition of fertilizer assets
On 27.05.2010, Vale completed the acquisition through its subsidiary Mineração Naque S.A., of a
direct and indirect stake of 58.6% in the capital of Vale Fertilizantes S.A. (Vale Fertilizantes)
— formerly known as Fertilizantes Fosfatados S.A. — Fosfertil (Fosfertil) — a company listed on
the BM&F Bovespa exchange and the largest Brazilian producer of fertilizer nutrients — and the
Brazilian fertilizer assets of Bunge Participacoes e Investimentos SA (BPI) for a total of US$4.7
billion, in a one-time payment. Of this amount, US$3.0 billion (equivalent to R$5.5 billion at the
time of payment) relates to a direct and indirect stake of 58.6% in the capital of Fosfertil, which
represents 72.6% of common shares and 51.4% of the preferred shares of Bunge Fertilizantes S.A.,
Bunge Brasil Holdings B.V., Yara Brasil Fertilizantes S.A. (Yara), Fertilizantes Heringer S.A.
(Heringer) and Fertilizantes do Paraná Ltda. (Fertipar) — equivalent to a price per share of
US$12.0185. The remaining US$1.7 billion (equivalent to R$3.1 billion at the time of payment) is
attributable to the acquisition of BPI’s Brazilian fertilizer asset portfolio, which includes
mining of phosphate rock and phosphate production units but does not include distribution/retail
operations.
Additionally, on 29.09.2010 Vale completed the acquisition, for US$1,029,811,129.77 (equivalent to
R$1.76 billion on the date of transaction) in a one-time payment, of 20.27% of the capital of Vale
Fertilizantes held by The Mosaic Company (Mosaic), corresponding to 27.27% of the common shares and
16.65% of the preferred shares of the company. Vale thus proceeded to hold 78.90% of the capital of
Vale Fertilizantes, composed by 99.81% of the common shares and 68.24% of the preferred shares of
the company.
Besides, under Brazilian corporate law and the norms of the capital market, Vale issued a
mandatory tender offer (public offer for acquisition or “OPA”, according to the initials in
Portuguese) to acquire up to the entirety of the common shares issued by Vale Fertilizantes
outstanding in the market at a value of US$12.0185 per share, converted into Brazilian reais, the
same price paid to other shareholders of Vale Fertilizantes. As a result of the OPA, in December
2010 Vale increased its direct and indirect interest in Vale Fertilizantes to 99.83% of the total
common shares and 78.92% of the total capital.
Sale of minority interest in Vale Oman Pelletizing Company
On 29.05.2010, Vale entered into an agreement with Oman Oil Company S.A.O.C. (OOC), an integrated
subsidiary of the government of the sultanate of Oman, to sell a 30% interest in Vale Oman
Pelletizing Company LLC (VOPC) for an amount equivalent in Omani Rials to US$125 million
(equivalent to R$228 million on the date of closing of agreement). Payment will be effected as
follows: (i) US$71 million paid by OOC against transfer of all the shares held by Vale Mauritius
Limited; (e) US$54 million by assuming the debt originally contracted by VOPC along with Vale
International. VOPC is a subsidiary that was created by Vale to build and operate a pelletizing
plant in the Industrial District of Porto de Sohar, in Oman.
The transaction is subject to the terms and conditions established in the final contract of
purchase of shares to be executed and filed with the Ministry of Industry and Commerce of Oman
after meeting the conditions above, as established in the Shareholders Agreement entered into with
OOC which, in turn, provides for the operational and administrative management of the pelletizing
plant by Vale.
Increased participation in Belvedere
On 01.06.2010, Vale acquired from AMCI Investments Pty Ltd (AMCI) for US$92 million (equivalent to
R$168 million on the date of payment), in a one-time payment, an additional share of 24.5% in the
Belvedere coal project. As a result of this transaction, Vale’s participation in Belvedere goes
from 51.0% to 75.5%. Belvedere is an underground mine coal project in the Bowen Basin region, near
the town of Moura in Queensland, Australia. According to preliminary estimates by the Company, once
ready, the Belvedere project will have the potential to reach a production capacity of up to 7.0
million metric tons of metallurgical coal per year.
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Sale of interest in PPSA
On 29.06.2010, Vale sold 86.2% of its interest in Pará Pigmentos S.A. (PPSA) and other kaolin
mining rights located in Pará. The assets were sold to Imerys S.A., a company listed on Euronext,
for US$74 million (equivalent to R$131 million on the date of transaction), in a one-time payment.
Acquisition of interest in SCDN
On 21.09.2010, Vale acquired 51% of Sociedade de Desenvolvimento do Corredor Norte S.A. (SDCN) for
US$21 million (equivalent to R$36.6 million on the date of payment), in a one-time payment, from
Mozambican company SGPS SA (Insitec). SDCN holds the concession to create the logistics structure
required for the production flow resulting from the second phase of Moatize coal project. SDCN
controls, through a 51% interest, Corredor de Desenvolvimento do Norte (CDN) and Central East
African Railway (CEAR). CDN is responsible for the concession of a railway section of 872 km in
Mozambique, linking Entrelagos, in the province of Niassa, with the port of Nacala, in the province
of Nampula, to the North of Mozambique and the port of Nacala. CEAR holds the concession of the
whole railway system of Malawi, currently consisting of 797 km of railway lines connecting the
whole country along the north-south and east-west axes. CDN and CEAR railway systems are
interconnected and close to Moatize mineral region, in the province of Tete, Mozambique, therefore
providing an additional logistic corridor for the coal to be produced in the area.
2011
Restructuring of aluminum assets portfolio
On 28.02.2011, Vale announced the completion of the operation, through subsidiary Vale Austria
Holdings GmbH, with Norsk Hydro ASA (Hydro), as announced on 02.05.2010, to transfer all its
interests in Albras — Alumínio Brasileiro S.A. (Albras), Alunorte — Alumina do Norte do Brasil S.A.
(Alunorte) and Companhia de Alumina do Pará (CAP), along with their respective rights of
exclusivity, commercial agreements and net debt of US$655 million, for 22% of the outstanding
common shares of Hydro and US$503 million (equivalent to R$836 million on the date of transaction)
in cash.
Besides, Vale created a new company, Mineração Paragominas S.A. (Paragominas), to which it
transferred the bauxite mine of Paragominas and all the other mining rights relating to bauxite in
Brazil. As a part of this transaction, Vale sold 60% of Paragominas to Hydro for US$578 million
(equivalent to R$960 million on the date of transaction), in a one-time payment, in cash. The
remaining portion of 40% will be sold in two equal parts of 20% within 3 and 5 years, for US$200
million in cash.
Pursuant to the terms of the operation, Vale will not be allowed to sell its shares issued by Hydro
for a period of 2 years nor will it be allowed to increase its interest in Hydro beyond 22%.
Besides, as another part of the agreement, Vale is entitled to appoint a representative in the
Board of Directors of Hydro.
Acquisition of Biopalma in Brazil
In February 2011, Vale acquired the majority stock of Biopalma da Amazônia S.A. Reflorestamento,
Indústria e Comércio, in the state of Pará (Biopalma). The amount of the transaction was R$290.2
million and at present Vale owns a 70% interest in this partnership. The Right to Vote is regulated
by the Shareholder’s Agreement. Biopalma will produce palm oil (dende oil) as feedstock to
manufacture biodiesel, and most of the production will be used for a B20 blend (a mixture of 20% of
biodiesel and 80% of regular diesel oil), as a fuel for our fleet of locomotives, equipment and
heavy machinery. Our investment in production of biodiesel forms part of our strategic focus on
global sustainability.
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Acquisition of copper assets in the African copper belt
On 08.04.2011, Vale and Metorex Limited (“Metorex”) agreed on the terms of Vale’s offer to acquire
the whole capital of Metorex for US$1.125 billion (equivalent to R$1.765 billion on the date of
agreement), to be settled in cash. Metorex shareholders will be summoned to consider the
acquisition proposal, which will be implemented through a scheme of arrangement, as defined by
corporate law in South Africa. Acquisition of 100% of the capital requires approval of at least 75%
of the capital stock represented by the shareholders present at the shareholders meeting. We have
already received the irrevocable commitment to do so by shareholders representing 25.8% of the
voting capital of Metorex. In addition, the acquisition is also subject to (i) applicable
governmental and regulatory approvals; (ii) approval by minority shareholders in Metorex
subsidiaries; (iii) sale or transfer of Sable Zinco Kabwe Limited, an operation for cathode copper
and cobalt processing in Zambia, from Metorex to third parties; (iv) no rejection to the purchase
from the shareholders of Metorex representing 5% or more of the capital stock of Metorex, or if
there is rejection of more than 5%, that the right of recess be not exercised with respect to the
5% or more of the total of shares of Metorex; and (v) statement of consent with respect to the
purchase from the creditors of Metorex or the partnerships that belong to the Metorex Group that
have rights with respect to the change of control of Metorex, including the rights arising from the
change of control as a hypothesis of advanced maturity of the obligations. The acquisition must be
submitted for approval before the antitrust authorities of Zambia, South Africa and China.
Metorex produces copper and cobalt from operations in the African copper belt. Metorex has two
mines in operation — Chibuluma, located in Zambia, in which it holds an 85% interest, and Ruashi,
in the Democratic Republic of Congo, in which it holds a 75% interest. Besides, Metorex has three
projects in the Democratic Republic of Congo, one of them at a development stage and the other two
at an exploration stage.
Acquisition of an interest in Belo Monte power project
On 28.04.2011, the Board of Directors approved the acquisition, subject to certain conditions, of
up to 9% of the capital of Norte Energia S.A. (NESA), a stake currently held by Gaia Energia e
Participações S.A (Gaia). NESA is a company whose sole purpose is the implementation, operation and
management of Belo Monte hydroelectric power plant in the Brazilian state of Pará. Vale will
reimburse Gaia for its capital contributions to NESA and will undertake to make future capital
contributions as a result of the acquired stock interest, estimated at R$2.3 billion (equivalent to
US$1.4 billion). This acquisition is consistent with our strategy to reduce operating costs and
minimize the price of power and the risks of supply. The operation has not yet been completed and
is subject to be submitted to the Administrative Board for Economic Defence (CADE) and other
agencies belonging to the Brazilian System of Fair Competition (SBDC, according to the initials in
Portuguese), as well as to approval by the National Agency of Electric Power (ANEEL, according to
the initials in Portuguese). A Shareholders Agreement will be executed to regulate voting rights.
6.6 Bankruptcy filings based on relevant values, or judicial or extrajudicial recovery of the
Company, and the current status of such requests, if applicable
Not applicable. There are no bankruptcy filings based on relevant values, or judicial or
extrajudicial recovery of the Company.
6.7 Other information that the Company deems relevant
There is no further relevant information about this item “6”.
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7.1 Summary of Company and Subsidiary activities
Vale is the second largest mining company in the world and the largest in the Americas by market
value. The Company is the largest iron ore producer and second largest nickel producer in the
world. Vale is among the largest producers of manganese ore and ferroalloys. It also produces
copper, thermal and metallurgical coal, phosphates, potash, cobalt, kaolin and platinum group
metals (PGMs) and other products. To sustain its growth strategy, Vale is actively engaged in
mineral exploration in 24 countries. The Company operates large logistics systems in Brazil
integrated with its mining operations, including railroads, maritime terminals and a port. In
addition, the Company has a portfolio of maritime freight to transport iron ore. Vale also has
significant investments in the sectors of energy and steel, directly or through subsidiaries and
joint ventures.
7.2 Operational segment(s) disclosed in the consolidated financial statements for the past 3 fiscal
years:
a. Products and services marketed in each operating segment
(i) Bulk Materials — Includes extraction of iron ore and production of pellets, as well as the
North, Southern and Southeastern transportation systems, including railroads, maritime terminals
and ports, linked to these operations. Manganese ore, ferroalloys and coal are also included in
this segment.
(ii) Base metals — Includes the production of non-ferrous minerals, including production of nickel
(co-products and by-products), copper and aluminum — it involves aluminum marketing, alumina
refining and smelting aluminum metals and investments in joint ventures and bauxite mining
partnerships — PGMs and other precious metals and cobalt.
(iii) Fertilizers — Includes three important nutrient groups: potassium, phosphates and nitrogen.
This is a new business segment, reported as of 2010, that is being formed through acquisitions and
organic growth.
(iv) Logistics — Includes the system of cargo transportation for third parties, divided into rail
transport, port and shipping services.
(v) Other investments — Includes investments in joint ventures and affiliates in other businesses.
The information presented to upper management regarding performance of each segment are usually
originated from accounting records maintained according to generally accepted accounting principles
in Brazil, with some minimum relocations between segments.
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b. Revenue from the segment and its participation in the Company’s net revenues
| 2010 | 2009 | |||||||||||||||
| In R$ thousands | % of | % of | ||||||||||||||
| Segment | Net Revenue | total | Net Revenue | total | ||||||||||||
Bulk Materials |
61,482,495 | 74 | 30,545,038 | 63 | ||||||||||||
Base Metals |
14,377,415 | 17 | 13,744,012 | 28 | ||||||||||||
Fertilizers |
3,013,814 | 4 | 777,991 | 2 | ||||||||||||
Logistics |
2,773,115 | 3 | 2,480,827 | 5 | ||||||||||||
Other Investments |
1,578,167 | 2 | 948,698 | 2 | ||||||||||||
Total Revenue |
83,225,006 | 100 | 49,496,566 | 100 | ||||||||||||
c. Profit or loss resulting from the segment and its participation in the Company’s net income
| 2010 | 2009 | |||||||||||||||
| In R$ thousand | % of | % of | ||||||||||||||
| Segment | Profit/Loss | total | Profit/Loss | total | ||||||||||||
Bulk Materials |
30,855,508 | 102 | 11,258,393 | 109 | ||||||||||||
Base Metals |
(739,403 | ) | -2 | (1,245,903 | ) | -12 | ||||||||||
Fertilizers |
(58,874 | ) | — | 333,627 | 3 | |||||||||||
Logistics |
453,828 | 1 | 329,019 | 3 | ||||||||||||
Other Investments |
(440,508 | ) | -1 | (338,186 | ) | -3 | ||||||||||
Net Total Profit/Loss |
30,070,051 | 100 | 10,136,950 | 100 | ||||||||||||
As of January 1, 2010, Vale adopted all resolutions issued by the CPC (Accounting Standards
Committee) retroactively to January 1, 2009. Therefore, the financial statements related to fiscal
year ending on December 31, 2010 are the first consolidated financial statements submitted by the
Company pursuant to International Financial Reporting Standards — IFRS. Thus, the financial
statements regarding fiscal year ending on December 31, 2008, since they were prepared using
different accounting standards, cannot be compared to financial statements for fiscal years ending
on December 31, 2009 and December 31, 2010, and therefore, no financial statements related to
fiscal year 2008 were included.
7.3 Products and services that correspond to the operating segments disclosed in item “7.2”
| a. | Characteristics of the production process |
|
| b. | Characteristics of the distribution process |
|
| v. | Characteristics of the markets, in particular: |
| i. | competition conditions in the markets |
||
| ii. | participation in each market |
| d. | Possible seasonality |
|
| e. | Main supplies and raw materials, reporting: |
| i. | description or relationships maintained with providers, including if
they are subject to government control or regulation, indicating the applicable
legislating body; |
||
| ii. | eventual dependence on fewer providers; and |
||
| iii. | eventual volatility in its prices. |
A. Bulk materials
The Company’s bulk materials business includes iron ore prospecting, pellet production, manganese
prospecting, iron alloy production and coal production. Each activity is described below.
A.1 Iron Ore
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A.1.1. Production Process
Vale runs the majority of its iron ore operations in Brazil directly and through its subsidiary
Urucum Mineração S.A. (Urucum) and Mineração Corumbaiense Reunidas (MCR). Our mines, which are all
open-pit, and other operations are concentrated mainly in three systems: the Southeastern System,
the Southern System and the Northern System, each with its own transportation capacity. Moreover,
Vale has mining operations in the Centralwestern System through its affiliate Samarco Mineração SA
(Samarco).
| Vale Participation | ||||||||||||||||
| Firm | System | Voting | Total | Vale Partners | ||||||||||||
| (%) | ||||||||||||||||
Vale |
North, Southeastern, Southern and Centralwestern | — | — | — | ||||||||||||
Urucum |
Centralwestern | 100 | 100 | — | ||||||||||||
MCR |
Centralwestern | 100 | 100 | — | ||||||||||||
Samarco |
— | 50 | 50 | BHP Billiton | ||||||||||||
Southeastern System
The Southeastern System mines are located in the Iron Quadrangle region of the state of Minas
Gerais, where they are divided into three mining complexes (Itabira, Minas Centrais and Mariana).
The ore reserves in the three mining complexes have high ratios of itabirite ore relative to
hematite ore. Itabirite ore has iron grade of 35-60% and requires concentration to achieve
shipping grade, which is at least 63.5% average iron grade.
We conduct open-pit mining operations in the Southeastern System. At the three mining complexes,
we generally process the run-of-mine by means of standard crushing, classification and
concentration steps, producing sinter feed, lump ore and pellet feed in the beneficiation plants
located at the mining sites. In 2010, we produced 65.3% of the electric energy consumed in the
Southeastern System at our hydroelectric power plants (Igarapava, Porto Estrela, Funil, Candonga,
Aimorés, Capim Branco I and Capim Branco II).
We own and operate integrated railroad and terminal networks in the three mining complexes, which
are accessible by road or by spur tracks of our EFVM railroad. The EFVM railroad connects these
mines to the Tubarão port in Vitória, in the state of Espírito Santo. For a more detailed
description of the network, please see Logistics.
Southern System
The Southern System mines are located in the Iron Quadrangle region of the state of Minas Gerais in
Brazil. The mines of our subsidiary Minerações Brasileiras Reunidas S.A.- MBR are operated by
Vale, pursuant to an asset lease agreement. The Southern System has three major mining complexes:
the Minas Itabirito complex (comprised of four mines, with two major beneficiation plants and three
secondary beneficiation plants); the Vargem Grande complex (comprised of three mines and one major
beneficiation plant); and the Paraopeba complex (comprised of four mines and three beneficiation
plants).
We use wet beneficiation processes to convert run-of-mine obtained from open-pit mining operations
into sinter feed, lump ore and pellet feed. In 2010, we produced 63.3% of the electric energy
consumed in the Southern System at our hydroelectric power plants (Igarapava, Porto Estrela, Funil,
Candonga, Capim Branco I and Capim Branco II).
We enter into freight contracts with MRS, a railway company in which we own a 41.5% stake, to
transport our iron ore products at market prices from the mines to our Guaíba Island and Itaguaí
maritime terminals in the state of Rio de Janeiro.
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Northern System
The Northern System mines, located in Carajás, in the state of Pará, contain some of the largest
iron ore deposits in the world. The reserves are divided into northern, southern and eastern
ranges situated 35 kilometers apart. Since 1985, we have been conducting mining activities in the
northern range, which is divided into three main mining bodies (N4W, N4E and N5). The Northern
System has open-pit mines and an ore processing plant. The mines are located on public lands for
which we hold mining concessions.
Because of the high grade (66.7% on average) of the Northern System deposits, we do not need to
operate a concentration plant at Carajás. The beneficiation process consists simply of sizing
operations, including screening, hydrocycloning, crushing and filtration. The beneficiation
process produces sinter feed and pellet feed. We obtain all of the electrical power for the
Northern System at market prices from regional utility companies.
We operate an integrated railroad and maritime terminal network in the Northern System. After
completion of the beneficiation process, our Carajás railroad — EFC transports the iron ore to the
Ponta da Madeira maritime terminal in the state of Maranhão. To support our Carajás operations, we
have housing and other facilities in a nearby township. These operations complex is accessible by
road, air and rail.
Centralwestern System
The Centralwestern System includes the Urucum and Corumbá mines, located in the state of Mato
Grosso do Sul.
We conduct open-pit mining operations in the Centralwestern System. The iron ore reserves in Urucum
contain a high level of hematite ore, with an average of 62.2%. In September of 2009, we concluded
the acquisition of the mine of Corumbá, were we produce iron ore pellets. In the Urucum and Corumbá
mines, we usually process the ROm through standard crushing, followed by classification, producing
granulated and fine.
The iron ore products from the Urucum and Corumbá mines are delivered to clients through vessels
sailing on Paraguay and Paraná rivers.
Samarco
We own 50% of Samarco, which operates an integrated system, comprised of a mine, pipeline, three
pellet plants and a port. Samarco’s Alegria mine complex, located in Mariana, Minas Gerais, is
close to our Southeastern System.
A.1.2. Production
The following table sets forth information about our iron ore production.
| Production for fiscal year ended on | ||||||||||||||||||
| December 31 | Recovery | |||||||||||||||||
| Mine/Plant | Type | 2008 | 2009 | 2010 | Rate | |||||||||||||
| (million metric tons) | (%) | |||||||||||||||||
Southeastern System |
||||||||||||||||||
Itabira |
||||||||||||||||||
Cauê(1) |
Open pit | 21.5 | 13.8 | 19.3 | 68.0 | |||||||||||||
Conceição(1) |
Open pit | 20.3 | 17.3 | 19.4 | 75.2 | |||||||||||||
Minas Centrais |
||||||||||||||||||
Água Limpa/Cururu(2) |
Open pit | 4.7 | 1.4 | 5.0 | 52.9 | |||||||||||||
Gongo Soco |
Open pit | 5.0 | 2.7 | 6.8 | 90.1 | |||||||||||||
Brucutu |
Open pit | 26.4 | 23.6 | 29.7 | 79.1 | |||||||||||||
Andrade(3) |
Open pit | 1.4 | 0.7 | — | — | |||||||||||||
Mariana
|
||||||||||||||||||
Alegria |
Open pit | 12.3 | 12.1 | 13.6 | 81.8 | |||||||||||||
Fábrica Nova(4) |
Open pit | 14.0 | 13.7 | 12.5 | 66.9 | |||||||||||||
Fazendão(5) |
Open pit | 9.8 | 3.1 | 10.6 | 100 | |||||||||||||
Timbopeba |
Open pit | — | — | — | — | |||||||||||||
Total Southeastern System |
115.4 | 88.5 | 116.9 | |||||||||||||||
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| Production for fiscal year ended on | ||||||||||||||||||
| December 31 | Recovery | |||||||||||||||||
| Mine/Plant | Type | 2008 | 2009 | 2010 | Rate | |||||||||||||
| (million metric tons) | (%) | |||||||||||||||||
Southern System |
||||||||||||||||||
Minas Itabirito
|
||||||||||||||||||
Segredo/João Pereira(6) |
Open pit | 12.1 | 8.4 | 12.4 | 73.5 | |||||||||||||
Sapecado/Galinheiro(7) |
Open pit | 15.1 | 9.8 | 17.7 | 67.0 | |||||||||||||
Vargem Grande
|
||||||||||||||||||
Tamanduá(8) |
Open pit | 9.8 | 7.3 | 8.6 | 83.4 | |||||||||||||
Capitão do Mato(8) |
Open pit | 9.7 | 8.0 | 8.2 | 83.4 | |||||||||||||
Abóboras |
Open pit | 4.2 | 5.4 | 5.2 | 100.0 | |||||||||||||
Paraopeba
|
||||||||||||||||||
Jangada |
Open pit | 4.3 | — | 3.5 | 98.9 | |||||||||||||
Córrego do Feijão |
Open pit | 8.4 | 5.6 | 6.8 | 79.3 | |||||||||||||
Capão Xavier(9) |
Open pit | 13.5 | 10.9 | 9.3 | 82.3 | |||||||||||||
Mar Azul |
Open pit | 3.5 | — | 3.0 | 100.0 | |||||||||||||
Total Southern System |
80.5 | 55.2 | 74.7 | |||||||||||||||
Centralwestern System |
||||||||||||||||||
Corumbá |
Open pit | — | 0.4 | 2.8 | 62.9 | |||||||||||||
Urucum |
Open pit | 1.0 | 0.5 | 1.4 | 55.3 | |||||||||||||
Total Sistema do Centro-Oeste |
1.0 | 1.0 | 4.2 | |||||||||||||||
Northern System |
||||||||||||||||||
Serra Norte(10)
|
||||||||||||||||||
N4W |
Open pit | 44.3 | 31 | 30.2 | 92.4 | |||||||||||||
N4E |
Open pit | 13.2 | 16.9 | 34 | 92.4 | |||||||||||||
N5 |
Open pit | 39.1 | 36.8 | 37 | 92.4 | |||||||||||||
Total Northern System |
96.5 | 84.6 | 101.2 | |||||||||||||||
Vale |
293.4 | 229.3 | 297.0 | |||||||||||||||
Samarco (11) |
8.3 | 8.6 | 10.8 | 57.2 | ||||||||||||||
Total |
301.7 | 238.0 | 307.8 | |||||||||||||||
| (1) | ROM from Meio and Conceição mines is sent to Cauê and Conceição concentration plants. |
|
| (2) | Água Limpa/Cururu is owned by Baovale, in which we own 100% of the voting shares and 50% of the
total shares. Production figures for Água Limpa/Curucu were not adjusted to reflect our ownership
interest. |
|
| (3) | The lease for the Andrade mine was terminated in 2009. |
|
| (4) | Fábrica Nova ore is sent to the Alegria and Fábrica Nova plants. |
|
| (5) | Fazendão ore is sent to the Alegria and Samarco plants. |
|
| (6) | Segredo and João Pereira ore is pocessed at the Fabrica plant. |
|
| (7) | Galinheiro and Sapecado ore is processed at the Pico plant. |
|
| (8) | Tamanduá and Capitão do Mato ore is processed at the Vargem Grande plant. |
|
| (9) | Capão Xavier ore is processed at the Mutuca plant. |
|
| (10) | All of the ore at Serra Norte is processed at the Carajás plant. |
|
| (11) | Production figures for Samarco, in which we have a 50% interest, have been adjusted to reflect
our ownership interest. |
A.2 Pellets
A.2.1 Production Process
Directly and through joint ventures, Vale produces iron ore pellets in Brazil, in Omã and China, as
shown in the table below. The estimated total nominal capacity is 45.3 million metric tons per
year, without including our joint ventures’ nominal capacity of 22.2 million metric tons per year
at Samarco, 4.5 million metric tons per year at Hispanobras, 1.2 million metric tons per year at
Zhuhai and 1.2 million metric tons per year at Anyang. With the launching of our pelletizing units
in Omã, we will increase our annual nominal capacity by 9.0 million metric tons.
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| Our Participation | ||||||||||||
| Voting | ||||||||||||
| Firm | Local Operation | (%) | Total | Our Partners | ||||||||
| Brazil: | ||||||||||||
Vale |
Tubarão, Fábrica, Vargem Grande e São Luís | — | — | — | ||||||||
Hispanobras |
Tubarão | 51 | 50.9 | Arcelor Mittal | ||||||||
Samarco |
Mariana and Anchieta | 50 | 50 | BHP Billiton | ||||||||
| China: | ||||||||||||
Zhuhai YPM |
Zhuhai, Guangdong | 25 | 25 | Zhuhai Yueyufeng Iron and Steel Co, Ltd, Pioneer Iron and Steel Group Co, Ltd. | ||||||||
Anyang Yu Vale Yongtong Pellet Co. Ltd. |
Anyang, Henan | 25 | 25 | Anyang Iron & Steel Co. Ltd. | ||||||||
| Omã: | ||||||||||||
Vale Oman Pelletizing Company LLC (VOPC) |
Complexo industrial de Sohar | 100 | 100 | (1) | ||||||||
| (1) | We signed an agreement to sell 30% of our voting stock and total capital in Oman Oil Companhia
S.A.O.C. (OOC). |
In the Tubarão port area, in Espírito Santo, we operate our wholly owned pellet plants, Tubarão I
and II, four plants we lease under operating leases and our jointly-owned plant, Hispanobras. We
send iron ore from our Southeastern System mines to these plants and use our logistics
infrastructure to distribute their final products.
Our São Luís pellet plant, located in Maranhão, is part of the Northern System. We send Carajás
iron ore to this plant and ship its production to customers through our Ponta da Madeira maritime
terminal.
The Fábrica and Vargem Grande pellet plants, located in Minas Gerais, are part of the Southern
System. We send some of the iron ore from the Fábrica mine to the Fábrica plant, and iron ore from
the Pico mine to the Vargem Grande plant. We transport pellets from the Vargem Grande plant using
MRS and pellets from the Fabrica plant using both MRS and EFVM.
We launched production at a pelletizing plant at the Sohar industrial complex, in Oman, in the
middle east. Each pelletizing plant will have an annual nominal production capacity of 4.5 million
metric tons per year, for a total of 9 million metric tons per year of direct-reduced pellets. The
pelletizing units are located in the area where we will have the distribution center with a
capacity to operate 40 million metric tons per year.
Samarco operates three pellet plants in two operating sites with nominal capacity of 22.2 million
metric tons per year. The pellet plants are located in the Ponta Ubu unit, in Anchieta, Espírito
Santo. Iron ore from Alegria and from Fábrica Nova mine, part of our Southeastern System, is sent
to the Samarco pellet plants using a 396-kilometer pipeline, the longest pipeline in the world for
the conveyance of iron ore. Samarco has its own port facilities to transport its production.
The Zhuhai YPM pellet plant, in China, is part of the Yueyufeng Steelmaking Complex. It has port
facilities, which we use to receive pellet feed from our mines in Brazil. Zhuhai YPM’s main
customer is Yueyufeng Iron & Steel (“YYS”), which is also located in the Yueyufeng Steelmaking
Complex. We also have a 25% participation in Anyang Yu Vale Yongtong Pellet Co. Ltd, which is a
pellet plant in China with capacity to produce 1.2 million metric tons per year which began
operating in March of 2011.
We sell pellet feed to our pelletizing joint ventures at market prices. We have supplied all of
the iron ore requirements of our wholly owned pellet plants and joint ventures, except for Samarco
and Zhuhai YPM, to which we supply only part of their requirements. Of our total 2010 pellet
production, 73.2% was blast furnace pellets, and the remaining 26.8% was direct reduction pellets,
which are used in steel mills that employ the direct reduction process rather than blast furnace
technology.
We sell iron ore to our pelletizing joint ventures. in 2010, we sold 4.2 million metric tons to
Hispanobras, 12 million metric tons to Samarco and 1.1 million metric tons to Zhuhai.
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A.2.2. Production
The table below provides information regarding our main pellet production.
| Production for fiscal year ending on December 31 | ||||||||||||
| Firm | 2008 | 2009 | 2010 | |||||||||
| (million metric tons) | ||||||||||||
Vale(1) |
26.6 | 15.3 | 36.3 | |||||||||
Hispanobras(5) |
1.9 | 0.6 | 1.9 | |||||||||
Itabrasco(2) |
2.9 | — | — | |||||||||
Kobrasco(3) |
2.1 | — | — | |||||||||
Nibrasco(4) |
2.7 | — | — | |||||||||
Samarco (5) |
8.6 | 8.0 | 10.8 | |||||||||
Zhuhai (5) |
0.2 | 0.3 | 0.3 | |||||||||
Total |
45.0 | 24.2 | 49.3 | |||||||||
| (1) | Figure includes actual production, including production from the four pellet plants we leased
in 2008. |
|
| (2) | Production through September 2008. We signed a 10-year operating lease contract for
Itabrasco’s pellet plant in October 2008. |
|
| (3) | Production through May 2008. We signed a five-year operating lease contract for Kobrasco’s
pellet plant in June 2008. |
|
| (4) | Production through April 2008. We signed a 30-year operating lease contract for Nibrasco’s
two pellet plants in May 2008. |
|
| (5) | Production figures for Hispanobras, Samarco and Zhuhai were adjusted to reflect our ownership
interest. |
A. 3. Iron ore and pellets
A.3.1. Market Characteristics
We supply all of our iron ore and pellets (including our share in joint-venture pellet production)
to the steel industry. Prevailing and expected levels of demand for steel products affect demand
for our iron ore and pellets. Demand for steel products is influenced by many factors, such as
global manufacturing production, civil construction and infrastructure spending.
In 2010, China accounted for 42.9% of our iron ore and pellet shipments, and Asia, as a whole,
accounted for 60.7%. Europe accounted for 20.7%, followed by Brazil with 13.7%. Our 10 largest
customers collectively purchased 130.2 million metric tons of iron ore and pellets from us,
representing 44% of our 2010 iron ore and pellet shipments and 45% of our total iron ore and
pellet revenues. In 2010, no individual customer accounted for more than 10% of our iron ore and
pellet shipments.
In 2010, the Asian market (mainly Japan and South Korea) and the European market were the primary
markets for our blast furnace pellets, while North America, the Middle East and North Africa were
the primary markets for our direct reduction pellets.
We strongly emphasize customer service in order to improve our competitiveness. We work with our
customers to understand their main objectives and to provide them with iron ore solutions to meet
specific customer needs. Using our expertise in mining, agglomeration and iron-making processes,
we search for technical solutions that will balance the best use of our world-class mining assets
and the satisfaction of our customers. We believe that our ability to provide customers with a
total iron ore solution and the quality of our products are very important advantages helping us to
improve our competitiveness in relation to competitors who may be more conveniently located
geographically. In addition to offering technical assistance to our customers, we operate sales
support offices in Tokyo (Japan), Seoul (South Korea), Singapore, Dubai (UAE) and Shanghai (China),
which support the sales made by our wholly owned subsidiary located in St. Prex, Switzerland.
These offices also allow us to stay in close contact with our customers, monitor their requirements
and our contract performance, and ensure that our customers receive timely deliveries.
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A.3.2 Competition
The global iron ore and iron ore pellet markets are highly competitive. The main factors affecting
competition are price, quality and range of products offered, reliability, operating costs and
shipping costs.
Our biggest competitors in the Asian market are located in Australia and include subsidiaries and
affiliates of BHP Billiton plc and Rio Tinto Ltd. Although the transportation costs of delivering
iron ore from Australia to Asian customers are generally lower than ours as a result of Australia’s
geographical proximity, we are competitive in the Asian market for two main reasons. First, steel
companies generally seek to obtain the types (or blends) of iron ore and iron ore pellets that can
produce the intended final product in the most economical and efficient manner. Our iron ore has
low impurity levels and other properties that generally lead to lower processing costs. For
example, in addition to its high grade, the alumina grade of our iron ore is very low compared to
Australian ores, reducing consumption of coke and increasing productivity in blast furnaces, which
is particularly important during periods of high demand. When demand is very high, our quality
differential is in many cases more valuable to customers than a freight differential. Second,
steel companies often develop sales relationships based on a reliable supply of a specific mix of
iron ore and iron ore pellets. We have a customer-oriented marketing policy and place specialized
personnel in direct contact with our customers to help determine the blend that best suits each
particular customer.
In terms of reliability, our ownership and operation of logistics facilities in the Northern and
Southeastern Systems help us ensure that our products are delivered on time and at a relatively low
cost. In addition, we are developing a low-cost freight portfolio, aimed at enhancing our ability
to offer our products in the Asian market at competitive prices and to increase our market share.
To support this strategy, we ordered new ships, purchased used vessels and entered into medium and
long-term freight contracts.
Our principal competitors in Europe are: Kumba Iron Ore Limited; Luossavaara Kiirunavaara AB
(“LKAB”); Société Nationale Industrielle et Minière (“SNIM”); Rio Tinto Ltd.; and BHP Billiton. We
are competitive in the European market not only for the same reasons we are competitive in Asia,
but also due to the proximity of our port facilities to European customers. In 2009 and 2010, we
had a 24.9 and 24.7% market share respectively of the total negotiated volume in the transoceanic
market.
The Brazilian iron market is also competitive. There are many smaller iron ore producers and new
companies that are developing projects, such as Anglo Ferrous Brasil, MMX, MHAG and Bahia
Mineração. Some steel plants, including Companhia Siderurgica Nacional (CSN), V&M of Brasil S.A.
(Mannesmann) and Usiminas, also have iron ore operations. Although price is important, quality and
reliability are important factors as well. We believe that our integrated transportation systems,
our high quality ore and technical support make us a strong competitor in the Brazilian market.
A.3.3 Seasonality
Demand for iron ore is higher in the months of December, March and April. Compared to the second
semester, demand tends to be weaker than in the first half of the year.
A.4 Manganese Ore
A.4.1 Production Process
Vale conducts manganese operations in Brazil directly and through its subsidiaries, Vale Manganês
S.A. (Vale Manganês) and Urucum.
| Our Participation | ||||||||||
| Firm | Location | Voting | Total | |||||||
| (%) | ||||||||||
| Brazil: | ||||||||||
Vale Manganês |
Pará and Minas Gerais | 100 | 100 | |||||||
Urucum |
Mato Grosso do Sul | 100 | 100 | |||||||
The Company’s mines produce three types of manganese products: |
||
| • | metallurgical ore used primarily in the production of ferroalloys; |
||
| • | natural manganese dioxide, suitable for the manufacturing of electrolytic batteries; and |
||
| • | chemical ore used in various industries for the production of fertilizers, pesticides and
animal feed, and is also used as pigment in the ceramics industry. |
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We operate on-site beneficiation plants at our Azul mine and at the Urucum mines, which are
accessible by road. The Azul and Urucum mines have high-grade ores (at least 40% manganese grade),
while our Morro da Mina mine has low-grade ores. All of these mines obtain electrical power at
market prices from regional electric utilities. The following table sets forth information about
our manganese production.
| Production for fiscal year ending | ||||||||||||||||||||
| December 31 | Rate of | |||||||||||||||||||
| Mine | Type | 2008 | 2009 | 2010 | recovery | |||||||||||||||
| (Millions of metric tons) | (%) | |||||||||||||||||||
Azul |
Open pit | 2.0 | 1.4 | 1.6 | 65.3 | |||||||||||||||
Morro da Mina |
Open pit | 0.1 | 0.1 | 0.1 | 88.88 | |||||||||||||||
Urucum |
Underground | 0.2 | 0.2 | 0.2 | 78.76 | |||||||||||||||
Total |
2.4 | 1.7 | 1.8 | |||||||||||||||||
A.5 Ferroalloys
A.5.1. Production Process
The following table sets forth the subsidiaries through which we conduct our ferroalloys business.
| Our Participation | ||||||||||
| Firm | Location | Voting | Total | |||||||
| (%) | ||||||||||
Vale Manganês |
Minas Gerais and Bahia | 100.0 | 100.0 | |||||||
Urucum |
Mato Grosso do Sul | 100.0 | 100.0 | |||||||
Vale Manganèse France |
Dunkerque, France | 100.0 | 100.0 | |||||||
Vale Manganese
Norway AS |
Mo I Rana, Norway | 100.0 | 100.0 | |||||||
We produce several types of manganese ferroalloys, such as high carbon and medium carbon
ferro-manganese and ferro-silicon manganese. Our facilities have nominal capacity of 651,000
metric tons per year. The production of ferroalloys consumes significant amounts of electricity,
representing 4.8% of our total consumption in 2010. The electricity supply for our fLTrroalloy
plant in Dunkerque, France and Mo I Rana, Norway is provided through long-term contracts.
The following table presents information about the Company’s ferroalloys production.
| Production for fiscal year ending December 31 | ||||||||||||
| Firm | 2008 | 2009 | 2010 | |||||||||
| (Thousands of metric tons) | ||||||||||||
Vale Manganês(1) |
288 | 99 | 207 | |||||||||
Urucum(2) |
20 | 0 | 0 | |||||||||
Vale Manganèse France(3) |
55 | 45 | 138 | |||||||||
Vale Manganese Norway AS |
112 | 79 | 106 | |||||||||
Total |
475 | 223 | 451 | |||||||||
| (1) | Vale Manganês has five plants in Brazil: Santa Rita, Barbacena and Ouro Preto in the state of
Minas Gerais; and Simões Filho in the state of Bahia. |
|
| (2) | Urucum has one plant in Corumbá in the state of Mato Grosso do Sul. |
|
| (3) | In August 2008, we shut down our furnaces at Vale Manganèse France due to technical problems
and we restarted them in September 2009. |
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A.6 Manganese ore and ferroalloys: market and competition
The markets for manganese ore and ferroalloys are highly competitive. Competition in the manganese
ore market takes place in two segments. High-grade manganese ore competes on a global seaborne
basis, while low-grade ore competes on a regional basis. For some ferroalloys, high-grade ore is
mandatory, while for others high- and low-grade ores are complementary. The main suppliers of
high-grade ores are located in South Africa, Gabon, Australia and Brazil. The main producers of
low-grade ores are located in Ukraine, China, Ghana, Kazakhstan, India and Mexico.
The ferroalloy market is characterized by a large number of participants who compete primarily on
the basis of price. The principal competitive factors in this market are the costs of manganese
ore, electricity, logistics and reductants. We compete both with stand-alone producers and
integrated producers that also mine their own ore. Our competitors are located mainly in countries
that produce manganese ore or steel.
A.7 Coal
A.7.1 Production Process
We produce thermal and metallurgical coal through Vale Australia, our subsidiary that operates coal
assets in Australia through subsidiaries and non-formed joint ventures, and thermal coal, through
our subsidiary, Vale Colombia.
We also have a minority stake in two Chinese companies, Henan Longyu Energy Resources Co., Ltd.
(Longyu) and Shandong Yankuang International Coking Companhia Ltd. (Yankuang), according to the
following table.
| Our | ||||||||||
| Particip | ||||||||||
| Empresa | Business | Location | ation | Our Partners | ||||||
| (%) | ||||||||||
Vale Austrália |
Australia | |||||||||
Integra Coal |
Thermal and metallurgical coal | Hunter Valley, New South Wales | 61,2 | Nippon Steel (NSC), JFE Group (JFE), Posco, Toyota Tsusho Austrália, Chubu Electric Power Co. Ltd | ||||||
Carborough Downs |
Metallurgical coal | Bowen Basin, Queensland | 80 | NSC, JFE, Posco, Tata | ||||||
Isaac Plains |
Thermal and metallurgical coal | Bowen Basin, Queensland | 50 | Aquila | ||||||
Broadlea |
Thermal and metallurgical coal | Bowen Basin, Queensland | 100 | — | ||||||
Vale Colombia |
||||||||||
El Hatillo |
Thermal coal | Colombia | 100 | — | ||||||
Longyu |
Coal and other related products | Henan Province, China | 25 | Yongmei Grupo Co., Ltd. (formerly, Yongcheng Carvão & Electricity (Grupo) Co. Ltd.), Shanghai Baosteel International Economic & Trading Co., Ltd. and other minority stockholders | ||||||
Yankuang |
Metallurgical coke and methanol | Shandong Province, China | 25 | Yankuang Grupo Co. Limited, Itochu Corporation | ||||||
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Integra Coal Operations (underground and open pit). The Integra Coal operations are located 10 km
northeast of Singleton, Hunter Valley, in New South Wales, Australia. The operations are comprised
of an underground coal mine that produces coal using the longwall method and an open pit mine. Coal
from these mines is processed in a coal handling and preparation plant (CHPP) with a capacity of
1,200 metric tons per hour and it is transported using a railroad that was specially built to
transport it to the port of Newcastle, in New South Wales, Australia.
Carborough Downs. Carborough Downs is located in the Central Bowen Basin, in central Queensland,
Australia, 15 km from the township of Moranbah and 180 km from the coastal city of Mackay. The
Carborough Downs concession comprises the Rangal Coal Measures of the Bacia de Bowen Basin as well
as the financial assets of Leichardt and Vermont. The two assets produce coking and can be
beneficiated to produce metallurgical coal and PCI. The mine in Leichardt is our main development
objective and to constitute 100% of the current reserves and base resources. The coal from
Carborough Downs is processed at the Carborough Downs CHPP, with a processing capacity of 1,000
metric tons per hour, and it operates seven days a week. The product is shipped by the railroad and
is transported 160 km to the Dalrymple Bay Terminal in Queensland, Australia.
Isaac Plains. The open pit mine at Isaac Plains is located next to Carborough Downs, in Central
Queensland. The mine is run by Isaac Plains Coal Management, with shared control through a joint
venture. Its coal is classified as semi-volatile, bituminous coal with low sulphur levels. The coal
is processed at the Isaac Plains CHPP and transported 172 km to the Dalrymple Bay Coal Terminal.
Broadlea. Broadlea is an open pit mine located north of the underground mine of Carborough Downs,
consisting of several small deposits of coal. The operation in Broadlea uses the truck-and-shovel
method and the coal is washed at the Carborough Downs CHPP and transported to the Dalrymple Bay
Coal Terminal, located 172 km away, in Queensland, Australia. At the end of 2009, Broadlea stopped
operating and underwent maintenance due to increasing unit costs. The financial viability of the
mine will undergo regular inspections to determine if it is possible to resume operations.
El Hatillo. El Hatillo coal mine in Colômbia is located in the central area of the Province of
Cesar, approximately 210 km southeast of Santa Marta. The concession is located next to the city of
La Loma and includes an area of 23,952 acres. Mining at El Hatillo is carried out using the
truck-and-shovel method and uses crushing and selection to produce thermal coal which is loaded
onto trains at a facility dedicated to transportation to the port of SPRC. A large part of this
thermal coal is exported to Europe and United States.
A.7.2 Production
The following table provides information about the Company’s coal production.
| Production during fiscal year ending | ||||||||||||||||
| December 31 | ||||||||||||||||
| Operation: | Mine Type | 2008 | 2009 | 2010 | ||||||||||||
| (million metric tons) | ||||||||||||||||
Thermal coal: |
||||||||||||||||
Vale Colombia |
||||||||||||||||
El Hatillo(1) |
open pit | — | 1,143 | 2,991 | ||||||||||||
Vale Austrália |
||||||||||||||||
Integra Coal(2) |
open pit | 557 | 702 | 305 | ||||||||||||
Isaac Plains(3) |
open pit | 147 | 551 | 371 | ||||||||||||
Broadlea |
open pit | 582 | 497 | 165 | ||||||||||||
Total Thermal coal |
1,286 | 2,892 | 3,832 | |||||||||||||
Carvão metalúrgico: |
||||||||||||||||
Vale Austrália |
||||||||||||||||
Integra Coal(3) |
Underground and open pit | 1,747 | 1,184 | 1,151 | ||||||||||||
Isaac Plains(3) |
open pit | 382 | 487 | 590 | ||||||||||||
Carborough Downs(4) |
Underground and | 429 | 604 | 1,216 | ||||||||||||
Broadlea |
open pit | 249 | 252 | 101 | ||||||||||||
Total de carvão
metalúrgico |
2,808 | 2,527 | 3,057 | |||||||||||||
| (1) | Vale acquired El Hatillo on the first quarter of 2009. The figures for 2009 include only
April through December production. |
|
| (2) | These figures correspond to our participation of 61.2% in Integra Coal, a joint venture
constituted as a partnership. |
|
| (3) | These figures correspond to our participation of 50% in Isaac Plains, a joint venture
constituted as a partnership. |
|
| (4) | These figures correspond to our participation of 80% in Carborough Downs, a joint venture
constituted as a partnership. |
57
Table of Contents
| Operation: | Mine type | |
El Hatillo(1) |
open pit | |
Integra Coal(2) |
Underground and open pit | |
Isaac Plains(3) |
open pit | |
Carborough Downs(4) |
Underground | |
Broadlea |
open pit |
| (5) | Vale acquired El Hatillo on the first quarter of 2009. The figures for 2009 include only
April through December production. |
|
| (6) | These figures correspond to our participation of 61.2% in Integra Coal, a joint venture
constituted as a partnership. |
|
| (7) | These figures correspond to our participation of 50% in Isaac Plains, a joint venture
constituted as a partnership. |
|
| (1) | These figures correspond to our participation of 80% in Carborough Downs, a joint venture
constituted as a partnership. |
Longyu produces coal and other related products. Yankuang, a metallurgical coal mine, has a
production capacity of 2 million metric tons of coal per year and 200,000 metric tons of methanol
per year.
A.7.3 Market Characteristics
Coal sales at our operations in Australia are basically geared towards the oriental Asian market.
In 2010, 32% of our sales were made to Japanese steel plants and power plants. In 2010, our Chinese
coal joint ventures concentrated their sales mostly in the domestic Chinese market. Coal sales from
our operations in Colombia were basically geared towards Europe and United States.
A.7.4 Competition
The global coal industry, basically made up by the metallurgical and thermal coal markets, is
highly competitive. The growing demand for steel, particularly in Asia, continues to promote a
strong demand for metallurgical coal. Significant port and railroad limitations in some of the
countries where our main providers are located may lead to a limited availability of metallurgical
coal.
The global transoceanic market has expanded significantly in the last few years. The growing demand
for thermal coal is closely related to an increased consumption of electricity, which will continue
to grow driven by economic growth, particularly among emerging economies. Current large fleets of
coal-powered plants with long life cycles take decades to be replaced or updated and this makes the
presence of metallurgical coal in the energy matrix to continue to be very high in countries with
high levels of consumption. As a rule, fuel cost is the most significant variable cost involved in
the generation of electricity and coal is currently the cheapest fossil fuel that can be used for
this purpose.
Competition in the coal industry is based mostly in production cost savings, coal quality, and
transportation cost. We believe that our operations and our portfolio of projects are competitive;
other strong points of our group include the geographical location of the current and future
location of providers and production costs with regard to several other coal producers.
The main participants in the transoceanic market are subsidiaries and affiliates of Xstrata PLC,
BMA (BHP Billiton Mitsubishi Alliance), PT Bumi Resources Tbk., Anglo Coal, Drummond Company, Inc.,
Rio Tinto Ltd., Teck Cominco, Peabody and the Shenhua Group.
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B. Base Metals:
B.1 Nickel
B.1.1 Production Process
We conduct our nickel operations primarily through our wholly owned subsidiary Vale Canada. Vale
Canada operates two nickel production systems, one in North America and Europe and the other in
Asia and the South Pacific. We recently commissioned and launched the ramp-up
of Onça Puma, a new nickel plant in the state of Pará. The operations are listed in the table
below.
| System | Locations | Operations | ||
North America & Europe
|
Canada — Sudbury, Ontario | Fully integrated mines, mill, smelter and refinery (producer of intermediates and finished nickel and by-products) | ||
| Canada — Thompson, Manitoba | Fully integrated mines, mill, smelter and refinery (producer of finished nickel and by-products) | |||
| Canada — Voisey Bay, Newfoundland and Labrador | Mine and mill (producer of nickel concentrates and by-products) | |||
| U.K. — Clydach, Wales | Stand-alone nickel refinery (producer of finished nickel) | |||
Asia & the South Pacific
|
Indonesia — Sorowako, Sulawesi(1) | Mining and processing operations (producer of nickel matte, an intermediate product) | ||
| New Caledonia — Southern Province (2) | Mining and processing operations (producer of nickel oxide and cobalt) | |||
| Japan — Matsuzaka(3) | Stand-alone nickel refinery (producer of finished nickel) | |||
| Taiwan — Kaoshiung(4) | Stand-alone nickel refinery (producer of finished nickel) | |||
| China — Dalian, Liaoning(5) | Stand-alone nickel refinery (producer of finished nickel) | |||
| South Korea — Onsan(6) | Stand-alone nickel refinery (producer of finished nickel) | |||
South Atlantic
|
Brazil — Ourilândia do Norte, Pará | Mining and processing operations (producer of ferronickel) |
| (1) | Operations conducted through our 59.2%-owned subsidiary PT International Nickel Indonesia
Tbk. |
|
| (2) | Operations conducted though our 74%-owned subsidiary Vale Nouvelle-Calédonie S.A.S. |
|
| (3) | Operations conducted through our 87.2%-owned subsidiary Vale Japan Limited. |
|
| (4) | Operations conducted through our 49.9%-owned subsidiary Taiwan Nickel Refining Corporation. |
|
| (5) | Operations conducted through our 98.3%-owned subsidiary Vale Nickel (Dalian) Co. Ltd. |
|
| (6) | Operations conducted through Korea Nickel Corporation (company in which we have a 25%
interest). |
North Atlantic
Sudbury Operations
Our long-established mines in Sudbury, Ontario, are primarily underground operations with nickel
sulfide ore bodies. These ore bodies also contain co-deposits of copper, cobalt, PGMs, gold and
silver. We have integrated mining, milling, smelting and refining operations to process ore into
finished nickel at Sudbury. We also smelt and refine nickel concentrates from our Voisey Bay
operations. We ship a nickel intermediate product, nickel oxide, from our Sudbury smelter to our
nickel refineries in Wales, Taiwan, China and South Korea for processing into finished nickel. In
2010, we produced 9% of the electric energy consumed in Sudbury at our hydroelectric power plants
there. The remaining electricity was purchased from Ontario’s provincial electricity grid.
In February, 2011, we shut down one of our furnaces in our smelter at Sudbury due to an operational
problem. The furnace will remain out of commission for 16 weeks, and as a result, we have sustained
a drop of 15,000 metric tons in the production of finished nickel.
In July 2010, a new five-year collective agreement was confirmed by representatives of production
and maintenance workers in Sudbury and Port Colborne. This agreement marked the end to a strike
that had started in July of 2009.
Thompson operations
Our long-established mines in Thompson, Manitoba, are primarily underground operations with nickel
sulfide ore bodies. The ore bodies also contain co-deposits of copper and cobalt. We have
integrated mining, milling, smelting and refining operations to process ore into finished nickel at
Thompson. We also smelt and refine an intermediate product, nickel concentrate, from our Voisey
Bay operations. Low-cost energy is available from purchased hydroelectric power at our Thompson
operations.
We are changing our operations in Thompson towards mining and processing operations eliminating
smelting and finishing operations until 2015. This will allow us to better align our processing
capabilities with our mineral reserves and observe our environmental commitments. The mineral
reserves at Thompson are not enough to run a full capacity smelting and finishing operation and do
not support the significant capital investment required pursuant to new federal regulations
regarding sulphur dioxide emissions which must go into effect in 2015.
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Voisey Bay operations
Our Voisey Bay operation in Newfoundland and Labrador is comprised of Ovoid, an open-pit mine, and
deposits with the potential for underground operations at a later stage. We mine nickel sulfide
ore bodies, which also contain co-deposits of copper and cobalt. We mill Voisey Bay ore on site
and ship it as an intermediate product (nickel concentrates) primarily to our Sudbury and Thompson
operations for final processing (smelting and refining). The electricity requirements of our
Voisey Bay operations are supplied through diesel generators.
On January 31, 2011, we ratified a five-year collective bargaining agreement with our unionized
employees at our Voisey Bay operations. This agreement marked the end of a strike that had started
in August, 2009.
Clydach Operations
Clydach is a stand-alone nickel refinery in the U.K. that processes a nickel intermediate product,
nickel oxide, supplied from our operations to produce finished nickel in the form of powders and
pellets.
Asia Pacific
Sulawesi operations
Our subsidiary PT International Nickel Indonesia (PTI) operates open pit mines and a processing
facility in Sorowako on the Island of Sulawesi, Indonesia. PTI mines nickel laterite saprolite ore
and produces an intermediate product (nickel matte), which is shipped primarily to our nickel
refinery in Japan. Pursuant to life-of-mine off-take agreements, PTI sells 80% of its production
to our wholly owned subsidiary Vale Canada and 20% of its production to Sumitomo Metal Mining Co.,
Ltd. (“Sumitomo”). PTI is a public company whose shares are traded on the Indonesia Stock
Exchange. We hold 59.2% of its share capital, Sumitomo holds 20.1%. Other 20.1% is publicly held
and 0.6% is held by other stockholders.
Energy costs are a significant component of our nickel production costs for the processing of
lateritic and saprolite ores at our PTI operations in Indonesia. A major part of the electric
furnace power requirements of PTI is supplied at low cost by its two hydroelectric power plants on
the Larona River, Larona and Balambano. PTI has thermal generating facilities in order to
supplement its hydroelectric power supply with a source of energy that is not subject to
hydrological factors. In 2010, the hydroelectric power plants provided 90% of the electric energy
consumed at our Indonesian operations, and oil-powered generators provided the remainder.
Asian refinery operations
Our subsidiary (in which we hold an 87.2 participation),Vale Japan Limited, operates a refinery in
Matsuzaka, which produces intermediate and finished nickel products, primarily using nickel matte
sourced from PTI. Vale Japan is a private company controlled by Vale. A minority interest is held
by Sumitomo (12.8%).
We also operate or have investments in nickel refining operations in Taiwan through our 49.9% stake
in Taiwan Nickel Refining Corporation (“TNRC”), China through our 98.3% interest in Vale Nickel
(Dalian) Co. Ltd. (“VNDC”) and South Korea through our 25% stake in Korea Nickel Corporation
(“KNC”). TNRC, VNDC and KNC produce finished nickel for the local stainless steel industry in
Taiwan, China and South Korea, primarily using intermediate products containing about 75% nickel
(in the form of nickel oxide) from Vale Japan and our Sudbury operations.
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New Caledonia operations
The commissioning stage of our VNC nickel operation in New Caledonia in the South Pacific is
practically complete. VNC uses a High Pressure Acid Leach (“HPAL”) process to treat laterite ores.
We expect to reach a nominal production capacity of 60,000 metric tons per year of nickel contained
in nickel oxide and 4,600 metric tons of cobalt in three years, and therefore, the production of
nickel oxide was initiated. In order to speed up the generation of revenue, the nickel solution
resulting from the HPAL is being transformed into an intermediate product, Nickel Hydroxide Cake
(NHC), which is being sold to clients.
South Atlantic
The commissioning stage of Onça Puma was already concluded and we already started the ramp-up
period in Ourilândia do Norte, in the state of Pará. Onça Puma is a nickel mine built over a large
deposit of laterite saprolite nickel and it has a nominal production capacity of 53,000 metric tons
of nickel, in ferronickel, its final product.
B.1.2 Production
The following table sets forth our annual mine production by operating mine (or on an aggregate
basis for PTI because it has mining areas rather than mines) and the average percentage grades of
nickel and copper. The mine production at PTI represents the product from PTI’s dryer kilns
delivered to PTI’s smelting operations and does not include nickel losses due to smelting. For our
Sudbury, Thompson and Voisey Bay operations, the production and average grades represent the mine
product delivered to those operations’ respective processing plants and do not include adjustments
due to beneficiation, smelting or refining. The following table sets forth information about ore
production at our nickel mining sites.
| 2008 | 2009 | 2010 | ||||||||||||||||||||||||||||||||||
| (thousands of metric tons, except percentages) | ||||||||||||||||||||||||||||||||||||
| Grade | Grade | Grade | ||||||||||||||||||||||||||||||||||
| % | % | % | % | % | % | |||||||||||||||||||||||||||||||
| Production | Copper | Nickel | Production | Copper | Nickel | Production | Copper | Nickel | ||||||||||||||||||||||||||||
Ontario operating mines |
||||||||||||||||||||||||||||||||||||
Copper Cliff North |
1.165 | 1,01 | 1,01 | 524 | 0,96 | 1,06 | 326 | 1,13 | 1,13 | |||||||||||||||||||||||||||
Copper Cliff South(1) |
771 | 1,67 | 1,48 | 78 | 1,45 | 1,40 | — | — | — | |||||||||||||||||||||||||||
Creighton |
1.001 | 1,56 | 2,14 | 395 | 1,57 | 1,82 | 426 | 2,65 | 3,10 | |||||||||||||||||||||||||||
Stobie |
2.892 | 0,65 | 0,72 | 1.198 | 0,64 | 0,72 | 775 | 0,59 | 0,69 | |||||||||||||||||||||||||||
Garson |
840 | 1,72 | 1,69 | 328 | 1,93 | 1,45 | 246 | 2,16 | 1,60 | |||||||||||||||||||||||||||
Coleman |
1.425 | 2,66 | 1,62 | 624 | 3,28 | 1,64 | 786 | 2,74 | 1,73 | |||||||||||||||||||||||||||
Gertrude |
124 | 0,29 | 0,72 | — | — | — | — | — | — | |||||||||||||||||||||||||||
Total Ontario operations |
— | — | — | — | — | — | 86 | 0,56 | 0,75 | |||||||||||||||||||||||||||
Manitoba operating mines |
— | — | — | — | — | — | 16 | 2,54 | 1,74 | |||||||||||||||||||||||||||
Thompson |
8.219 | 1,36 | 1,26 | 3.145 | 1,49 | 1,19 | 2.660 | 1,78 | 1,53 | |||||||||||||||||||||||||||
Birchtree |
1.165 | 1,01 | 1,01 | 524 | 0,96 | 1,06 | 326 | 1,13 | 1,13 | |||||||||||||||||||||||||||
Total Manitoba operations |
771 | 1,67 | 1,48 | 78 | 1,45 | 1,40 | — | — | — | |||||||||||||||||||||||||||
Voisey Bay operating mines |
1.001 | 1,56 | 2,14 | 395 | 1,57 | 1,82 | 426 | 2,65 | 3,10 | |||||||||||||||||||||||||||
Ovoid |
2.892 | 0,65 | 0,72 | 1.198 | 0,64 | 0,72 | 775 | 0,59 | 0,69 | |||||||||||||||||||||||||||
Total Voisey Bay operations |
840 | 1,72 | 1,69 | 328 | 1,93 | 1,45 | 246 | 2,16 | 1,60 | |||||||||||||||||||||||||||
Sulawesi operating mining areas |
1.425 | 2,66 | 1,62 | 624 | 3,28 | 1,64 | 786 | 2,74 | 1,73 | |||||||||||||||||||||||||||
Sorowako |
124 | 0,29 | 0,72 | — | — | — | — | — | — | |||||||||||||||||||||||||||
Pomalaa (2) |
— | — | — | — | — | — | 86 | 0,56 | 0,75 | |||||||||||||||||||||||||||
Total Sulawesi operations |
— | — | — | — | — | — | 16 | 2,54 | 1,74 | |||||||||||||||||||||||||||
Mine operations in New Caledonia
|
||||||||||||||||||||||||||||||||||||
VNC |
— | — | — | — | — | — | 326 | — | 1,31 | |||||||||||||||||||||||||||
New Caledonia
total operations |
— | — | — | — | — | — | 326 | — | 1,31 | |||||||||||||||||||||||||||
Mine operations in Brazil
Onça Puma |
— | — | — | — | — | — | 1.259 | — | 1,93 | |||||||||||||||||||||||||||
Total operations in Brazil |
— | — | — | — | — | — | 1.259 | — | 1,93 | |||||||||||||||||||||||||||
| (1) | This mine has been closed indefinitely since January 2009. |
|
| (2) | This mine has been closed indefinitely since May 2008. |
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The following table sets forth information about our nickel production, including: (i) nickel
refined through our facilities, (ii) nickel further refined into specialty products, and (iii)
intermediates designated for sale. The numbers below are reported on an ore-source basis.
| Production for fiscal year ending December 31 | ||||||||||||||
| Mine | Type | 2008 | 2009 | 2010 | ||||||||||
| (Thousands of metric tons) | ||||||||||||||
Sudbury (1) |
Underground | 85.3 | 43.6 | 22.4 | ||||||||||
Thompson (1) |
Underground | 28.9 | 28.8 | 29.8 | ||||||||||
Voisey Bay (2) |
Open pit | 77.5 | 39.7 | 42.3 | ||||||||||
Sorowako (3) |
Open pit | 68.3 | 68.8 | 78.4 | ||||||||||
External (4) |
— | 15.4 | 5.8 | 5.9 | ||||||||||
Total (5) |
275.4 | 186.7 | 178.7 | |||||||||||
| (1) | Primary nickel production only (i.e., does not include secondary nickel from unrelated
parties). |
|
| (2) | Includes finished nickel produced at our Sudbury and Thompson operations, as well as some
finished nickel produced by unrelated parties under toll-smelting and toll-refining
arrangements. |
|
| (3) | We have a 59.2% interest in PTI, which owns the Sorowako mines, and these figures include the
minority interests. |
|
| (4) | Finished nickel processed at our facilities using feeds purchased from unrelated parties. |
|
| (5) | Excludes finished nickel produced under toll-smelting and refining arrangements covering
purchased intermediates with unrelated parties. Unrelated-party tolling of purchased
intermediates was 7.5 thousand metric tons in 2008, 5.2 thousand metric tons in 2009 and none
in 2010. |
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B.1.3 Market Characteristics
Our nickel customers are broadly distributed on a global basis. In 2010, 71% of our total nickel
sales were delivered to customers in Asia, 19% to North America, 9% to Europe and 1% to customers
in other markets. We have short-term fixed-volume contracts with customers for the majority of our
expected annual nickel sales. These contracts generally provide stable demand for a significant
portion of our annual production.
Nickel is an exchange-traded metal, listed on the London Metal Exchange (“LME”), and most nickel
products are priced according to a discount or premium to the LME price, depending on the nickel
product’s physical and technical characteristics. Our finished nickel products represent what is
known in the industry as “primary” nickel, meaning nickel produced principally from nickel ores (as
opposed to “secondary” nickel, which is recovered from recycled nickel-containing material).
Finished primary nickel products are distinguishable in terms of the following characteristics,
which determine the product price level and the suitability for various end-use applications:
| • | Nickel content and purity level: (i) intermediates with various levels of nickel content, (ii)
nickel pig iron has 1.5-6% nickel, (iii) ferro-nickel has 10-40% nickel, (iv) standard LME grade
nickel has a minimum of 99.8% nickel, and (v) high purity nickel has a minimum of 99.9% nickel and
does not contain specific elemental impurities; |
|
| • | Shape (such as pellets, discs, squares, strips and foams); and |
|
| • | Size. |
In 2010, the principal end-use applications for nickel were:
| • | Austenitic stainless steel (64% of global nickel consumption); |
|
| • | Non-ferrous alloys, alloy steels and foundry applications (18% of global nickel consumption); |
|
| • | Nickel plating (9% of global nickel consumption); and |
|
| • | Specialty applications, such as batteries, chemicals and powder metallurgy (9% of global nickel
consumption). |
In 2010, 65% of our refined nickel sales were made into non-stainless steel applications, compared
to the industry average for primary nickel producers of 36%. As a result of our focus on such
higher-value segments, our average realized nickel prices for refined nickel have constantly
exceeded LME cash nickel prices.
We offer sales and technical support to our customers on a global basis. We have a
well-established global marketing network for finished nickel, based at our head office in Toronto,
Canada. We also have sales offices in St. Prex (Switzerland), Saddle Brook, New Jersey (United
States), London (England), Tokyo (Japan), Hong Kong, Shanghai (China), Kaohsiung (Taiwan), Bangkok
(Thailand) and Bridgetown (Barbados).
B.1.4 Competition
The global nickel market is highly competitive. Our key competitive strengths include our
long-life mines, our low production costs compared to other nickel producers, sophisticated
exploration and processing technologies, along with a diversified portfolio of products. Our
global marketing reach, diverse product mix, and technical support direct our products to the
applications and geographic regions that offer the highest margins for our products.
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Our nickel deliveries, which were impacted by strikes in our units in Canada, represented 12% of
global consumption for primary nickel in 2010. In addition to us, the largest suppliers in the
nickel industry (each with their own integrated facilities, including nickel mining, processing,
refining and marketing operations) are: Mining and Metallurgical Company Norilsk Nickel, Jinchuan
Nonferrous Metals Corporation, BHP Billiton plc and Xstrata plc. Together with us, these companies
accounted for about 53% of global finished primary nickel production in 2010.
While stainless steel production is a major driver of global nickel demand, stainless steel
producers can use nickel products with a wide range of nickel content, including secondary nickel
(scrap). The choice between primary and secondary nickel is largely based on their relative prices
and availability. In recent years, secondary nickel has accounted for about 42-49% of total nickel
used for stainless steels, and primary nickel has accounted for about 51-58%. In 2006, a new
primary nickel product entered the market, known as nickel pig iron. This is a low-grade nickel
product made in China from imported lateritic ores (primarily from the Philippines and Indonesia)
that is suitable primarily for use in stainless steel production. With nickel being sold at higher
prices and a strong demand from the stainless steel industry, domestic production of nickel pig
iron has experienced ongoing growth in China. It is estimated that in 2010, Chinese production of
nickel pig iron and ferro-nickel exceeded 150,000 metric tons, representing 11% of world primary
nickel supply.
Competition in the nickel market is based primarily on quality, reliability of supply and price.
We believe our operations are competitive in the nickel market because of the high quality of our
nickel products and our relatively low production costs.
B. 2 Copper
B.2.1 Production Process
We operate our copper businesses in Brazil at the parent-company level and through our wholly-owned
subsidiaries in Canada and Chile.
| Vale’s participation | ||||||||||||
| Firm | Location | Voting | Total | |||||||||
| (%) | ||||||||||||
Vale |
Brasil | — | — | |||||||||
Vale Canada |
Canada | 100.0 | 100.0 | |||||||||
Tres Valles |
Chile | 100.0 | 90.0 | |||||||||
Operations in Brazil
The Sossego mine, in Carajás, state of Pará, has two main copper areas, Sossego and Sequeirinho.
The copper mine is operated using the open pit method and ROM ore is processed through primary
crushing and transportation, SAG grinding (a semi automatic grinder that uses a large rotatory drum
filled with ore, water and steel grinding spheres that transform the ore into a soft paste),
grinding, fluctuation of copper in concentrate, elimination of waste, concentrate thickener,
filtration and discharge. The concentrate is transported by truck to the storage terminal in
Parauapebas and, immediately, and transferred via Carajás Railroad (EFC) to the maritime terminal
in Ponta da Madeira, in São Luís, Maranhão.
We built an 85 km road to connect Sossego to the railroad and aiport facilities in Carajás and a
power line that allows us to purchase electricity at market prices. We have a long-term power
distribution agreement with Eletronorte.
Operations in Canada
In Canada, we’d recover copper along with our nickel operations, mostly in Sudbury and Voisey Bay.
In Sudbury, we produce two intermediate copper products: copper concentrates and copper anodes and
we also produce electrolytic copper cathodes as a by-product of our nickel finishing plants. In
Voisey Bay, we produce copper concentrate.
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Operations in Chile
In December 2010, we launched the ramp up process in our Tres Valles copper mine, our first project
in Chile. Located in Salamanca, in the Coquimbo region, the plant has an estimated annual capacity
of 18,500 tons of copper cathodes (metal plates) and it is our first industrial scale cathode plant
to use a hydrometallurgical process. Operations in Tres Valles include two copper oxide mines: Don
Gabriel, an open pit mine, and Papomono, an underground mine, as well as a SX-EW processing plant
that produces copper cathodes.
B.2.2 Production
The following table provides information about our production of copper.
| Production during fiscal year ending December 31 | ||||||||||||||||
| Mine | Type | 2008 | 2009 | 2010 | ||||||||||||
| (million metric tons) | ||||||||||||||||
Brazil: |
||||||||||||||||
Sossego |
Open pit | 126 | 117 | 117 | ||||||||||||
Canada: |
||||||||||||||||
Sudbury |
Underground | 115 | 42 | 34 | ||||||||||||
Voisey Bay |
Open pit | 55 | 24 | 33 | ||||||||||||
Thompson |
Underground | 1 | 1 | 1 | ||||||||||||
Externo (1) |
— | 14 | 14 | 22 | ||||||||||||
Total |
312 | 198 | 207 | |||||||||||||
| (1) | We process copper in our facilities using third party resources. |
B.2.3 Market Characteristics
The copper concentrate from Sossego is sold under mid and long-term contracts executed with copper
smelting plants in South America, Europe and Asia. We have long-term sale agreements to sell the
entire first production phase of Salobo copper concentrate to smelting plants. We have long-term
distribution agreements with Xstrata Copper Canada, to sell cathode copper and a significant part
of copper concentrates produced in Sudbury. Copper concentrate from Voisey Bay is sold through
mid-term agreements with clients in Europe. Electrolytic copper from Sudbury is sold in North
America through short-term sale agreement.
B.2.4 Competition
The cathode copper global market is highly competitive. It is produced by mining companies and
smelting plants spanning worldwide, while customers are mostly producers of copper wires, rods and
alloy. Competition takes place mostly at a regional level, and it is based mostly in product cost,
quality, distribution reliability and logistics costs. The largest cathode copper producers in the
world are Codelco, Aurubis, Freeport-McMoRan, Jiangxi and Xstrata, operating at the parent company
level or through subsidiaries. Our participation in the global copper market is negligible.
Copper concentrate and copper anodes are intermediate products in the copper production chain. Both
the concentrate and anode markets are competitive, with several producers, but fewer participants
and smaller volumes than the cathode copper market due to the high levels of integration of large
copper producers.
In the copper concentrate market, the main producers are mining companies located in South America
and Indonesia, while the consumers are smelting plants located in Europe and Asia. Competition in
the copper concentrate market takes place mostly at a global level, and it is based mostly in
product cost, quality, logistics costs and distribution reliability. Main competitors in the copper
concentrate market are Freeport-McMoRan, BHP Billiton, Rio Tinto and Xstrata, operating at a parent
company level and through subsidiaries. Our market share in 2010 was approximately 2.6% of the
total copper concentrate market.
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The copper anode/blister market is very limited in the copper industry. In general, anodes are
produced to supply the integrated refining of every company. Anode/blister trade is limited to
facilities that have more smelting capacity than what the plant can handle or the financial
situation regarding logistics costs is an incentive to purchase anodes from other smelting plants.
The main competitors in the anode market are Codelco, Anglo American and Xstrata, operating at a
parent company level or through its subsidiaries.
B.2.5. Seasonality of the nickel and copper markets
Among the metals produced by Vale, there is seasonal demand for nickel and copper. Nickel demand is
usually lower in the third quarter and copper demand is low during the entire second half of the
year.
B.3 Aluminum
In 2010, we refined alumina through our subsidiary, Alunorte, and smelted aluminum through our
subsidiary, Albras, as part of our aluminum operations. Alunorte produced alumina by refining
bauxite supplied from the MRN and Paragominas mines. Albras produced aluminum using alumina
supplied by Alunorte. Our aluminum production facilities were located in Pará. Furthermore, we had
a participation in a project to build a new alumina refinery plant through our subsidiary, CAP. In
several related transactions executed in February of 2011, we transferred our participation in
Albras, Alunorte and CAP, among other items, to Hydro. We are still joined to those aluminum
operations through a participation of 22.0% in Hydro which we received as compensation.
B.4 Bauxite
B.4.1 Production Process
We also conduct our bauxite operations through a 40% participation in MRN and through a 40%
participation in Paragominas, both located in Brazil.
| • | MRN. MRN, located in the state of Pará, northern Brazil, is one of the largest bauxite
operations in the world and operates four open pit bauxite mines that produce high quality
bauxite. Furthermore, MRN controls substantial additional reserves of high quality bauxite
which will be converted into reserves after obtaining final environmental licenses. MRN
also operates facilities for beneficiation of ore in its mines, which are linked by rail
to the loading terminal and port facilities on the Trombetas River, a tributary of the
Amazon River, through which ships of up to 60,000 DWT (deadweight) can sail. MRN owns and
operates the railroad and port facilities which serve their mines. The MRN bauxite mines
are accessible by road from the port area and are powered by its own thermoelectric plant. |
| • | Paragominas. Paragominas mine, located in the state of Pará, began operating in the
first quarter of 2007 in order to supply the Alunorte’s alumina refinery. The first
expansion project of Paragominas (Paragominas II) was completed in the second quarter of
2008. The mine produces bauxite with 12% moisture content and the quality of the bauxite
is similar to that of MRN. In Paragominas there is a beneficiation plant and 244 km
pipeline to transport ore slurry. Electricity in Paragominas is provided by Eletronorte, a
Brazilian state-run power generation plant. In 2010, we transferred the Paragominas
bauxite mine and all its rights to bauxite exploration (with the exception of rights
derived from our participation in Mineração Rio do Norte S.A.) to a new company, from
which we will transfer 60.0% to Hydro in exchange for US$578 million in cash in February
2011. We will transfer the remaining 40.0% of our joint venture in two equal amounts, in
2013 and 2015 each for US$200 million in cash. |
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The following table presents information on Vale’s bauxite ore production.
| Production for fiscal year ending December 31 |
Recovery | |||||||||||||||||
| Mine (1) | Type | 2008 | 2009 | 2010 | Rate | |||||||||||||
| (million metric tons) | (%) | |||||||||||||||||
MRN |
||||||||||||||||||
Almeidas |
Open pit | 3.6 | 2.2 | 1.3 | — | |||||||||||||
Aviso |
Open pit | 14.5 | 13.5 | 15.2 | — | |||||||||||||
Saracá V |
Open pit | 2.3 | 0.9 | 0.7 | — | |||||||||||||
Saracá W |
Open pit | 3.9 | 4.1 | 4.2 | — | |||||||||||||
Bacaba |
Open pit | — | — | 0.4 | ||||||||||||||
Total MRN |
24.2 | 20.7 | 21.8 | 72-77 | ||||||||||||||
Paragominas
Miltonia 3 |
Open pit | 7.3 | 10.1 | 10.8 | 60 | |||||||||||||
| (1) | This figures represent ROM production. |
The following table presents information about Vale’s bauxite production.
| Production for fiscal year ending | ||||||||||||||||||
| December 31 | Recovery | |||||||||||||||||
| Mine | Type | 2008 | 2009 | 2010 | Rate | |||||||||||||
| (million metric tons) | (%) | |||||||||||||||||
MRN |
Open pit | 18.1 | 15.6 | 17.0 | 72-77 | |||||||||||||
Paragominas |
Open pit | 4.4 | 6.2 | 7.5 | 60-64 | |||||||||||||
B.5. PGM and other precious metals
B.5.1 Production Process
As by-products of our Sudbury nickel operations in Canada, we recover significant quantities of
PGMs, as well as small quantities of gold and silver. We operate a processing facility in Port
Colborne, Ontario, which produces PGMs, gold and silver intermediate products. We have a refinery
in Acton, England, where we process our intermediate products, as well as feeds purchased from
unrelated parties and toll-refined materials. In 2010, PGM concentrates from our Sudbury
operations supplied about 8% of our PGM production, which also includes precious metals purchased
from unrelated parties and toll-refined materials). Our base metal commercial department sells our
PGMs and other precious metals, as well as unrelated parties and toll-refined products, on
commission.
The following table presents information on production of the Company’s precious metals.
| Mine (1) | Type | 2008 | 2009 | 2010 | ||||||||||
| (Thousand troy ounces) | ||||||||||||||
Sudbury: |
||||||||||||||
Platinum |
Underground | 166 | 103 | 35 | ||||||||||
Palladium |
Underground | 231 | 152 | 60 | ||||||||||
Gold |
Underground | 85 | 49 | 42 | ||||||||||
| (1) | Production figures exclude precious metals purchased from unrelated parties and toll-refined
materials. |
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B.6 Cobalt
B.6.1 Production Process
We recover significant quantities of cobalt as a by-product of our Canadian nickel operations. In
2010, we produced 438 metric tons of refined cobalt metal at our Port Colborne refinery and 499
metric tons of cobalt in a cobalt-based intermediate at our Thompson nickel operations in Canada.
Our remaining cobalt production consisted of 129 metric tons of cobalt contained in other
intermediate products (such as nickel concentrates). We expect to increase our production of cobalt
as we increase nickel production in New Caledonia, at the VNC operations, because the nickel
laterite ore at this location contains significant co-deposits of cobalt.
We sell cobalt on a global basis. Our cobalt metal, which is electro-refined at our Port Colborne
refinery, has very high purity levels (99.8%). Cobalt metal is used in the production of various
alloys, particularly for aerospace applications, as well as the manufacture of cobalt-based
chemicals.
The following table sets forth information on our cobalt production.
| Production for fiscal year ending December 31 | ||||||||||||||
| Mine | Type | 2007 | 2008 | 2009 | ||||||||||
| (Metric tons) | ||||||||||||||
Sudbury |
Underground | 804 | 359 | 302 | ||||||||||
Thompson |
Underground | 168 | 181 | 189 | ||||||||||
Voisey Bay |
Open pit | 1,695 | 971 | 524 | ||||||||||
External (1) |
— | 161 | 64 | 51 | ||||||||||
Total |
2,828 | 1,575 | 1,066 | |||||||||||
| (1) | These figures do not include unrelated-party tolling of feeds purchased from unrelated
parties. |
C. Fertilizers
C.1 Phosphates
C.1.1 Production Process
In 2010, we acquired the assets of fertilizantes in Brazil, consolidated into Vale Fertilizantes,
and we launched phosphate rock operations in Peru through our subsidiary, MVM Resources
International, B.V. We operate our phosphate activities through our subsidiaries and joint
ventures, as indicated in the table below.
| Vale’s participation | ||||||||||||||
| Firm | Location | Voting | Total | Our partners | ||||||||||
| (%) | ||||||||||||||
Vale Fertilizantes |
Uberaba, Brasil | 99.9 | % | 84.3 | % | — | ||||||||
MVM Resources
International, B.V |
Bayóvar, Peru | 51 | 40 | Mosaic, Mitsui & Co. | ||||||||||
Vale Fertilizantes is a company that produces phosphate rock, phosphate fertilizers (P),
(monoammonium phosphate (MAP), diammonium phosphate (DAP), triple superphosphate (TSP) and single
superphosphate (SSP)) and nitrogen (“N”) fertilizers (e.g., ammonium nitrate and urea). It is the
largest producer of phosphate and nitrogren crop nutrients in Brazil and operates the following
phosphate rock mines: Catalão, in the state of Goiás, Tapira and Patos de Minas and Araxá, all of
them in the state of Minas Gerais, and Cajati, in the state of Sao Paulo. In addition, Vale
Fertilizantes has nine processing plants for the production of phosphate and nitrogen nutrients
located in Catalão, Goiás; Araxá and Uberaba, in Minas Gerais; Guará, Cajati, and three plants in
Cubatão, in Sao Paulo, and Araucaria, in Parana. In addition to Vale Fertilizer’s phosphate and
nitrogen operations, starting in 2010, we started operating the Bayovar phosphate rock, in Peru,
which should achieve a nominal production capacity of 3.9 million metric tons per year until 2014.
Bayovar has high grade resources with a low phosphate rock production cost.
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The following table contains information regarding Vale’s phosphate rock production.
| Production for fiscal | ||||||
| year ending December | ||||||
| Mine | Type | 31, 2010 | ||||
| (million metric tons) | ||||||
Bayóvar |
Open pit | 791 | ||||
Catalão |
Open pit | 626 | ||||
Tapira |
Open pit | 2,068 | ||||
Patos de Minas |
Open pit | 43 | ||||
Araxá |
Open pit | 1,182 | ||||
Cajati |
Open pit | 545 | ||||
Total |
5,255 | |||||
The following table contains information regarding Vale’s phosphate and nitrogen production.
| Production for fiscal year ending | ||||
| Firm/product | December 31, 2010 | |||
| (million metric tons) | ||||
Fosfato monoamônio (MAP) |
898 | |||
Superfosfato triplo (TSP) |
788 | |||
Superfosfato simples (SSP) |
2,239 | |||
Fosfato bicálcico (DCP) |
491 | |||
Amônia |
508 | |||
Ureia |
511 | |||
Ácido nítrico |
454 | |||
Nitrato de amônio |
447 | |||
C.2 Potash
C.2.1. Production Process
We conduct potash operations in Brazil at the parent-company level. We lease Taquari-Vassouras,
the only potash mine in Brazil (in Rosario do Catete, in the state of Sergipe), from Petrobras —
Petróleo Brasileiro S.A. The lease, signed in 1991, became effective in 1992 for a period of 25
years. The following table sets forth information on our potash production.
| Production for fiscal year ending | ||||||||||||||||||
| December 31 | Recovery | |||||||||||||||||
| Mine | Type | 2008 | 2009 | 2010 | rate | |||||||||||||
| (Thousands of metric tons) | (%) | |||||||||||||||||
Taquari-Vassouras |
Underground | 607 | 717 | 662 | 85.7 | |||||||||||||
C.3 Market Characteristics
All potash sales from the Taquari-Vassouras mine are to the Brazilian market. in 2010, our
production represented close to 9% of total potash consumption in Brazil. We have a strong
presence and long-standing relationships with the major players in Brazil, with more than 66% of
our sales allocated to four traditional clients.
Our phosphate products are sold to be used in fertilizer blenders and cooperatives. In 2010, Vale’s
production represented near 34% of the total phosphate consumption in Brazil, with imports
representing a 44% of total supply. In the high concentration segment, Vale supplied over 36% of
total consumption in Brazil, with products such as monoammonium phosphate (MAP), diammonium
phosphate (DAP) and triple superphosphate (TSP). In the low concentration nutrients segment, Vale’s
production represented near 45% of total consumption in Brazil.
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C.4 Competition
Fertilizers have a strong demand growth potential, which is anchored in market fundamentals similar
to those underlying the global demand for minerals, metals and energy. Rapid per capita income
growth of emerging economies causes diet changes towards an increasing intake of proteins that
ultimately contribute to boost fertilizer use. More recently, global output of biofuels has
started to boom as they emerged as an alternative source of energy to reduce world reliance on
sources of climate-changing greenhouse gases. Given that key inputs for the production of biofuels
— sugar cane, corn and palm — are intensive in the use of fertilizers, they are becoming another
major driver of the global demand for crop nutrients.
The industry is divided into three major groups of nutrients: potash, phosphate and nitrogen.
There are limited resources of potash around the world with Canada, Russia and Belarus being the
most important sources. Due to the lack of resources, the high level of investment and the long
time for a project to mature, it is unlikely that other regions will emerge as major potash
producers. In addition, the potash industry is highly concentrated, with the 10 largest producers
representing over 95% of the total global production capacity. While potash is a very scarce
resource, phosphate is more available, but all major exporters are located in the northern region
of Africa (Morocco, Algeria and Tunisia) and in the United States. The five largest producers of
phosphate rock (China, Morocco, Russia and India) hold 80% of global production, of which a maximum
of 20% is exported. Meanwhile, products with great added value, such as MAP and DAP are marketed
instead of phosphate rock, due to cost-benefit relationship.
Brazil is one of the largest agribusiness markets in the world due to its high production and
consumption of grains and biofuel. It is the fourth-largest consumer of fertilizers in the world
and one of the largest importers of phosphates, potash, urea and phosphoric acid. Brazil imports
91% of its potash, which corresponds to 5.2 million metric tons per year of KCL (potassium
choloride) in 2010, 52% more than in 2009 from Russian, Belarusian, Canadian and German producers
in descending order. The United States, Brazil, China and India are other important consumers of
potash, representing close to 62% of total global consumption. Our projects portfolios are highly
competitive in terms of cost and logistics with these regions.
Most phosphate rock concentrate is consumed locally by downstream integrated producers, with the
seaborne market corresponding to 16% of total phosphate rock production. Major phosphate rock
exporters are concentrated in North Africa, mainly through state-owned companies, with the Moroccan
OCP Group holding 39% of the total seaborne market. Brazil imports 19% of the total phosphate
nutrients it needs in both phosphate fertilizer products and phosphate rock. The phosphate rock
imports supply non-integrated producers of phosphate fertilizers products such as single
superphosphate (SSP), triple superphosphate (TSP) and monoammonium phosphate (MAP)
Nitrogen-based fertilizers are basically derived from ammonia (NH3), which, in turn, is produced
from the nitrogen that is present in the air and in natural gas, making it a nutrient that requires
a high level of energy. Ammonia and urea are the main consumables and nitrogen based on nitrogen.
The consumption of nitrogen-based fertilizers has a regional profile because of the high cost
associated with transportation and storage of ammonia which requires refrigerated and pressurized
facilities. Thus, only 12% of ammonia produced in the world is traded. North America is the largest
importer, with 40% of the global market. The larger exporters are the Middle East, North Africa and
Russia.
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D. Logistics Services
We have developed our logistics business based on the transportation needs of our mining
operations, and it also provides transportation services for other customers. We conduct logistics
businesses at the parent-company level, through subsidiaries and joint ventures, as set forth in
the following table.
| Participation of Vale | ||||||||||||||
| Firm | Business | Location | Voting | Total | Vale Partners | |||||||||
| (%) | ||||||||||||||
| Vale |
Port, maritime and railroad operations (EFVM and EFC) |
Brazil | 100 | 100 | — | |||||||||
FCA |
Railway operations | Brazil | 100 | 99.9 | ||||||||||
FNS(1) |
Railroad operations | Brazil | 100 | 100 | — | |||||||||
MRS |
Railroad operations | Brazil | 37.9 | 41.5 | CSN, Usiminas and Gerdau | |||||||||
CPBS |
Maritime terminal operations and ports | Brazil | 100 | 100 | — | |||||||||
Log In |
Maritime terminal operations and ports | Brazil | 31.3 | 31.3 | Mitsui & Co., public investors | |||||||||
PTI |
Maritime terminal operations and ports | Indonesia | 59.2 | 59.2 | Sumitomo, public investors | |||||||||
SPRC |
Maritime terminal operations and ports | Colombia | 100 | 100 | — | |||||||||
FENOCO |
Railroad operations | Colombia | 8.4 | 8.4 | Drummond, Glencore and Coalcorp | |||||||||
Vale Logística Argentina |
Port Operations | Argentina | 100 | 100 | — | |||||||||
SDCN |
Maritime and railroad terminal Operations | Mozambique | 51 | 51 | NCI and GESTRA — Gestão e Transportes, SARL; Consórcio de Cabo Delgado, SARL; GEDENA — Gestão e Desenvolvimento, SARL; STP — Sociedade de Tecnologias e Participações, SARL; Niassa Desenvolvimento, SARL; and Moçambique Gestores, SARL |
|||||||||
VBG Logistics (Vale BSGR Logistics) Corp. |
Port and railroad operations | Liberia | 51 | 51 | BSG Resources (Guiné) | |||||||||
Transbarge Navigación |
Fluvial System in Paraguay and Paraná rivers (convoys) | Paraguay | 100 | % | 100 | % | — | |||||||
| (1) | BNDESPAR owns debentures in FNS which, as of 2018, may be swapped, at the holder’s discretion,
in FNS ordinary stock representing a minority participation in the company, pursuant to the formula
in the debenture contract. |
D.1 Railroads
Brazil
Vitória a Minas railroad (“EFVM”). The EFVM railroad links our Southeastern System mines in the
Iron Quadrangle region in the Brazilian state of Minas Gerais to the Tubarão Port, in Vitória, in
the state of Espírito Santo. We operate this 905-kilometer railroad under a 30-year renewable
concession, which expires in 2027. The EFVM railroad consists of two lines of track extending for
a distance of 601 kilometers to permit continuous railroad travel in opposite directions, and
single-track branches of 304 kilometers. Large industrial manufacturers are located in this area
and major agricultural regions are also accessible to it. The EFVM railroad has a daily capacity
of 342,000 metric tons of iron ore. In 2010, the EFVM railroad carried a total of 78.9 billion ntk
of iron ore and other cargo, of which 16.8 billion ntk, or 21.3%, consisted of cargo transported
for customers, including iron ore for Brazilian customers. The EFVM railroad also carried one
million passengers in 2010. In 2010, we had a fleet of 331 locomotives and 18,967 wagons at EFVM.
Carajás railroad (“EFC”). We operate the EFC railroad under a 30-year renewable concession, which
expires in 2027. EFC is located in the Northern System, beginning at our Carajás iron ore mines,
state of Pará, and extending 892 kilometers to our Ponta da Madeira maritime terminal complex
facilities located near the Itaqui Port in the Brazilian state of Maranhão. Its main cargo is iron
ore, principally carried for us. It has a daily capacity of 313,970 metric tons of iron ore. In
2010, the EFC railroad carried a total of 90.4 billion ntk of iron ore and other cargo, 3.0 billion
ntk of which was cargo for customers, including iron ore for Brazilian customers. EFC also carried
341,583 passengers in 2010. EFC supports the largest capacity train in Latin America, which
measures 3.4 kilometers, weighs 42,300 gross metric tons when loaded and has 330 cars. In 2010,
EFC also had a fleet of 220 locomotives and 10,701 wagons.
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Ferrovia Centro-Atlântica (“FCA”). Our subsidiary FCA operates the central-east regional railway
network of the Brazilian national railway system under a 30-year renewable concession, which
expires in 2026. The central east network has 8,023 kilometers of track extending into the states
of Sergipe, Bahia, Espírito Santo, Minas Gerais, Rio de Janeiro and Goiás and Brasília, the Federal
District of Brazil. It connects with our EFVM railroad near the cities of Belo Horizonte, in the
state of Minas Gerais and Vitória, in the state of Espírito Santo. FCA operates on the same track
gauge as our EFVM railroad and provides access to the Santos Port in the state of São Paulo. In
2010, the FCA railroad transported a total of 11.4 billion ntk of cargo for customers. In 2010,
FCA had a fleet of 500 locomotives and 12,000 wagons.
Ferrovia Norte-Sul railroad (“FNS”). In October 2007, we won the auction for the subconcession for
commercial operation for 30 years of a 720-kilometer stretch of the FNS railroad, in Brazil. Since
1989, we have operated a segment of the FNS, which connects to the EFC railroad, enabling access to
the port of Itaqui, in São Luís, where our Ponta da Madeira maritime terminal is located. A
452-kilometer extension was concluded in December 2008. In 2010, the FNS railroad transported a
total of 1.52 billion ntk of cargo for customers. This new railroad creates a new corridor for the
transportation of general cargo, mainly for the export of soybeans, rice and corn produced in the
center-northern region of Brazil. In 2010, FNS had a fleet of 6 locomotives and 440 wagons.
The principal items of cargo of the EFVM, EFC, FCA and FNS railroads are:
| • | Iron ore and iron ore pellets, carried for us and customers; |
|
| • | Steel, coal, pig iron, limestone and other raw materials carried for customers with steel mills
located along the railroad; |
|
| • | Agricultural products, such as soybeans, soybean meal and fertilizers; and |
|
| • | Other general cargo, such as building materials, pulp, fuel and chemical products. |
We charge market prices for customer freight, including iron ore pellets originating from joint
ventures and other enterprises in which we do not have a 100% equity interest. Market prices vary
based on the distance traveled, the type of product transported and the weight of the freight in
question, and are regulated by the Brazilian transportation regulatory agency, ANTT (Agência
Nacional de Transportes Terrestres).
MRS Logística S.A. (“MRS”). The MRS railroad is 1,643 kilometers long and links the Brazilian
states of Rio de Janeiro, São Paulo and Minas Gerais. In 2010, the MRS railroad carried a total of
144.9 million metric tons of cargo, including 60.8 million metric tons of iron ore and other cargo
from Vale.
Colombia
Ferrocarriles del Norte de Colombia S.A. (“FENOCO”). We own an 8.4% equity stake in FENOCO, a
company that owns a concession to restore and operate the Chiriguana — Santa Marta segment (220
kilometers) of the Atlantic Railroad, which connects the Cesar coal-producing region with various
ports in the Atlantic Ocean.
Argentina
In August 24, 2010, through our subsidiary, Potasio Rio Colorado S.A., we entered into an agreement
with Ferrosur Roca, S.A. for a partial concession, pending government authorization, an
administrative concession of a 756 km. railroad track which is important support to the potash
Project in Rio Colorado and to our strategy to become a leader in the fertilizer industry.
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Africa
In September, 2010, we exercised a purchase option of a 51% stake in Sociedade de Desenvolvimento
do Corredor do Norte SA (SDCN) for US$21 million. That acquisition will allow the Moatize expansion
and facilitate the creation of a high level logistics infrastructure supporting our operations in
Central and East Africa. We will invest in the expanding the capacity of the Nacala logistic
corridor through the rehabilitation of existing SDCN railroad tracks in Malaui and in Mozambique
and the construction of necessary tracks to carry production from Moatize to the new deep wáter
maritime terminal in Nacala, which will also be built by Vale.
We signed agreements with the government of Liberia for the construction of an port-railroad
integrated system to transport iron ore from Simandou, Guinea. Simandou is one of the two best
deposits of iron ore that has not been developed in the world in terms of size and quality and,
until the end of this decade, the logistic corridor will allow the transportation of up to 50
million metric tons per year of iron ore to our maritime terminal in the coast of Liberia.
D.2 Ports and maritime terminals
Brasil
We operate a port and six maritime terminals principally as a means to complete the delivery
of our iron ore and iron ore pellets to bulk carrier vessels serving the seaborne market. See —
Bulk materials-iron ore pellets-Operations. We also use our port and terminals to handle customers’
cargo. In 2010, 1.2% of the cargo handled by our port and terminals represented cargo handled for
customers.
Tubarão Port. The Tubarão Port, which covers an area of 18 square kilometers, is located near
the Vitória Port, state of Espírito Santo, and contains four maritime terminals: (i) the iron ore
maritime terminal, (ii) Praia Mole Terminal, (iii) Terminal de Produtos Diversos, and (iv) Terminal
de Granéis Líquidos.
| • | The iron ore maritime terminal located in this area has two piers. Pier I can
accommodate two vessels at a time, one of up to 170,000 DWT on the southern side and
one of up to 200,000 DWT on the northern side. Pier II can accommodate one vessel of
up to 365,000 DWT at a time, limited at 20 meters draft plus tide. In Pier I there
are two ship loaders, which can load up to a combined total of 14,000 metric tons per
hour. In Pier II there are two ship loaders that work alternately and can each load
up to 16,000 metric tons per hour. In 2010, 100.4 million metric tons of iron ore and
iron ore pellets were shipped through the terminal. The iron ore maritime terminal
has a storage capacity of 2.8 million metric tons. |
||
| • | Praia Mole terminal is principally a coal terminal and handled 10.7 million metric
tons in 2010. |
||
| • | Terminal de Produtos Diversos handled 6.6 million metric tons of grains and
fertilizers in 2010. |
||
| • | Terminal de Granéis Líquidos handled 1.0 million metric tons of liquid bulk in
2010. |
Ponta da Madeira maritime terminal. The Ponta da Madeira maritime terminal is located near
the Itaqui Port, state of Maranhão. The terminal facilities can accommodate four vessels. Pier I
can accommodate vessels displacing up to 420,000 DWT. Pier II can accommodate vessels of up to
155,000 DWT. Pier I has a maximum loading rate of 16,000 tons per hour. Pier II has a maximum
loading rate of 8,000 tons per hour. Pier III, which has two berths and three shiploaders, can
accommodate vessels of up to 220,000 DWT on the south berth and 180,000 DWT on the north berth and
has a maximum loading rate of 8,000 metric tons per hour in each shiploader. Cargo shipped through
our Ponta da Madeira maritime terminal consists principally of our own iron ore production. Other
cargo includes manganese ore, copper concentrate and pig iron produced by us and pig iron and
soybeans for unrelated parties. In 2010, 94.2 million metric tons were handled through the
terminal for us and 5.4 million metric tons for customers. The Ponta da Madeira maritime terminal
has a storage capacity of 6.2 million metric tons.
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Itaguaí maritime terminal — Cia. Portuária Baía de Sepetiba (“CPBS”). CPBS is a wholly owned
subsidiary that operates the Itaguaí terminal, in the Sepetiba Port, state of Rio de Janeiro.
Itaguaí’s maritime terminal has a pier that allows the loading of ships up to 18 meters of draft
and up to 230,000 DWT. In 2010, the terminal loaded 22.6 million metric tons of iron ore.
Guaíba Island maritime terminal. We operate a maritime terminal on Guaíba Island in the
Sepetiba Bay, state of Rio de Janeiro. The iron ore terminal has a pier that allows the loading of
ships of up to 300,000 DWT. In 2010, the terminal loaded 37.9 million metric tons of iron ore.
Inácio Barbosa maritime terminal (“TMIB”). We operate the Inácio Barbosa maritime terminal,
located in the Brazilian state of Sergipe. The terminal is owned by Petrobras. Vale and Petrobras
entered into an agreement in December 2002, which allows Vale to operate this terminal for a period
of 10 years. In 2010, 600 hundred thousand metric tons of fuel,agricultural products and steel
were shipped through TMIB.
Santos Maritime Terminal (TUF). We operate a maritime terminal through our subsidiary, Vale
Fertilizantes, in Santos, Sao Paulo. The terminal has a pier that allows loading of ships of up to
67,000 DWT. In 2010, the terminal loaded 2.1 million tons of ammonia and bulk solids, 10.2% more
than in 2009.
Colombia
Sociedad Portuaria Rio Cordoba (“SPRC”). SPRC is a seaport facility wholly owned by Vale and
used to export coal from the El Hatillo operation, as well as other nearby mines. The port is
located in Cienaga, on the Caribbean coast of Colombia, in the Magdalena Department, about 67
kilometers from Barranquilla and 31 kilometers from Santa Marta.
Argentina
Vale Logistica Argentina S.A. (Vale Logistica Argentina) operates a terminal at the San Nicolas
port located in the province of Buenos Aires, Argentina, where Vale Logistica Argentina has been
authorized to use a 20,000 m2 terminal until October 2016 and has executed an agreement with
unrelated parties for the use of an additional 27,000 m2 terminal. The company expects to handle 2
million metric tons of iron ore and manganese through this port in 2011, which will reach Corumbá,
Brazil, through the Paraguay and Paraná rivers to be transported to Asian and European markets. The
loading rate at this port is 17 thousand tons per day and an unload rate of 12 thousand tons per
day.
Indonesia
PTI owns and operates two ports in Indonesia to support its nickel mining activities.
| • | The Balantang Special Port is located in Balantang Village, South Sulawesi, and has
a pier that can accommodate vessels displacing up to 6,000 DWT. |
| • | The Harapan Tanjung Mangkasa Village is located in Harapan Tanjung Mangkasa
Village, South Sulawesi, and has a pier that can accommodate vessels displacing up to
39,000 DWT. |
D.3 Seaborne Transportation
In addition to seaborne transportation of iron ore to support our iron ore and pellet operations
and the transportation and shipping in the fluvial system on the Paraná and Paraguay rivers carried
out to support our bulk material transportation operations, we also provide tug boat services.
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We continue to develop and operate a low cost fleet of vessels, comprised of company-owned vessels
and leased vessels through mid and long-term lease agreements, to support our bulk material
businesses. The last two years, we acquired 22 capesize vessels. In late 2010, 14 company-owned
vessels were in operation. We have placed orders for the construction of 19
large vessels, each with a 400,000 DWT capacity, and four additional capesize vessels, each with a
180,000 DWT capacity. The first large iron ore vessel was delivered in March 2011. We believe this
service to enhance our ability to offer our iron ore products in the Asian market at competitive
prices and to increase our market share in China and the global seaborne market. In 2010, 72.1
million tons of iron ore and pellets were shipped to China on CFR basis.
On the Paraná and Paraguay fluvial system, we transport iron ore and manganese through an
intermediary of wholly-owned subsidiary, Transbarge Navigacion, which fluvially transported
1,335,210 tons in 2010 and our wholly-owned subsidiary, Vale Logistica Argentina, which loaded
1,629,000 tons of ore though the port of Saint Nicolas in seaborne vessels in 2010. In 2010, we
also purchased two new convoys (two tugboats and 32 barges) which will start operating in 2011.
We also operate a fleet of 28 tugboats (23 owned and 5 chartered) in maritime terminals in Brazil,
in Vitória, state of Espírito Santo; Trombetas, state of Pará; São Luís, state of Maranhão; and
Aracaju, state of Sergipe.
We own 31.3% of Log-In, which conducts our intermodal shipping business operations. Log-In offers
port handling and container transportation services, by sea or rail, as well as container storage.
It operates owned and chartered ships for coastal shipping, a container terminal (Terminal Vila
Velha — TVV) and multimodal terminals. In 2010, Log-In’s coastal shipping service transported
159,856 units equivalent to twenty-foot units (teus); TVV handled 249,072 teus and its express
train service moved 38,684 teus.
E. Others
E1. Electric Energy
We have developed our energy assets based on the current and projected energy needs of our mining
operations, with the goal of reducing our energy costs and minimizing the risk of energy shortages.
Brazil
Energy management and efficient supply in Brazil are priorities for us, given the uncertainties
associated with changes in the regulatory environment, and the risk of rising electricity prices
and electric energy shortages (as experienced in Brazil in the second half of 2001). We currently
have seven hydroelectric power plants in operation. In addition, in December 2010, we received the
operational license for the Estreito power plant, the first company-owned hydroelectric in the
Northern region which began generating power in March 2011. In 2010, our total installed energy
capacity in Brazil was 818 MW, similar to the previous year. We use the electricity produced by
these plants for our internal consumption needs. As a large consumer of electricity, we expect
that investing in power projects will help us reduce costs and will protect us against energy price
volatility. However, we may experience delays in the construction of certain generation projects
due to environmental and regulatory issues, which may lead to higher costs.
Canada
In 2010, our wholly-owned and operated hydroelectric power plants in Sudbury generated
approximately 9% of the electricity requirements of our Sudbury operations. The power plants
consist of five separate generation stations with an installed generator nameplate capacity of 56
MW. The output of the plants is limited by water availability, as well as restrictions imposed by
a water management plan regulated by the Government of Ontario. Over the course of 2010, the
power system operator distributed electricity at a rate of 117 MW to all surface plants and mines
in the Sudbury area.
In 2010, diesel generation provided 100% of the electric requirements of our Voisey Bay operations.
We have six diesel generators on-site, of which normally only four are in operation, producing 12
MW.
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Indonesia
Energy costs are a significant component of our nickel production costs for the processing of
saprolitic lateritic ores at PTI operations in Indonesia. Practically the entire electricity
consumption of PTI’s electric furnace power requirements are supplied at low-cost by its two
hydroelectric power plants on the Larona River: (i) the Larona plant, which generates an average of
165 MW, and (ii) the Balambano plant, which generates an average of 110 MW. PTI has thermal
generating facilities of 78 MW, of which 54 MW are generated by 24 Caterpillar diesel generators,
with capacity of 1 MW each, five Mirrlees Blackstone diesel generators, and one 24 MW oil burning
steam turbine generator with high sulphur levels, located in Sorowako. In addition, we are building
a plant in Karebbe, which will be the third hydroelectric power plant on the Larona river, with an
average electricity generating capacity of 90 MW. This plant will reduce production costs by
replacing oil in the generation of power for hydroelectric power.
E.2 Oil and natural gas
The use of natural gas in our energy matrix in Brazil is expected to increase from 1.7 million
cubic meters per day (“Mm3/day”) in 2010 to 11.6 Mm3/day in 2020. In order to mitigate supply and
price risks we started investing in natural gas exploration. Since 2007, we have developed an
important hydrocarbon prospecting portfolio in the Brazilian coastline and deep water offshore
basins. During 2009, we made two discoveries which are being analyzed. We believe natural gas will
play an important role in our future global energy matrix, thanks to lower carbon emissions and
higher flexibility regarding energy generation.
E.3 Other Investments
Vale owns 50% of capital stock of California Steel Industries (CSI), a producer of flat rolled
steel and pipes, located in the United States. The remaining 50% belongs to JFE Steel. CSI produces
about 1.8 million metric tons of flat rolled steel products per year. CSI successfully commissioned
a second reheating furnace with state-of-the-art environmental technology at a cost of US$ 71
million which will increase annual capacity to about 2.8 million metric tons of flat steel and
pipes. The furnace will be fully operational by the second quarter in 2011.
Vale holds a 26.9% stake in TKCSA, an integrated producer of steel plates in the state of Rio de
Janeiro. The plant was commissioned on the third quarter in 2010, and has an annual production
capacity of 5 million metric tons per year and requires 8.5 million metric tons of iron ore and
pellets per year, which will be supplied exclusively by Vale.
We have a 61.5 stake in CADAM S.A. (CADAM) located in the border between the states of Pará and
Amapá, in the Amazon region. CADAM produces kaolin for paper coating and it also conducts research
into other uses for kaolin products in order to develop a more diversified portfolio. CADAM’s
reserves are mostly concentrated in the Morro do Felipe open pit mine, in Vitória do Jari, state of
Amapá. The beneficiation plant and private port facilities are situated on the west bank of the
Jari River, in Munguba, in the state of Pará. CADAM produces the following products: Amazon SB,
Amazon Premium and Amazon Plus. They are sold mainly in the European, Asian and Latin American
markets. CADAM gets its electricity from its own thermal power plant. In 2010, CADAM produced
403,000 metric tons of Kaolin.
We are operating a pig iron operation projection in northern Brazil. This operation was conducted
through our wholly owned subsidiary Ferro-Gusa Carajás S.A. (“FGC”) until April 2008, when FGC was
merged into Vale. We utilize two conventional mini-blast furnaces to produce 350,000 metric tons of
pig iron per year, using iron ore from our Carajás mines in northern Brazil.
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F. Key consumables and raw materials:
F.1 Description of the relationships with suppliers, including whether they are subject to
governmental control or regulation, identifying the institutions and applicable legislation
Vale’s strategy in relation to its suppliers is to maintain a long term relationship in order to
promote partnerships aimed at gains for both parties, through continuous innovation and development
and supply of goods and quality services at a compatible cost. Therefore, Vale uses as
communication tools visits and talks at their operations, exchange programs and structured
meetings.
In order to achieve continuous improvement and contribute to advances in the production chain,
Vale’s management of relationships with suppliers comprises four steps: (i) classification based on
Vale’s values, (ii) contracts taking into account the identification and analysis of environmental
risks (iii) periodic performance evaluations to ensure compliance with applicable requirements and
as defined in the contracting stage, and (iv) development.
The guidelines and criteria that Vale adopts to evaluate its suppliers are based on environmental
legal requirements applicable to suppliers whose operational processes involve the use of natural
resources or are potentially polluting or likely to cause environmental degradation. In addition to
these legal aspects, Vale’s Environmental Management criteria and the principles of its Sustainable
Development Policy are considered.
Every contract involving construction sites / facilities within Vale areas are inspected prior to
demobilization to assess compliance with environmental requirements specified in the contract. That
evaluation focuses on the environmental quality of the area to verify the existence of potential
liability for which the supplier may be responsible.
With regard to recipients of waste generated in Vale production processes, they all are subject to
audit by the Department of the Environment and Sustainable Development during their initial
approval and periodic revalidation.
The main environmental laws applicable to this process are:
a) Environmental Permit
| • | Federal Law 6938/81 — National Environmental Policy |
|
| • | CONAMA Resolution (National Council for the Environment) 237/97 |
|
| • | CONAMA Resolution (National Council for the Environment) 01/86. |
|
| • | Federal Law 10165/00 |
|
| • | IBAMA Norm (Brazilian Institute of Renewable Natural Resources) 96/06. |
b) Pesticides
| • | Federal Law 7802/99 |
|
| • | Federal Decree 4047/02 |
|
| • | Law 6360/76 — ANVISA — National Agency for Sanitary Surveillance |
c) Transportation of Dangerous Goods
| • | Decree 96044/88 |
|
| • | ANTT Resolution (National Ground Transportation Agency) 420/02 |
d) Radioactive Material
| • | CNEN Resolution (National Nuclear Energy Council) NE 2.01 |
|
| • | CNEN Resolution (National Nuclear Energy Council) NE 5.02 |
e) Explosive Materials
| • | Federal Decree 3665/00 |
f) Controlled Chemicals
| • | Ministry of Justice Decree 1274/2003. |
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F.2 Potential dependence on few suppliers
The main consumables purchased by Vale in 2009 were: (i) materials and other equipment, including
tires, conveyor belts, parts and components, mining equipment, railroad gear, industrial
installations and maintenance workshops, which accounted for 18% of cost of goods sold (COGS) in
2010, (ii) fuel and gas, which contributed 10.7% to COGS, and electricity with 6.6% of COGS.
Moreover, the rendering of various services, such as operational services, maintenance of equipment
and facilities, and transportation services represented 13.7% of COGS in 2009.
The main pieces of equipment purchased by Vale are Off-road trucks, Loaders, Auxiliary trucks,
Tractors, Diggers, Wagons, and other mining equipment. The largest suppliers of these types of
equipment for Vale in 2010 were Letourneau, Bucyrus International Inc., Sotreq CV, Amsted-Maxion
and Komatsu, accounting jointly for 6% of total purchases of the company.
Fuel consumption is quite intense, especially in operations and transport of iron ore, located in
Brazil. The main supplier of this consumable item for Vale is Petrobras, which accounted for 86% of
the purchase of fuels by Vale in 2010. The electricity supply is managed largely through contracts
with regional electricity companies. The main suppliers of this consumable were Centrais Elétricas
no Norte do Brasil S.A. (Eletronorte), CEMIG Distribuição S.A. and Espírito Santo Centrais
Elétricas S.A., together accounting for 36% of purchases of electricity by Vale in 2010.
In 2010, the 10 largest Vale comsumer, equipment and service providers represented 19% of Company’s
total purchases.
F.3 Possible volatility in their prices
Vale has some contracts where prices are pegged to market indexes (parametric formulas) and
therefore subject to these volatilities. Prices can also vary in relation to historical prices
depending on offer versus demand in the market at the time of competition.
7.4 Customers that accounted for more than 10% of total net revenues of the Company
There are no customers accounting for more than 10% of Vale’s net revenue.
7.5 Relevant effects of state regulation on the Company’s activities
a. Need for government authorization for the exercise of activities and long-standing relationship
with the government to obtain such permits
We are subject to a wide range of governmental regulations in all jurisdictions where we operate
worldwide. The following discussion summarizes the regulations that have the most significant
impact on our operations.
Mining rights
In order to conduct mining activities, we generally require some form of governmental permits,
which differ in form depending on the jurisdiction but may include concessions, licenses,
prospecting applications, permits, releases or franchises (all of which we refer to below as
“concessions”). Some concessions have indefinite duration, but many have specific expiration
dates, and may not be renewable. The legal and regulatory regime governing concessions differs
among jurisdictions, often in important ways. For example in many jurisdictions, including Brazil,
mineral resources belong to the state and may only be extracted under concession. In other
jurisdictions, including Canada, a substantial part of our mining operations is conducted pursuant
to leases, often from government agencies.
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The table below summarizes our principal mining concessions and other similar rights. In addition
to the concessions described below, we have exploration licenses covering 10.1 million
hectares in Brazil (out of which, 5.9 are already under application) and 17.8 million hectares in
other countries.
| Approximate area covered | ||||||||
| Location | Concession or other right | (in hectares) | Expiration date | |||||
Brazil |
||||||||
| Mining concessions | 664,627 | Undetermined | ||||||
Canada |
||||||||
Ontário |
Leases | 14,026 | 2011-2028 | |||||
| Patented Lands | 82.805 | Undetermined | ||||||
| Water rights | 1,157 | Undetermined | ||||||
| Mining Licence of Occupation | 2,952 | Undetermined | ||||||
Manitoba |
Leases | 109.043 | 2011-2028 | |||||
| Other Leases | 4.903 | 2013 | ||||||
Newfoundland and
Labrador |
Mining lease | 1,599 | 2027 | |||||
| Surface lease | 4.015 | 2027 | ||||||
Indonesia |
||||||||
| Single Work Contract | 190.510 | 2025 (1) | ||||||
Australia |
||||||||
| Mining tenements | 22,281 | 2011-2039 | ||||||
New Caledonia |
||||||||
| Mining concessions | 20,332 | 2016-2051 | ||||||
| Mining Concessions Tiebaghi Nickel | 936 | 2048 | ||||||
| Mining concessions outside VNC Project | 13,586 | 2016-2040 | ||||||
Peru |
||||||||
| Exploration Concession | 146.887 | Undetermined (2) | ||||||
Colombia |
||||||||
| El Hatillo Exploration Concession | 9.695 | 2027 | ||||||
| Cerro Largo Sur Exploration Concession | 1.092 | 2032 | ||||||
Argentina |
||||||||
| Exploration Concession (Prospection Statement) | 80,889 | Undetermined (3) | ||||||
Chile |
||||||||
| Exploration Concession | 50,632 | Undetermined (4) | ||||||
Mozambique |
||||||||
| Exploration Concession (Mining Concession) | 23,780 | 2030 | ||||||
Guinea |
||||||||
| Exploration Concession (Mining Concession) | 102.400 | 2045 | ||||||
| (1) | Work Contract of Vale’s mines in Indonesia expire in 2025. Meanwhile, according to the new
Mining Law, Vale will be entitled to request, at least, a 10 year extension. |
|
| (2) | According to Peruvian mining law, there is only one type of license. The above represents
merely licenses with exploration concession. |
|
| (3) | Of the 80,889 that it has in Argentina, only 40,274 represents activities in progress. |
|
| (4) | Of the 50,332 that it has in Chile, only 23,657 represents activities in progress. |
Many concessions impose specific obligations on the concessionaire governing such matters as how
operations are conducted and what investments are required. Our ability to maintain our mineral
rights depends on meeting these requirements, which often involve significant capital expenditures
and high operating costs.
Regulation of mining activities
Vale is subject to numerous regulations, which differ according to the jurisdiction in which
it operates. Its operations depend on legislation and regulations that apply to mining activities,
which include in many countries, state and local laws, as well as federal laws. Moreover, most of
the Company’s concessions, especially for large operations, impose additional obligations on the
concessionaire.
The jurisdictions in which Vale operates generally have government agencies responsible for
granting mining licenses and supervising compliance with mining laws and regulations. For example,
in Brazil, the exploration activities are supervised by the National
Department of Mineral Production (ANP), an entity connected to the Ministry of Mines and
Energy.
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Changes in mining legislation may have a significant effect on Vale operations. Among the
jurisdictions in which the Company has operations, there are several changes in legislation
proposed or recently adopted, which can affect it significantly. Among them we can mention:
| • | The Ministry of Mines and Energy of Brazil is studying changes to the Mining
Code which, if adopted, may have important implications on local operations or require
unexpected investments. However, considering that it is not known what changes to the
Mining Code will be effectively adopted, there is no way to accurately assess their
implications on our local operations. |
| • | In January 2009, a new Mining Law went into effect in Indonesia, with new
licensing rules. In 2010, some regulations were enacted for the Mining Code, not all
yet implemented. PTI, along with its legal advisors from Indonesia, is studying the
impacts of the new Mining Law on current and future operations of PTI exploration in
Indonesia. Until all regulations are passed, Vale cannot evaluate how and to what
extent the Employment Contract and PTI operations will be affected. |
| • | In New Caledonia, a law was passed in March 2009 which states that for new
mining projects, formal authorization is required, rather than a simple declaration.
Vale’s license application (which replaces the 2005 declaration) should be submitted
by April 2012. The Company will receive the authorization no later than April 2015.
Vale believes it is unlikely that the authorization will be rejected, but there is
always the risk that there will be new charges. |
| • | In Guinea, the government proposed a new Mining Code that would modify some
of the regulations that currently govern mining operations. Among other regulations,
there would be a mandatory participation of 15% for the State in all mining projects,
which is currently applied only to projects involving diamonds, gold and precious
stones. |
Environmental regulations
We are also subject to environmental regulations that apply to the specific types of mining
and processing activities we conduct. We require approvals, licenses or permits from governmental
authorities to operate, and in most jurisdictions the development of new facilities requires us to
submit environmental impact statements for approval and often to make additional investments to
mitigate environmental impacts. We must also operate our facilities in compliance with the terms
of the approvals, licenses or permits.
Environmental regulations affecting our operations relate, among other matters, to emissions
into the air, soil and water; recycling and waste management; protection and preservation of
forests, coastlines, natural caverns, watersheds and other features of the ecosystem; water use;
and decommissioning and reclamation. In many cases, the mining concessions or environmental
permits under which we operate impose specific environmental requirements on our operations.
Environmental regulations can sometimes change and ongoing compliance can require significant costs
for capital expenditures, operating costs, reclamation costs and compliance. For example, in
Brazil, a suit challenging a Brazilian environmental decree that permits mining in certain
subterraneous areas may adversely affect our ability to conduct some mining operations or even
reserves.
Environmental legislation is becoming stricter worldwide, which could lead to greater costs
for environmental compliance. For instance, if we are required to modify installations, develop
new operational procedures or purchase new equipment, our environmental compliance costs could
increase. In particular, we expect heightened attention from various governments to reducing
greenhouse gases. Some important regulatory environmental initiatives are described below, but we
do not know if it will be necessary to carry out operational and capital investments to observe
such changes or the effect it will have over our businesses, financial results and cash flow in
those operations:
| • | Our operations in Canada and at PTI in Indonesia are subject to air emission
regulations that address, among other things, sulfur dioxide (SO2), particulates and
metals. We will be required to make significant capital expenditures to ensure
compliance with these emissions standards. The imposition of more stringent standards
in the future, especially for SO2 and nickel, could further increase our costs. |
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| • | The rhythm of the efforts by the Canadian government to legislate Greenhouse Gas
(GHG) emissions targets has slowed down. The provinces of Manitoba, Ontario and
Newfoundland will launch a consultancy along with several interested parties with
regards to climate change initiatives and also focused on implementation strategies. |
| • | In Canada, a number of studies have been completed or are in progress in Sudbury
and Port Colborne related to contamination of soil and water from past and current
activities. We are taking steps, in partnership with other stakeholders, to remediate
the ecological impact of our activities. |
| • | The Australian government is seeking to introduce an environmental program as part
of an overall strategy to address climate change and reduce greenhouse gas emissions
in Australia. The Australian government stated that it has decided to impose mandatory
targets to control greenhouse gas emission levelsby 2020. Thus, it is expected that a
policy to set prices on carbon emissions will be imposed in the country within a short
period of time. |
| • | In October 2009, Indonesia adopted new legislation on Environmental Protection and
Management. It sets out a broad regulatory structure and provides that many important
details will be clarified in later implementing regulations, which the law provides
should be issued within one year of its effective date. |
| • | Brazil adopted a National Policy on Climate Change in December 2009 which
contemplates specific carbon emission limits to be set forth by the end of 2011 and
implemented before 2020. The law sets forth a voluntary commitment to reduce
greenhouse gas emissions in Brazil between 36.1% and 38.9% before 2020, based on
levels registered in 2005, and several regulated sectors, such the steel, forest,
agriculture and energy industry to create projects to reduce greenhouse emissions. By
the end of 2011, the government plans to publish regulations on specific limits on
carbon emissions for other sectors of the economy, including the mining sector. |
| • | In December 2010, Brazil implemented the National Law on Solid Waste. The law set
forth a strict regulatory structure with flexibility instruments to comply with
management controls regarding solid waste, including mineral waste. Mining companies
will have to submit a plan to manage solid mineral waste and will be subject to
stricter controls by environmental authorities. |
Royalties and other taxes on mining activities
Vale pays royalties on revenues obtained from the extraction and sale of mineral products. The
following royalties and taxes apply in some of the jurisdictions in which we have our largest
operations:
| • | In Brazil, we pay a royalty known as the CFEM (Compensação Financeira pela
Exploração de Recursos Minerais or Financial Compensation for Exploration of Mineral
Resources) on the revenues from the sale of minerals we extract, net of taxes,
insurance costs and costs of transportation. The current annual CFEM rates on our
products are: 2% for iron ore, kaolin, copper, nickel, fertilizers and other
materials; 3% on bauxite, potash and manganese ore; and 1% on gold. The Brazilian
government is considering changes in the CFEM regime. These changes will only be
enforceable once a final proposal is issued by DNPM and approved by the National
Congress. We are currently engaged in several administrative and legal proceedings
alleging that we have failed to pay the proper amount of CFEM which we consider
inadequate. For further information on the above proceedings,
see Item 4 in this Reference Form. |
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| • | The Canadian provinces in which we operate charge us a tax on profit from mining
operations. Profit from mining operations is generally determined by reference to
gross revenue from the sale of mine output and deducting certain costs, such as mining
and processing costs and investment in processing assets. The statutory mining tax
rates are 10% in Ontario; 17% in Manitoba; and 16% in Newfoundland and Labrador. |
| • | In Indonesia, our subsidiary PTI pays a royalty fee on, among other items, its
nickel production on the concession area and has made certain other commitments.
Until March 2008 the royalty was equal to 1.1% of revenues from sales of nickel
products. As of April 2008, the royalty payment was changed to a fixed amount based
on sales volume (US$78 per metric ton of nickel, based on overall production). |
| • | In Australia, we pay royalties on the revenues from sales of minerals extracted
pursuant to state laws. In Queensland, a 2/3 proportional payment is applied, under
the terms that we pay 7% of the amount up to A$100 per ton and 10% thereafter. The
cost is after port fees and demurrage. In New South Wales, we pay royalties ad valorem
on coal, on the production’s value (revenues minus allowed deductions). Royalty rates
are in the order of 6.2% for deep underground mines (coal extracted below 400 m), 7.2%
for underground mines, and 8.2% for open pit mines. Taxed revenues is free of
beneficiation costs and other taxes. |
| • | Currently, the Australian government is studying the possibility of applying a new
mineral resource rent tax or “MRRT”. The MRRT will be applied on the profits generated
from the exploration of coal and iron ore resources in Australia. The proposed tax
would be paid as a proportional fee of 22.5% of the taxable profits and would be
deductible from the company’s income tax. The difference between the MRRT and
royalties paid to each of the state governments is that royalties were calculated
based on rent whereas MRRT is calculated on profits. Meanwhile, the government
indicated that companies will receive a deductible credit from state royalties in the
states where the MRRT is owed. |
Regulation of other activities
In addition to mining and environmental regulation, we are subject to comprehensive regulatory
regimes for some of our other activities, including rail transport, electricity generation, and oil
and gas. We are also subject to more general legislation on workers’ health and safety, safety and
support of communities near mines, and other matters.
Our Brazilian railroad business is subject to regulation and supervision by the Brazilian Ministry
of Transportation and the transportation regulatory agency (Agência Nacional de Transportes
Terrestres), or ANTT, and operates pursuant to concession contracts granted by the federal
government. The concession contracts impose certain shareholder ownership limitations. The
concession contract for FCA limits shareholder ownership to 20% of the voting capital of the
concessionaire, unless such limit is waived by ANTT. We own 99.9% of FCA, which ANTT has
authorized. The 20% ownership limitation does not apply to our EFVM, EFC and FNS railroads. ANTT
also sets different tariff limits for railroad services for each of the concessionaires and each of
the different products transported. So long as these limits are respected, the actual prices
charged can be negotiated directly with the users of such services.
The MRS concession contract provides that each shareholder can only own up to 20% of the voting
capital of the concessionaire, unless otherwise permitted by ANTT. As a result of our acquisitions
of CAEMI and Ferteco, our share in the voting capital of MRS surpassed this threshold. As a
result, Vale waived its voting and veto rights with respect to MRS shares in accordance with a 2006
ANTT resolution. We continue to have some voting rights through the shareholdings of a subsidiary.
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Our railroad concession contracts have a duration of 30 years and are renewable. The FCA and MRS
concessions expire in 2026, and the concessions for EFC and EFVM expire in 2027. We also own the
subconcession for commercial operation for 30 years of a 720-kilometer segment of the FNS railroad,
in Brazil. This concession expires in 2037.
In connection with the approval in 2006 of our acquisition of Vale Canada, we made a number of
undertakings to the Canadian Minister of Industry under the Investment Canada Act. We believe we
are substantially in compliance with these undertakings, which include locating our global nickel
business in Toronto, Canada; accelerating the Voisey Bay development project; enhancing investments
in a number of areas in Canada; and honoring agreements with provincial governments, local
governments, labor unions and aboriginal groups.
Some of our products are subject to regulations applicable to the marketing and distribution of
chemicals and other substances. For example, the European Commission has adopted a European
Chemicals Policy, known as REACH (“Registration, Evaluation, and Authorization of Chemicals”).
Under REACH, manufacturers and importers will be required to register new substances prior to their
entry into the European market and in some cases may be subject to an authorization process. A
company that fails to comply with the REACH regulation could face restrictions to commercialize its
products in Europe. We have complied with registration requirements for the substances we import
into or manufacture in the EU in 2010 and continue to take measures to manage our exposure to the
authorization process.
b. Environmental policy of the Company and costs incurred for compliance with environmental
regulation and, where appropriate, other environmental practices, including adherence to
international standards of environmental protection
Vale’s Environmental Management System determines the development of effective monitoring,
conservation, environmental protection and rehabilitation, aimed at ensuring the maintenance and
recovery of ecosystems in which it operates. The Company’s system is based on ISO 14001 guidelines,
to which it adds additional features that make up Vale’s standard of environmental quality. Aiming
to assess the management and ensure the development of performance, various operations are
submitted by Vale, periodically, to internal and external audits.
Listed below are units of Vale with ISO 14001:
| • | Iron ore and pellets (all iron ore mines and the Tubarão and Fábrica pelletizing plants); |
|
| • | Manganese and ferroalloys (Azul and Morro da Mina, Vale Manganèse France and Vale Manganese
Norway AS); |
|
| • | Nickel (Vale Inco Europe, Taiwan Nickel Refining Corporation, Vale Japan Limited and Vale Nickel
Dalian (INNM)) |
|
| • | Port of Tubarão; |
|
| • | Aluminum (Alunorte, Albras and Valesul) and |
|
| • | Kaolin (CADAM). |
In many cases, Vale operates with higher levels of environmental requirements than is legally
required. To run the Environmental Management System, Vale disbursed US$ 1.99 billion in the last
three years.
Vale systems and control equipment, such as the storage and spraying of water on the roads, besides
the use of chemical powder inhibitors or installation of filters and electrostatic precipitators in
facilities, are complemented by comprehensive monitoring systems and control software.
The control of air emissions is one of Vale’s main goals. Besides complying with all legal
requirements, the Company continuously evaluates the air quality of its facilities and its effects
on surrounding communities, and makes the necessary investments to improve air quality.
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Regarding improvement of water quality, Vale makes every effort to treat and control pollutants
discharged into the sea, rivers and other water bodies, and runs a comprehensive water
recycling program for water used in its operations. The Company is researching into new processes
and technologies to improve the use, recycling and treatment of water. Through its comprehensive
system of waste treatment and removal of debris, Vale seeks greater control of generation and
disposal of residues in order to create opportunities for reuse, recycling and reducing waste.
Vale’s guidelines for decommissioning mines describe a complete set of guidelines, including
practical and technical procedures to be followed during closure of the mines. The handbook
outlines the procedures for monitoring and recovery of degraded areas, the main steps and sequence
to be obeyed during the closure and other liabilities that may result from the closure of the mine.
The manual also provides standardized basic criteria, based on the guidelines of the CVM and the
SEC (FAS 143), for cost evaluation, budgeting for the present, future decommissioning and
restoration.
The waters of the mine, waste dams and waste rock deposits are classified according to a risk
matrix involving all the parameters related to construction, operation and safety control. A
complete audit program has been established which can evaluate the stability of these structures
and provide elements for the preparation, if necessary, of plans for corrective or preventive
action.
Vale’s environmental program also includes restoration projects aimed at (i) protecting the soil
against erosion, (ii) building impact reducers between their activities and the communities in
surrounding areas and (iii) maintaining biodiversity through recovery of the ecosystem. The Company
has partnerships with universities and governmental research agencies to conduct extensive research
on methods of protecting the ecosystem.
Vale conducts extensive studies on fauna and flora, to minimize the environmental risks associated
with investments in potentially sensitive areas. It takes part in the conservation of Brazilian
ecosystems, leaving some land untouched and protecting some private land. It also participates in
the preservation of federal lands located in areas of environmental conservation, called “protected
areas” and develops and supports research in the field of biodiversity. Over the past 25 years the
Company has offered support to indigenous communities in education, health, infrastructure
development and technical assistance to improve the quality of life and self-sufficiency of these
communities.
c. Reliance on patents, trademarks, licenses, concessions, franchises, contracts, royalties for the
development of relevant activities.
Vale operates mines, railways, ports, marine terminals and power plants, in general, through
concessions granted by federal and state governments in several countries. Accordingly, the Company
depends greatly on the concession of operating licenses for such assets for the development of
their activities. For more information on permits and concessions held by the Company, see item 9.1
b of this form.
Furthermore, the Company believes its many patents are fundamental in achieving the goals of
research and technological development and its major brand “Vale” is of great importance for the
development of their activities.
7.6 Relevant revenue from customers allocated to Brazil and to foreign countries in the last fiscal
year
| Fiscal year December 31, 2010 | % In total net income | |||||||
| Revenue from customers attributed to: | Revenue (R$ thousand) | of the Company | ||||||
Brazil |
14,306,162 | 16.8 | ||||||
China |
27,581,351 | 32.3 | ||||||
Japan |
9,302,640 | 10.9 | ||||||
United States |
2,432,904 | 2.9 | ||||||
Germany |
5,601,086 | 6.6 | ||||||
Canada |
1,993,686 | 2.3 | ||||||
South Korea |
3,358,630 | 3.9 | ||||||
Taiwan |
2,168,423 | 2.5 | ||||||
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| Fiscal year December 31, 2010 | % In total net income | |||||||
| Revenue from customers attributed to: | Revenue (R$ thousand) | of the Company | ||||||
England |
2,051,857 | 2.4 | ||||||
France |
1,338,550 | 1.6 | ||||||
Belgium |
765,528 | 0.9 | ||||||
Italy |
1,831,569 | 2.1 | ||||||
Other countries |
12,612,867 | 14.8 | ||||||
Total income from abroad |
71,039,091 | 83.2 | ||||||
7.7 Regulation of foreign countries in which the Company obtains relevant revenue
Vale is subject to a number of government regulations in all the jurisdictions in which it
operates worldwide. Below, we will provide a summary of regulations that have the most significant
impact in our operations.
Direitos de mineração
De modo a realizar as nossas atividades de mineração, geralmente temos que obter certas licenças,
que variam, segundo a jurisdição, mas que, geralmente incluem concessões, licenças, pedidos de
exploração, alvarás, liberações ou franquias (que denominamos abaixo como “Concessões”). Algumas
dessas Concessões têm prazo indefinido, mas muitas têm datas de vencimento específicas e não podem
ser renovadas. O regime jurídico e regulatório que governa as Concessões varia, dependendo das
jurisdições, de maneira por vezes bastante relevante. Por exemplo, em jurisdições não brasileiras,
inclusive o Canadá, uma parte importante das nossas operações é realizada por meio de direitos de
mineração que possuímos ou por meio de arrendamentos, em geral firmados com agências
governamentais.
A tabela abaixo indica as nossas principais Concessões de lavra e outros direitos afins. Além das
Concessões indicadas abaixo, a Vale possui licenças de exploração que incluem 17,8 milhões de
hectares em outros países.
| Approximate covered | ||||||||
| Loation | Concession or other right | area (in hectares) | Expiration date | |||||
Canada |
||||||||
Ontário |
Leases | 14,026 | 2011-2028 | |||||
| Patented Lands | 82.805 | Undetermined | ||||||
| Water rights | 1,157 | Undetermined | ||||||
| Mining Licence of Occupation | 2,952 | Undetermined | ||||||
Manitoba |
Leases | 109.043 | 2011-2028 | |||||
| Other Leases | 4.903 | 2013 | ||||||
Newfoundland and Labrador |
Mining lease | 1,599 | 2027 | |||||
| Surface lease | 4.015 | 2027 | ||||||
Indonesia |
||||||||
| Single Work Contract | 190.510 | 2025 (1) | ||||||
Australia |
||||||||
| Mining tenements | 22,281 | 2011-2039 | ||||||
New Caledonia |
||||||||
| Mining concessions | 20,332 | 2016-2051 | ||||||
| Mining Concessions Tiebaghi Nickel | 936 | 2048 | ||||||
| Mining concessions outside VNC Project | 13,586 | 2016-2040 | ||||||
Peru |
||||||||
| Exploration Concession | 146.887 | Undetermined (2) | ||||||
Colombia |
||||||||
| El Hatillo Exploration Concession | 9.695 | 2027 | ||||||
| Cerro Largo Sur Exploration Concession | 1.092 | 2032 | ||||||
Argentina |
||||||||
| Exploration Concession (Prospection Statement) | 80,889 | Undetermined (3) | ||||||
Chile |
||||||||
| Exploration Concession | 50,632 | Undetermined (4) | ||||||
Mozambique |
||||||||
| Exploration Concession (Mining Concession) | 23,780 | 2030 | ||||||
Guinea |
||||||||
| Exploration Concession (Mining Concession) | 102.400 | 2045 | ||||||
| (1) | Work Contract of Vale’s mines in Indonesia expire in 2025. Meanwhile, according to the new
Mining Law, Vale will be entitled to request, at least, a 10 year extension. |
|
| (2) | According to Peruvian mining law, there is only one type of license. The above represents
merely licenses with exploration concession. |
|
| (3) | Of the 80,889 that it has in Argentina, only 40,274 represents activities in progress. |
|
| (4) | Of the 50,332 that it has in Chile, only 23,657 represents activities in progress. |
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Many concessions imposse some obligations on the concessionaire regulating these issues regarding
how operations are carried out and what type of investments are necessary. To maintain mining
rights, it is necessary to attend to these demands, which usually involve significant investments
and high operating costs.
Mining activities regulations
We are subject to a number of regulations that change according to the jurisdiction in which we are
operating. Our operations depend on the legislation and regulations applicable to mining
activities, which include, in many countries, state and local laws, as well as the federal laws. In
addition, a significant part of our concessions, particularly in the case of large operations,
imposes additional obligations on the concessionaire.
The jurisdictions in which Vale operates generally have government agencies responsible for
granting mining licenses and supervising compliance with mining laws and regulations.
Changes in mining legislation may have a significant effect on Vale operations. Among the
jurisdictions in which the Company has operations, there are several changes in legislation
proposed or recently adopted, which can affect it significantly. Among them we can mention:
| • | In January 2009, a new Mining Law went into effect in Indonesia, with new
licensing rules. In 2010, some regulations were enacted for the Mining Code, not all
yet implemented. PTI, along with its legal advisors from Indonesia, is studying the
impacts of the new Mining Law on current and future operations of PTI exploration in
Indonesia. Until all regulations are passed, Vale cannot evaluate how and to what
extent the Employment Contract and PTI operations will be affected. |
| • | In New Caledonia, a law was passed in March 2009 which states that for new
mining projects, formal authorization is required, rather than a simple declaration.
Vale’s license application (which replaces the 2005 declaration) should be submitted
by April 2012. The Company will receive the authorization no later than April 2015.
Vale believes it is unlikely that the authorization will be rejected, but there is
always the risk that there will be new charges. |
| • | In Guinea, the government proposed a new Mining Code that would modify some
of the regulations that currently govern mining operations. Among other regulations,
there would be a mandatory participation of 15% for the State in all mining projects,
which is currently applied only to projects involving diamonds, gold and precious
stones. |
Environmental regulations
We are also subject to environmental regulations that apply to the specific types of mining
and processing activities we conduct. We require approvals, licenses or permits from governmental
authorities to operate, and in most jurisdictions the development of new facilities requires us to
submit environmental impact statements for approval and often to make additional investments to
mitigate environmental impacts. We must also operate our facilities in compliance with the terms
of the approvals, licenses or permits.
Environmental regulations affecting our operations relate, among other matters, to emissions
into the air, soil and water; recycling and waste management; protection and preservation of
forests, coastlines, natural caverns, watersheds and other features of the ecosystem; water use;
and decommissioning and reclamation. In many cases, the mining concessions or environmental
permits under which we operate impose specific environmental requirements on our operations.
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Environmental legislation is becoming stricter worldwide, which could lead to greater costs
for environmental compliance. For instance, if we are required to modify installations, develop
new operational procedures or purchase new equipment, our environmental compliance costs could
increase. In particular, we expect heightened attention from various governments to reducing
greenhouse gases. Some important regulatory environmental
initiatives are described below, but we do not know if it will be necessary to carry out
operational and capital investments to observe such changes or the effect it will have over our
businesses, financial results and cash flow in those operations:
| • | Our operations in Canada and at PTI in Indonesia are subject to air emission
regulations that address, among other things, sulfur dioxide (SO2), particulates and
metals. We will be required to make significant capital expenditures to ensure
compliance with these emissions standards. The imposition of more stringent standards
in the future, especially for SO2 and nickel, could further increase our costs. |
| • | The rhythm of the efforts by the Canadian government to legislate Greenhouse Gas
(GHG) emissions targets has slowed down. The provinces of Manitoba, Ontario and
Newfoundland will launch a consultancy along with several interested parties with
regards to climate change initiatives and also focused on implementation strategies. |
| • | In Canada, a number of studies have been completed or are in progress in Sudbury
and Port Colborne related to contamination of soil and water from past and current
activities. We are taking steps, in partnership with other stakeholders, to remediate
the ecological impact of our activities. |
| • | The Australian government is seeking to introduce an environmental program as part
of an overall strategy to address climate change and reduce greenhouse gas emissions
in Australia. The Australian government stated that it has decided to impose mandatory
targets to control greenhouse gas emission levels by 2020. Thus, it is expected that a
policy to set prices on carbon emissions will be imposed in the country within a short
period of time. |
| • | In October 2009, Indonesia adopted new legislation on Environmental Protection and
Management. It sets out a broad regulatory structure and provides that many important
details will be clarified in subsequently implemented regulations. |
Royalties and other taxes on mining activities
Vale pays royalties on revenues obtained from the extraction and sale of mineral products. The
following royalties and taxes apply in some of the jurisdictions in which we have our largest
operations:
| • | The Canadian provinces in which we operate charge us a tax on profit from mining
operations. Profit from mining operations is generally determined by reference to
gross revenue from the sale of mine output and deducting certain costs, such as mining
and processing costs and investment in processing assets. The statutory mining tax
rates are 10% in Ontario; 17% in Manitoba; and 16% in Newfoundland and Labrador. |
| • | In Indonesia, our subsidiary PTI pays a royalty fee on, among other items, its
nickel production on the concession area and has made certain other commitments.
Until March 2008 the royalty was equal to 1.1% of revenues from sales of nickel
products. As of April 2008, the royalty payment was changed to a fixed amount based
on sales volume (US$78 per metric ton of nickel, based on overall production). |
| • | In Australia, we pay royalties on the revenues from sales of minerals extracted
pursuant to state laws. In Queensland, a 2/3 proportional payment is applied, under
the terms that we pay 7% of the amount up to A$100 per ton and 10% thereafter. The
cost is after port fees and demurrage. In New South Wales, we pay royalties ad valorem
on coal, on the production’s value (revenues minus allowed deductions). Royalty rates
are in the order of 6.2% for deep underground mines (coal extracted below 400 m), 7.2%
for underground mines, and 8.2% for open pit mines. Taxed revenues is free of
beneficiation costs and other taxes. |
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| • | Currently, the Australian government is studying the possibility of applying a new
mineral resource rent tax or “MRRT”. The MRRT will be applied on the profits generated
from the exploration of coal and iron ore resources in Australia. The proposed tax
would be paid as a proportional fee of 22.5% of the taxable profits and would be
deductible from the company’s income tax. The difference between the MRRT and
royalties paid to each of the state governments is that royalties were calculated
based on rent whereas MRRT is calculated on profits. Meanwhile, the government
indicated that companies will receive a deductible credit from state royalties in the
states where the MRRT is owed. |
Regulation of other activities
In addition to mining and environmental regulations, we are subject to comprehensive regulatory
regimes for some of our other activities, including rail transport, electricity generation, and oil
and gas. We are also subject to more general legislation on workers’ health and safety, safety and
support of communities near mines, and other matters.
In connection with the approval in 2006 of our acquisition of Vale Canada, we made a number of
undertakings to the Canadian Minister of Industry under the Investment Canada Act. We believe we
are substantially in compliance with these undertakings, which include locating our global nickel
business in Toronto, Canada; accelerating the Voisey Bay development project; enhancing investments
in a number of areas in Canada; and honoring agreements with provincial governments, local
governments, labor unions and aboriginal groups.
Some of our products are subject to regulations applicable to the marketing and distribution of
chemicals and other substances. For example, the European Commission has adopted a European
Chemicals Policy, known as REACH (“Registration, Evaluation, and Authorization of Chemicals”).
Under REACH, manufacturers and importers will be required to register new substances prior to their
entry into the European market and in some cases may be subject to an authorization process. A
company that fails to comply with the REACH regulation could face restrictions to commercialize its
products in Europe. We have complied with registration requirements for the substances we import
into or manufacture in the EU in 2010 and continue to take measures to manage our exposure to the
authorization process.
Vale’s Environmental Management System determines the development of effective monitoring,
conservation, environmental protection and rehabilitation, aimed at ensuring the maintenance and
recovery of ecosystems in which it operates. The Company’s system is based on ISO 14001 guidelines,
to which it adds additional features that make up Vale’s standard of environmental quality. Aiming
to assess the management and ensure the development of performance, various operations are
submitted by Vale, periodically, to internal and external audits.
Listed below are units of Vale with ISO 14001:
| • | Iron ore and pellets (all iron ore mines and the Tubarão and Fábrica pelletizing plants); |
|
| • | Manganese and ferroalloys (Azul and Morro da Mina, Vale Manganèse France and Vale Manganese
Norway AS); |
|
| • | Nickel (Vale Inco Europe, Taiwan Nickel Refining Corporation, Vale Japan Limited and Vale Nickel
Dalian (INNM)) |
|
| • | Port of Tubarão; |
|
| • | Aluminum (Alunorte, Albras and Valesul) and |
|
| • | Kaolin (CADAM). |
In many cases, Vale operates with higher levels of environmental requirements than is legally
required. To run the Environmental Management System, Vale disbursed US$ 1.99 billion in the last
three years.
Vale systems and control equipment, such as the storage and spraying of water on the roads, besides
the use of chemical powder inhibitors or installation of filters and electrostatic precipitators in
facilities, are complemented by comprehensive monitoring systems and control software.
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The control of air emissions is one of Vale’s main goals. Besides complying with all legal
requirements, the Company continuously evaluates the air quality of its facilities and its effects
on surrounding communities, and makes the necessary investments to improve air quality.
Regarding improvement of water quality, Vale makes every effort to treat and control pollutants
discharged into the sea, rivers and other water bodies, and runs a comprehensive water recycling
program for water used in its operations. The Company is researching into new processes and
technologies to improve the use, recycling and treatment of water. Through its comprehensive system
of waste treatment and removal of debris, Vale seeks greater control of generation and disposal of
residues in order to create opportunities for reuse, recycling and reducing waste.
Vale’s guidelines for decommissioning mines describe a complete set of guidelines, including
practical and technical procedures to be followed during closure of the mines. The handbook
outlines the procedures for monitoring and recovery of degraded areas, the main steps and sequence
to be obeyed during the closure and other liabilities that may result from the closure of the mine.
The manual also provides standardized basic criteria, based on the guidelines of the CVM and the
SEC (FAS 143), for cost evaluation, budgeting for the present, future decommissioning and
restoration.
The waters of the mine, waste dams and waste rock deposits are classified according to a risk
matrix involving all the parameters related to construction, operation and safety control. A
complete audit program has been established which can evaluate the stability of these structures
and provide elements for the preparation, if necessary, of plans for corrective or preventive
action.
Vale’s environmental program also includes restoration projects aimed at (i) protecting the soil
against erosion, (ii) building impact reducers between their activities and the communities in
surrounding areas and (iii) maintaining biodiversity through recovery of the ecosystem. The Company
has partnerships with universities and governmental research agencies to conduct extensive research
on methods of protecting the ecosystem.
7.8 Description of long-term relationships relevant to the Company that are not listed elsewhere in
this form
As one of the leading global companies in the mining sector, Vale seeks to contribute to the
promotion of good practices in sustainability. Vale’s sustainability strategy calls for the
responsible management of economic, environmental, and social issues in an integrated manner. The
goal is to promote its business, especially mining operations, producing local, regional and global
wealth, but also to support the construction of a legacy of positive value over the lifecycle of
its projects. To support this management, the Company carries out voluntary actions in partnership
with various levels of government, public institutions, other businesses and society.
7.9 Other information that the Company deems relevant
No
further relevant information about this item “7”.
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8.1 Description of the group within which the Company functions
a. Direct and indirect control
Valepar S.A. is a holding company that has direct control of Vale, with a participation 32.4% of
capital stock. Valepar is controlled by (i)Litel Participações S.A., a holding company (48.79%);
(ii) Bradespar S.A., a holding company (17.00%); (iii) Mitsui & Co., Ltd, a trading company
(15.00%); (iv) BNDES Participações S.A.; a holding company (9.79%); and (v) Eletron S.A., a holding
company (0.02%).
Litel Participações S.A. is a holding company controlled by BB Carteira Ativa Portfolio (78.41%),
an investment fund, administered by BB Gestão de Recursos — Distribuidora de Títulos e Valores
Mobiliários S.A., whose shares are 100% owned by Previ — Caixa de Previdência dos Funcionários do
Banco do Brasil (Previ). Previ is a private pension fund and its participants are employees of the
Banco do Brasil and of Previ itself. Previ management is divided between the Advisory Board and the
Board of Directors. The Board of Directors is composed of six members: President, Director of
Administration and Directors for Investments, Social Security, Share participations, and Planning.
The Advisory Board is composed of six members and their substitutes. Three are elected by the
participants and users of the security, and three others are indicated by the Banco do Brasil.
According to the Statutes of Previ, the Board of Directors is the body of the organizational
structure responsible for defining the general policy for the administration of the entity.
Bradespar S.A. is a holding company controlled by (i) Cidade de Deus Companhia Comercial de
Participações S.A., a holding company (12.93%), (ii) NCF Participações S.A., a holding company
(6.80%); (iii) Nova Cidade de Deus Participações S.A., a holding company (0.65%), and (iv) Fundação
Bradesco (Bradesco Foundation), a non-profit entity with the goal of providing education and
professional training for children, youths, and adults (5.83%). The Cidade de Deus Companhia
Comercial de Participações S.A. is controlled by Nova Cidade de Deus Participações S.A., a holding
company (44.91%), Fundação Bradesco (33.20%), and Mmes. Lina Maria Aguiar (8.51%), Lia Maria Aguiar
(7.01%) and Maria Ângela Aguiar (4.71%). NCF Participações S.A. is controlled by Bradesco
Foundation (60.41%), Cidade de Deus Companhia Comercial de Participações S.A. (39.51%), and Nova
Cidade de Deus Participações S.A. (0.08%). Nova Cidade de Deus Participações S.A. is controlled by
the Fundação Bradesco (73.32%) and BBD Participações S.A. (25.86%). BBD Participações S.A. has its
capital dispersed among multiple shareholders, with Mr. Lazáro de Mello Brandão the largest of
them, with 4.44% of the total share capital. In accordance with the terms of the Statute of the
Fundação Bradesco, all Directors of Bradesco, members of the Board of Directors and directors of
Departments, as well as all directors and leaders of Cidade de Deus Companhia Comercial de
Participações S.A., act as members of the Fundação Bradesco board of trustees, known as the Mesa
Regedora.
Mitsui & Co., Ltd is a Japanese trading company, which has its capital spread among many
shareholders, but whose largest shareholders are the following Japanese banks (I) the Master Trust
Bank of Japan, Ltd. (trust account) with 9.04% of the share capital; and (ii) Japan Trustee
Services Bank, Ltd. (trust account) with 6.8% of the share capital.
BNDES Participações is a holding company 100% owned by Banco Nacional de Desenvolvimento Econômico
e Social (BNDES). BNDES is a public company endowed with legal personality under private law, whose
shares are 100% owned by the Federal Union.
Electron S.A. is a holding company controlled by Opportunity Anafi Participações S.A. (99.97%), a
holding company controlled by Belapart S.A. (38.47%), Valetron S.A. (38.47%) and Opportunity
Holding FIP (23.07%). Opportunity Holding FIP is an equity investment fund with the Fund Manager,
Mr. Marco Nascimento Ferreira responsible for their investment decisions. Belapart S.A. and
Valetron S.A. are corporate holdings controlled by Ms. Verônica Valente Dantas, who own 50.5% of
the total share capital of each of the above mentioned companies.
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b. subsidiaries and affiliates
For a detailed description of the subsidiaries and affiliates of the company which carry out
activities for Vale, see Item 9 of this Reference Form
3254054 Canada Limited
Aços Laminados do Pará S.A.
Aegis Indemnity Ltd.
Anyang Yu Vale Yongtong Pellet Co., Ltd.
Associação Instituto Tecnologico Vale — ITV
Associação Itakyra
Associação Memorial Minas Gerais Vale
Associação Vale para Desenvolvimento Sustentável — Fundo Vale
Baldertonn Trading Corporate
Baovale Mineração S.A.
Belcoal Pty Ltd
Belvedere Australia (BP) PTY Ltd
Belvedere Coal Management Pty Ltd. (ACN 112 868 461)
Belvedere JV (Unincorporate)
Bowen Central Coal JV (Unincorporate)
Bowen Central Coal Management Pty Limited — (ACN 107 199 619)
Bowen Central Coal Pty Limited — (ACN107 198 676)
Bowen Central Coal Sales Pty Limited — (ACN 107 201 230)
Brasamerican Limited
Broadlea Coal Management Pty Limited — (ACN 104 885 994)
Broadlea JV (Unincorporate)
Cadam Overseas Ltd.
Cadam S.A
Caemi Holding GmbH
California Steel Industries, Inc.
Camberwell Coal Pty Limited — (ACN 003 825 018)
Canico Resources Corp.
Carborough Downs Coal Management Pty Ltd. — (ACN 108 803 461)
Carborough Downs Coal Sales Pty Limited — (ACN 108 803 470)
Carborough Downs JV (Unincorporate)
CMM Overseas Limited
Compagnie Minière Trois Rivières — CMTR
Companhia Coreano-Brasileira de Pelotização — KOBRASCO
Companhia de Maracás S.A
Companhia Ferro-Ligas do Amapá S.A. — cfa
Companhia Hispano-Brasileira de Pelotização — HISPANOBRAS
Companhia Italo-Brasileira de Pelotização — ITABRASCO
Companhia Nipo-Brasileira de Pelotização — NIBRASCO
Companhia Paulista de Ferro-Ligas — CPFL
Companhia Portuaria Baia de Sepetiba — CPBS
Companhia Siderúrgica Ubu
Compañia Minera Andino-Brasileira Ltda — CMAB
Compañia Minera Miski Mayo S.Ac.
Consórcio AHE Porto Estrela
Consórcio Brasileiro de Produção de Óleo de Palma — CBOP
Consórcio Candonga
Consórcio Capim Branco Energia — CCBE
Consórcio da Hidrelétrica de Aimorés
Consórcio da Usina Hidrelétrica de Funil
Consórcio da Usina Hidrelétrica de Igarapava
Consórcio de Rebocadores da Baia de São Marcos — CRBSM
Aços Laminados do Pará S.A.
Aegis Indemnity Ltd.
Anyang Yu Vale Yongtong Pellet Co., Ltd.
Associação Instituto Tecnologico Vale — ITV
Associação Itakyra
Associação Memorial Minas Gerais Vale
Associação Vale para Desenvolvimento Sustentável — Fundo Vale
Baldertonn Trading Corporate
Baovale Mineração S.A.
Belcoal Pty Ltd
Belvedere Australia (BP) PTY Ltd
Belvedere Coal Management Pty Ltd. (ACN 112 868 461)
Belvedere JV (Unincorporate)
Bowen Central Coal JV (Unincorporate)
Bowen Central Coal Management Pty Limited — (ACN 107 199 619)
Bowen Central Coal Pty Limited — (ACN107 198 676)
Bowen Central Coal Sales Pty Limited — (ACN 107 201 230)
Brasamerican Limited
Broadlea Coal Management Pty Limited — (ACN 104 885 994)
Broadlea JV (Unincorporate)
Cadam Overseas Ltd.
Cadam S.A
Caemi Holding GmbH
California Steel Industries, Inc.
Camberwell Coal Pty Limited — (ACN 003 825 018)
Canico Resources Corp.
Carborough Downs Coal Management Pty Ltd. — (ACN 108 803 461)
Carborough Downs Coal Sales Pty Limited — (ACN 108 803 470)
Carborough Downs JV (Unincorporate)
CMM Overseas Limited
Compagnie Minière Trois Rivières — CMTR
Companhia Coreano-Brasileira de Pelotização — KOBRASCO
Companhia de Maracás S.A
Companhia Ferro-Ligas do Amapá S.A. — cfa
Companhia Hispano-Brasileira de Pelotização — HISPANOBRAS
Companhia Italo-Brasileira de Pelotização — ITABRASCO
Companhia Nipo-Brasileira de Pelotização — NIBRASCO
Companhia Paulista de Ferro-Ligas — CPFL
Companhia Portuaria Baia de Sepetiba — CPBS
Companhia Siderúrgica Ubu
Compañia Minera Andino-Brasileira Ltda — CMAB
Compañia Minera Miski Mayo S.Ac.
Consórcio AHE Porto Estrela
Consórcio Brasileiro de Produção de Óleo de Palma — CBOP
Consórcio Candonga
Consórcio Capim Branco Energia — CCBE
Consórcio da Hidrelétrica de Aimorés
Consórcio da Usina Hidrelétrica de Funil
Consórcio da Usina Hidrelétrica de Igarapava
Consórcio de Rebocadores da Baia de São Marcos — CRBSM
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Consórcio de Rebocadores da Barra dos Coqueiros — CRBC
Consórcio Estreito Energia — CESTE
Consórcio Gesai — Geração Santa Isabel
Consórcio Machadinho
Consórcio Railnet
Corredor do Desenvolvimento do Norte SRL — CDN
CPP Participações S.A
CSP — Companhia Siderúrgica do Pecém
Cubatão Fertilizer B.V.
CVRD Overseas S.A.
CVRD Venezuela S.A
Docepar S.A.
Ellensfield Coal Management Pty Ltd. — (ACN 123 542 754)
Empreendimentos Brasileiros de Mineração S.A. — EBM
Empresa Brasileira de Reparos Navais S.A. — RENAVE
Empresa de Mineração Curuá Ltda.
Exide Group Incorporated
Ferrovia Centro-Atlântica S.A. — FCA
Ferrovia Norte Sul S.A
Ferteco Europa S.à.r.l
Fertilizantes Participações S.A
Florestas Rio Doce S.A
Fortlee Investiments Limited
Fosbrasil S.A
Fundação Caemi de Previdência Social
Fundação Centro de Estudos do Comércio Exterior — FUNCEX
Fundação Estação do Conhecimento Moçambique
Fundação Vale do Rio Doce de Habitação e Desenvolvimento Social — FVRD
Fundação Zoobotânica de Carajás
GEVALE Indústria Mineira Ltda.
Glennies Creek Coal Management Pty Ltd. — (ACN 097 768 093)
Glennies Creek JV (Unincorporate)
Goro Funding, LLC
GREMBER — Grêmio dos Empregados da MBR
Heckbert 8 Group Financing Limited Liability Company
Heckbert C8 Holdings Limited
Henan Longyu Energy Resources Co. Ltd.
Heron Resources Limited
IFC — Indústria de Fosfatados Catarinense Ltda
Inco Australia Management Pty Ltd.
Infostrata S.A
Instituto Ambiental Vale — IAV
Integra Coal JV (Unincorporate)
Integra Coal Operations Pty Ltd. — (ACN 118 030 998)
Integra Coal Sales Pty Ltd. — (ACN 080 537 033)
Internacional Iron Company. Inc — IICI
Isaac Plains Coal Management Pty Ltd. — (ACN 114 277 315)
Isaac Plains Coal Sales Pty Ltd. — (ACN 114 276 701)
Consórcio Estreito Energia — CESTE
Consórcio Gesai — Geração Santa Isabel
Consórcio Machadinho
Consórcio Railnet
Corredor do Desenvolvimento do Norte SRL — CDN
CPP Participações S.A
CSP — Companhia Siderúrgica do Pecém
Cubatão Fertilizer B.V.
CVRD Overseas S.A.
CVRD Venezuela S.A
Docepar S.A.
Ellensfield Coal Management Pty Ltd. — (ACN 123 542 754)
Empreendimentos Brasileiros de Mineração S.A. — EBM
Empresa Brasileira de Reparos Navais S.A. — RENAVE
Empresa de Mineração Curuá Ltda.
Exide Group Incorporated
Ferrovia Centro-Atlântica S.A. — FCA
Ferrovia Norte Sul S.A
Ferteco Europa S.à.r.l
Fertilizantes Participações S.A
Florestas Rio Doce S.A
Fortlee Investiments Limited
Fosbrasil S.A
Fundação Caemi de Previdência Social
Fundação Centro de Estudos do Comércio Exterior — FUNCEX
Fundação Estação do Conhecimento Moçambique
Fundação Vale do Rio Doce de Habitação e Desenvolvimento Social — FVRD
Fundação Zoobotânica de Carajás
GEVALE Indústria Mineira Ltda.
Glennies Creek Coal Management Pty Ltd. — (ACN 097 768 093)
Glennies Creek JV (Unincorporate)
Goro Funding, LLC
GREMBER — Grêmio dos Empregados da MBR
Heckbert 8 Group Financing Limited Liability Company
Heckbert C8 Holdings Limited
Henan Longyu Energy Resources Co. Ltd.
Heron Resources Limited
IFC — Indústria de Fosfatados Catarinense Ltda
Inco Australia Management Pty Ltd.
Infostrata S.A
Instituto Ambiental Vale — IAV
Integra Coal JV (Unincorporate)
Integra Coal Operations Pty Ltd. — (ACN 118 030 998)
Integra Coal Sales Pty Ltd. — (ACN 080 537 033)
Internacional Iron Company. Inc — IICI
Isaac Plains Coal Management Pty Ltd. — (ACN 114 277 315)
Isaac Plains Coal Sales Pty Ltd. — (ACN 114 276 701)
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Isaac Plains JV (Unincorporate)
Itabira Internacional — Serviços e Comércio Ltda. — ITACO
Kaolin International BV — KIBV
Kaolin International OY — KIOY
Kaolin International S.A. — KISA
Kaolin Overseas Limited
Kaserge Serviços Gerais Ltda. — KSG
Kobrasco International Trading Co. Ltd. — KOBIN
Korea Nickel Corporation
LOG-IN Logística intermodal S.A.
LOG-IN Mercosur
Machadinho Energética S.A
Maitland Main Collieries Pty Ltd. — (ACN 000 021 652)
MBR Overseas Ltd.
Minas da Serra Geral S.A. — MSG
Mineração Corumbaense Reunida S.A. — MCR
Mineração Dobrados S.A. Indústria e Comércio
Mineração Guanhães Ltda.
Mineração Guariba S.A.
Mineração Japurá Ltda.
Mineração Manati LTDA
Mineração Mato Grosso S.A
Mineração Naque S.A
Mineração Ocirema Indústria e Comércio Ltda
Mineração Paragominas S.A
Mineração Rio do Norte S.A. — MRN
Mineração Urucum Ltda
Mineração Zarzuela Ltda
Minerações BR Holding GmbH
Minerações Brasileiras Reunidas S.A. — MBR
Minérios Metalúrgicos do Nordeste S.A. — MMN
Monticello Insurance Ltd.
MRS Logística S.A
MS Empreendimentos e Participações Ltda. — MSEP
MSE — Serviços de Operação, Manutenção e Montagens Ltda.
MSL Minerais S.A.
MSL Overseas Ltd
Multiplex Resource (Kazakhstan) Limited — MRK
MVM Resources International B.V
Mystery Lake Nickel Mines Limited
Namoi Coal Pty Ltd — (ACN 065 759 882)
Namoi Highwall Pty Ltd — (ACN 074 013 719)
Namoi Hunter Pty Ltd — (ACN 080 537 006)
Nebo Central Coal Pty Ltd — (ACN 079 942 377)
NH2 Pty Ltd — (ACN 097 547 969)
NORPEL — Pelotização do Norte S.A
Norsk Hidro ASA
NSW Coal Resources Pty Ltd — (ACN 077 459 735)
Itabira Internacional — Serviços e Comércio Ltda. — ITACO
Kaolin International BV — KIBV
Kaolin International OY — KIOY
Kaolin International S.A. — KISA
Kaolin Overseas Limited
Kaserge Serviços Gerais Ltda. — KSG
Kobrasco International Trading Co. Ltd. — KOBIN
Korea Nickel Corporation
LOG-IN Logística intermodal S.A.
LOG-IN Mercosur
Machadinho Energética S.A
Maitland Main Collieries Pty Ltd. — (ACN 000 021 652)
MBR Overseas Ltd.
Minas da Serra Geral S.A. — MSG
Mineração Corumbaense Reunida S.A. — MCR
Mineração Dobrados S.A. Indústria e Comércio
Mineração Guanhães Ltda.
Mineração Guariba S.A.
Mineração Japurá Ltda.
Mineração Manati LTDA
Mineração Mato Grosso S.A
Mineração Naque S.A
Mineração Ocirema Indústria e Comércio Ltda
Mineração Paragominas S.A
Mineração Rio do Norte S.A. — MRN
Mineração Urucum Ltda
Mineração Zarzuela Ltda
Minerações BR Holding GmbH
Minerações Brasileiras Reunidas S.A. — MBR
Minérios Metalúrgicos do Nordeste S.A. — MMN
Monticello Insurance Ltd.
MRS Logística S.A
MS Empreendimentos e Participações Ltda. — MSEP
MSE — Serviços de Operação, Manutenção e Montagens Ltda.
MSL Minerais S.A.
MSL Overseas Ltd
Multiplex Resource (Kazakhstan) Limited — MRK
MVM Resources International B.V
Mystery Lake Nickel Mines Limited
Namoi Coal Pty Ltd — (ACN 065 759 882)
Namoi Highwall Pty Ltd — (ACN 074 013 719)
Namoi Hunter Pty Ltd — (ACN 080 537 006)
Nebo Central Coal Pty Ltd — (ACN 079 942 377)
NH2 Pty Ltd — (ACN 097 547 969)
NORPEL — Pelotização do Norte S.A
Norsk Hidro ASA
NSW Coal Resources Pty Ltd — (ACN 077 459 735)
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Pineland Timber Company Limited
Ponta Ubu Agropecuária Ltda
Porto Norte S.A.
Potássio Rio Colorado S.A. — PRC
Prairie Potash Mines Limited
Prony Branch
Prony Nickel S.A.S.
PSC Terminais Intermodais Ltda.
PT International Nickel Indonesia Tbk
PT Vale Eksplorasi Indonesia
Qld Coal Holdings Pty Ltd — (ACN 081 724 129)
QUADREM International Holdings Ltd.
Queensland Coal Resources Pty Ltd — (ACN 075 176 395)
Rio Doce Amsterdam BV
Rio Doce Australia Pty Ltd
Rio Doce International Finance Limited — RDIF
Rio Doce International S.A
Rio Doce Netherlands BV
Rio Paranoá Participações Ltda.
Salobo Metais S.A
Samarco Mineração S.A.
Seamar Shipping Corporation
Shandong Yankuang Internatational Coking Company Limited
Sharcolle Investments Limited
SL Serviços Logísticos Ltda
Sociedad Contractual Minera Tres Valles
Sociedad Portuaria Rio Cordoba S.A
Sociedade de Desenvolvimento do Coredor de Nacala
Sociedade de Mineração Constelação de Apolo S.A.
Societe d’Exploration Minière Vior Inc (VIOR)
Société Industrielle et Com. Brasilo-Luxemborgoise — BRASILUX
SRV Insurance do Brasil S.A.
SRV Reinsurance Company S.A.
Swanbank Queensland Pty Ltd — (ACN 108 563 373)
Taiwan Nickel Refining Corporation
Tao Sustainable Power Solutions (BVI)
Tao Sustainable Power Solutions (UK)
Tao Sustainable Power Solutions (US)
Teal Minerals (Barbados) Incorporated
Tecnored Desenvolvimentos Tecnológicos S.A
Terminal de Vila Velha S.A. — TVV
Tethys Mining LLC
The Central East African Railways Company Limited
ThyssenKrupp CSA Companhia Siderúrgica
ThyssenKrupp Slab International B.V
Tiebaghi Nickel S.A.S (Branch)
Tiebaghi Nickel S.A.S.
Transbarge Navegacion S.A. — TBN
Ponta Ubu Agropecuária Ltda
Porto Norte S.A.
Potássio Rio Colorado S.A. — PRC
Prairie Potash Mines Limited
Prony Branch
Prony Nickel S.A.S.
PSC Terminais Intermodais Ltda.
PT International Nickel Indonesia Tbk
PT Vale Eksplorasi Indonesia
Qld Coal Holdings Pty Ltd — (ACN 081 724 129)
QUADREM International Holdings Ltd.
Queensland Coal Resources Pty Ltd — (ACN 075 176 395)
Rio Doce Amsterdam BV
Rio Doce Australia Pty Ltd
Rio Doce International Finance Limited — RDIF
Rio Doce International S.A
Rio Doce Netherlands BV
Rio Paranoá Participações Ltda.
Salobo Metais S.A
Samarco Mineração S.A.
Seamar Shipping Corporation
Shandong Yankuang Internatational Coking Company Limited
Sharcolle Investments Limited
SL Serviços Logísticos Ltda
Sociedad Contractual Minera Tres Valles
Sociedad Portuaria Rio Cordoba S.A
Sociedade de Desenvolvimento do Coredor de Nacala
Sociedade de Mineração Constelação de Apolo S.A.
Societe d’Exploration Minière Vior Inc (VIOR)
Société Industrielle et Com. Brasilo-Luxemborgoise — BRASILUX
SRV Insurance do Brasil S.A.
SRV Reinsurance Company S.A.
Swanbank Queensland Pty Ltd — (ACN 108 563 373)
Taiwan Nickel Refining Corporation
Tao Sustainable Power Solutions (BVI)
Tao Sustainable Power Solutions (UK)
Tao Sustainable Power Solutions (US)
Teal Minerals (Barbados) Incorporated
Tecnored Desenvolvimentos Tecnológicos S.A
Terminal de Vila Velha S.A. — TVV
Tethys Mining LLC
The Central East African Railways Company Limited
ThyssenKrupp CSA Companhia Siderúrgica
ThyssenKrupp Slab International B.V
Tiebaghi Nickel S.A.S (Branch)
Tiebaghi Nickel S.A.S.
Transbarge Navegacion S.A. — TBN
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Transporte Ferroviario Concesionaria S.A. — TFC
Transporte Ferroviário Inversora Argentina S.A. — TFI
Turbo Power Systems Inc.
UF Distribuidora de Combustíveis Ltda
Ultrafértil S.A
Urucum Mineração S.A. — UMSA
Vale Americas Inc
Vale Ásia Kabushiki Kaisha — Vale Asia K.K.
Vale Australia (CQ) Pty Ltd — (ACN 103 902 389)
Vale Australia (EA) Pty Ltd — (ACN 081 724 101)
Vale Australia (EF) Pty Ltd — (ACN 108 555 111)
Vale Australia (GC) Pty Ltd — (ACN 097 238 349)
Vale Australia (IP) Pty Ltd — (ACN 114 276 694)
Vale Australia Ellensfield Pty Ltd — (ACN 123 542 487)
Vale Australia Holdings Pty Ltd (ACN 075 176 386)
Vale Australia Pty Ltd (ACN 062 536 270)
Vale Austria Holdings GmbH
Vale Austria Holdings GmbH (Oman Branch)
Vale Belvedere (BC) Pty Ltd
Vale Belvedere (SEQ) Pty Ltd
Vale Belvedere Pty Ltd (ACN 128 403 645)
Vale Canada Holdings Inc.
Vale Canadá Limited
Vale Canadian Nickel Holdings Inc.
Vale Capital II
Vale Capital Limited
Vale China Holdings (Barbados) Ltd.
Vale Coal Colombia Ltd
Vale Coal Exploration Pty Ltd — (ACN 108 568 725)
Vale Colombia C.I. SAS
Vale Colombia Holdings Ltd.
Vale Colombia Port Ltd
Vale Colombia Transportation Ltd
Vale Comércio Internacional SE
Vale Cubatão Fertilizantes Ltda
Vale Emirates Limited
Vale Empreendimentos e Participações Ltda
Vale Energia Limpa S.A
Vale Energia Limpa Moçambique Ltd
Vale Energia S.A
Vale Europa S.A
Vale Europe Ltd.
Vale Europe Pension Trustees Ltd.
Vale Evate Moçambique Limitada
Vale Exploració Argentina S.A. — VEA
Vale Exploraciones Chile Ltda
Vale Exploration Canada Inc.
Vale Exploration Peru SAC
Vale Exploration Philippines Inc
Transporte Ferroviário Inversora Argentina S.A. — TFI
Turbo Power Systems Inc.
UF Distribuidora de Combustíveis Ltda
Ultrafértil S.A
Urucum Mineração S.A. — UMSA
Vale Americas Inc
Vale Ásia Kabushiki Kaisha — Vale Asia K.K.
Vale Australia (CQ) Pty Ltd — (ACN 103 902 389)
Vale Australia (EA) Pty Ltd — (ACN 081 724 101)
Vale Australia (EF) Pty Ltd — (ACN 108 555 111)
Vale Australia (GC) Pty Ltd — (ACN 097 238 349)
Vale Australia (IP) Pty Ltd — (ACN 114 276 694)
Vale Australia Ellensfield Pty Ltd — (ACN 123 542 487)
Vale Australia Holdings Pty Ltd (ACN 075 176 386)
Vale Australia Pty Ltd (ACN 062 536 270)
Vale Austria Holdings GmbH
Vale Austria Holdings GmbH (Oman Branch)
Vale Belvedere (BC) Pty Ltd
Vale Belvedere (SEQ) Pty Ltd
Vale Belvedere Pty Ltd (ACN 128 403 645)
Vale Canada Holdings Inc.
Vale Canadá Limited
Vale Canadian Nickel Holdings Inc.
Vale Capital II
Vale Capital Limited
Vale China Holdings (Barbados) Ltd.
Vale Coal Colombia Ltd
Vale Coal Exploration Pty Ltd — (ACN 108 568 725)
Vale Colombia C.I. SAS
Vale Colombia Holdings Ltd.
Vale Colombia Port Ltd
Vale Colombia Transportation Ltd
Vale Comércio Internacional SE
Vale Cubatão Fertilizantes Ltda
Vale Emirates Limited
Vale Empreendimentos e Participações Ltda
Vale Energia Limpa S.A
Vale Energia Limpa Moçambique Ltd
Vale Energia S.A
Vale Europa S.A
Vale Europe Ltd.
Vale Europe Pension Trustees Ltd.
Vale Evate Moçambique Limitada
Vale Exploració Argentina S.A. — VEA
Vale Exploraciones Chile Ltda
Vale Exploration Canada Inc.
Vale Exploration Peru SAC
Vale Exploration Philippines Inc
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Vale Exploration Pty Ltd (ACN 127 080 219)
Vale Explorations USA, Inc.
Vale Fertilizantes Moçambique Limitada
Vale Fertilizantes S.A.
Vale Fertilizer International Holding B.V
Vale Fertilizer Netherlands B.V
Vale Florestar Fundo de Deenvolvimento e Participações (“FUNDO”)
Vale Florestar S.A.
Vale Guinée S.A
Vale Holdings (Barbados) Limited
Vale Holdings AG
Vale Inco Asia Ltd.
Vale Inco Atlantic Sales Limited
Vale Inco Australia Ltd. Partnership
Vale Inco Europe Holdings
Vale Inco Management Advisory Services (Shangai) Co., Ltd.
Vale Inco Metals (Shangai) Co., Ltd
Vale Inco Nouvelle-Calédonie Branch
Vale Inco Pacific Ltd Branch (Taiwan)
Vale Inco Pacific Ltd Branch (Thailand)
Vale Inco Pacific Ltd.
Vale Inco Resources (Australia) Pty Ltd.
Vale India Private Limited
Vale International S.A
Vale International S.A. DIFC Branch
Vale International Singapore
Vale Investments Ltd.
Vale Japan Ltd.
Vale Kazakhstan Limited Liability Partinership
Vale Limited
Vale Logística da Argentina S.A — VLA
Vale Logística do Uruguay S.A
Vale Logística Integrada S.A.
Vale Malaysia Manufacturing SDN. BHD.
Vale Manganês S.A
Vale Manganese France
Vale Manganese Norway AS
Vale Mauritius Ltd.
Vale Mina do Azul S.A
Vale Minerals China Co. Ltd
Vale Moçambique Ltda.
Vale Newfoundland & Labrador Ltd.
Vale Nickel (Dalian) Co. Ltd
Vale Nouvelle-Calédonie S.A.S.
Vale Óleo e Gás S.A
Vale Oman Distribution Center LLC
Vale Oman Pelletizing Company LLC
Vale Explorations USA, Inc.
Vale Fertilizantes Moçambique Limitada
Vale Fertilizantes S.A.
Vale Fertilizer International Holding B.V
Vale Fertilizer Netherlands B.V
Vale Florestar Fundo de Deenvolvimento e Participações (“FUNDO”)
Vale Florestar S.A.
Vale Guinée S.A
Vale Holdings (Barbados) Limited
Vale Holdings AG
Vale Inco Asia Ltd.
Vale Inco Atlantic Sales Limited
Vale Inco Australia Ltd. Partnership
Vale Inco Europe Holdings
Vale Inco Management Advisory Services (Shangai) Co., Ltd.
Vale Inco Metals (Shangai) Co., Ltd
Vale Inco Nouvelle-Calédonie Branch
Vale Inco Pacific Ltd Branch (Taiwan)
Vale Inco Pacific Ltd Branch (Thailand)
Vale Inco Pacific Ltd.
Vale Inco Resources (Australia) Pty Ltd.
Vale India Private Limited
Vale International S.A
Vale International S.A. DIFC Branch
Vale International Singapore
Vale Investments Ltd.
Vale Japan Ltd.
Vale Kazakhstan Limited Liability Partinership
Vale Limited
Vale Logística da Argentina S.A — VLA
Vale Logística do Uruguay S.A
Vale Logística Integrada S.A.
Vale Malaysia Manufacturing SDN. BHD.
Vale Manganês S.A
Vale Manganese France
Vale Manganese Norway AS
Vale Mauritius Ltd.
Vale Mina do Azul S.A
Vale Minerals China Co. Ltd
Vale Moçambique Ltda.
Vale Newfoundland & Labrador Ltd.
Vale Nickel (Dalian) Co. Ltd
Vale Nouvelle-Calédonie S.A.S.
Vale Óleo e Gás S.A
Vale Oman Distribution Center LLC
Vale Oman Pelletizing Company LLC
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Vale Operações Ferroviárias S.A
Vale Operações Portuárias S.A
Vale Overseas Ltd.
Vale Potash Canada Limited
Vale Potássio Nordeste S.A
Vale Projectos e Desenvolvimento Moçambique Limitada
Vale Proyectos Minerales S.A
Vale Republic Democratique Du Congo — Vale Congo
Vale S.A
Vale Salzach GmbH
Vale Shipping Company Pte Limited
Vale Shipping Enterprise Pte. Ltd
Vale Shipping Holding Pte. Ltd
Vale Shipping Singapore Pte. Ltd
Vale Slab S.A
Vale Soluções em Energia S.A
Vale South Africa (Proprietary) Ltd.
Vale Technology Development (Canada) Limited
Vale Zambia Limited
Valepar
ValeServe Malaysia Sdn. Bhd.
Valesul Alumínio S.A.
VBG — Logistics ( Vale BSGR Logistics) Corp.
VBG — Vale BSGR BVI Limited
VBG — Vvale BSG Guinea
VBG — Vale BSGR Liberia Limited
VBG — Vale BSGR Limited
VEL (ME) Ltd
VEL Holdings GmbH
Vistaerea S.A
Zhuhai YPM Pellet Co. Ltd.
Vale Operações Portuárias S.A
Vale Overseas Ltd.
Vale Potash Canada Limited
Vale Potássio Nordeste S.A
Vale Projectos e Desenvolvimento Moçambique Limitada
Vale Proyectos Minerales S.A
Vale Republic Democratique Du Congo — Vale Congo
Vale S.A
Vale Salzach GmbH
Vale Shipping Company Pte Limited
Vale Shipping Enterprise Pte. Ltd
Vale Shipping Holding Pte. Ltd
Vale Shipping Singapore Pte. Ltd
Vale Slab S.A
Vale Soluções em Energia S.A
Vale South Africa (Proprietary) Ltd.
Vale Technology Development (Canada) Limited
Vale Zambia Limited
Valepar
ValeServe Malaysia Sdn. Bhd.
Valesul Alumínio S.A.
VBG — Logistics ( Vale BSGR Logistics) Corp.
VBG — Vale BSGR BVI Limited
VBG — Vvale BSG Guinea
VBG — Vale BSGR Liberia Limited
VBG — Vale BSGR Limited
VEL (ME) Ltd
VEL Holdings GmbH
Vistaerea S.A
Zhuhai YPM Pellet Co. Ltd.
c. Vale shareholdings in companies in the group
None
d. Shareholdings in Vale held by companies in the group
As well as shareholdings by the direct controller Valepar in Vale, described in item “a” above, the
following companies hold direct shares in Vale:
| Company in the Group | Company share (%) | |||
BNDES Participações S.A |
5.343 | % | ||
Caixa de Previd.dos Func.do Banco do Brasil — Previ |
0.073 | % | ||
e. companies under common control
None.
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8.3 Restructuring operations
Instructions for filling the table:
See item 6.5 of this Reference Form.
See item 6.5 of this Reference Form.
8.4 Other information which the Company judges to be relevant
As Mitsui & Co. Ltd., direct controller of Valepar S.A., has capital shares spread among many
shareholders with no clearly defined control, its shareholders were not considered to be a company
in the group in item 8.1(d).
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9. RELEVANT ASSETS
9.1 Uncirculated assets for the relevant development activities of the Company for the last fiscal
year
Items 9.1 (a), 9.1 (b) and 9.1(c) of this Reference Form, describe the main uncirculated assets of
the Company.
The main fixed assets of the Company consist of various buildings, facilities, equipment, IT
equipment, railroads, and mining rights, pursuant to item 9.1 (a) of this Reference Form. The
following table describes the book value of fixed assets of the Company in December 31, 2010 by
category and geographic location:
In Thousands of Reais
| North | New | |||||||||||||||||||||||||||||||||||
| 2010 | Brazil | Europe | America | Australia | Africa | Asia | Caledonia | Others | Total | |||||||||||||||||||||||||||
Buildings |
4,923,466 | 95,661 | 773,757 | — | 604 | 1,151,343 | 2,324,958 | — | 9,269,787 | |||||||||||||||||||||||||||
Facilities |
19,274,685 | 177,014 | 1,727,954 | — | 261,397 | 86,642 | 4,313,741 | 115,379 | 25,956,813 | |||||||||||||||||||||||||||
Equipment |
13,281,680 | 91,139 | 1,249,755 | — | 153,435 | 1,744,529 | 108,303 | 347,994 | 16,976,836 | |||||||||||||||||||||||||||
Mining |
15,975,825 | 2,000 | 17,501,001 | 1,128,844 | 2,357,850 | 2,060,257 | 994,721 | 651,735 | 40,672,233 | |||||||||||||||||||||||||||
Others |
5,749,001 | 15,312 | 7,992,226 | 1,467,258 | 816,488 | 45,175 | 26,658 | 569,362 | 16,681,480 | |||||||||||||||||||||||||||
ongoing |
10,066,919 | 1,803,144 | 1,120,531 | — | 2,911,559 | 1,967,797 | 1,939,457 | 720,277 | 20,529,685 | |||||||||||||||||||||||||||
Total |
69,271,576 | 2,184,270 | 30,365,224 | 2,596,102 | 6,501,333 | 7,055,743 | 9,707,838 | 2,404,747 | 130,086,833 | |||||||||||||||||||||||||||
a. Fixed assets, including those subject to rent or lease:
| Brief Description of Asset | Location | State | Municipality | |||
Iron ore mine — Carajás |
Brazil | Pará | Various | |||
Iron ore mines — various Southeast system |
Brazil | Various | Various | |||
Iron ore mines — various Southern system |
Brazil | Minas Gerais | Various | |||
Iron ore mines — various Central West system |
Brazil | Mato Grosso do Sul | ||||
Pelletizing plant — Tubarão I |
Brazil | Espírito Santo | Vitória | |||
Pelletizing plant — Tubarão II |
Brazil | Espírito Santo | Vitória | |||
Pelletizing plant — Fábrica |
Brazil | Minas Gerais | Congonhas | |||
Pelletizing plant — São Luiz |
Brazil | Maranhão | São Luiz | |||
Pelletizing plant — Vargem Grande |
Brazil | Minas Gerais | Nova Lima |
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| Brief Description of Asset | Location | State | Municipality | |||
Pelletizing plant — Samarco |
Brazil | Espírito Santo | Anchieta | |||
Pelletizing plant — Zhuhai YPM |
China | Zhuhai | ||||
Pelletizing plant — Hispanobras |
Brazil | Espírito Santo | Vitória | |||
Pelletizing plant — Itabrasco |
Brazil | Espírito Santo | Vitória | |||
Pelletizing plant — Kobrasco |
Brazil | Espírito Santo | Vitória | |||
Pelletizing plant — Nibrasco |
Brazil | Espírito Santo | Vitória | |||
Pelletizing plant — Oman |
Oman | |||||
Integrated nickel production system: mine, processing plant, smelter, and nickel refinery |
Canada | Sudbury | ||||
Integrated nickel production system: mine, processing plant, smelter, and nickel refinery |
Canada | Thompson | ||||
Nickel mine and processing plant |
Canada | Voisey's Bay | ||||
Nickel mine and processing plant |
Indonesia | Sorowako | ||||
Nickel mine and processing plant |
New Caledonia | Noumea | ||||
PTI nickel mine |
Indonesia | Sorowako | ||||
Nickel refinery |
Wales | Clydach | ||||
Sossego mine |
Brazil | Pará | Various | |||
Salobo mine |
Brazil | Pará | Various | |||
Onça Puma mine |
Brazil | Pará | Various | |||
Carajás Railroad |
Brazil | Various | Various | |||
Vitória a Minas Railroad |
Brazil | Various | Various | |||
Centro-Atlântica Railroad |
Brazil | Various | Various | |||
North-South Railroad |
Brazil | Various | Various | |||
MRS Logistics |
Brazil | Various | Various | |||
Manganês Mines |
Brazil | Various | Various | |||
Paragominas mine — bauxite |
Brazil | Pará | Various | |||
Thermal and metallurgical coalmine |
Australia | Hunter Valley | ||||
Thermal and metallurgical coalmine |
Australia | Bowen Basin | ||||
Thermal and metallurgical coalmine — Moatize |
Mozambique | Various | ||||
Thermal coalmine — El Hatillo |
Colômbia | Santa Marta | ||||
Phosphorite mine — Bayóvar |
Peru | Salamanca | ||||
Phosphorite mine and processing plant |
Brazil | Various | ||||
Port Colborne smelter of precious metals |
Canadá | Ontario | ||||
Plant of ferroalloys |
Brazil | Various | Various | |||
Plant of ferroalloys |
France | Dunkirk | ||||
Plant of ferroalloys |
Norway | Mo I Rana |
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b Patents, trademarks, licenses, concessions, franchises and contracts for technology transfer:
| Territory affected | Events which might cause a loss of | Possible Consequences of Loss | ||||||||||||
| Type of asset | Description/class | Duration | (hectares) | rights | of Rights for the Company | |||||||||
Concessions
|
Mining concessions in Brazil | Undetermined | 664,627 | Persistent breach of current Mining Legislation: predatory mining, mining stopped without notice to, and consent of, the Competent organ, not answering repeated requests for routine inspections. | Interruption and / or canceling of mining operations in Brazil | |||||||||
Concessions
|
Patented lands in Canada /Province of Ontario | Undetermined | 89,732 | Non-payment of taxes (mining tax) | Interruption and / or canceling of mining operations in Ontario, Canada | |||||||||
Concessions
|
Mining leases in Canada/Province of Ontario | 2011-2028 | 14,026 | Failure/refusal to make renewal request, failure to pay mining lease rent for more than 2 years. | Interruption and / or canceling of mining operations in Ontario | |||||||||
Licença
|
Mining license of occupation in Canada/ Province of Ontario | Undetermined | 2,952 | Non-payment of taxes (mining rent) | Interruption and / or canceling of mining operations in Ontario | |||||||||
Licença
|
OIC’s (Order in Council Leases) in Canada/ Province of Manitoba | 2011-2028 | 109,043 | Failure to make renewal request for the area and non-payment of taxes (rental fee and mining claim tax) | Interruption and / or canceling of mining operations in Manitoba, Canada | |||||||||
Concessions
|
Mining leases in Canada/Province of Manitoba | 2013 | 4,903 | Failure to make renewal request for the area and non-payment of taxes (rental fee) and failure to present evaluation work | Interruption and / or canceling of mining operations in Manitoba | |||||||||
Concessions
|
Mining leases in Canada/Province of Newfoundland and Labrador | 2027 | 1,599 | Failure to present evaluation work and non-payment of taxes (rental fee). | Interruption and / or canceling of mining operations in Newfoundland and Labrador, Canada | |||||||||
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| Territory affected | Events which might cause a loss of | Possible Consequences of Loss | ||||||||||||
| Type of asset | Description/class | Duration | (hectares) | rights | of Rights for the Company | |||||||||
Concessions
|
Surface lease in Canada/Province of Newfoundland and Labrador | 2027 | 4,015 | Failure to present evaluation work and non-payment of taxes (rental fee). | Interruption and / or canceling of mining operations in Newfoundland and Labrador | |||||||||
Concessions
|
Work contract in Indonesia | 2025 | 190,523 | End of the contract; by cancellation due to errors or irregularity in the procedure or in the act of its granting and in case of bankruptcy or termination of the Concessionary. | Interruption and / or canceling of mining operations in Indonesia | |||||||||
| Note: The Contract of Work of Vale mines in Indonesia expires in 2025. However, and according to the new Mining Law, Vale can ask for an extension of at least 10 years | ||||||||||||||
Concessions
|
Mining concessions in Australia | 2011-2039 | 22,281 | Non payment of lease/royalties, failure to submit report on activities | Interruption and /or canceling of mining operations in Australia | |||||||||
Concessions
|
Mining concessions in New Caledonia |
2016-2051 | 20,332 | Non payment of lease/royalties, failure to submit report on activities. | Interruption and / or canceling of mining operations in New Caledonia | |||||||||
| Note: The Goro project comprises 6,571 hectares in eight mining concessions, out of which three are renewable in 2016, while the others should be renewed in 2048 and 2051. | ||||||||||||||
Concessions
|
Mining concessions in New Caledonia (except for the area for the VNC project) |
2016-2040 | 13,586 | Non payment of lease/royalties, failure to submit report on activities | Interruption and / or canceling of mining operations in New Caledonia | |||||||||
Concessions
|
Mining concessions in Peru | Undetermined | 146,778 | Non-payment of annual fee for more than 2 consecutive years and non-payment of fine. | Interruption and / or canceling of mining operations in Peru | |||||||||
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| Territory affected | Events which might cause a loss of | Possible Consequences of Loss | ||||||||||||
| Type of asset | Description/class | Duration | (hectares) | rights | of Rights for the Company | |||||||||
Concessions
|
El Hatillo concessions in Colombia |
2027 | 9,695 | Not performing the work and the works of exploration, construction and installation and operation on the terms and conditions set forth in the contract, no payment of royalties and other considerations of the contract, failure to submit the reports in the contract non-renewal or adjustment of policies breach of contract, breach of the obligation to maintain the area given in concession, non-payment of fines that are imposed by any authority mining, the suspension of work and works for more than 3 consecutive months or six months accrued in one year without prior authorization from the mining authority, not meeting standards of technical mining, non-compliance with environmental standards, carrying out works and mining activities in special areas without prior authority, violation of laws governing the sale and marketing of coal, the assignment, subcontracting or hiring of equipment without prior approval of the competent authority. | Consecutive fines, declaration of ending of the mining contract, and consequently, inability to execute this type of Contract with the State again. | |||||||||
Concessions
|
Concessions in de Cerro Largo Sur in Colombia | 2032 | 1,092 | Not performing the work and the works of exploration, construction and installation and operation on the terms and conditions set forth in the contract, no payment of royalties and other considerations of the contract, failure to submit the reports in the contract non-renewal or adjustment of policies breach of contract, breach of the obligation to maintain the area given in concession, non-payment of fines that are imposed by any authority mining, the suspension of work and works for more than 3 consecutive months or six months accrued in one year without prior authorization from the mining authority, not meeting standards of technical mining, non-compliance with environmental standards, carrying out works and mining activities in special areas without prior authority, violation of laws governing the sale and marketing of coal, the assignment, subcontracting or hiring of equipment without prior approval of the competent authority. | Consecutive fines, declaration of ending of the mining contract, and consequently, inability to execute \ this type of Contract with the State again. | |||||||||
Concessions
|
Mining concessions (Manifestación de Descubrimiento —[Discovery Statement]) in Argentina | Undetermined | 80,889 | Failure to present request for measurement, failure to carry out legal labor (LL), non-payment of fee (“canon minero” [mining royalties]) | Interruption and / or canceling of mining operations in Argentina | |||||||||
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| Territory affected | Events which might cause a loss of | Possible Consequences of Loss | ||||||||||
| Type of asset | Description/class | Duration | (hectares) | rights | of Rights for the Company | |||||||
Concessions
|
Mining concessions (Concesión de explotación [exploitation concession]) in Chile |
Undetermined | 50,632 | Non-compliance with annual payment deadlines; lack of opposition from third parties to requests for areas by Vale. | Interruption and / or canceling of mining operations in Chile | |||||||
Concessions
|
Mining concessions in Mozambique |
2030 | 23,780 | Lack of demarcation of the area, lack of payment of specific taxes, failure to submit work report and not carrying out work as per mining plan. | Interruption and / or canceling of mining operations in Mozambique | |||||||
Concession
|
Rail concession for passenger and freight transport on the Carajás railroad | 2027 (prorogable for 30 years) | 892 km, covering the states of MG, SP, ES, RJ, GO, BA, SE and the Federal district (DF) | The concession will be terminated if one of the following takes place: the end of the contractual period, expropriation, forfeiture, termination of period, cancellation, bankruptcy or closure of the Concessionary. | Interruption and / or canceling of railroad operations which are part of Vale’s Northern System. | |||||||
Concession
|
Rail concession for passenger and freight transport on the Vitória a Minas railroad | 2027 (extendable for 30 years) | 905 km in the states of ES and MG. | The concession will be terminated if one of the following takes place: the end of the contractual period, expropriation, forfeiture, termination of period, cancellation, bankruptcy or closure of the Concessionary. | Interruption and / or canceling of railroad operations which are part of Vale’s Southeast System. | |||||||
Concession
|
Concession for the Center-East network belonging to the Federal Railroad Network (Rede Ferroviária Federal S.A.), granted to the Centro-Atlântica railroad | 2026 (extendable for 30 years) | 8,023 km in the states of MA and PA. | The concession will be terminated if one of the following takes place: the end of the contractual period, expropriation, forfeiture, termination of period, cancellation, bankruptcy or closure of the Concessionary. | Interruption and / or canceling of railroad operations. | |||||||
Concession
|
Concession for the South-East network belonging to the Federal Railroad Network (Rede Ferroviária Federal S.A.), granted to MRS Logística | 2026 (extendable for 30 years) | 1,643 km in the states of MG, SP and RJ | The concession will be terminated if one of the following takes place: the end of the contractual period, expropriation, forfeiture, termination of period, cancellation, bankruptcy or closure of the Concessionary. | Interruption and / or canceling of railroad operations which are part of Vale’s Southern System. | |||||||
Concession
|
Subconcession contract with lease of North-South railroad network | 2037 (extendable for 30 years) | 720 km, between Açailândia (MA) and Palmas (TO) | The concession will be terminated if one of the following takes place: the end of the contractual period, expropriation, forfeiture, termination of period, cancellation, bankruptcy or closure of the Sub-Concessionary. | Interruption and / or canceling of railroad operations. | |||||||
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| Territory affected | Events which might cause a loss of | Possible Consequences of Loss | ||||||||||
| Type of asset | Description/class | Duration | (hectares) | rights | of Rights for the Company | |||||||
Concession
|
Concession for Use of Public property for electrical energy generation — UHE Igarapava | 2028 | Igarapava (SP), Conquista(MG), Rifaina(SP) and Sacramento(MG) | (i) by reversal of the asset at the end of the contractual period; (ii) by expropriation. | Interruption and / or canceling of supply of energy generated by own plant. | |||||||
Concession
|
Concession for Use of Public property for electrical energy generation — UHE Porto Estrela | 2032 | Joanésia(MG), Braúnas(MG) and Açucena(MG) | (i) by the contractual period ending; (ii) by expropriation of the services; (iii) by expiration (iv) by recision; (v) the cancellation due to error or irregularity in procedure or found in the act of its granting, (vi) in the case of bankruptcy or dissolution of the Concessionary. | Interruption and / or canceling of supply of energy generated by own plant. | |||||||
Concession
|
Concession for Use of Public property for electrical energy generation — UHE Capim Branco I and II | 2036 | Araguari(MG), Uberlândia(MG) and Indianópolis(MG) | (i) by the contractual period ending; (ii) by expropriation of the services; (iii) by expiration (iv) by recision; (v) the cancellation due to error or irregularity in procedure or found in the act of its granting, (vi) in the case of bankruptcy or dissolution of the Concessionary. | Interruption and / or canceling of supply of energy generated by own plant. | |||||||
Concession
|
Concession for Use of Public property for electrical energy generation — UHE Funil | 2035 | Lavras (MG), Perdões(MG), Ijaci(MG), Itumirim(MG), Ibituruna(MG), Bom Sucesso(MG) |
(i) by the contractual period ending; (ii) by expropriation of the services; (iii) by expiration (iv) by recision; (v) the cancellation due to error or irregularity in procedure or found in the act of its granting, (vi) in the case of bankruptcy or dissolution of the Concessionary. | Interruption and / or canceling of supply of energy generated by own plant. | |||||||
Concession
|
Concession for Use of Public property for electrical energy generation — UHE Aimorés | 2035 | Aimorés (MG), Baixo Guandu(ES), Resplendor(MG) and Itueta(MG) | ((i) by the contractual period ending; (ii) by expropriation of the services; (iii) by expiration (iv) by recision; (v) the cancellation due to error or irregularity in procedure or found in the act of its granting, (vi) in the case of bankruptcy or dissolution of the Concessionary. | Interruption and / or canceling of supply of energy generated by own plant. | |||||||
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| Territory affected | Events which might cause a loss of | Possible Consequences of Loss | ||||||||||
| Type of asset | Description/class | Duration | (hectares) | rights | of Rights for the Company | |||||||
Concession
|
Concession for Use of Public property for electrical energy generation — UHE Candonga | 2035 | Rio Doce(MG), Santa Cruz do Escalvado(MG) |
(i) by the contractual period ending; (ii) by expropriation of the services; (iii) by expiration (iv) by recision; (v) the cancellation due to error or irregularity in procedure or found in the act of its granting, (vi) in the case of bankruptcy or dissolution of the Concessionary. | Interruption and /or canceling of supply of energy generated by own plant. | |||||||
Concession
|
Concession for Use of Public property for electrical energy generation — UHE Estreito | 2037 | Estreito and Carolina (MA) and Aguiarnópolis, Darcinópolis, Goiatins, Babaçulândia, Barra do Ouro, Palmeirante, Palmeiras do Tocantins, Tocantinópolis, Tupiratins, Itapiratinsm, and Filadélfia (TO) | (i) by the contractual period ending; (ii) by expropriation of the services; (iii) by expiration (iv) by recision; (v) the cancellation due to error or irregularity in procedure or found in the act of its granting, (vi) in the case of bankruptcy or dissolution of the Concessionary. | Interruption and /or canceling of supply of energy generated by own plant. | |||||||
Concession
|
Concession for Use of Public property for electrical energy generation — UHE Santa Isabel | 2037 | Ananás, Araguanã, Riachinho, and Xambioá (TO) and Palestina do Pará, Piçarraand São Geraldo do Araguaia (PA) | (i) by the contractual period ending; (ii) by expropriation of the services; (iii) by expiration (iv) by recision; (v) the cancellation due to error or irregularity in procedure or found in the act of its granting, (vi) in the case of bankruptcy or dissolution of the Concessionary. | Interruption and /or canceling of supply of energy generated by own plant. | |||||||
Concession
|
Shared concession for electrical energy generation — UHE Machadinho |
2032 | Anita Garibaldi, Celso Ramos, Campos Novos, Zortéa, Capinzal and Piratuba (RS) and Maximiliano de Almeida, Machadinho, Barracão and Pinhal da Serra (SC) | (i) by reversal of the asset at the end of the contractual period; (ii) by expropriation (iii) by expiration. | Interruption and /or canceling of supply of energy generated by own plant. | |||||||
Concession
|
Concession for usage of hydro energy — PCH Nova Maurício | 2021 | Leopoldina (MG) | (i) period of concession ending. | Interruption and /or canceling of supply of energy generated by own plant. | |||||||
Concession
|
Concession for usage of hydro energy — PCH Glória | 2021 | Muriaé (MG) | (i) period of concession ending. | Interruption and /or canceling of supply of energy generated by own plant. | |||||||
Concession
|
Concession for usage of hydro energy — PCH Ituerê | 2021 | Rio Pomba (MG) | (i) period of concession ending. | Interruption and /or canceling of supply of energy generated by own plant. | |||||||
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| Territory affected | Events which might cause a loss of | Possible Consequences of Loss | ||||||||||
| Type of asset | Description/class | Duration | (hectares) | rights | of Rights for the Company | |||||||
Concession
|
Concession for usage of hydro energy — PCH Mello | 2025 | Rio Preto (MG) | (i) period of concession ending. | Interruption and /or canceling of supply of energy generated by own plant. | |||||||
Brand
|
Registry of the Mixed Brand “Vale” | 2017 (extendable every 10 years) | 98 countries | Within the administrative field (INPI), the registries of brands already granted may be contested by a nullity proceedings, or suffer requirements of partial or total expiration, in the event the brand is not being used in the way for which the registration was granted. Within the legal field, third parties may request the nullity of the registrations stating a violation of their intellectual property rights. The maintenance of the trademark registrations is made through the periodical payment of fees to INPI. The payment of the corresponding rates and the continuous use of the trademarks is necessary to avoid the end of the registration and the consequent expiration of the owner’s rights. | The loss of the rights on the trademarks implies the impossibility to stop third parties from using the same or similar trademarks in order to name concurrent services or products, once the owner has no more the exclusive right of use on them. There is also the possibility for the owner to suffer legal claims within the criminal and civil field, based on unlawful use in case of violation of third parties’ rights; this may result in the impossibility to use the marks in his activities. It is not possible to quantify the impact of this hypothesis. | |||||||
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Companies in which Vale has a share participation
| Book value (“VC”) | ||||||||||||||||||||||||||||||||||||
| and Market value | Increase or Decrease in Value of | |||||||||||||||||||||||||||||||||||
| iv. Share in | (“VM”) of Share | Share, according to book value | Dividends Received | |||||||||||||||||||||||||||||||||
| company | CVM | (R$ mil) | and market value | (R$) | ||||||||||||||||||||||||||||||||
| CNPJ | (%) | registration | 2010 | 2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||||||||||
CONTROLADAS
ALBRAS — ALUMÍNIO
BRASILEIRO S.A.
|
05.053.020/0001-44 | 51 | NO | VC: 1,088,000,000.00 | 4.8 | % | 4.7 | % | 9.5 | % | 0 | 5,830,000.00 | 77,777,000.00 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Rodovia PA 483 — KM 21 — Edifício 711 Ala C — Distrito de Murucupi — Barcarena — PA — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: Production and sale of alumina and other related industry products and trading of alumina, its raw materials and products derived there from; import and export of any products or goods necessary to carry out industrial and commercial activities of the Society, participation in ventures having similar objectives and purposes or otherwise related to the objectives of the Company, development of technology for alumina production and provision of technical services related thereto, and transportation and other services of any nature (including port operations), provided that they are related to the objectives stated above. | ||||||||||||||||||||||||||||||||||||
| Reasons for Acquiring and Maintaining Share: Running aluminum operations in Brazil. Investment kept for sale. | ||||||||||||||||||||||||||||||||||||
ALUNORTE — ALUMINA DO
NORTE DO BRASIL S.A.
|
05.848.387/0001-54 | 57.03 | NO | VC: 2,732,000,000.00 | 5.1 | % | 4.8 | % | 5.5 | % | 31,000,000 | 8,087,000.00 | 79,027,000.00 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Rodovia PA 483 — KM 12 — Área 73 Barcarena — PA — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: Production and sale of alumina and other related industry products and trading of alumina, its raw materials and products derived there from; import and export of any products or goods necessary to carry out industrial and commercial activities of the Society, participation in ventures having similar objectives and purposes or otherwise related to the objectives of the Company, development of technology for alumina production and provision of technical services related thereto, and transportation and other services of any nature (including port operations), provided that they are related to the objectives stated above. | ||||||||||||||||||||||||||||||||||||
| Reasons for Acquiring and Maintaining Share: Running aluminum operations in Brazil. Investment kept for sale. | ||||||||||||||||||||||||||||||||||||
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| Book value (“VC”) | ||||||||||||||||||||||||||||||||||||
| and Market value | Increase or Decrease in Value of | |||||||||||||||||||||||||||||||||||
| iv. Share in | (“VM”) of Share | Share, according to book value | Dividends Received | |||||||||||||||||||||||||||||||||
| company | CVM | (R$ mil) | and market value | (R$) | ||||||||||||||||||||||||||||||||
| CNPJ | (%) | registration | 2010 | 2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||||||||||
FERROVIA CENTRO —
ATLÂNTICA S.A.
|
00.924.429/0001-75 | 100 | 15369 | VC: 1,916,000,000.00 | 12.4 | % | 0.23 | % | -44.3 | % | 0 | 0 | 0 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Rua Sapucaí, 383 – 7º andar — Belo Horizonte — MG — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: To provide rail transport services; operate services for loading, unloading, warehousing and transshipment stations, yards and land within the range of existing railway lines which are object of the concession, exploring modal transport related to rail transport; serving as a port operator, running services and operations for moving and storage of goods destined for or coming from water transport; participating in projects that aim to promote the development of the socio-economic areas of influence, seeking to expand rail services delivered; perform all similar or related activities as those described in the above, and engage in other activities that are based on the infrastructure of the Company. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Exploitation of the Centro-Atlantica railroad concession. | ||||||||||||||||||||||||||||||||||||
FERROVIA NORTE SUL
S.A.
|
09.257.877/0001-37 | 100 | SIM | VC: 1,744,000,000.00 | 35.0 | 57.6 | % | 10.9 | % | 0 | 5,680,000.00 | 0 | ||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Av. dos Portugueses s/nº — Prédio DILN, 1º andar — Sala 1 — Itaqui-Pedrinhas Retorno de Itagui — São Luiz — MA — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: Perform the operation of rail freight, under the regime of subconcession, through the following activities: (a) provision of the administration and operation of the North South Railroad, for the stretch in Açailândia, State of Maranhão, to Palmas, State of Tocantins (Stretch), including operation, maintenance, monitoring, improvement and adaptation of the stretch of railroad, as defined in the Bid Notice No. 001/2006 (Notice) including, in compliance with the conditions of the Sub-concession contract with Lease (Contract); and (b) implementation, management and supervision of services mentioned in item (a) above, including associated projects, operational services and additional services, as well as to support additional services and related acts provided that such activities are related to the objectives of the Company, under the terms of the Contract. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Running of the North-South railroad concession. | ||||||||||||||||||||||||||||||||||||
Vale Fertilizantes S.A
|
19.443.985/0001-58 | 78.92 | YES | VC: 7,384,000,000.00 | N/A | N/A | N/A | 0 | 0 | 0 | ||||||||||||||||||||||||||
| VM: 4,829,000,000.00 | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Estrada da Cana, Km 11, Distrito Industrial Delta, Uberaba, MG — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: the utilization of mineral resources, through research, mining and concentration of phosphate rocks; the industrial utilization of phosphate ores and associated ores, including the use of these and other ores and minerals associated or not with these and also to obtain other chemical products; the manufacture of fertilizers and other products for agriculture and livestock; trade, transportation, exportation and importation of these products as well as brokering, by third parties; the activity of providing industrialization services to third parties; and the participation in other commercial or civil companies, domestic or foreign, as a partner, shareholder or quota holder. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Expansion of fertilizer activities, in line with Vale’s strategy to become a global leader in the fertilizer industry. | ||||||||||||||||||||||||||||||||||||
MINERAÇÕES
BRASILEIRAS REUNIDAS
S.A. — MBR
|
33.417.445/0001-20 | 92.99 | NO | VC: 3,291,000,000.00 | -3.88 | -4.1 | % | 28.3 | % | 19,000,000.00 | 0 | 0 | ||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Av. de Ligação No. 3.580, Águas Claras — Nova Lima — MG — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: The mineral extraction industry, including exploration and prospecting; provision of technical services especially for mining companies; transportation, beneficiation, shipping and sale of ores, from own production or third parties, the export and import of ores, shareholdings in other companies, especially those whose objective is mining or transportation, industrialization, shipping and sale of ores, the provision of transport services, port and fluvial support. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Running iron ore operations in Brazil | ||||||||||||||||||||||||||||||||||||
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| Book value (“VC”) | ||||||||||||||||||||||||||||||||||||
| and Market value | Increase or Decrease in Value of | |||||||||||||||||||||||||||||||||||
| iv. Share in | (“VM”) of Share | Share, according to book value | Dividends Received | |||||||||||||||||||||||||||||||||
| company | CVM | (R$ mil) | and market value | (R$) | ||||||||||||||||||||||||||||||||
| CNPJ | (%) | registration | 2010 | 2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||||||||||
SALOBO METAIS S.A.
|
33.931.478/0001-94 | 100 | NO | VC: 3,271,000,000.00 | 104.5 | % | 92.2 | % | 39.9 | % | 0 | 0 | 0 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Rua Santa Luzia, 651, 14º andar — Parte, Rio de Janeiro — RJ — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: Utilization of mineral resources in National Territory, particularly the Salobo deposit, located in the Serra dos Carajás, in the district and municipality of Maraba, in the State of Pará, the subject of Mining Ordinance No. 1121, of 7/14/87, including the mining, beneficiation, smelting, refining, transportation, and marketing of copper, gold, and their by-products. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Running Salobo copper deposit operations in Brazil. | ||||||||||||||||||||||||||||||||||||
VALE CANADÀ LIMITED
|
N.A. | 100 | NO | VC: 9,250,000,000.00 | 13.34 | % | 6.15 | % | 12.1 | % | 0 | 0 | 0 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: 200 Bay Street, Royal Bank Plaza — Suite 1600, South Tower, P.O. Box 70 — Toronto — Ontario — Canada | ||||||||||||||||||||||||||||||||||||
| Activities: Vale Inco’s global activities are managed from headquarters in Toronto, in the Canadian state of Ontario, which continues its corporate functions and has significant local involvement. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Running operations in nickel and by-products (copper, cobalt, platinum group metals, and other precious metals) in Canada, United Kingdom, and Indonesia. | ||||||||||||||||||||||||||||||||||||
VALE INTERNATIONAL
S.A.
|
N.A. | 100 | NO | VC: 42,442,000,000.00 | 23.3 | % | -18.3 | % | 38.2 | % | 0 | 0 | 0 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Route de Pallatex 29 — 1162 St-Prex — Switzerland | ||||||||||||||||||||||||||||||||||||
| Activities: Acquire, own, manage, and sell direct or indirect holdings in companies or enterprises, especially abroad; trade and distribute the products of companies within the Vale group, develop relationships with customers and provide technical assistance, including product development and production planning, to customers and group companies worldwide; perform research and development activities in the sectors of mining, logistics and energy; finance companies and group companies and provide business, financial, administrative and legal services to other companies and other group companies in Switzerland and abroad. The company may conduct any activities that may be related to its objectives, or support them, especially as regards managing and defining ownership rights and / or licensing of patents, trademarks of any kind, know-how and other intellectual property rights; buy, hold and sell real estate on the company’s own behalf or on behalf of other companies and group companies, except for transactions under the jurisdiction of Swiss federal law related to the acquisition of real estate by persons abroad. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Financial transactions and business activities. | ||||||||||||||||||||||||||||||||||||
VALE MANGANÊS S.A.
|
15.144.306/0001-99 | 100 | NO | VC: 890,000,000.00 | 29.1 | % | 14.8 | % | 11.5 | % | 0 | 0 | 0 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Km 24 da Rodovia BR-324 — Centro Industrial de Aratu — Simões Filho — BA — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: The steel industry, metallurgy, industrialization, and sale of ferroalloys; exploitation, on its own account or in combination with other companies, of mineral deposits, including research, mining, beneficiation, transportation, sale, import, and export of mineral substances; reforestation; extraction, production, sale, import, and export of wood and charcoal and other goods of mineral or vegetable origin used in their production processes and their derivatives and by-products; import and export of goods related to or required for its activities, including equipment, supplies and miscellaneous materials; any other related activities that do not conflict with its stated purpose or with prevailing legislation. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Running of ferroalloy and manganese operations in Brazil. | ||||||||||||||||||||||||||||||||||||
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| Book value (“VC”) | ||||||||||||||||||||||||||||||||||||
| and Market value | Increase or Decrease in Value of | |||||||||||||||||||||||||||||||||||
| iv. Share in | (“VM”) of Share | Share, according to book value | Dividends Received | |||||||||||||||||||||||||||||||||
| company | CVM | (R$ mil) | and market value | (R$) | ||||||||||||||||||||||||||||||||
| CNPJ | (%) | registration | 2010 | 2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||||||||||
| SUBSIDIARIES WITH SHARED CONTROL |
||||||||||||||||||||||||||||||||||||
MINERAÇÃO RIO DO
NORTE S.A.
|
04.932.216/0001-46 | 40 | NO | VC: 236,000,000.00 | 7.8 | % | 8.3 | % | 0.1 | % | 18,000,000.00 | 86,373,000.00 | 172,459,000.00 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Porto Trombetas, s/nº68.275-000 — Oriximina — PA — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: Carry out the activities of a mining company, including those of a company with industrial, commercial, and service objectives, with the main objective of performing exploration and utilization of mineral deposits within national territory on its own account or for others, including prospecting, exploration, extraction, beneficiation, manufacturing, sales, import, and export of bauxite and other ores and minerals in general; generate and distribute electricity for own consumption or for third parties’, represent national or foreign companies; be part of other companies, either as partner or shareholder, practicing all acts appropriate to the protection and development of such shares; sell, beneficiate, improve, manage, develop, exchange, lease, dispose of or deal in any form, any and all assets, properties or rights of the company, acquire and operate vessels for its exclusive use; undertake programs or implement projects for forestation / reforestation. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Running of bauxite operations in Brazil. | ||||||||||||||||||||||||||||||||||||
MRS LOGÍSTICA S.A.
|
01.417.222/0001-77 | 41,5 | YES | VC: 851,000,000.00 | 4.7 | % | 307.2 | % | 52.6 | % | 126,000,000.00 | 54,063,000.00 | 27,036,000.00 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Praia de Botafogo nº 228, 12º andar — Sala 1.201-E — Botafogo — Rio de Janeiro — RJ — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: To provide rail transport services; operate services for loading, unloading, warehousing and transshipment stations, yards and land within the range of existing railway lines which are object of the concession, running modal transport related to rail transport; serving, as per the law, as a port operator, running services and operations for moving and storage of goods destined for or coming from water transport; participating in projects that aim to promote the development of the socio-economic areas of influence, seeking to expand rail services delivered; perform all similar or related activities to those described above, and engage in other activities that are based on the infrastructure of the Company. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Provision of logistics services for operation of iron ore and pellets. | ||||||||||||||||||||||||||||||||||||
SAMARCO MINERAÇÃO S.A.
|
16.628.281/0001-61 | 50 | NO | VC: 676,000,000.00 | -25.05 | % | 200.8 | % | -27.1 | % | 1,639,000,000.00 | 347,114,000.00 | 545,824,000.00 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Rua Paraíba nº 11229º e 10 andares — Funcionários — Belo Horizonte — MG — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: Research, mining of ores throughout the country, industrialization and marketing of ores, transport and navigation within the port, including for third parties, importation of equipment for its own use, spare parts and raw materials. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Expansion of Vale’s participation in the market for iron ore and pellets in Brazil. | ||||||||||||||||||||||||||||||||||||
LOG-IN LOGÍSTICA
INTERMODAL S.A.
|
42.278.291/0001-24 | 31,33 | YES | VC: 224,000,000.00 | 2.7 | % | -1.2 | % | 16.6 | % | 0 | 0 | 0 | |||||||||||||||||||||||
| VM: 890,4247,000.00 | 22.4 | % | 68.3 | % | -65.8 | % | ||||||||||||||||||||||||||||||
| Head Office: Praia de Botafogo, 501 — Torre Corcovado — sala 703 — Botafogo — Rio de Janeiro — RJ — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: Operate own or third party boats for long-distance maritime commerce, coastal and river transport of general cargo; operate inland terminals and ports, including port support navigation; carry out marketing and warehousing services and freight logistics and management of vessels; provide transport services by road and rail, and carry out complementary, related or incidental activities, related to their main activity, when necessary or convenient for corporate interests. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Provide logistics solutions for clients. | ||||||||||||||||||||||||||||||||||||
111
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| Book value (“VC”) | ||||||||||||||||||||||||||||||||||||
| and Market value | Increase or Decrease in Value of | |||||||||||||||||||||||||||||||||||
| iv. Share in | (“VM”) of Share | Share, according to book value | Dividends Received | |||||||||||||||||||||||||||||||||
| company | CVM | (R$ mil) | and market value | (R$) | ||||||||||||||||||||||||||||||||
| CNPJ | (%) | registration | 2010 | 2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||||||||||
MINERAÇÃO CORUMBAENSE
REUNIDA S.A.
|
03.327.988/0001-96 | 100 | NO | VC: 1,225,000,000.00 | -14.10 | % | N/A | N/A | 0 | 0 | 0 | |||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Rodovia Morro do Urucum, s/n° — Corumbá — MS — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: Investigation and research of ores and minerals, exploration, usage, and administration of mine and mineral resources in in general, obtaining research permits, mining concessions of all kinds of ores and minerals under the terms of the laws ruling these issues, purchase and lease of lands, equipment and facilities, including rights and interests in the subsoil and the surface; purchase, sale, beneficiation, processing, refining, industrialization, importation and exportation, commercialization and transport by rail, road and/or sea of ores, minerals and metals of any kind whatsoever, on its own or on behalf of third parties; purchase and sale of all and any manufactured products, machineries and equipment related with above listed activities; representation of other companies, either national or foreign, and participation in other commercial or civil companies, either as a partner, shareholder or quota holder. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Expansion of Vale’s participation in of granulated iron ores | ||||||||||||||||||||||||||||||||||||
SOCIEDAD CONTRACTUAL MINERA TRES VALLES |
— | 90 | NO | VC: 394,000,000.00 VM: N/A |
-13.60 N/A |
% | N/A N/A |
N/A N/A |
N/A | N/A | N/A | |||||||||||||||||||||||||
| Head Office: Rosário Norte, 615 - sala 1.201 — Las Condes — Santiago — Chile | ||||||||||||||||||||||||||||||||||||
| Activities: The acquisition of mining rights and concessions in Chile or abroad; exploitation, development and usage of mineral deposits either in Chile or abroad; provision and hiring of all type of services and advisory services, development either in Chile or abroad of other activities related to the corporate purpose, either directly or not, including the investigation, industrialization, purchase and sale, import and export of all type of assets; participation in all types of companies, either in Chile or abroad, related with the corporate purpose; development of other activities agreed by the partners. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Running of copper operations in Chile [•] | ||||||||||||||||||||||||||||||||||||
URUCUM MINERAÇÃO S.A.
— UMSA
|
03.553.344/0001-16 | 100 | NO | VC: 120,000,000.00 | 76.47 | % | 78.95 | % | -11.63 | % | N/A | N/A | 100,000,00.00 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Rodovia Morro do Urucum, s/n° — Corumbá — MS — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: Produçtion, beneficiation, agglomeration, and commercialization of manganese ore, iron ore and others, and any complementary and subsidiary activity, and the participation in any way with other companies and/or undertakings with purposes related or connected with their own purposes. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Expansion of Vale’s participation in the market of iron and manganese ores, [•] | ||||||||||||||||||||||||||||||||||||
112
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| Book value (“VC”) | ||||||||||||||||||||||||||||||||||||
| and Market value | Increase or Decrease in Value of | |||||||||||||||||||||||||||||||||||
| iv. Share in | (“VM”) of Share | Share, according to book value | Dividends Received | |||||||||||||||||||||||||||||||||
| company | CVM | (R$ mil) | and market value | (R$) | ||||||||||||||||||||||||||||||||
| CNPJ | (%) | registration | 2010 | 2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||||||||||
VALE COLOMBIA LTD.
|
N/A | 100,00 | NO | VC: 826,000,00.00 | 21,83 | N/A | N/A | 0 | 0 | 0 | ||||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: CLL 113, nº 7-21, Torre A. OF. 907 — Bogotá — Colombia. | ||||||||||||||||||||||||||||||||||||
| Activities: Prospecting, exploitation and exploitation of mines and quarries of all types of minerals and other non reneweable mineral resources, metallic or non metallic, including their extraction, processing, benefit or transformation, commercialization and/or exportation. In the development of its corporate purposes, the company can go forward and perform the following acts and contracts: acquire, sell, levy, administer, receive or lease or give in any other way all kind of assets; take part either as creditor or debtor, in credit operations, giving or receiving the corresponding guaranties, if this were the case; enter with credit agencies and insurance companies all kind of transactions that are typical of its purpose; transform, accept, endorse, insure, collect and negotiate, in general, titles, securities and any other class of credits; be part of other companies that intend to carry out activities that are similar, complementary and accessory to the company, that are convenient to the partners, or absorb such companies, enter into participation account agreement, either as active or non-active participation, and contracts of association and mining operation; turn into another type of company or merge with other companies; break, waive and appeal the arbitration or conciliators’ decisions in cases where it may have interests before third parties, its own partners, or its administrators and workers; to provide professional and advisory services; participate as bidder in public bids, private bids and reorganization proceedings, and comply with the required requisites, celebrate and execute, in general, all acts and agreements that are preparatory, complementary and additional to all the aforementioned ones, that are related with the existence and working of the company, and particularly, the concession agreements with the authorities that have competition with mining and/or the others that serve the performance of the corporate purposes well. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Runing of operations of thermal coal in Colombia | ||||||||||||||||||||||||||||||||||||
VALE AUSTRIA HOLDINGS GMBH |
11.698.030/0001-30 | 100 | NO | VC: 1,549,000,000.00 | N/A | N/A | N/A | 0 | 0 | 0 | ||||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Sterneckstraße, 11, 5020 — Salzburg — Austria | ||||||||||||||||||||||||||||||||||||
| Activities: Acquisition and management of shares and participations in companies/associations of any kind and investments in assets; control and management of one or more activities related to any of the participating companies or the assets in which it had investments; exercise of all and any activity which is necessary or useful in order to reach the above-mentioned purposes. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Holding and holder of mineral exploitation company all over the world. | ||||||||||||||||||||||||||||||||||||
HENAN LONGYU ENERGY
RESOURCES CO. LTD.
|
N/A | 25 | % | NO | VC: 417,000,000.00 | -4.14 | % | 5.84 | % | N/A | 147,000,000.00 | 0 | 0 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: 25 Middle Section, Guangming Road — Yongcheng — Henan Province — China | ||||||||||||||||||||||||||||||||||||
| Activities: exploitation, and development of coal resources; production washing, processing, trading and sales (including exportation) of coal and other related products, use, with different purposes, of the mining resources of coal; manufacturing and repair of mechanical and electrical products for mining, rental of equipment and waste treatment; and supply of post-sale technical and advisory services regarding above products. The company can adjust its corporate purpose, based on the needs of development of the business and its own capacity, through the approval by the general meeting of shareholders and the corresponding governmental authorities. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Have participation in the Company that has coal assets in China | ||||||||||||||||||||||||||||||||||||
113
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| Book value (“VC”) | ||||||||||||||||||||||||||||||||||||
| and Market value | Increase or Decrease in Value of | |||||||||||||||||||||||||||||||||||
| iv. Share in | (“VM”) of Share | Share, according to book value | Dividends Received | |||||||||||||||||||||||||||||||||
| company | CVM | (R$ mil) | and market value | (R$) | ||||||||||||||||||||||||||||||||
| CNPJ | (%) | registration | 2010 | 2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||||||||||
THYSSENKRUPP CSA - CIA SIDERÚRGICA DO ATLÂNTICO |
07.005.330/0001-19 | 26.87 | NO | VC: 3,065,000,000.00 | -13.50 | % | 243.04 | % | N/A | 0 | 0 | 0 | ||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Avenida João XXIII, s/nº — Distrito Industrial de Santa Cruz — Rio de Janeiro — RJ — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: Construction and operation of an integrated steel plant for the production and transformation or iron and steel products, as well as the production, transformation and trading of all by-products related to the working of such plant, including the importation and exportation of all products, of the by-products, of inputs and of capital assets related to the working of the plant; construction, management, operation and exploitation of a commercial complex of port operations, even operating as a Brazilian shipping company in performing shipping services or port support and carrying out drainage services; construction, administration, operation and exploitation of a thermoelectrical plant; creation of subsidiaries as well as the participation in any other company, association, partnership, or entity either in Brazil or abroad for achieving the corporate purpose; and the development either within the Brazilian territory or abroad, of any other activity thst is directly or indirectly related to the achievement of the corporate purpose of the company. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Encourage the consumption of iron ore in Brazil through the investment in the company that manufactures steel sheets. | ||||||||||||||||||||||||||||||||||||
AÇOS LAMINADOS DO PARÁ
|
10.335.963/0001-08 | 100 | NO | VC: 84,000,000.00 | 740 | % | N/A | N/A | 0 | 0 | 0 | |||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Avenida Graça Aranha, 26, salão1601 — Centro — Rio de Janeiro — RJ — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: Develop studies for technical economic viability, as well as market studies, business plans and other related studies to build an integrated siderurgical plant in Marabá (“Project”), State of Pará, that shall produce steel either to export or to sell in the domestic market, considering one or more plants of sintering, coking, high furnace, steel mill and machines of ingot casting/ending for the Project, including market, engineering and environmental assessments, budgets and fiscal and economic analysis (the “Project Study”); acquire the premises where the Project shall be placed and sign the necessary agreements for said acquisition; obtain the required licenses for the implementation of the Project, including, but not limited to the environmental licenses; negotiate all commercial agreements that are necessary for the implementation of the Project, including the supply of ores of iron/pellets, contracts for the supply of coal, of ferroalloys, contracts for the supply of logistic services, building contracts, maintenance and operation contracts, off-take contracts and financing contracts; implant, operate and exploit a steel integrated plant for the production and commercialization of iron and steel products, as well as their by-products, including the production, transformation, import and export of all products and by-products related with the working of such steel plant; implement, operate and exploit port terminals necessary to serve the logistics of their plants, and develop either within the Brazilian territory or abroad, any other activity which is directly or indirectly related to the achievement of the corporate purpose of the company. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Encourage the consumption of iron ore in Brazil through investment in the siderurgical company. | ||||||||||||||||||||||||||||||||||||
BSGR LIMITED
|
N/A | 51 | NO | VC: 833,000,000.00 | N/A | N/A | N/A | 0 | 0 | 0 | ||||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Akara Building., 24 de Castro Street — Wickhams Cay I — Road Town — Tortola — British Virgin Islands | ||||||||||||||||||||||||||||||||||||
| Activity: All and any activity not prohibited by law. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Investment of iron ores in Guinea. | ||||||||||||||||||||||||||||||||||||
CADAM S.A
|
04.788.980/0001-90 | 100 | NO | VC: 124,000,000.00 | -12.06 | % | -9.62 | % | -17.89 | % | 0 | 0 | 0 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Km 07, s/n° — Estrada da Ponta da Montanha — Distrito de Vila do Conde — Barcarena — PA — Brazil. | ||||||||||||||||||||||||||||||||||||
| Activities: The utilization of the industry for the extraction of ores, including research and mining; provision of technical services to mining companies, transportation, beneficiation, shipping and trading of ores either by its own or on behalf of third parties; export and import of ores; and the company participation in other companies, especially in those that have as purpose the industry of extraction, or the transportation, the beneficiation, the shipping and/or trading of ores. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Running of operations of kaolinite in Brazil. Investment kept for sale. | ||||||||||||||||||||||||||||||||||||
114
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| Book value (“VC”) | ||||||||||||||||||||||||||||||||||||
| and Market value | Increase or Decrease in Value of | |||||||||||||||||||||||||||||||||||
| iv. Share in | (“VM”) of Share | Share, according to book value | Dividends Received | |||||||||||||||||||||||||||||||||
| company | CVM | (R$ mil) | and market value | (R$) | ||||||||||||||||||||||||||||||||
| CNPJ | (%) | registration | 2010 | 2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||||||||||
COMPANHIA COREANO-BRASILEIRA DE PELOTIZAÇÃO — KOBRASCO |
33.931.494/0001-87 | 50 | NO | VC: 208,000,000.00 | 38.67 | % | 18.11 | % | 58.75 | % | 18,000,000.00 | 0 | 0 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Avenida Dante Michelini, 5.500 — Parque Industrial — Vitória — ES — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: Production and commercialization of iron ore pellets, as well as the performance of other activities directly of indirectly related to its purpose, including the import, export, and provision of services of any nature, being also able to participate, in any way, in other companies. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Expansion of Vale’s participation in the market of pellets in Brazil. | ||||||||||||||||||||||||||||||||||||
COMPANHIA HISPANO-BRASILEIRA DE PELOTIZAÇÃO — HISPANOBRÁS |
27.240.092/0001-33 | 50.89 | NO | VC: 212,000,000.00 | 45.21 | % | 85.88 | % | 123.68 | % | 0 | 0 | 0 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Avenida Dante Michelini 5500 — Parque Industrial — Jardim Camburi — Vitória — ES | ||||||||||||||||||||||||||||||||||||
| Activities: Production and sale of iron ore pellets and the performing of any activity directly or inderectly related to the production and sale of iron ore pellets. The company may also participate in any other industrial and/or commercial activities correlated with its main purpose, as well as participate in any other way in the other undertakings in Brazil. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Expansion of Vale’s participation in the market of pellets in Brazil. | ||||||||||||||||||||||||||||||||||||
COMPANHIA ÍTALO-BRASILEIRA DE PELOTIZAÇÃO — ITABRASCO |
27.063.874/0001-44 | 50.9 | NO | VC: 143,000,000.00 | -10.06 | % | 16.91 | % | 65.85 | % | 45,000,000.00 | 0 | 0 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Avenida Dante Michelini, 5.500 — Parque Industrial — Vitória — ES — Brazil. | ||||||||||||||||||||||||||||||||||||
| Activities: Production and sale of iron ore pellets and the performance of any activity directly or indirectly related to the production and sale of iron ore pellets. The company may also participate in any other industrial and/or commercial activities correlated with its main purpose, as well as participate in any other way in the other undertakings in Brazil. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Expansion of Vale’s participation in the market of pellets in Brazi. | ||||||||||||||||||||||||||||||||||||
COMPANHIA NIPO-BRASILEIRA DE PELOTIZAÇÃO — NIBRASCO |
27.251.842/0001-72 | 51.00 | NO | VC: 333,000,000.00 | 30.59 | -0.77 | % | 137.96 | % | 5,000,000.00 | 46,000,000.00 | 0 | ||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Avenida Dante Michelini, 5.500 — Parque Industrial — Vitória — ES — Brazil. | ||||||||||||||||||||||||||||||||||||
| Activities: Production and sale of iron ore pellets and the performing of any activity directly or indirectly related to the production and sale of iron ore pellets. The company may also participate in any other industrial and/or commercial activities correlated with its main purpose, as well as participate in any other way in the other undertakings in Brazil. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Expansion of Vale’s participation in the market of pellets in Brazil. | ||||||||||||||||||||||||||||||||||||
COMPANHIA PORTUÁRIA DA BAÍA DE SEPETIBA — CPBS |
72.372.998/0001-66 | 100.00 | NO | VC: 347,000,000.00 | 0 | 6.7 | % | 17.09 | % | 147,000,000.00 | 46,000,000.00 | 0 | ||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Avenida Graça Aranha, 26, salão 1601 — Centro — Rio de Janeiro — RJ — Brazil | ||||||||||||||||||||||||||||||||||||
| Activity: The construction and utilization of a port facility for private, mixed use, located within the area of Porto de Sepetiba — Rio de Janeiro, specialized in moving and storage of iron ore and its derivatives. Subsidiarily and with a complementary character, the company may carry out port operations with other dry bulks, whenever these complementary operations do not damage the main operations. It is forbidden to the company to perform any activity different from its purpose, except with the express authorization of Companhia Docas do Rio de Janeiro — CDRJ. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Supply of port services for operations of iron ores. | ||||||||||||||||||||||||||||||||||||
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| Book value (“VC”) | ||||||||||||||||||||||||||||||||||||
| and Market value | Increase or Decrease in Value of | |||||||||||||||||||||||||||||||||||
| iv. Share in | (“VM”) of Share | Share, according to book value | Dividends Received | |||||||||||||||||||||||||||||||||
| company | CVM | (R$ mil) | and market value | (R$) | ||||||||||||||||||||||||||||||||
| CNPJ | (%) | registration | 2010 | 2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||||||||||
MINAS DA SERRA GERAL
S.A. — MSG
|
33.137.654/0001-10 | 50 | NO | VC: 58,000,000.00 | 13.73 | % | 4.08 | % | -7.55 | % | 0 | 0 | 0 | |||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Rua Sapucaí, 383, 2º andar — Belo Horizonte — MG — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: Exploitation and/or direct or indirect usage of mineral deposits, including research, prospections, extraction, mining, production, beneficiation, transportation, industrialization and commercialization of all and any mineral substance, being also able to participate in the distribution and commercialization of its products, derivatives and by-products in Brazil, and the import and export of inputs and raw material, either “in natura” or beneficiated and industrialized; the performing of studies, projects and technological investigations and the rental of equipment. The company may also participate, directly or indirectly, under any way, of other companies related to its corporate purposes, either in Brazil or abroad. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Expansion of Vale’s participation in the market of iron ores in Brazil. | ||||||||||||||||||||||||||||||||||||
MINERAÇÃO PARAGOMINAS
|
12.094.570/0001-77 | 100 | NO | VC: 1,813,000,000.00 | N/A | N/A | N/A | 0 | 0 | 0 | ||||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Avenida Lameira Bittencourt, 123 — Centro — Paragominas — PA — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: (a) Mining development, industrial and commercial activities, having as main purpose the mining within the national territory, including prospection, drilling, search, production, operation, beneficiation, industrialization, import, export and commercialization of bauxite and other minerals and mineral substances in general; (b) The performance, either in Brazil or abroad, of any other activity directly or indirectly related to the attainment of the purpose set forth in (a) above, including the development of technology for the production of bauxite and the rendering of technical services or of any other kind, including the transportation related to (a) above. Participation in other companies, either in Brazil or abroad, with a corporate purpose similar or related to those listed in (a) and (b) above. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Running of bauxite operations in Brazil. | ||||||||||||||||||||||||||||||||||||
VALE FOSFATADOS S.A.
|
08.404.776/0001-89 | 100 | NO | VC: 3,217,000,000.00 | N/A | N/A | N/A | 0 | 0 | 0 | ||||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Avenida das Nações Unidas, 12.551, 24º andar, cj. 2407, Novo Brooklin, Prédio WTC, São Paulo — SP | ||||||||||||||||||||||||||||||||||||
| Activities: Search, mining, exploitation and usage of mineral resources within the national territory; extraction, manufacturing, beneficiation, industrialization, importation, exportation and, commercialization of fertilizers or other materials, including minerals, such as phosphates, raw materials, product and by-products for agriculture and livestock; utilization of all type of activities related to the agriculture and livestock area, or compatible activities, among which, the commercialization of agricultural and livestock products, provision of services and transportation of raw materials, materials, products and by-products that are directly or indirectly used in the industry of fertilizers and in the agriculture and livestock area in general, manufacturing and commercialization of pigments for the industry of inks, plastics and paper, and participation in other companies. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Expansion of the activities of phosphate fertilizers, aligned with Vale’s strategy to become a global leader in the industry of fertilizers. | ||||||||||||||||||||||||||||||||||||
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| Book value (“VC”) | ||||||||||||||||||||||||||||||||||||
| and Market value | Increase or Decrease in Value of | |||||||||||||||||||||||||||||||||||
| iv. Share in | (“VM”) of Share | Share, according to book value | Dividends Received | |||||||||||||||||||||||||||||||||
| company | CVM | (R$ mil) | and market value | (R$) | ||||||||||||||||||||||||||||||||
| CNPJ | (%) | registration | 2010 | 2010 | 2009 | 2008 | 2010 | 2009 | 2008 | |||||||||||||||||||||||||||
VALE FLORESTAR S.A.
|
11.985.056/0001-69 | 100 | NO | VC: 235,000,000.00 | 0 |
0 |
0 |
N/A | N/A | N/A | ||||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Rua Lauro Muller, 116, sala 1802 — Botafogo — Rio de Janeiro — RJ — Brazil | ||||||||||||||||||||||||||||||||||||
| Activities: To take part directly or indirectly, and develop projects in the areas of afforestation, forest management, rendering of environmental services, usage of carbon credits, rendering of services related to forest activities and supply of activities related either to the forest or timber sector. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Promote the reforestation of depleted areas. | ||||||||||||||||||||||||||||||||||||
VALE SOLUÇÕES EM ENERGIA |
09-327.793/0001-22 | 52,77 | NO | VC: 198,000,000.00 | 15.12 | % | 75.51 | % | N/A | 0 | 0 | 0 | ||||||||||||||||||||||||
| VM: N/A | N/A | N/A | N/A | |||||||||||||||||||||||||||||||||
| Head Office: Avenida Rio Branco, 138, sala 1.602 — Centro — Rio de Janeiro — RJ — Brazil. | ||||||||||||||||||||||||||||||||||||
| Activities: Research and development of technologies in order to obtain systems and products eco-efficient for the generation of energy, as well as the development and test of prototypes; development of studies of techno economic viability related to the purpose of the company, as well as market studies, business plans and other related studies; participation either as partner or shareholder in other simple or business companies, and in business undertakings of any nature, including partnerships, in Brazil and/or abroad; development, industrialization, construction, purchase, sale, distribution, renting, gratuitous loan, importation and exportation of machines and equipment for the industry, including accessories, parts and other materials that are necessary in order to obtain eco-efficient products for generating energy and rendering services for the assembly, maintenance and technical assistance of machines and equipment for the generation of energy. | ||||||||||||||||||||||||||||||||||||
| Reasons for the Acquisition and Maintenance of Share: Develop energy generation systems | ||||||||||||||||||||||||||||||||||||
9.2 OTHER INFORMATION WHICH THE COMPANY DEEMS RELEVANT
At present, Vale has a total of 5,482 processes all over the world (in 98 countries), considered as
intangibles of Intellectual Property (376 patents in Brazil and 1,360 abroad, 837 processes of
trademarks in Brazil and 1,310 abroad, 1,251 domain names and 348 abroad).
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Item 10
10.1. General Financial and Equity Conditions
Vale adopted on January 1st, 2010, retroactive to January 1st, 2009, all the
resolutions issued by CPC. Therefore, the financial statements for the fiscal year ending at
December 31, 2010 are the first consolidated financial statements submitted by the Company pursuant
to the International Financial Reporting Standards — IFRS. Thus, the financial statements for the
fiscal year ending at December 31, 2008, having been prepared based on different accounting
standards, are no longer comparable to the financial statements at December 31, 2009 and December
31, 2010, and therefore 2008 accounting information was not included in item 10.1.
a. General Financial and Equity Conditions
The year 2009 was characterized as a transition period, marked by operational and financial
performance at a lower threshold than the previous two years, however quite robust.
2010 was a year of strong recovery and of extraordinary performance resulting from the
convergence of the actions of two main forces. On the one hand, the initiatives developed in 2009
in response to the global recession, focusing on structural transformations, started to present
returns. On the other hand, the global economy, led by the emerging companies, which are the main
source of expansion of demand for ores and metals, showed exceptional growth.
As a consequence, 2010 recorded the best financial performance in the history of Vale,
registering records of revenues, operational profit, operational margin, generation of cash and
profit. The quality of financial performance is highlighted by the record value of investments,
which build new platforms to support the growth in the long run.
The net operational revenue of Vale reached the record value of R$ 83,225 billion, having
recorded growth of 71.6% in 2009.
Bulk materials sales — made up of iron ore, pellets, manganese ore and iron-alloy, thermal
and metallurgical and thermal coal — represented 73.4% of the 2010 operating revenues, increasing
the 62.7% from 2009. Participation of base metals in total revenue decreased from 27.6% to 17.0% in
2010 due to the strike in Canada. Participation in revenue for fertilizers sale was of 3.8% in 2010
with an increase of 1.6% compared to the previous year. Logistics services contributed with 2.4%
and other products with 2.0%.
| Business segments | 2009 | 2010 | ||||||
Bulk Materials |
62.7 | % | 73.4 | % | ||||
Base Metals |
27.6 | % | 17.0 | % | ||||
Fertilizers |
1.6 | % | 3.8 | % | ||||
Logistics services |
5.7 | % | 3.8 | % | ||||
Others |
2.4 | % | 2.0 | % | ||||
In 2010, operating profit, measured by EBIT1, reached R$ 40,490 billion and was
constituted as a new record. The operating margin was also record, with 48.7%, against 27.2% in
2009.
Cash generation, measured by EBITDA2, reached R$ 46,378 billion, marking thus a new
record. Net profit, R$ 30,070 billion, was the highest in the history of Vale.
| 1 | Profit before interest and taxes. |
|
| 2 | Profit before interest, taxes, depreciation and
amortization and exhaustion and accreted of dividends received, also known as
LAJIDA. |
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| in R$ million | 2009 | 2010 | ||||||
Net Operating revenue |
48,496 | 83.225 | ||||||
EBIT |
13,173 | 40,490 | ||||||
EBIT margin (%) |
27.2 | % | 48.7 | % | ||||
EBITDA |
18,641 | 46,378 | ||||||
Net profit |
10,337 | 30,070 | ||||||
Remuneration to shareholder (parent company) |
5,299 | 5,095 | ||||||
ROE (%)* |
10.8 | % | 26.8 | % | ||||
| * | Return on equity |
b. Capital Structure
The shareholders’ equity of Vale, on the 31st of December 2010, was R$112.116
billion. On the same date, the gross debt added to obligations with third parties totaled R$ 43,789
billion, with a cash
position3 of R$ 16,456 billion, including R$ 2,987 billion invested
in net assets of fixed income of low risk, with maturity varying between 91 and 360 days and
average maturity of 135 days. The gross debt index and obligation with third parties /shareholders’
equity and participation of non controlling shareholders was 37.6% compared to 42.0% on
31st December, 2009, and 44.9% on 31st December, 2009.
On 31st December, 2009, the shareholders’ equity was R$ 95,758 billion, the gross
debt was R$ 42,088 billion, and the cash position R$ 19,746 billion.
i. Hypotheses of Redemption
ii. Redemption Value Method
The Bylaws of the Company does not authorize the application of profits or reserves in the
redemption or amortization of shares. Additionally, on the date of this Reference Form, Vale’s
Administration does not have the intention of calling a special shareholders meeting with this
purpose.
c. Payment Capacity in Relation to the Financial Commitments Contracted
Vale enjoys a healthy financial position, supported by strong cash generation, ample
liquidity, availability of short and long term credit facilities and portfolio of debt with low
risk. Such position gives us comfort in connection with the capacity to pay our financial
commitments.
The leverage, measured by the relation total debt /EBITDA, decreased to 0.9x on December
31st 2010, compared to 2.3x on December 31st 2009. The reduction in leverage
reflects the effects of the global economy recovery on our financial performance.
The
total debt ration /EV4 was equal to 13.7% on December 31st 2010,
while the index of interest coverage, measured by the indicator EBITDA / payment of interest, was
22.86 times.
| in R$ million | 2009 | 2010 | ||||||
Gross debt |
42,088 | 43,789 | ||||||
Cash position * |
19,746 | 16,456 | ||||||
Net debt |
22,342 | 27,333 | ||||||
| 3 | Includes cash and cash equivalent and short-term
investments |
|
| 4 | EV, enterprise value, equals the sum of the company’s
market capitalization with the net debt. |
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d. Source of financing for working capital and investments in non-current assets
The sources of funds utilized by Vale were generation of operational cash, loans and
financing, and issue of bonds and securities, convertible or not, launched in the capitals market.
Additionally, in 2008, we made a global offering of shares that permitted net funding of R$ 19,273
billion.
In September 2010, Vale issued R$ 1.7 billion in bonuses, maturing on 2020 and R$1.3 billion
in bonuses maturing on 2039. The bonus of 2020 will have a coupon of 4.625% per year, semi
annually paid, at the price of 99.030% of the face value of the instrument. The 2039 bonus issued
at the price of 110.872% of the face value of the instrument, were consolidated with the bonus of
US$ 1 billion issued by Vale Overseas in November 2009 with coupon of 6.875% and maturity in 2039,
forming a single series. In March 2010, Vale captured R$ 1.8 billion in eurobonus of 8 years at the
price of 99.564% of the face value of the instrument. The notes with maturity in 2018, will have
coupon of 4.375% per year, paid annually.
The operational activities generated cash flows of R$ 35,375 billion in 2010, in view of R$
11,517 billion and R$ 32,187 billion in 2009. The operational cash flows grew significantly in the
last years up to 2008, driven by the growth in sales volume and by the high of prices of our
products. In 2009, this cycle of growth was interrupted as a result of negative effects of the
global recession on the prices and volumes of sales. In 2010, growth was resumed and the strong
recovery of demand reflected positively on the price.
Among other more relevant operation in the three-year period, the following are highlighted:
| • | In January 2011 (subsequent period), Vale signed an agreement with some commercial
banks with the guarantee of the Italian credit agency Servizi Assicurativi Del Commercio
Estero S.p.A (Sace) for the supply of a line of credit of US$ 300 million (equivalent to
R$ 500 million) for 10 years. |
| • | In October 2010, Vale signed an agreement with Export Development Canada (EDC),
official agency of credit for export of Canada, for the financing of the package of Vale’s
Investments Program. According to the contract, EDC shall supply a credit facility of up
to US$ 1 billion. The amount of US$ 500 million (equivalent to R$ 855.6 million) will be
available for investment operations in Canada, the remaining US$ 500 million (equivalent
to R$ 855.6 million) will be available for financing of purchases of Vale from Canadian
companies for the supply of our operations outside Canada. At December 31st,
2010, Vale had used US$ 250 million (equivalent to R$ 417 million) of this line of credit. |
| • | In September 2010, Vale issued US$ 1.75 billion (equivalent to R$ 3 billion), US$ 1
billion in bonus with maturity in 2020 and coupon of 4.65%, with semi annual payments and
US$ 750 million through the reopening of the 2039 bonus, with yield to the investor of
6.074%. The bonus of 2039 is part of the bonus of US$ 1 billion issued in November 2009. |
| • | In September 2010, Vale signed a contract with The Export-Import Bank of China and the
Bank of China Limited for the financing of the construction of 12 ships, with capacity of
400,000 dwt, in the total value of up to US$ 1.229 billion (equivalent to R$ 2,048
billion). The financing has a total period for payment of 13 years and Value will receive
the funds in the next 3 years according to the schedule of construction of ships. At
December 31st, 2010, US$ 291 million had been disbursed (equivalent to R$ 485
million) from the facility. |
| • | In June 2010, Vale agreed with the National Bank for Economic and Social Development —
BNDES some credit facilities totaling R$ 774 million, to finance the acquisition of
certain equipment. At December 31st, 2010, R$ 205 million had been disbursed
in this agreement. |
| • | In June 2010, Vale signed an export pre-payment financing agreement in the amount of
US$ 500 million (equivalent to R$901 million) with maturity in 10 years. |
| • | In March 2010, Vale captured € 750 million (equivalent to R$1.8 billion) through
eurobonus of 8 years at the price of 99.564% of the face value of the instrument. The
notes with maturity in March 2018, shall have a coupon of 4.375% per year, paid semi
annually. |
| • | In November 2009, Vale made a public global offering of 30 year bonus in the amount of
US$1 billion (equivalent to R$ 1.7 billion on the date of the transaction) issued through
the wholly owned subsidiary Vale Overseas, totally and unconditionally guaranteed by Vale,
with maturity in November 2039, and coupon of 6.875% per annum, paid semi annually. |
| • | In September 2009, Vale made a public global offering of 10 year bonus in the amount of
US$1 billion (equivalent to R$ 1.8 billion on the date of the transaction) issued through
its wholly
owned subsidiary Vale Overseas, totally and unconditionally guaranteed by Vale, with
maturity in September 2019, and coupon of 5.625% per annum, paid semi annually. |
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| • | In July 2009, Vale issued US$ 942 million (equivalent to R$ 1.858 billion on the date
of the transaction) in notes compulsorily swappable with maturity in 2012 through its
wholly owned subsidiary Vale Capital II. The notes are divided into 2 series: Vale 2012
and Vale P 2012. Both series have maturity in June 2012 and shall be compulsorily
swappable by American Depositary Shares (ADS). The series Vale 2012 shall be swapped by
ADS in connection with common shares issued by Vale, and the series Vale P 2012 shall be
swapped by ADS in connection with preferred Class A shares issued by Vale. Additional
remuneration shall be paid to the holders of notes by Vale, based on the net value of the
dividends distributed by Vale to the holders of ADS. |
| • | In May 2008, Vale signed agreements with the Japan Bank for International Cooperation
(JBIC) and Nippon Export and Investment Insurance (NEXI) for the financing of projects
that are part of the investment program for 2008-2012. Vale’s projects to be financed
shall follow the criteria required by the Japanese financial institutions. The JBIC may
provide funds of up to US$3 billion (equivalent to R$5.0 billion on the date of execution
of the contract) and NEXI shall provide debt insurance on loans of up to US$ 2 billion
(equivalent to R$ 3.3 billion on the date of execution of the contract). In November 2009,
Vale, through its subsidiary PT International Nickel Indonesia Tbk (PTI), contracted a
facility in the amount of US$300 million (equivalent to R$525 million on the date of
execution of the contract) with Japanese financial institutions, using insurance of NEXI,
for the financing of the construction of the hydroelectric plant of Karebbe, in Indonesia,
from which US$150 million were drawn (equivalent to R$ 249.9 million on December 31st
2010) to the end of 2010. |
| • | In April 2008, Vale signed with BNDES a facility transaction in the amount of R$7.3
billion (equivalent to US$ 4.2 billion on the date of execution of the contract) to be
used to finance projects that are part of Vale investment program for 2008-2012. At
December 31st 2010, Vale had used R$ 1.92 billion (equivalent to US$ 1,153 billion on
December 31st 2010) of this facility with BNDES. |
| • | In January 2008, Vale contracted with a Brazilian commercial bank, a transaction for
financing of working capital of R$ 2 billion (equivalent to US$ 1.1 billion on the date of
execution of the contract), fully used. |
e. Potential sources of financing used for working capital and for investments in non-current
assets for coverage of liquidity deficiency
In the regular course of business, the principal need for funds of Value refers to capital
investments, payments of dividends and debt service. The sources of funds frequently used are:
operating cash flow and financing, which we complemented in 2008-2010 with a global offering of
shares and an issue of notes compulsorily convertible into shares.
Moreover, the main sources of financing to cover liquidity deficiency are the facilities
related to the export transactions offered by local banks (Advance on Foreign Exchange Contract -
ACCs and Advance on Delivered Exchange Instruments — ACEs).
Vale has, moreover, rotary credit facilities available which may be used at the option of the
debtor. On December 31st, 2010, the amount available involving credit facilities was
US$1.6 billion (equivalent to R$ 2,666 billion on December 31st, 2010), where US$ 850
million (equivalent to R$1.416 billion on the transaction date) was made available to our indirect
subsidiary Vale International and the remainder to our indirect subsidiary Vale Canada Limited
(Vale Canada). At December 31st, 2010, no value had been drawn by Vale International or
by Vale Canada, but letters of credit were issued in the value of US$114 million (equivalent to
R$190 million on December 31st, 2010) related to the credit facility of Vale Canada.
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f. Indebtedness levels and composition of such debts
On December 31st, 2010, our total debt was R$ 43,789 billion, with a portion of R$ 3
million guaranteed by assets of Vale, with average period of maturity of 9.9 years and average cost
of 4.9% per year in US dollars.
| In R$ million | 2009 | 2010 | ||||||
Gross debt |
42,088 | 43,789 | ||||||
Tranche guaranteed by assets of Vale |
4 | % | 0 | % | ||||
Average term of maturity (in years) |
9.2 | 9.9 | ||||||
Average cost (in US dollars) |
5.3 | % | 4.9 | % | ||||
Since July 2005, Vale has been considered investment grade. Currently, Vale has the following
credit risk ratings: BBB+ (Standard & Poor’s), Baa2 (Moody’s), BBB high (Dominion Bond Ratings) e
BBB+ (Fitch).
i. Relevant loan and financing contracts
The short term debt consists principally of financing for export (trade financing) and import
expressed in US dollars, with financial institutions. On December 31st, 2010 the short
term debt was R$ 1,144 billion, as compared to R$ 646 million and R$ 1,088 billion in 2009 and
2008, respectively.
The most important categories of the long term debt are presented below. The values presented
include the short term portion of the long term debt and exclude the accumulated costs.
| • | Loans and financing expressed in US dollar (R$ 10.7 billion, R$14.5 billion and
R$16.3 billion on 31th of December 2010, 2009 and 2008, respectively).
These loans include credit facilities for export, financing of import of the export
credit agencies and loans from commercial banks and multilateral organizations. The
main credit facility is a prepayment of export, linked to future exports, originally
in the amount of US$ 6.0 billion (equivalent to R$10.4 billion), captured as part of
the refinancing of the debt for the acquisition of Inco. On December 31st,
2010, the outstanding balance was US$ 2.7 billion (equivalent to R$4.4 billion) |
| • | Fixed income papers expressed in US dollars (R$ 17.1 billion, R$ 12.9 billion and
R$ 15.2 billion on December 31st, 2010, 2009 and 2008, respectively). Vale
issued several debt instruments in the capital market through its wholly owned
subsidiary Vale Overseas in the total amount of US$ 9.1 billion (equivalent to R$ 15.2
billion). The subsidiary Vale Canada issued debt instruments in the amount of US$ 1.1
billion (equivalent to R$ 1.9 billion). |
| • | Fixed income papers in euros (R$ 1.7 billion on 31 December 2010). Vale issued a
debt instrument in the capital market in the total amount of Euros 750 million
(equivalent to R$ 1.7 billion). |
| • | Instruments expressed in US dollars guaranteed by receivables of future exports (R$
0.3 billion and R$ 0.5 billion on December 31st, 2009 and 2008,
respectively). In December 2009, we had a securitization program originally in the
amount of US$ 400 million based on existing and future accounts receivable related to
export of iron ore and pellets to customers in Europe, Asia and the USA. On 15 January
2010, Vale liquidated in advance the remaining balance of the securitization program. |
| • | Non-convertible debentures expressed in reais (R$4.7 billion, R$ 6.0 billion and R$
6.0 billion on December 31st, 2010, 2009 and 2008, respectively). In
November 2006, we issued non convertible debentures in the value of approximately US$
3.2 billion (equivalent to R$5.5 billion), in two series, with maturities of four and
seven years. The first series, of US$862 million (equivalent to R$ 1.5 billion), fell
due in 2010, with interest of 101.75% of the accrued variation of the interest rate of
the CDI (interbank deposit certificate). The second series, of US$ 2.3 billion
(equivalent to R$ 4.0 billion), with maturity on 2013 has interest of variation of the
CDI plus 0.25% per year. |
| • | Perpetual instruments (R$ 0.1 billion, R$ 0.1 billion and R$ 0.2 billion on
December 31st, 2010, 2009 and 2008, respectively). We issued perpetual
instruments which are negotiable for 48.0 billion preferred shares of Mineração Rio do
Norte S.A (MRN). The interest is paid on the instruments in a value equal to the
dividends paid to the underlying preferred shares. |
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ii. Other long-term relationships with financial institutions
Vale and its associated and subsidiary companies have a commercial relationship in the normal
course of their business with some of the main financial institutions of the country, according to
the usual practices of the financial market.
Other debts totaled R$ 7.8 billion, R$ 7.2 billion and R$5.4 billion on December 31st,
2010, 2009 and 2008, respectively. We have several loans contracted in Brazil, especially with
BNDES and some Brazilian private banks, in addition to loans and financing in other currencies.
iii. Degree of subordination among debts
There is no degree of contractual subordination among our unsecured debts. Debts that are secured
through collateral have the privileges and prerogatives granted by the law.
iv. Eventual restrictions imposed on the issuer especially, in relation to limits of
indebtedness and contracting of new debts, to the distribution of dividends, to the disposal of
assets, to the issue of new securities and to the disposal of corporate control
Some of the long term financial instruments contain obligations related to financial indicators.
The main indicators are debt on shareholders’ equity, debt on Earnings Before Interest Tax,
Depreciation and Amortization (EBITDA) and interest coverage. Vale is in conformity with the levels
required for the indicators. We believe that the current clauses shall not significantly restrict
the capacity to contract new debts to meet capital needs. Additionally, none of the clauses
restricts directly our capacity to distribute dividends or interest on net current assets.
g. Limits of use of financing already contracted
Certain financing contracts signed by Vale establish restrictions in connection with the use of
funds. There follows the description of the relevant financing contracts:
| Date | Counterparty | Allocation | Value | Disbursement of funds | ||||
11/23/2010
|
BNDES | Supplementation of funds related to the implementation of the Hydroelectric Plant Estreito (UHE) | R$ 208.03 million | The credit is provided in tranches according to the schedule of the projects | ||||
10/272010
|
BNDES | Credit allocated to financing of equipment and expansion of production capacity | R$ 246.6 million | The credit is provided in tranches according to the schedule of the projects | ||||
09/09/2010
|
Exim and Bank of China Limited | Credit allocated to financing for the acquisition of ships from shipyard Rongsheng | R$ 2.119 billion | The credit is provided in tranches according to the schedule of payments contemplated in the construction contract | ||||
06/30/2010
|
Banco Votorantim | Credit allocated to financing of equipment | R$ 57.2 million | The credit is provided in tranches according to the schedule of the projects | ||||
06/30/2010
|
Banco do Brasil | Credit allocated to financing of equipment | R$ 16.8 million | The credit is provided in tranches according to the schedule of the projects | ||||
06/30/2010
|
Banco do Brasil | Credit allocated to financing of equipment | R$ 59.8 million | The credit is provided in tranches according to the schedule of the projects | ||||
06/30/2010
|
Banco do Brasil | Credit allocated to financing of equipment | R$ 17.8 million | The credit is provided in tranches according to the schedule of the projects | ||||
06/30/2010
|
Banco Santander and Banco Bradesco | Credit allocated to financing of equipment | R$ 135.1 million | The credit is provided in tranches according to the schedule of the project | ||||
06/30/2010
|
Banco do Brasil | Credit allocated to financing of equipment | R$ 175.8 million | The credit is provided in tranches according to the schedule of the projects | ||||
06/29/2010
|
BNDES | Credit allocated to financing of equipment | R$ 135.1 million | The credit is provided in tranches according to the schedule of the projects | ||||
06/29/2010
|
BNDES | Credit allocated to financing of equipment | R$ 175.8 million | The credit is provided in tranches according to the schedule of the projects | ||||
04/01/2008
|
BNDES | Credit allocated to investments made in Brazil | R$ 7.3 billion | The credit is provided in tranches according to the schedule of the projects | ||||
03/11/2008
|
BNDES | Credit allocated to the construction of Hydroelectric Plant UHE Estreito, its transmission lines and several social investments | R$ 808.4 million | The credit is provided in tranches according to the schedule of the projects |
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h. Significant alterations in each item of the financial statements
Analysis of the Results of Operations
The table below presents the values for the consolidated statements of results for the fiscal
years ended on 31 December 2009 and December 31st, 2010:
| On December 31st | ||||||||||||
| (in R$ billion) | ||||||||||||
| Income Statement | 2008 | AV | 2010 | |||||||||
Net Operating Revenue |
48,496 | 71.6 | % | 83,225 | ||||||||
Cost of products and services |
(27,750 | ) | 21.6 | % | (33,756 | ) | ||||||
Administrative and sales expenses |
(2,347 | ) | 36.4 | % | (3,201 | ) | ||||||
Research and Development |
(1,964 | ) | -20.2 | % | (1,567 | ) | ||||||
Reduction of the recoverable value of intangible assets |
— | — | — | |||||||||
Other expenses |
(3,262 | ) | 29.1 | % | (4,211 | ) | ||||||
Operating Revenue |
13,173 | 207.4 | % | 40,490 | ||||||||
Result of corporate participations |
99 | -148.5 | % | (48 | ) | |||||||
Amortization of premium |
— | — | — | |||||||||
Net financial income |
2,094 | -231.9 | % | (2,763 | ) | |||||||
Gain (loss) in the realization of assets |
93 | — | — | |||||||||
Profit before income tax and social contribution |
15,459 | 143.7 | % | 37.679 | ||||||||
Income tax and social contribution |
(4,954 | ) | 42.0 | % | (7,035 | ) | ||||||
Discontinued Operations |
(222 | ) | ||||||||||
Participation of minority holders |
(168 | ) | 109.5 | % | (352 | ) | ||||||
Net Profit |
10,337 | 190.9 | % | 30,070 | ||||||||
Fiscal year ended on December 31st, 2009 compared to the fiscal year ended on December
31st, 2010
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Revenues
The net operating revenue reached R$ 83,225 billion in 2010 versus R$ 48,496 billion in 2009, an
increase of 71.6% compared to 2009.
In 2010, the increase in revenue was due basically to the largest volume sold and to the increase
in prices of the principal products sold by the Company, which contributed to an increase in
revenue of R$7,366 billion and R$ 28.167 billion, respectively, compared to 2009.
The expansion in revenue was determined mainly by higher prices of iron ore, R$ 17,953 billion,
pellets R$6,880 billion, and by the purchase of Vale Fosfatados and Vale Fertilizantes, which
contributed with revenue of R$ 2,419 billion.
Iron ore
Revenues from iron ore sales increased by 80%, from R$ 5,234 billion in 2009 to R$ 45,419 billion
in 2010, due to a 71.1% increase in the average sale price and an 8.8% in volumes sold. The
increase in prices reflects strong demand.
Pellets
Revenues from pellet shipments increased 266% from R$3,887 billion in 2009 to R$ 14,227 billion in
2010 due to a 177.8% variation in average sales prices and an 89.3% increase of volumes sold.
Higher prices are explained by the same methodology applied in iron ore, while higher volumes are
explained by the increased use of plants due to market recovery.
Manganese ore
Revenues from manganese ore increased 66.5%, from R$ 275 million in 2009 to R$ 458 million in 2009
due to prices positive variation of 53.1% as a result of the impact of global economic conditions
and to the increase in volumes sold of 13.5% due to demand recovery.
Iron alloys
Revenues from iron alloys sales increased by 57.4%, from R$ 693 billion in 2010 to R$ 1,091 billion
in 2009, due to a 58.5% increase in volumes sold due to the recovery of steel industry. The alloys
average price remained stable by the variation of mix of alloys sold.
Nickel and other products
Revenues from this segment increased by 4.3%, from R$ 7,868 billion in 2009 to R$ 8,204 billion in
2010, mainly due to the following factors:
• Revenues from nickel sales increased by 3.7%, from R$ 6,457 billion in 2009 to R$ 6,698
billion in 2010, due to a 26.4% increase in average nickel prices. Nickel volume sold
declined by 22.8% due to the shutdown of our Sudbury and Voisey Bay operations as a result
of labor strikes beginning in the second half of 2009; and
• Revenue from copper sales increased 28% from R$ 903 million in 2009 to R$ 1,156 billion
in 2010, primarily due to an increase of 33.8% in average selling prices in part offset by
a 5.7% drop in volumes sold due to the shutdowns described above.
Copper concentrate
Revenues from copper concentrate sales increased 23.3%, from R$ 1,329 billion in 2009 to R$ 1,638
billion in 2010, due to a 25.8% increase in average sale prices.
Aluminum
Revenues from our aluminum business increased 10.6%, from R$ 4,217 billion in 2009 to R$ 4,663
billion in 2010 mainly due to LME price variation.
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Potash
Revenues from potash sales decreased 39.3%, from R$ 810 billion in 2009 to R$ 492 million in 2010,
due to 13.9% drop in sales volumes, explained by recuperation of internal inventory and by
reduction of average prices in 25.3%.
Phosphate
Sales revenue is attributed to the acquisition of Vale Fosfatados (formerly known as Bunge
Participações e Investimentos S.A.) and Vale Fertilizantes (formerly known as Fosfertil).
Nitrogen
Sales revenue is attributed to the acquisition of Vale Fosfatados and Vale Fertilizantes.
Logistics services
Revenue from logistics services increased 14%, from R$ 2,838 billion in 2009 to R$ 3,236 billion in
2010 mainly due to the mix of products transported.
Other products and services
Revenues from other products and services increased from R$ 1,190 billion in 2009 to R$ 1,664
billion in 2010. This occurred mainly because of higher revenues from steel products.
Services Costs and Expenses
Costs related to services and goods sold by Vale are detailed below:
Comments on Cost by Type of Product
Our total cost of goods sold increased from R$ 27,750 billion in 2009 to R$ 33,756 billion in 2010,
a 21.6% increase, due to higher volumes sold. The following were the main factors that contributed
to this variation:
• Outsourced services. Outsourced services costs increased by 8.6% in 2010, from R$ 4,274
billion in 2009 to R$ 4,640 billion in 2010, due to higher volumes sold.
• Materials costs. Materials costs increased by 2.2% in 2010, from R$ 5,943 billion in 2009 to
R$ 6,071 billion in 2010, reflecting the increase in demand. In 2009 there was the anticipation of
maintenance reflecting in the consumption of inputs in this period.
• Costs of energy and fuels. Energy costs decreased by 2.9% in 2010, from R$ 6,034 billion in
2009 to R$ 5,858 billion in 2010. This increase reflected higher volumes sold and prices.
• Staff costs. Staff costs decreased 3.8%, from R$ 4,077 billion in 2009 to R$ 3,921 billion
in 2010, reflecting the temporary interruption that occurred in nickel, impacting on the reduction
volumes sold, partially offset by an adjustment of 7% in payroll in Brazil.
• Acquisition of products. The cost of products purchased from third parties increased by
56.1%, from R$ 1,219 billion in 2009 to R$ 1,903 billion in 2010 mainly due to higher volumes sold
of pellets.
• Depreciation and depletion. The cost of depreciation and depletion increased 5.9%, from R$
4,642 billion in 2009 to R$ 4,916 billion in 2010. Part of the increase is due to acquisition of
fertilizer companies.
• Other costs. Increased 110.8% in 2010, from R$ 3,058 billion in 2009 to R$ 6,447 billion in
2010, mainly due to allocation of fertilizer costs of this nature — Vale Fosfatados and Vale
Fertilizantes.
Sales and administrative expenses
Sales and administrative expenses increased by 36.3%, from R$ 2,347 billion in 2009 to R$ 3,201
billion in 2010. The increase was explained by increased expenses in services, advertising and
personnel related to increased level of product commercialization.
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Research and development expenses
Research and development expenses decreased 20.2% in 2010, from R$ 1,964 billion in 2009 to R$
1,567 billion in 2010. The decrease in research on gas and energy is due to the economic
feasibility of some of these projects.
Other operating costs and expenses
Other operating expenses increased from R$ 3,262 billion in 2009 to R$ 4,211 billion in 2010, an
increase of 29.1% due to provision for loss of materials, increased distribution of variable
compensation (profit sharing) and review of mining rights.
Result of equity investments
The company share in non-controlled companies decreased 148.5% from R$ 99 million of revenue in
2009 to an expense of R$ 48 million in 2010. The reduction was due to losses from the startup of
the Companhia Siderúrgica do Atlântico.
Net Financial result
The financial result varied 231.9%, from an income of R$ 2,094 billion in 2009 to an expense of R$
2,763 billion in 2010. The main factors that contributed to the negative result was the lower
positive monetary and exchange variation recorded in 2009, market marking of shareholders
debentures and expenses with tax on financial operations due to the redemption of securities
convertible into shares.
Gain (loss) on realization of assets
The gain (loss) on asset realization was of R$ 93 million in 2009, mainly due to the sale of the
remaining of our stake in Usiminas with a gain of R$ 288 million partially offset by a loss in
Valesul of R$ 147 million in 2009. In 2010 there have been no gains/losses.
Income taxes and Social Security Contributions
For 2010 we recorded a net income tax expense of R$ 7,035 billion, compared with R$ 4,954 million
in 2009 due to a higher tax basis.
Net income
Net profit increased by 190.9%, from R$ 10,337 billion in 2009 to R$ 30,070 billion in 2010 and is
due primarily to factors explained previously.
Analysis of equity accounts
| 2010 | AV | 2009 | ||||||||||
Current Assets |
||||||||||||
Cash and cash equivalents |
13,469 | 1.9 | 13,221 | |||||||||
Short-term investments |
2,987 | (54.2 | ) | 6,525 | ||||||||
Derivatives at fair price |
87 | (52.5 | ) | 183 | ||||||||
Financial assets available for sale |
21 | (25.0 | ) | 28 | ||||||||
Accounts Receivable |
13,962 | 147.4 | 5,643 | |||||||||
Related parties |
90 | 2.150.0 | 4 | |||||||||
Inventory |
7,592 | 28.4 | 5,913 | |||||||||
Taxes to be refunded |
2,796 | 4.1 | 2,685 | |||||||||
Advances to suppliers |
318 | (63.5 | ) | 872 | ||||||||
Other |
1,070 | (37.8 | ) | 1,719 | ||||||||
| 42,392 | 15.2 | 36,793 | ||||||||||
Non-current assets held for sale |
11,876 | — | — | |||||||||
| 54,268 | 47.5 | 36,793 | ||||||||||
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| 2010 | AV | 2009 | ||||||||||
Non-current |
||||||||||||
Related Parties |
8 | (87.5 | ) | 64 | ||||||||
Loans and financing |
274 | (4.2 | ) | 286 | ||||||||
Advanced expenses |
254 | (13.9 | ) | 295 | ||||||||
Legal deposits |
3,062 | 1.5 | 3,109 | |||||||||
Advances to energy suppliers |
— | — | 889 | |||||||||
Income tax and social sec. payments deferred |
2,440 | (11.6 | ) | 2,760 | ||||||||
Taxes to be refunded |
612 | (60.3 | ) | 1,540 | ||||||||
Derivatives at fair price |
502 | (66.7 | ) | 1,506 | ||||||||
Other |
936 | 71.4 | 546 | |||||||||
| 8,088 | (26.4 | ) | 10,995 | |||||||||
Investments |
3,945 | (13.5 | ) | 4,562 | ||||||||
Intangibles |
18,274 | 11.2 | 16,440 | |||||||||
Fixed Assets |
130,087 | 19.4 | 108,948 | |||||||||
| 160,394 | 13.8 | 140,945 | ||||||||||
| 214,662 | 20.8 | 177,738 | ||||||||||
| 2010 | 2009 | |||||||||||
Liabilities and equity |
||||||||||||
Current |
||||||||||||
Accounts Payable to suppliers and contractors |
5,804 | 50.8 | 3,849 | |||||||||
Salaries and employment taxes |
1,966 | 26.3 | 1,556 | |||||||||
Derivatives at fair price |
92 | (65.2 | ) | 264 | ||||||||
Portion of long term current loans |
4,866 | (8.4 | ) | 5,310 | ||||||||
Loans and financing |
1,144 | 77.1 | 646 | |||||||||
Related Parties |
24 | (27.3 | ) | 33 | ||||||||
Taxes, contributions and royalties |
442 | 72.7 | 256 | |||||||||
Allowance for income tax |
1,310 | 257.9 | 366 | |||||||||
Pension and retirement benefits |
311 | 6.5 | 292 | |||||||||
Sub-concession Ferrovia Norte Sul |
117 | (76.4 | ) | 496 | ||||||||
Allowance for asset retirement |
128 | (18.5 | ) | 157 | ||||||||
Dividends and interest over own capital |
8,104 | 178.8 | 2.907 | |||||||||
Other |
1,736 | 29.7 | 1.338 | |||||||||
| 26,044 | 49.1 | 17,470 | ||||||||||
Liabilities related to non current assets held for sale |
5,340 | — | — | |||||||||
| 31,384 | 79.6 | 17,470 | ||||||||||
Non current |
||||||||||||
Derivatives at fair price |
103 | 157.5 | 40 | |||||||||
Loans and financing |
37,779 | 4.6 | 36,132 | |||||||||
Related Parties |
3 | (97.1 | ) | 103 | ||||||||
Pension and retirement benefits |
3,224 | 4.0 | 3,101 | |||||||||
Contingency Allowances |
3,712 | (11.7 | ) | 4,202 | ||||||||
Income tax and social sec, payments deferred |
12,947 | 39.1 | 9,307 | |||||||||
Allowance for asset retirement |
2,463 | 27.6 | 1,930 | |||||||||
Participation Debentures |
2,140 | 63.9 | 1,306 | |||||||||
Non-controlling shareholders’ redeemable share |
1,186 | (6.8 | ) | 1,273 | ||||||||
Other |
3,396 | 31.6 | 2,581 | |||||||||
| 66,953 | 11.6 | 59,975 | ||||||||||
Equity |
||||||||||||
Class A preferred shares- 7,200,000,000 authorized,
no par value shares and 2,108,579,618
(2009 — 2,108,579,618) issued |
19,650 | 6.4 | 18,469 | |||||||||
Common shares — 3,600,000,000 authorized,
no par shares and 3,256,724,482 (2009 — 3,256,724,482)
issued |
30,350 | 4.8 | 28,965 | |||||||||
Mandatorily convertible securities in common shares |
445 | (82.8 | ) | 2,584 | ||||||||
Mandatorily convertible securities in preferred shares |
996 | (50.3 | ) | 2,003 | ||||||||
Treasury shares — 99,649,571(2009 — 77,581,904)
preferred shares and 47,375,394 (2009 -
74,997,899) common shares |
(4,826 | ) | 95.4 | (2,470 | ) | |||||||
Operating P&L with non-controlling shareholders |
685 | — | — | |||||||||
Shares conversion/issuance P&L |
1,867 | 1,259.6 | (161 | ) | ||||||||
Equity valuation adjustment |
(25 | ) | 19.0 | (21 | ) | |||||||
Accrued conversion adjustment |
(9,512 | ) | 7.0 | (8,886 | ) | |||||||
Profit reserves |
72,486 | 47.1 | 49,272 | |||||||||
Accrued profits |
— | — | 6,003 | |||||||||
Total controlling shareholders’ equity |
112,116 | 17.1 | 95,758 | |||||||||
Non-controlling shareholders’ interest |
4,209 | (7.2 | ) | 4,535 | ||||||||
Total equity |
116,325 | 15.9 | 100,293 | |||||||||
Total liabilities and equity |
214,662 | 20.8 | 177,738 | |||||||||
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Position on December 31st, 2009 compared with the position at December 31st,
2009
Vale has assets and debts referenced to different currencies, the main ones being the real, U.S.
dollar and Canadian dollar. On December 31st, 2009, we had 57% of our assets related to
Brazilian reais, 14% to U.S. dollars, 25% to Canadian dollars and 4% to other currencies, while the
majority of our debt was expressed in U.S. dollars. Consequently, the effects of changes in
exchange rates impact the financial statements, especially the U.S. dollar, which in 2009 devalued
by 4.3% against the real.
Current assets
Cash and cash equivalents.
An increase of 1.9% from R$ 13,221 billion on December 31st, 2009, to R$ 13,469 billion
on December 31st, 2010. Although the company has made funding during 2010 that amounted
to R$ 4,771 billion, significant disbursements were made to face repayment of loans, including
debentures due in 2010, and investments in structure as well as companies acquisitions.
Short-term investments.
The reduction of 54.2%, from R$ 6,525 billion on December 31st, 2009, to R$ 2,987
billion on December 31st, 2010, refers mainly to investments maturity.
Accounts receivable from customers.
The increase of 147.4%, from R$ 5,643 billion at December 31st, 2009 to R$ 13,962
billion on December 31st, 2010, refers mainly to the increase in price and sales.
Inventories
The increase in inventories of 28.4%, from R$ 5,913 billion at December 31st, 2009, to
R$ 7,592 billion on December 31st, 2010, refers mainly to operations commencement of
project Vale Canada in New Caledonia.
Non-current assets held for sale
The R$ 11,876 billion in 2010 refer to aluminum sector assets and kaolin assets. There was no
execution in 2009.
Non-current assets
Advances to energy suppliers
The R$ 889 million in 2009 refer to the availability of aluminum assets for sale. There was no
execution in 2010.
Derivatives at fair price
The 66.7% reduction in derivatives at fair value, from R$ 1,506 billion at December
31st, 2009 to R$ 502 million on December 31st, 2010, refers basically to the
market marking of floating debt swap derivative transactions, called in reais, as a result of the
variations in the U.S. dollars.
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Investments
The reduction of 23.4%, from R$ 4,562 billion at December 31, 2009 to R$ 3,495 billion on December
31st, 2010, refers mainly to the loss in ThyssenKrupp CSA Siderúrgica do Atlântico.
Fixed assets
The increase in fixed assets of 19.4%, from R$ 108,948 billion at December 31, 2009, to R$130,087
billion on December 31st, 2010, refers mainly to the acquisition of companies in the
fertilizer sector as well as projects for infrastructure expansion.
Current liabilities
Accounts payable to suppliers and contractors
The decrease in accounts payable to suppliers and contractors of 50.8%, from R$ 3,849 billion on
December 31st, 2009, to R$ 5,804 billion on December 31st, 2010, was
basically due to the consolidation of fertilizer companies.
Portion of liabilities of long-term loans
The reduction in the portion of long-term loans under the item liabilities of 8.4%, from R$ 5,310
billion on December 31st, 2009, to $ 4,866 billion on December 31st, 2010,
is due to settlements of the year.
Loans and financing
The increase of 77.1%, from R$ 646 million at December 31st, 2009 to R$ 1,144 billion on
December 31st, 2010 is due to new lines of credit available for the Vale group.
Allowance for income tax
The increase of 257.9% from R$ 366 million in 2009 to R$ 1,310 billion in 2010 refers to the
balance of tax loss existing in 2009 and was fully used to that date. In addition to this impact,
there is the increase of net profit.
Proposed dividends and interest on capital
The increase of 178.8% from R$ 2,907 billion on December 31st, 2009, to $ 8,104
billion on December 31st, 2010, is due mainly to increased net profits by 190%.
Liabilities related to non-current assets held for sale
The R$ 5,340 billion in 2010 refers to the commitments linked to the assets available for sale of
aluminum sector and kaolin companies. There was no execution in 2009.
Non-current liabilities
Loans and financing
The increase in loans and financing in 4.6%, from R$ 36,132 billion on December 31st,
2009, to R$ 37,779 billion on December 31st, 2010, is due to security issuing occurred
in 2010, partially offset by the transfer of short-term debt installments.
Provisions for contingencies
The reduction of 11.7%, from R$ 4,202 billion on December 31st, 2009 to R$ 3,712 billion
on December 31, 2010, is due to settlement of contingencies for which the Company had made legal
deposits.
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Deferred Income taxes and social security contribution
The increase of 39.1%, from R$ 9,307 billion in 2009 to R$ 12,947 million in 2010 refers to the
allocation of surplus value due to the acquisition of fertilizer companies.
Provision with obligations for asset retirement
The increase of 27.6%, from R$ 1,930 billion in 2009 to R$ 2,463 million in 2010 was due to the
adjustment of adoption of IFRS in the controlled Vale Canada and acquisition of fertilizer
companies.
Shareholder Debentures
The increase of 63.9% from R$ 1,306 billion in 2009 to R$ 2,140 billion in 2010 refers to the
marking to market of shareholder debentures.
Stockholder’ equity
The stockholders’ equity increased by 17.1%, R$ 95,758 billion on December 31st, 2009,
to R$ 112,117 billion on December 31st, 2010. The increase in profit reserves came from
the capitalization of net income.
Non-current assets
10.2) Operating and Financial Results
Vale adopted on January 1st, 2010, retroactive to January 1st, 2009, all the
resolutions issued by CPC. Therefore, the financial statements for the fiscal year ending at
December 31, 2010 are the first consolidated financial statements submitted by the Company pursuant
to the International Financial Reporting Standards — IFRS. Thus, the financial statements for the
fiscal year ending at December 31, 2008, having been prepared based on different accounting
standards, are no longer comparable to the financial statements at December 31, 2009 and December
31, 2010, and therefore 2008 accounting information was not included in item 10.2.
a) Results of Vale Operations, in particular:
i. Description of key components of revenue
Net operating revenues totaled R$ 83,225 billion in 2010, increasing by 71.6% compared to 2009.
Compared to 2009.
Individually, the most important products in terms of revenue generation (i) in 2010 and 2009 were:
iron ore, nickel, pellets and copper:
| REVENUES BY PRODUCT | ||||||||||||||||
| R$ million | 2009 | % | 2010 | % | ||||||||||||
Bulk materials |
31,214 | 62.7 | 62,661 | 73.4 | ||||||||||||
Ferrous minerals |
30,212 | 60.7 | 61,322 | 71.9 | ||||||||||||
Iron ore |
25,234 | 50.7 | 45,419 | 53.2 | ||||||||||||
Pellet plant operation services |
18 | — | 22 | — | ||||||||||||
Pellets |
3,869 | 7.8 | 14,205 | 16.6 | ||||||||||||
Manganese |
275 | 0.6 | 458 | 0.5 | ||||||||||||
Ferroalloys |
693 | 1.4 | 1,091 | 1.3 | ||||||||||||
Others |
123 | 0.2 | 127 | 0.1 | ||||||||||||
Coal |
1,002 | 2 | 1,339 | 1.6 | ||||||||||||
Thermal Coal |
400 | 0.8 | 515 | 0.6 | ||||||||||||
Metallurgical Coal |
602 | 1.2 | 824 | 1 | ||||||||||||
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| REVENUES BY PRODUCT | ||||||||||||||||
| R$ million | 2009 | % | 2010 | % | ||||||||||||
Non-ferrous metals |
13,414 | 26.9 | 14,505 | 17 | ||||||||||||
Nickel |
6,457 | 13 | 6,698 | 7.8 | ||||||||||||
Copper |
2,232 | 4.5 | 2,794 | 3.3 | ||||||||||||
PGMs |
291 | 0.6 | 174 | 0.2 | ||||||||||||
Precious metals |
133 | 0.3 | 124 | 0.1 | ||||||||||||
Cobalt |
84 | 0.2 | 52 | 0.1 | ||||||||||||
Primary aluminum |
1,687 | 3.4 | 1,794 | 2.1 | ||||||||||||
Alumina |
2,337 | 4.7 | 2,650 | 3.1 | ||||||||||||
Bauxite |
193 | 0.4 | 219 | 0.3 | ||||||||||||
Fertilizers |
810 | 1.6 | 3,201 | 3.8 | ||||||||||||
Potash |
810 | 1.6 | 492 | 0.6 | ||||||||||||
Phosphate |
— | — | 2,085 | 2.4 | ||||||||||||
Nitrogen |
— | — | 593 | 0.7 | ||||||||||||
Others |
— | — | 31 | — | ||||||||||||
Logistics services |
2,838 | 5.7 | 3,236 | 3.8 | ||||||||||||
Railroads |
2.322 | 4.7 | 2,605 | 3,1 | ||||||||||||
Ports |
516 | 1 | 631 | 0,7 | ||||||||||||
Others |
1.537 | 3.1 | 1,742 | 2 | ||||||||||||
Gross Revenues |
49.812 | 100.0 | 85,345 | 100.0 | ||||||||||||
Taxes |
(1.316 | ) | (2.6 | ) | (2,120 | ) | (2.5 | ) | ||||||||
Net Revenues |
48.496 | 97.4 | 83,225 | 97.5 | ||||||||||||
In 2010, in terms of geographical distribution of our sales destination, although China has
decreased its revenue participation, it continued to be responsible for the main destination of our
sales, followed by Brazil, Japan, Germany and South Korea.
| REVENUE PER REGION | ||||||||||||||||
| R$ million | 2009 | % | 2010 | % | ||||||||||||
North America |
4,138 | 8.3 | 4,556 | 5.3 | ||||||||||||
USA |
2,264 | 4.5 | 2,433 | 2.9 | ||||||||||||
Canada |
1,832 | 3.7 | 1,994 | 2.3 | ||||||||||||
Others |
42 | 0.1 | 130 | 0.2 | ||||||||||||
South America |
8,507 | 17.1 | 16,148 | 18.9 | ||||||||||||
Brazil |
7,758 | 15.6 | 14,306 | 16.8 | ||||||||||||
Others |
749 | 1.5 | 1,842 | 2.2 | ||||||||||||
Asia |
27,709 | 55.6 | 44,544 | 52.2 | ||||||||||||
China |
18,379 | 36.9 | 27,581 | 32.3 | ||||||||||||
Japan |
4,709 | 9.5 | 9,303 | 10.9 | ||||||||||||
South Korea |
1,783 | 3.6 | 3,359 | 3.9 | ||||||||||||
Taiwan |
1,365 | 2.7 | 2,168 | 2.5 | ||||||||||||
Others |
1,474 | 3.0 | 2,133 | 2.5 | ||||||||||||
Europe |
8,081 | 16.2 | 16,217 | 19.0 | ||||||||||||
Germany |
2,118 | 4.3 | 5,601 | 6.6 | ||||||||||||
Belgium |
661 | 1.3 | 766 | 0.9 | ||||||||||||
France |
661 | 1.3 | 1,339 | 1.6 | ||||||||||||
United Kingdom |
1,103 | 2.2 | 2,052 | 2.4 | ||||||||||||
Italy |
650 | 1.3 | 1,832 | 2.1 | ||||||||||||
Others |
2,888 | 5.8 | 4,628 | 5.4 | ||||||||||||
Around the World |
1,377 | 2.8 | 3,879 | 4.5 | ||||||||||||
Gross Revenues |
49,812 | 100.0 | 85,345 | 100.0 | ||||||||||||
Taxes |
(1,316 | ) | (2.6 | ) | (2,120 | ) | (2.5 | ) | ||||||||
Net Revenues |
48,496 | 97.4 | 83,225 | 97.5 | ||||||||||||
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ii. Factors that affected materially the operational outcomes
The Company’s operating results are affected mainly by demand and prices for our main products and
services; and exchange rates.
Demand and prices
The following table summarizes the average sale price by products for the periods indicated.
| 2009 | 2010 | |||||||
| $/metric ton, except when | ||||||||
| indicated5 | ||||||||
Iron ore |
111.68 | 182.09 | ||||||
Pellets |
147.10 | 283.76 | ||||||
Manganese |
293.33 | 405.03 | ||||||
Ferroalloys |
2,782.99 | 2,723.11 | ||||||
Coal |
||||||||
Thermal coal |
132.84 | 123.85 | ||||||
Metallurgical Coal |
230.48 | 263.82 | ||||||
Nickel |
29,114.28 | 38,669.75 | ||||||
Copper |
10,430.54 | 13,599.55 | ||||||
Platinum (US$ /oz) |
2,142.16 | 2,922.55 | ||||||
Cobalt (US$ /lb) |
20.01 | 26.55 | ||||||
Aluminum |
3,364.63 | 3,837.07 | ||||||
Alumina |
451.70 | 498.92 | ||||||
Bauxite |
68.12 | 55.66 | ||||||
Potash |
1,040.10 | 722.30 | ||||||
Phosphate |
||||||||
MAP |
— | 843.44 | ||||||
TSP |
— | 782.29 | ||||||
SSP |
— | 383.28 | ||||||
DCP |
— | 987.79 | ||||||
Nitrogen |
— | 793.16 | ||||||
| 5 | Amounts converted at the average exchange rate in each period: R$ 1.8375/US$ in 2008,
R$ 1.9935/US$ in 2009 and R$ 1.7593/US$ in 2010. |
Iron ore and pellets
The demand for iron ore and pellets is a result of the global demand for high carbon steel. The
demand for high carbon steel, in turn, is highly influenced by global industrial production. There
are several quality levels of iron ore and pellets, as well as, several physical characteristics.
Several factors affect the prices of different types of iron ore, such as the iron content of
specific ore deposits, the size of particles, the humidity content and the type and concentration
of contaminants (such as phosphorus, alumina and manganese) in the ore. Generally, the
classification of ore into thin ore, lump ore and pellet feed determines price differences.
Since April 2010, all of our iron ore clients have agreed to move from annual reference contracts
to price index-based contracts. The former benchmark pricing system was replaced with a new system,
as agreed with our clients, which determines a quarterly price for the iron ore, based on the
three-month average of the index prices for the period ended a month before the start of the new
quarter.
Fine iron ore prices are determined based on the iron content, and calculated according to the
system described above. The lump ore and pellet prices contain premiums in relation to fine iron
ore prices and
are determined based on client negotiations. Our average prices for iron ore in 2010 increased by
84.9%, and our pellet prices were 118.7% higher than in 2009.
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Chinese iron ore imports reached 619.1 million metric tons in 2010, just under the 627.8 million
metric tons in 2009, mainly due to the strong increase in the Chinese steel production in 2010.
We expect China’s growth to remain above 10% in the first semester of 2011, driven mainly by
internal demand, and to decrease slightly in the second semester. The demand for minerals and
metals is expected to remain high, not only due to the rapid economic growth, but also due to
restocking.
Manganese and ferroalloys
The prices of manganese ore and ferroalloys are mainly influenced by trends in the high carbon
steel market. The prices of ferroalloys are also influenced by the prices of its main inputs, such
as manganese ore, energy and coke. Manganese ore negotiations are based on the spot market or
calculated on a quarterly basis. Ferroalloys prices are determined on a quarterly basis.
Coal
The demand for metal coal is driven by the demand for steel, especially in Asia. The demand for
thermal coal is directly related to electrical energy consumption, which will continue to be driven
by the worldwide economic growth, especially in emerging economies. Since April 2010, the prices of
metallurgical coal are set on a quarterly basis for most volumes sold in the transoceanic market.
The prices of thermal coal are set in spot negotiations and/or through annual contracts.
Nickel
Nickel is traded in the London Metal Exchange (LME). It is mainly used to produce stainless steel,
corresponding on average to 64% of global nickel consumption. Most nickel products are priced
according to a discount or a premium to the LME price, depending on the technical and physical
characteristics of the nickel product. Nickel demand, from sources other than stainless steel
production, represents 36% of the global nickel demand.
We have short-term fixed-volume contracts with customers for the majority of our expected annual
nickel sales. These contracts, together with our sales for non-stainless steel applications (high
nickel alloys, steel alloys, forging, plating, batteries and special applications), provide stable
demand for a significant portion of our annual production. In 2010, 65% of our refined nickel sales
were destined to applications outside the stainless steel industry. This, when compared to the
industry average of 36% among nickel producers, renders our sales volume more steady. As a result
of our focus on such higher-value segments, our average realized nickel prices have typically
exceeded LME prices.
Primary nickel (including iron-nickel, pig iron and nickel cathode) and secondary nickel (scrap)
are competing sources of nickel for stainless steel production. The choice between the different
types of primary and secondary nickel is largely driven by its relative prices and availability.
Over the past years, secondary nickel accounted for about 42-49% of the overall nickel used in
stainless steel production, and primary nickel accounted for 51-58%. In 2010, the Chinese nickel
pig iron production and iron-nickel production is estimated to have been higher than 150,000 metric
tons, representing 11% of the global offer of primary nickel, compared to 7% in 2009.
Nickel’s foundations are expected to remain strong in the near future. Stainless steel consumption
is strongly correlated with consumer spending and oscillation in relation to income growth. This
helps explaining why nickel consumption rates, measured as consumption per US$ from the GDP, is
still lower in emerging economies than in more advanced economies; unlike other metals, such as
steel and copper. We expect emerging economies to keep the momentum of rapid increase in individual
income, as in previous years, leading the expansion of consumer spending worldwide; this implies
significant growth potential for nickel demand in the medium term.
Aluminum
In February 2011, we transferred most of our aluminum businesses to Norsk Hydro ASA (Hydro), and we
now own 22% of Hydro’s capital, an aluminum producer company based out of Norway. Before this
transaction, the prices of our aluminum were based on the LME prices for the month prior to the
sale. Our alumina prices used to be calculated based on a percentage of the LME aluminum prices;
and our bauxite prices used to be determined by a formula linked to the price of aluminum for
three-month futures contracts on the LME and to the price of alumina FOB Australia.
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Copper
Growth in copper demand has been driven primarily by Chinese imports. Copper prices are determined
on the basis of: (i) copper metal prices on end markets, such as the LME and the NYMEX; and (ii)
for intermediate products, such as cooper concentrate and copper anode (which represent the
majority of our
sales), treatment and refining rates are negotiated with each client. According to a pricing system
known as MAMA (month after month of arrival), sale prices of copper concentrate and anode are
provisionally set at the time of shipment, and the final prices are based on the LME at a future
time, typically three months after shipment of product.
Copper consumption is rapidly increasing, partly as a result of further recovery in the global
economy. Due to structural limitations to the growth of the supply of concentrates, there are
strong factors driving relatively high prices.
Fertilizer nutrients
The demand for fertilizers is driven on the long run by agricultural production, which is dependent
on the demand for food, which in turns depends on the level of growth of income per capita,
population age structure, food preferences and technological innovation. The demand for fertilizers
has recently been influenced by the biofuel production, which is determined by economic growth,
competition with fossil fuels and environmental regulations.
In the short term, the demand for fertilizers is affected by the agriculture economic cycles, which
are mostly determined by offer, and vary depending on weather conditions and credit availability,
unlike the mining cycles which are influenced mainly by the fluctuations in demand. The demand for
fertilizers has a strong seasonal component, derived from the planting seasonal periods, which
result in prices fluctuations within the same year.
Fertilizers are sold mainly on a cash-basis, based on international reference prices; although
certain large importers, such as China and India, often sign annual contracts.
Logistics
Demand for our transportation services in Brazil is primarily driven by Brazilian economic growth,
mainly in the agricultural and steel sectors. Our logistics revenues are primarily from fees
charged to customers for the transportation of cargo on Vale’s railroads, ports and ships. Our
railroads account for most of this revenue. Nearly all of our logistics revenues are expressed in
Brazilian Reais and subject to adjustments triggered by changes in fuel prices. Prices in the
Brazilian market for railroad services are subject to ceilings set by the Brazilian regulatory
authorities, but they primarily reflect competition with the trucking industry.
Exchange Rate
The impact of exchange rate variations on our results are described in item “10.2 (b)”.
b. Variations of incomes attributable to changes in prices, exchange rates, inflation, changes in
volumes and the introduction of new products and services
Exchange rate variations
The increase in the value of the US dollar in relation to the Brazilian Real tends to result in
higher operating margins and lower financial results. This is due to exchange gains on our
liabilities in US dollars and fair market value gains on our currency derivatives.
Most of our revenues are expressed in US dollars, whereas most of our costs of goods sold are
expressed in other currencies, mainly the Brazilian Real (69% in 2010), and also, including but not
limited to the US dollar (15% in 2010), Canadian dollar, Indonesian rupees, Australian dollars and
Euros. As a result, changes in exchange rates affect our operating margins.
Most of our long-term debt is expressed in US dollars. Due to the fact that Vale’s functional
currency is the Brazilian Real, changes in the value of the US dollar against the Brazilian real
result in exchange gains or losses on our net liabilities, which, in turn, affect our financial
results.
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On December 31st, 2010 our debt expressed in Brazilian Reais was R$ 13.3 billion. Since
most of our revenue is in US dollars, Vale uses derivatives to convert our debt from Brazilian
Reais to US dollars. As a consequence of the depreciation of the Brazilian Real in the first
semester, and its revaluation in the second half, in relation to the US dollar, the net exchange
rate and monetary variation caused a positive impact on our net profits of R$ 442 million in 2010.
The net result of the currency and interest rate swaps, structured mainly to convert the debt
expressed in Brazilian Reis into US dollars to protect our cash flow
from currency price volatility, produced a positive effect of R$ 1,290 billion in 2010, of which R$
2,240 billion generated a positive impact on the cash flow.
Variations in the rates of inflation
Our revenues are not significantly affected by inflation rates.
Variations attributable to price changes, volume changes and the introduction of new products and
services
Our revenues are not significantly affected by inflation rates.
Our operating revenue is directly affected by changes to our products’ prices and services, as well
as, by changes to the volumes sold, as discussed in item “10.2(a)(ii)” of this Reference Form.
Fertilizers
The fertilizers segment is accountable for the following effects on our results: contribution of R$
3.014 billion to our net income in 2010 and of R$ 2.729 billion to our costs. The remaining
operations did not have relevant impacts on the Company’s results.
c. Impact of inflation, price variations of main inputs and products, exchange rate and interest
rates on operating results and the issuer’s financial result
For comments on the impact of inflation, price variations of main products and exchange rates, see
item “10.2 (b)” of this Reference Form.
We are exposed to the risk of interest rates for loans and financings. Debt tied to interest rates
in US$ consists mainly of loans, including export prepayment operations, loans from commercial
banks and multilateral organizations. In general, these debts are indexed to the LIBOR (London
Interbank Offered Rate). The natural hedge between North American interest rate fluctuations and
prices of metals mitigates the volatility of Vale’s cash flow. In the event of an imbalance in this
natural hedge, Vale assesses the possibility of contracting financial instruments to provide the
desired protection. The floating rate of our debt expressed in Brazilian Reais includes debentures,
loans obtained from the BNDES, fixed assets and financing for the purchase of services in the
Brazilian market. The interest on these obligations is tied primarily to CDI (Interbank Deposit
certificate), the reference interest rate on the Brazilian interbank market and the TJLP (long-term
interest rate). About 30% of the debt is expressed in Brazilian Reais and is linked to a floating
interest rate; the remaining 70% is expressed in other currencies.
Energy costs are an important component of our production cost and represent 17.4% of the total
cost of products sold in 2010. Increases in the price of oil and gas negatively impact our
logistics, mining, pellets, and nickel and alumina businesses. Electricity costs represented 6.7%
of the total cost of products sold in 2010.
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10.3 Relevant effects on Financial Statements
The purchase of Vale Fosfatados and Vale Fertilizantes has had significant impacts on our results:
contribution of R$ 3,014 billion to our net income in 2010 and of R$ 2,729 billion to our costs.
The remaining operations did not have relevant impacts on the Company’s results.
Vale does not provide advisory forecasts regarding its future financial performance. The company
seeks to disclose as much information as possible about its views on the different markets where it
operates, its strategic guidelines and implementation in order to give participants in the capital
market a sound basis for their expectations regarding its performance in the medium and long term.
a. Introduction or disposal of operating segment
In 2010, the fertilizer segment was introduced and its contribution to the revenue was of 3.8%.
b. Incorporation, acquisition or divestiture of equities
Events following the Accounting Statements from the 31st of December, 2010
The following events have not had significant impacts on Vale’s financial statements or its results
in 2010.
Acquisition of Biopalma
In February 2011, Vale became the controller of Biopalma da Amazônia S.A. Reflorestamento Indústria
e Comércio, in Pará, a producer of palm oil, which is used in biodiesel production. The transaction
value was R$ 173.5 million. Our goal is to use this fuel in Vale’s operations in Brazil. Biopalma
begins palm oil production in 2011, expecting to reach annual production of 500,000 tons by 2019,
when crops reach maturity. The main use of the oil will be on Vale’s biodiesel production to fuel
its locomotives, machines and equipment in large Brazilian operations, using the B20 (mixture
containing 20% biodiesel and 80% common diesel).
Portfolio management
In February 2011, Vale announced completion of its transaction with Norsk Hydro ASA (Hydro), a
company listed in the Oslo Stock Exchange and in the London Stock Exchange (ticker symbol: NHY), to
transfer all of its shares with Albras — Alumínio Brasileiro S.A. (Albras), Alunorte — Alumina do
Norte do Brasil S.A. (Alunorte) and Companhia de Alumina do Pará (CAP), as well as, respective
exclusivity rights, business contracts and net debt of US$ 655 million; in exchange for 22% of
Hydro’s outstanding common shares, following today’s issuance, and US$ 503 million in cash,
following adjustments.
Additionally, Vale has incorporated a new company, Mineração Paragominas S.A (Paragominas), and
transferred the Paragominas bauxite mine and all of its remaining bauxite mining rights in Brazil.
As part of this transaction, Vale has sold 60% of Paragominas to Hydro for US$ 578 million in cash,
after working capital adjustments. The remaining 40% shall be sold in two equal shares of 20% in
2013 and 2015, for US$ 200 million in cash each.
Under the terms of the agreement, Vale, through its fully owned subsidiaries, has transferred to
Hydro: (a) 51% of the total capital of Albras; (b) 57% of the total capital of Alunorte; (c) 61% of
the total capital of CAP; and will sell (d) 60% of the total capital of Paragominas — Vale will
hold 40% of the capital until it is completely sold in 2015.
Vale, through its fully owned subsidiaries, has subscribed 447,834,465 Hydro shares, or 22% of the
2,035,611,206 outstanding shares, approximately US$ 3.5 billion according to Hydro’s closing price
and the exchange rate NOK/US$ on the 25th of February, 2011. Under the terms of the transaction,
Vale shall not sell its shares for a 2-year lock-up period and shall not own more than the 22% of
Hydro.
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Main Acquisitions
2010
Acquisition of iron ore assets in Africa
In April 2010, Vale acquired from BSG Resources Ltd. (BSGR) 51% equity in BSG Resources (Guinea)
Ltd., which holds concessions for iron ore in Guinea, Simandou South (Zogota) and exploration
permits for Simandou North (Blocks 1 & 2). Vale has paid US$ 2.5 billion for the acquisition of
these assets — US$ 500 million in cash and the remaining US$ 2 billion in installments subject to
the fulfillment of specific goals. Simandou Blocks 1 & 2 and Zogota are among the best unexploited
iron ore deposits in the world, with high quality and potential for the development of large scale
and long term projects, at low operating and investment costs. The joint venture between Vale and
BSGR will implement the Zogota project and conduct feasibility studies for Blocks 1 & 2, with the
creation of a logistics corridor for the flow of materials through Liberia. For the right to move
goods through Liberia, the joint venture is committed to renewing 660 km of the Trans- Guinea
railway for passenger and light cargo. Vale will be responsible for asset management, marketing and
sales of the joint venture with the exclusive off-take of the iron ore produced.
Acquisition of coal assets in Australia
In June 2010, Vale acquired from AMCI Investments Pty Ltd (AMCI), for US$ 92 million, additional
holdings of 24.5% in the Belvedere (Belvedere) coal project. As a result of this transaction,
Vale’s interest in Belvedere increased from 51.0% to 75.5%. Belvedere is an underground coal mine
project in the Bowen Basin region, near the town of Moura in Queensland, Australia. According to
our preliminary estimates, when completed the Belvedere project will have the potential to reach
production capacity of up to 7.0 million metric tons of metallurgical coal per year.
Acquisition of assets of fertilizer
In line with our strategy of becoming global leaders in the fertilizer industry, in May 2010
we acquired 58.6% of the capital of Fertilizantes Fosfatados S.A. (Fosfertil), currently Vale
Fertilizantes S.A.; as well as, the Brazilian fertilizer assets of Bunge Participações e
Investimentos S.A. (BPI), currently Vale fosfatados, for R$ 8,692 billion (corresponding to a price
per share of US$ 12.0185 for Fosfertil shares and a total of US$ 1.7 billion for Bunge fertilizer
assets). A payment of R$ 103 million was made in July to complement the price of Vale Fosfatados.
In September, we acquired an additional 20.27% of Fosfertil’s equity for R$ 1,762 billion
(corresponding to a price per share of US$ 12.0185) and, in December, we disclosed the result of
the public offering for the acquisition of the company’s common shares held by minority
shareholders. In December 2010, we held 78.92% of the total capital and 99.83% of the voting
capital of Vale Fertilizantes, and 100% of the capital of Vale Fosfatados.
Acquisition of equity on SDCN
In September 2010, we acquired 51% of the Sociedade de Desenvolvimento do Corredor Norte S.A.
(SDCN) for US$ 21 million (equivalent to R$ 36.6 million on the date of disbursement). SDCN has a
concession to create the necessary logistics infrastructure to enable the flow of the production
from the second phase of the Moatize coal project.
Main investment disposals and asset sales
Sale of Valesul assets
In January 2010, our fully owned subsidiary, Valesul Alumínio S.A., signed a sale agreement of its
aluminum assets for US$ 31.2 million. Valesul assets, located in the State of Rio de Janeiro,
comprising the agreement included the anode, reduction and melting factory, as well as, industrial,
administrative and stocking services.
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Sale of kaolin assets
In the second quarter of 2010, Vale sold 86.2% of its equity in Pará Pigmentos S.A. (PPSA), as well
as, other kaolin mining rights in Pará. Assets were sold to Imerys S.A., a company listed in the
Euronext, by US$ 72 million.
Sale of equities in the Bayóvar project
In July 2010, Vale completed the sale of its minority equities in the Bayóvar project, in Peru,
through a newly incorporated Company, namely MVM Resources International BV (MVM). The Company sold
35% of MVM’s total equity to Mosaic for R$ 682 million, and 25% to Mitsui for R$ 487 million. Vale
controls the Bayóvar project, holding 40% of the total capital and 51% of the voting capital of the
newly incorporated Company. Overall capital investments by the 30th of June 2010 were
approximately US$ 550 million (equivalent to R$ 932 million in September 2010). The difference
between the fair value and book value in this transaction, totaling R$ 544 million, was accounted
for in our net equity, as per gain/ loss regulations applicable to when the control of a company is
held.
Sale of equities in Vale Oman Pelletizing Company LLC
In May 2010, Vale signed an agreement with the Oman Oil Company SAOC (OOC), a company controlled by
the Sultanate of Oman, to sell 30% of Oman Pelletizing Company LLC (VOPC), for US$ 125 million
(equivalent to R$ 212 million on September 30th, 2010). The transaction is still
subject to the terms of the final agreement for the purchase of shares, to be signed when the
preceding conditions are met. The difference between the fair value and the book value of this
transaction, totaling R$ 544 million, was accounted for in our net equity, as per gain/ loss
regulations applicable to when the control of a company is held.
Main Acquisitions
2009
Iron ore assets in Corumbá
In September 2009, Vale concluded the acquisition of the open pit iron ore mining exploration
operations in Corumbá, Brazil, along with its respective logistics infrastructure for US$ 750
million (equivalent to R$ 1,473 billion on the date of disbursement) from Rio Tinto Plc. The
Corumbá iron ore mine is a world class asset, defined by its high iron content, with lump reserves.
The logistics assets support 70% of the operation’s transport needs. The purchase of the Corumbá
assets is subject to Federal Government approval.
Potash deposits in Argentina and Canada
In January 2009, Vale purchased the Rio Colorado project from Rio Tinto Plc, in the Mendoza and
Neuquén provinces, in Argentina, and the Regina project in the Saskatchewan province, in Canada,
for US$ 850 million (equivalent to R$ 1,995 billion on the date of disbursement). The Rio Colorado
project includes the development of a mine with initial rated capacity of 2.4 Mtpy of potash, with
potential for expansion up to 4.35 Mtpy. The project also includes 350 km of railway connections,
port facilities and a power plant. The Regina project is still in its exploration phase, with
potential for annual production of approximately 2.8 Mt of potash. The current local infrastructure
will enable the final product to be transported to Vancouver, facilitating access to the expanding
markets in Asia.
Copper exploitation assets in the African copper belt
In the first quarter of 2009 Vale purchased a 50% equity in a joint venture with African Rainbow
Minerals Limited, for future development of TEAL Exploration & Mining Incorporated (TEAL) assets,
for US$ 60 million (equivalent to R$ 139 million on the date of disbursement); thus, expanding the
strategic options for growth in the African copper market.
TEAL has two copper projects in the African copper belt already at feasibility and approval stage.
Over the next few years, these projects together may represent a nominal production capacity of
65,000 metric tons of copper per year, as well as, an extensive and highly promising portfolio of
copper exploitation assets.
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Coal assets in Colombia
In the first quarter of 2009 Vale completed its acquisition of the coal exploitation assets from
Cementos Argos S.A. (Argos), in Colombia, for US$ 306 million (equivalent to R$ 695 million on the
date of disbursement). Assets acquired were: the El Hatillo coal mine, in the Cesar department;
Cerro Largo, a coal deposit under exploration; a minority stake in the Fenoco consortium, which
holds the concession and operation of the railroad linking the coal operations to the Córdoba River
port — SPRC; and 100% of the port’s concession.
Increased holdings in TKCSA
In the third quarter of 2009, Vale agreed with ThyssenKrupp Steel AG to increase our holdings in
ThyssenKrupp CSA Siderúrgica do Atlântico Ltda. (TKCSA), from the current 10% to 26.87%, through
capital input of EUR 965 million (equivalent to R$ 2,532 billion on the date of disbursement). By
the end of 2008, Vale’s contributions to TKCSA amounted to US$ 478 million (equivalent to R$ 930
million on the date of disbursement). TKCSA is building an integrated steel slab plant, with rated
capacity of five million metric tons of steel slab per year in the state of Rio de Janeiro.
Production commenced in the third quarter of 2010. As a strategic partner of ThyssenKrupp, Vale is
the exclusive supplier of iron ore to TKCSA.
2008
Acquisition of mining rights
In the second quarter of 2008 Vale purchased the iron ore mining rights owned by Mineração Apolo
S.A., located in the municipalities of Rio Acima and Caeté, in Minas Gerais. The total cost of the
acquisition, which increased Vale’s estimated resources in 1.1 billion metric tons of iron ore, was
US$ 154.3 million (equivalent to R$ 255.8 million on that date of disclosure of the acquisition),
whereby US$ 9.3 million (equivalent to US$ 15.4 million on the date of acquisition) were paid as a
call option in May 2005, and US$ 145 million (equivalent to R$ 240.4 million on the date of
disclosure of the acquisition) in 2008.
Main investment disposals and asset sales
In line with our strategy, we continue to reduce our holdings in non-essential assets. The
following is a summary of the main disposals and sales of assets in the three-year period.
2010
Sale of Valesul assets
In January 2010, our fully owned subsidiary, Valesul Alumínio S.A. entered into an agreement for
the sale of its aluminum assets for US$ 31.2 million. Valesul assets included in the agreement, and
located in the State of Rio de Janeiro, included the anode, reduction and melting factory, as well
as, industrial, administrative and stocking services.
2009
Usiminas.
In the second quarter of 2009, Vale sold its 2.93% stakes in Usinas Siderúrgicas de Minas Gerais
S.A. (Usiminas) for R$ 595 million.
PTI
Vale sold, through a book building process, for IDR 925.6 billion — equivalent to US$ 91.4 million
(R$ 171 million on the date disbursement) — 205,680,000 of its shares in the subsidiary PT
International Nickel Indonesia Tbk (PTI), representing 2.07% of PTI’s outstanding shares.
Sale of forestry assets to Suzano
In July 2009, Vale entered into an agreement with Suzano Papel e Celulose S.A, by which Vale agreed
to supply reforested wood and to the sale of forest assets, totaling 84.7 thousand hectares,
including conservation areas of eucalyptus forest located in the southwest of Maranhão. The agreed
value of this negotiation was R$ 235 million.
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Sale of Nickel assets
In the last quarter of 2009 Vale sold downstream non-strategic assets: Jinco Nonferrous Metals Co.,
(US$ 6.5 million — R$ 11 million on the date of disbursement), and International Metals
Reclamation Company
(US$ 34 million — R$ 59 million on the date of disbursement). These companies produced very
specific and low profit nickel products.
2008
Jubilee Mines
In the first quarter of 2008, Vale sold its minority holdings in Jubilee Mines, a nickel producer
in Australia, for US$ 130 million (R$ 232 million on the date of disbursement).
c. Unusual events or operations
Over the past three financial years there have been no unusual transactions or events.
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10.4 Changes in Accounting Practices. Corrections and Remarks.
a. Significant changes in accounting practices
There have been no significant changes in the consolidated accounting statements for the year
ending on December 31st, 2010 except for those relating to the first annual consolidated
accounting statements in accordance with the Accounting Pronouncements Committee (CPC) and the
International Financial Reporting Standards - IFRSs. The Company applied the CPC Pronouncements 37
and 43 and IFRS 1 in preparing these consolidated accounting statements. For more details, see Note
5 in the accounting statements.
The individual accounting statements of the Parent Company for the year ending on December
31st, 2010 are the first annual individual statements in accordance with the CPC. The
Company applied CPCs 37 and 43 when preparing these individual accounting statements.
The transition date is January 1, 2009. The administration prepared balance sheets in accordance
with the CPCs and the IFRS at that date.
In preparing those accounting statements, the Company applied all the relevant mandatory exceptions
and certain optional exemptions regarding the full retrospective application.
| I) | The Company chose to apply the following exemptions in relation to retrospective
application: |
| a) | Retirement benefit obligations — The Company elected to recognize all actuarial gains
and losses cumulatively passed on January 1st, 2009. |
| b) | Provision for Asset Retirement — The Company adopted exemption from this
pronouncement in relation to historical rates of long-term interest before income tax that
reflects the assessment of market conditions prevailing at the time and the specific risks
associated with the liabilities and used in previous principles, and remeasurement
provided in the new principles, in order to calculate the present value discount bonds
with assets retirement. |
| c) | Business combinations — the Company adopted exemption from business combinations as
described in IFRS 1 and CPC 37 and therefore did not restate business combinations that
occurred before January 1, 2009, the transition date. |
| d) | Cumulative conversion adjustments — The Company made the initial recording of
cumulative transition adjustments on January 1st, 2009, in retained earnings, applying
this exemption on the transition date to all controlled companies, according to the
pronouncement. |
| II) | Reconciliation between IFRS/CPCs with past practices: |
| a) | The Company immediately made initial records in employee benefit plans and
acknowledged an increase in liabilities reflecting on deferred income tax assets and on
shareholders’ equity. These adjustments are included in gains and losses relating to the
previous accounting policy, which would fall within the limits of the “corridor” (see
definition in note 2 (t) of the Accounting Statements). The company will continue using
the “corridor” as an accounting practice. |
| b) | Asset Retirement Provision — The Company already recognized in its financial
statements the provision for retirement in accordance with IFRS, except for the
remeasurement of the historical rate of long-term interest before income tax that reflects
the assessment of market conditions prevailing at the time used to calculate the present
value of the bonds, which according to IFRS standards should be reviewed/remeasured on the
date of the balance sheet. |
| c) | Deferred income tax — adjustments in this regard basically refer to the transfer of
shares registered as non-current to current, according to new principles and compensation
between assets and liabilities of the same nature. |
| d) | Investment — the adjustment relates to the impact of transition from previous
practice to CPC pronouncements in the invested and captured in the line of equity in the
Parent DRE. |
| e) | Legal deposits — refers to the reclassification of funds that during the previous
practices were presented as a reduction of the contingent liabilities. |
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| f) | Minor equity — this accounting category is now to be called Interest of
Non-controlling Shareholders and was reassigned to the equity. The participation of
non-controlling shareholders, recorded in the accounting prominently under equity requires
that the movement of assets for these shareholders occur similarly to those given to the
controlling shareholders. |
| g) | Redeemable non-controlling shareholders shares — the participation of non-controlling
shareholders is redeemable upon the occurrence of certain events beyond the control of the
Company, and was classified as redeemable non-controlling shareholders shares in
non-current liabilities. |
| h) | Intangible Assets — In the railway concessions in which the Company participates, the
investment in permanent ways should be resumed to the granting authority at the conclusion
of the concession agreement, and was reclassified from fixed assets to intangible assets. |
b. Significant effects of changes in accounting practices
The effects of adopting these new accounting practices in the fiscal year on the net income and
shareholders’ equity are the following. Please see further details in the explanatory notes #5 of
the accounting statements:
Adjustments in the Adoption of New Practices, Accounting Estimates and Reclassifications
Consolidated
| Results on | ||||
| R$ million | 12/31/2009 | |||
Balance prior to the adoption of the new practices |
10,249 | |||
Adjustments |
88 | |||
Net earnings in the period |
10,337 | |||
Net earnings attributable to non controlling
shareholders |
168 | |||
Net earnings in the period |
10,505 | |||
| Equity on | Equity on | |||||||
| R$ million | 12/31/2009 | 01/01/2009 | ||||||
Balance prior to the adoption of the new practices |
95,737 | 96,275 | ||||||
Adjustments |
21 | 33 | ||||||
Non controlling shareholders’ equity |
4,535 | 4,691 | ||||||
Equity |
100,293 | 100,999 | ||||||
c. Corrections and remarks present in the auditor’s opinion
There were no corrections or remarks on the opinions relating to the financial statements for 2008,
2009 and 2010.
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10.5 Critical Accounting Policies
The criteria listed below refer to the critical accounting policies that are adopted and reflected
in the consolidated financial statements.
We considered an accounting policy critical when it is important to the financial condition and
operations results and requires significant judgments and estimates by the Vale management. The
summary of most important accounting policies can be found in Note 3 of the accounting statements.
The presentation of accounting statements in accordance with the principles of recognition and
measurement by the accounting standards issued by the CPC and the International Accounting
Standards Board (“IASB”) requires the Company management to make judgments, estimates and
assumptions that may affect the value of assets and liabilities presented.
These estimates are based on the best information available in each period and the actions planned
and are constantly reviewed based on available information. Changes in facts and circumstances may
lead to revision of estimates, so the actual future results could differ from estimates.
Significant estimates and assumptions used by the company management in preparing the 2010
accounting statements are thus presented:
Mineral reserves and mine life
The estimates of proven reserves and probable reserves are regularly evaluated and updated. Proven
and probable reserves are determined using techniques generally accepted geological estimates. The
calculation of reserves requires the Company to assume positions of future conditions that are
uncertain, including future ore prices, exchange rates, inflation rates, mining technology,
availability of permits and production costs. Changes in some of these assumptions could have a
significant impact on proven reserves and probable reserves recorded.
The estimated volume of mineral reserves is based on calculation of the exhaust portion of the
mines, and the estimated mine life is a major factor in quantifying the provision of environmental
rehabilitation of mines during the write-down of fixed assets. Any change in the estimates of the
volume of mine reserves and life of assets linked to them may have significant impact on charges
for depreciation, depletion and amortization recognized in financial statements as cost of goods
sold. Changes in estimated mine life could cause significant impact on estimates of the provision
for environmental costs of recovery after write-down of fixed assets and impairment analysis.
Environmental costs and recuperation of areas degraded
Expenses related to compliance with environmental regulations are recorded in income or are
capitalized. These programs were designed to minimize the environmental impact of activities.
The Company recognizes an obligation under the market value for disposal of assets during the
period in which they occur, according to Note 2 (s) in the financial statements.
The Company believes the accounting estimates related to reclamation and closure costs of a mine
are a critical accounting policy because it involves significant values for the provision and it
is expected to involve several assumptions, such as interest rate, inflation, life the asset,
considering the current stage of exhaustion and the projected date of exhaustion of each mine.
Although the estimates are reviewed each year, this provision requires that the premises are
assumed to project cash flows applicable to the operations.
Income tax and social security contribution
The determination of the provision for income taxes or deferred income tax assets and liabilities
and any valuation allowance on tax credits requires estimates from Management. For each income tax
asset, the Company assesses the likelihood of part or the entire asset not being recovered. The
valuation allowance made with respect to accumulated tax losses depends on the assessment by the
Company, the probability of generating future taxable profits in the deferred income tax asset was
recognized based on production and sales planning, commodity prices, costs of operational plans,
restructuring costs, reclamation costs and planned capital.
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The Company recognizes, where applicable, provision for losses in cases where tax credits may not
be fully recoverable in the future.
Contingencies
Contingent liabilities are recorded and/or disclosed unless the possibility of loss is considered
remote by our legal advisors. These contingencies are arranged in notes to the financial
statements, Notes 2 (s) and 20 of the financial statements.
The record of the contingencies of a given liability on the date of the financial statements is
done when the value of these losses can be reasonably estimated. By their nature, contingencies
will be resolved when one or more future events occur or fail to occur. Typically, the occurrence
of such events depends not on our performance, which makes it difficult to give precise estimates
about the exact date on which such events are recorded. Assessing such liabilities, particularly in
the uncertain legal environment in Brazil, and in other jurisdictions, involves exercising
significant estimates and judgments from management regarding the results of future events.
Post-retirement benefits for employees
The Company sponsors various plans for post-retirement benefits to employees in Brazil and abroad,
the parent company and entities in the Group, as described in note 2 (t) and 22 of the financial
statements.
The values reported in this section depend on a number of factors that are determined based on
actuarial calculations using several assumptions in order to determine the costs and liabilities,
among others. One of the assumptions used in determining the amounts to be recorded in accounting
is the interest rate to discount and upgrade. Any changes in these assumptions will affect the
accounting records made.
The Company, together with external actuaries, reviews at the end of each fiscal year, which
assumptions should be used for the following year. These premises are used for upgrades and
discounts to fair value of assets and liabilities, costs and expenses and determination of future
values of estimated cash outflows, which are needed to settle the obligations with the plans.
Reduction in recoverable value of assets
The Company annually tests the recoverability of its tangible and intangible assets with indefinite
useful lives that are mostly of the portion of premium for expected future earnings arising from
processes of the business combination. The accounting policy in respect of an item is presented in
Note 2 (n) of the financial statements and the possible values and procedures used for the
calculations and records are presented in Note 18 of the financial statements.
Recoverability of assets based on the criterion of discounted cash flow depends on several
estimates, which are influenced by market conditions prevailing at the time that such impairment is
tested and thus management believes it is not possible to determine whether new impairment losses
will occur in the future.
Fair Value of Derivatives and Other Financial Instruments
The fair value of financial instruments not traded in an active market is determined by using
valuation techniques. Vale uses assessments to choose the various methods and assumptions set which
are mainly based on market conditions existing at balance sheet date. See note 24 in the financial
statements.
The impact analysis if actual results are different from the management estimate is presented in
note 26 of the financial statements on the topic of sensitivity analysis.
Conversion of foreign currency transactions
The rights and monetary obligations denominated in foreign currencies are converted at
exchange rates prevailing at the balance sheet date, being US$ 1.00 is equivalent to R$ 1.6662
on December 31, 2010 (US$ 1.00 equivalent to R$ 1.7412 on December 31, 2009 and R$ 2.3370 on
December 31, 2008).
Sales revenues, costs and expenses denominated in foreign currencies are converted
using the average exchange rates for the month of their occurrence.
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10.6 Internal Controls
a. Degree of efficiency of such controls, and any imperfections and actions taken to correct them
Vale management evaluated the effectiveness of internal controls related to financial statements
through a process designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements.
Management established a process for evaluating internal controls with statistical process mapping
and risk assessment to identify applicable controls in order to mitigate the risks affecting the
company’s ability to start, authorize, record, process and disseminate relevant information in
financial statements.
At the end of fiscal year, based on tests performed by the administration during the period, no
shortcomings were identified in the implementation of relevant controls. During the fiscal year,
whenever inadequacies are identified in the implementation of controls, they are corrected through
the implementation of action plans to ensure their effectiveness at year end.
Vale managers understand that the process mapping and risk assessment methodology used is adequate
to ensure efficiency, accuracy and reliability on our internal controls.
b. Deficiencies and recommendations on internal controls included in the independent
auditor report
The auditors reported no deficiencies or recommendations about the effectiveness of internal
controls adopted by Vale.
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10.7 Public Offerings of Securities
a. How resources resulting from the offering were used
2010
Vale prices US$ 1 billion in bonds maturing in 2020
In September 2010, Vale issued US$ 1 billion (equivalent to R$ 1,694 billion) in bonds maturing in
2020 and US$ 750 million (equivalent to R$ 1,271 billion) in bonds maturing in 2039. Bonds for
2020 will have a coupon of 4.625% per annum, payable semiannually at a price of 99.030% of the
title’s face value. The bonds issued for 2039 at a price of 110.872% of face value of the title,
will be consolidated with the bonus of US$ 1 billion issued by Vale Overseas in November 2009 with
6.875% and maturing in 2039, forming a single series.
Vale used the net proceeds of this offering for general corporate purposes.
Vale prices € 750 million in bonds maturing in 2018
In March 2010, Vale raised € 750 million (equivalent to R$ 1.806 billion) of eight years Eurobonds
at a price of 99.564% of face value of the title. The notes maturing in March 2018, will have a
coupon of 4.375% per annum, payable annually.
Vale used the net proceeds of this offering for general corporate purposes.
2009
Global public offering of US$ 942 million in mandatorily exchangeable notes maturing in 2012
On July 7, 2009, Vale announced offering of US$ 942 million (R$ 1,858 billion on the transaction
date) of notes due 2012 (VALE-2012 Series and VALE.P-2012 Series) through its subsidiary Vale
Capital II.
Notes in the VALE-2012 and VALE.P-2012 Series, bear interest at 6.75% per annum, and are payable
quarterly. In their maturity on June 15, 2012, or before it, upon certain events, Notes of the
VALE-2012 series will be mandatorily exchanged for ADSs, each representing one common share or
preferred class A shares of Vale. Additional remuneration will be paid based on the net amount of
cash distributions paid to holders of ADSs.
The ADSs, together, represent the amount of up to 18,415,859 shares and 47,284,800 preferred class
A shares emitted by Vale, which Vale currently holds in treasury.
Vale used the net proceeds of this offering for general corporate purposes.
Global public offering of US$ 1 billion in bonds maturing in 2019
On September 8, 2009, Vale issued US$ 1 billion (R$ 1.8 billion at the transaction date) in bonds
maturing in ten years, through its wholly owned subsidiary Vale Overseas Limited (Vale Overseas).
The notes mature in September 2019 with a coupon of 5 5/8% per annum, payable semiannually at a
price of 99.232% of the title’s face value. The bonds were issued with a spread of 225 basis points
over the return of U.S. Treasury securities, resulting in a yield to investor of 5.727% per annum.
Vale used the net proceeds of this offering for general corporate purposes.
Global public offering of US$ 1 billion in bonds maturing in 2039
On November 3, 2009, Vale priced an offer of US$ 1 billion (R$ 1.7 billion at the transaction date)
in bonds maturing in thirty years, through its wholly owned subsidiary Vale Overseas Limited.
The notes expire in November 2039, with a coupon of 6.875% per annum, payable semiannually at a
price of 98.564% of face value of the title. The bonds were issued with a spread of 265 basis
points over the return of U.S. Treasury securities, resulting in a yield to investor of 6.99% per
annum.
As disclosed, Vale will use the net funds of these offerings for general corporate purposes.
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2008
Global public offering of primary shares
On July 17, 2008, Vale priced a global public offering of 256,926,766 shares and 189,063,218
preferred class A shares, all nominative, without par value shares of Vale, including in the form
of ADSs represented by American Depositary Receipts (ADRs), at the price of US$ 46.28 per common
share and US$ 29.00 or € 18.25 per common ADS, and R$ 39.90 per preferred class A and US$ 25.00 or
€ 15.74 per preferred ADS, totaling R$ 19,434 billion.
Vale used the net proceeds of this offering for general corporate purposes, which will include
financing its program of organic growth, strategic acquisitions and increased financial
flexibility, as disclosed at the time.
b. Whether there have been deviations between the effective application of resources and the
proposals disclosed in the offering memoranda of the same distribution
There have not.
c. In case there were deviations, reasons for such deviations
There have not.
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10.8 Significant items Not Included In The Financial Statements
a. Assets and liabilities held by Vale, directly or indirectly, that do not appear on its balance
sheet (off-balance sheet items)
Nickel Project — New Caledonia
Regarding the agreement on tax incentive for lease financing sponsored by the French government, we
provided in December 2004 some guarantees in favor of Vale New Caledonia S.A.S. (VNC) for which we
guarantee payments due from VNC of up to a maximum amount of U$ 100 million (the equivalent to R$
167 million on December 31, 2010) (Maximum Amount) in connection with the indemnity. This guarantee
was provided to BNP Paribas on behalf of tax investors from Gnifi, a special purpose entity that
owns a portion of assets of our nickel cobalt processing plant in New Caledonia (Girardin Assets).
We also provide an additional guarantee covering the payments due to VNC of (a) amounts exceeding
the Maximum Amount in connection with the indemnity and (b) other amounts payable by VNC under a
lease agreement covering the Girardin Assets. This guarantee was provided to BNP Paribas on behalf
of GniFi.
Another commitment related to VNC was that the Girardin Assets would be substantially completed by
December 31, 2009. Due to the delay, the Administration proposed a term extension to December 31,
2010, which was accepted. Consequently, the benefits of the financing structure are highly probable
and we do not anticipate losses from the tax advantages provided under this financing structure.
In 2009 two new bank guarantees totaling U$ 58 million (€ 43 million) (the equivalent to R$ 97
million on December 31, 2010) were established by the Company on behalf of VNC in favor of the
South Province of New Caledonia in order to guarantee the performance of VNC with respect to
certain environmental obligations in relation to the metallurgical plant and the Kwe West residue
storage facility.
Sumic Nickel Netherlands B.V. (Sumic), a 21% shareholder of VNC, has a put option to sell to Vale
25%, 50%, or 100% of the shares they own of VNC. The put option can be exercised if the initial
cost of the nickel-cobalt development project exceeds U$ 4.2 billion (the equivalent to R$ 7
billion on December 31, 2010) and an agreement cannot be reached. On February 15, 2010, we formally
added our agreement with Sumic to raise the limit to approximately U$ 4.6 billion (the equivalent
to R$ 7.7 billion on December 31, 2010). On May 27, 2010 the limit was reached and on October 22,
2010 an agreement was signed to extend the put option date for the first half of 2011. On January
25, 2011 a new agreement was signed extending the put option date for the second half of 2011.
We provided a guarantee covering certain termination payments due from VNC to the supplier, under
an electricity supply agreement (“ESA”) entered into in October 2004 for the project. The amount of
the termination payments depends upon a number of factors, including whether any termination of the
ESA is a result of a default by VNC and the date on which an early termination of the ESA were to
occur. During the first quarter of 2010, the supply of electricity by ESA started and the
guaranteed amounts decreased over the life of the ESA based on the maximum amount. On December 31,
2010, the guarantee was U$ 169 million (€ 126 million) (the equivalent to R$ 282 million on
December 31, 2010).
In February 2009, Vale and Vale Newfoundland, Vale’s subsidiary, and Labrador Limited (“VINL”)
entered into a fourth amendment to the Voisey’s Bay Development agreement with the Government of
Newfoundland and Labrador Canada, which permits VNL to ship up to 55,000 metric tons of nickel
concentrate from the Voisey’s Bay area mines. As part of the agreement, letters of credit were
provided to the Government of Newfoundland and Labrador in the amount of U$ 16 million (CAD$ 16
million) (the equivalent to R$ 27 million on December 31, 2010) for each shipment of nickel
concentrate shipped out of the province from January 1, 2009 to August 31, 2009. The amount of this
financial assurance was U$ 110 million (CAD$ 112 million).
As at December 31, 2010, there was an additional of U$ 114 million (the equivalent to R$ 190
million on December 31, 2010) of letters of credit issued and not paid pursuant to our union of
revolving credit line as well as an additional of U$ 39 million (the equivalent to R$ 65 million on
December 31, 2010) in letters of credit and U$ 57 million (the equivalent to R$ 95 million on
December 31, 2010) in bank guarantees issued and not paid. These are associated with environmental
complaints and other operational items attached, such as insurance, electricity commitments and
import and export duties.
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Commercial Leasing
The table below shows the minimum value of future annual payments of operating leasing at December
31, 2010.
Years ended on December 31 and in millions of reais:
2011 |
178 | |||
2012 |
178 | |||
2013 |
178 | |||
2014 |
178 | |||
2015 onwards |
1,820 | |||
Total |
2,532 | |||
The total cost of operating leasing on December 31, 2010 and 2009 was R$ 178 million and R$ 198
million, respectively.
Concessions and sub-concessions agreements
(a) Railway transportation companies
The Company and certain Group Companies entered into with the Union, through the Ministry of
Transport, concession agreements for exploration and development of public railway transport of
cargo and leasing of assets for the provision of such services. The accounting records of
concessions and sub-concessions are shown in notes 16 and 23 of the financial statements.
The concession terms for the railroad are:
| Termination of the | ||||
| Railroad | concession period | |||
Vitória to Minas and Carajás (direct) (*) |
June 2027 | |||
Carajás (direct) (*) |
June 2027 | |||
Center-East Network (indirect through FCA) |
August 2026 | |||
Southeast Network (indirect through MRS) |
December 2026 | |||
Ferrovia Norte Sul S.A. (“FNS”) |
December 2037 | |||
| (*) | Non-onerous concessions. |
The concession will be terminated if one of the following takes place: the end of the contractual
period, expropriation, forfeiture, termination of period, cancellation, bankruptcy or closure of
the Concessionary.
Concessions, sub-concessions and leasing of our subsidiaries are treated for accounting purposes as
operational leases and have the following characteristics:
| Railroads | FNS | FCA | MRS | |||||||||
1) Total installments |
3 | 112 | 118 | |||||||||
2) Frequency of payment |
(* | ) | Quarterly | Quarterly | ||||||||
3) Correction index |
IGP-DI FGV | IGP-DI FGV | IGP-DI FGV | |||||||||
4) Total installment paid |
2 | 47 | 50 | |||||||||
5) Current value of installment |
||||||||||||
Concession |
R$0 | R$2 | R$3 | |||||||||
Leasing |
R$0 | R$29 | R$49 | |||||||||
Sub-concession |
R$496 | R$0 | R$0 | |||||||||
| (*) | According to the delivery of each part of railroad |
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(b) Ports
The Company owns specialized port terminals, as follows:
| Termination | ||||||||
| of the | ||||||||
| concession | ||||||||
| Terminal | Location | period | ||||||
Tubarão, Praia Mole and Granéis Líquidos Terminals |
Vitória — ES | 2020 | ||||||
Praia Mole Terminal |
Vitória — ES | 2020 | ||||||
Produtos Diversos Terminal |
Vitória — ES | 2020 | ||||||
Granéis Líquidos Terminal |
Vitória — ES | 2020 | ||||||
Vila Velha Terminal |
Vila Velha — ES | 2023 | ||||||
Maritime Terminal of Ponta da Madeira — Pier I and III |
São Luís — MA | 2018 | ||||||
Maritime Terminal of Ponta da Madeira — Pier II |
São Luís — MA | 2010 | (*) | |||||
Inácio Barbosa Maritime Terminal |
Aracaju — SE | 2012 | ||||||
Ore Export Terminal — Port of Itaguaí |
Rio de Janeiro — RJ | 2021 | ||||||
Ilha Guaíba Maritime Terminal — TIG — Mangaratiba |
Rio de Janeiro — RJ | 2018 | ||||||
| (*) | Extension of validity period for 36 months until the completion of new public bidding. |
b. Other items not shown in the financial statements
There are no other items not shown in Vale’s financial statements other than those previously
reported.
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10.9 — Comments on items not shown
Vale managers do not expect relevant effects on the operations described at item “10.8” of this
reference form and not recorded in financial statements that would change the revenues, expenses,
operating income, financial expenses or other items of accounting information of the Company.
For a description of the nature and purpose of each operation, as well as the amount of the
obligations assumed and rights generated on behalf of Vale as a result of operations not shown in
our financial statements, please refer to item “10.8” of this Reference Form.
10.10 — Business Plan
a. investments, including: (i) quantitative and qualitative description of ongoing and planned
investments; (ii) investments financing sources and (iii) relevant ongoing and planned divestments.
b. already disclosed acquisition of plant, equipment, patents or other assets which must
materially affect Vale’s productive capacity
c. new products and services, including: (i) description of ongoing researches already
published; (ii) the total amounts spent by the issuer in researches to develop new products or
services; (iii) ongoing projects already announced; and (iv) the total amounts spent by the issuer
to develop new products or services
In 2010, investments — excluding acquisitions — amounted R$ 22,352 billion, with R$ 14,494
billion allocated for project development, R$ 1,998 billion for R&D — after adjustments on natural
gas exploration — and R$ 5,858 billion for maintaining existing operations. Investments in
corporate social responsibility totaled R$ 1,998 billion, R$ 1,296 billion allocated for
environmental protection and R$ 701 million for social projects.
Investments in acquisitions totaled R$ 11,800 billion in 2010. Major acquisitions are
explained in item “10.3” of this reference form.
In 2009, investments — excluding acquisitions — reached R$ 17,977 billion, with R$ 11,658
billion allocated for project development, R$ 2,015 billion for R&D and R$ 4,302 billion for
maintaining existing operations. Investments in corporate social responsibility totaled R$ 1,558
billion, R$ 1,157 billion allocated for environmental protection and R$ 401 million for social
projects.
Investments in acquisitions totaled R$ 7,448 billion in 2009.
During 2008, Vale invested R$ 18,961 billion, of which R$ 11,865 billion were spent on organic
growth, consisting of R$ 6,457 billion in projects and R$ 1,953 billion in research and
development, while R$ 4,910 billion were invested in maintaining existing operations.
We used cash generated by operations and any issuance of securities to fund our investments
and general corporate purposes.
In 2010, we continued to explore opportunities for organic growth through implementation of
world-class projects. Vale completed six projects: (A) Additional 20 Mtpy, high-quality low-cost
brown field project in Carajás; (b) Bayóvar, phosphate rock mine in Peru; (c) Onça Puma,
ferronickel operation in the state of Pará, Brazil; (d) Tres Valles, copper operation in Chile; (e)
Oman, pelletizing operation in the Middle East; and (f) TKCSA, a steel plant in the state of Rio de
Janeiro, Brazil.
In February 2011, Vale announced that it completed the transaction with Norsk Hydro ASA
(Hydro), the company listed on Oslo Stock Exchange and London Stock Exchange (ticker symbol: NHY),
to transfer all its shares in Albras — Alumínio Brasileiro S.A. (Albras), Alunorte — Alumina do
Norte do Brasil S.A. (Alunorte) and Companhia de Alumina do Pará (CAP), together with the exclusive
rights, commercial contracts and net debt of U$ 655 million, for 22% of Hydro outstanding common
shares, after issuing held today, and U$ 503 million in cash, after adjustments.
Moreover, Vale has created a new company, Mineração Paragominas S.A. (Paragominas) and
transferred the bauxite mine of Paragominas and all its other bauxite mining rights in Brazil. As
part of this transaction, Vale sold 60% of Paragominas to Hydro for U$ 578 million in cash, after
adjustments for working capital. The remaining installment of 40% will be sold in two equal
installments of 20% in 2013 and 2015, for U$ 200 million in cash each.
Under the terms of the agreement, Vale transferred to Hydro, through its wholly owned
subsidiaries: (a) 51% of the total capital of Albras; (b) 57% of the total capital of Alunorte; (c)
61% of the total capital of CAP and it will sell (d) 60% of the total capital of Paragominas; Vale
will still own 40% of the capital until it is fully sold in 2015.
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Vale, through its wholly owned subsidiaries, endorsed 447,834,465 shares of Hydro or 22% of
the 2,035,611,206 outstanding shares, approximately U$ 3.5 billion, according to Hydro’s closing
price and NOK/US$ exchange rate on February 25th, 2011. Under the terms of the
transaction, Vale cannot sell its shares during the 2 years lock-up and it cannot increase its
stake at Hydro beyond 22% either.
NOTE: To convert the values of investments, we used the average exchange rate for the periods for
conversion.
| Performed | Budget5 | |||||||||||||||||||||||
| million of R$ | ||||||||||||||||||||||||
| Area | Project | 2008 | 2009 | 2010 | 2011 | Total | Status | |||||||||||||||||
Bulk Materials / Logistics |
Carajás — additional 40 Mtpy |
919 | 766 | 635 | 823 | 5,079 | The previous Carajás Additional 30 Mtpy project was expanded to 40 Mtpy and, consequently, our Board of Directors approved the additional budget of U$ 490 million. Investments include the construction of a dry processing plant. Investments to increase the capacity of Ponta da Madeira Maritime Terminal were completed in 2010. Vegetation removal license and installation license obtained. Start-up expected for the second half of 2012. | |||||||||||||||||
| Carajás Serra Sul (mine S11D) |
N/A | N/A | 371 | 1,740 | 11,595 | Located on the Southern range of Carajás, in the Brazilian state of Pará, this project will develop a mine complex and processing plant with capacity to produce 90 Mtpy, using the truckless mining concept. Start-up expected for 2S14. | ||||||||||||||||||
| CLN S11D | N/A | N/A | 32 | 265 | TBA | The project will expand the EFC railroad and the port terminal of Ponta da Madeira in the North System to increase the flow capacity in line with the expansion of Carajás, as well as the construction of a railway spur connecting the EFC railroad to the mine S11D (Serra Sul). Start-up expected for 2S14. The project is still subject to approval by the Board of Directors. | ||||||||||||||||||
| Apolo | 4 | 18 | 12 | 645 | TBA | Project in the Southeastern System with a production capacity of 24 Mtpy of iron ore. Start-up expected for 1S14. The project is still subject to approval by the Board of Directors. | ||||||||||||||||||
| Conceição — Itabiritos |
0 | 14 | 294 | 703 | 2,009 | This project in the Southeastern System will add 12 Mtpy of iron ore to current capacity. It involves investment in a new concentration plant, which will receive ROM from the Conceição mine. Start-up expected for 2S13. | ||||||||||||||||||
| CLN 150 Mtpa | N/A | N/A | 1.033 | 2.206 | 5,110 | The project includes investments in railroads and in the terminal of Ponta da Madeira in Maranhão, Brazil, including the construction of Píer IV. It will increase the flow capacity of the railway and of the port to 150 Mtpy. Start-up expected for 2S12. | ||||||||||||||||||
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| Performed | Budget5 | |||||||||||||||||||||||
| million of R$ | ||||||||||||||||||||||||
| Area | Project | 2008 | 2009 | 2010 | 2011 | Total | Status | |||||||||||||||||
| Vargem Grande — Itabiritos |
0 | 0 | 99 | 609 | 2,603 | This project in the Southeastern System will add 10 Mtpy of iron ore to current capacity. It involves investment in a new iron ore treatment plant, which will receive low grade iron ore from the Abóboras, Tamanduá and Capitão do Mato mines. Start-up expected for 2S13. | ||||||||||||||||||
| Tubarão VIII | 151 | 415 | 232 | 317 | 1,425 | Pelletizing plant to be built at the port of Tubarão, in the Brazilian state of Espírito Santo, with a 7.5 Mtpy capacity. Start-up expected for 2S12. | ||||||||||||||||||
| Simandou Phase 1 |
0 | 0 | 55 | 1.473 | 2,156 | The first phase of Simandou in Guinea has an estimated capacity of 15 Mtpy. The project includes the development of Zogota mine (located in southern Simandou), the construction of a dry processing plant and the construction of approximately 100km railway to link the operation to a pre-existing railroad in Liberia. Scheduled to start producing 2 Mtpy and to reach the end of its ramp-up, 15 Mtpy in 2014. | ||||||||||||||||||
| Serra Leste | 0 | 0 | 26 | 469 | TBA | The project includes investments in mining equipment, a new treatment plant and logistics to meet the additional production of 10 Mtpy in 2013. The ore flow will be conducted by EFC railroad. Start-up expected for 1S12. The project is still subject to approval by the Board of Directors. | ||||||||||||||||||
| Moatize | 263 | 602 | 1.101 | 722 | 2.837 | This project is located in Mozambique and will have an annual production capacity of 11 Mtpy, of which 8.5 million tons of metallurgic coal and 2.5 million tons of thermal coal. Completion is scheduled for 1S11. | ||||||||||||||||||
| Moatize II | 0 | 0 | 0 | 276 | TBA | The project includes investments to open a new pit, duplication of the Coal Handling Preparation Plant (CHPP) and infrastructure, increasing production to 22 Mtpy. Start-up expected for 2S13. The project is still subject to approval by the Board of Directors. | ||||||||||||||||||
| Nacala Corridor | 0 | 0 | 116 | 510 | TBA | Project to develop Nacala Corridor, involving the construction of a 200 km railway connecting Moatize mine to Malawi, a new marine terminal for coal in Nacala, Mozambique and an extension of 21 km railway that will connect the existing railway to the new marine terminal for coal and the recovery of the existing railway in Malawi and Mozambique. Start-up expected for 2014. The project is still subject to approval by the Board of Directors. | ||||||||||||||||||
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| Performed | Budget5 | |||||||||||||||||||||||
| million of R$ | ||||||||||||||||||||||||
| Area | Project | 2008 | 2009 | 2010 | 2011 | Total | Status | |||||||||||||||||
| Teluk Rubiah | 0 | 8 | 76 | 253 | 2,346 | Teluk Rubiah project, in Malaysia, involves the construction of a maritime terminal that will be able to receive 400,000 dwt vessels and a distribution center with a capacity to handle up to 30 million metric tons of iron ore in this first phase. It has the possibility to expand it up to 100 million Mtpy in the future. The start-up is expected for first half of 2014. | ||||||||||||||||||
Non-Ferrous Minerals |
Totten | 75 | 112 | 148 | 1.398 | 4,827 | Mine in Sudbury, Canada, aiming to produce 8,200 tpy of nickel, copper and precious metals as by-products. Project being implemented and conclusion planned for 1S11. | |||||||||||||||||
| Long-Harbour | 125 | 201 | 934 | 253 | 2,346 | Nickel processing facility in the province of Newfoundland and Labrador, Canada, to produce 50.000 metric tons of finished nickel per year, together with up to 5.000 metric tons of copper and 2.500 metric tons of cobalt, using the ore from the Ovoid mine in our Voisey’s Bay mining site. The start-up is scheduled for 1S13. | ||||||||||||||||||
| Salobo | 410 | 870 | 1.147 | 695 | 3,094 | The project will have an annual production capacity of 100.000 metric tons of copper in concentrate. Start-up expected for 2S11. | ||||||||||||||||||
| Salobo II | 0 | 4 | 137 | 471 | 1,754 | The project will expand the Solobo mine annual production capacity from 100.000 to 200,000 metric tons of copper in concentrate. Conclusion is estimated for 2S13. | ||||||||||||||||||
| Cristalino | 0 | 0 | 0 | 457 | TBA | Project located in the Carajás region, with a nominal capacity of 95.000 tpy of copper in concentrate. Start-up expected for 2S14. The project is still subject to approval by the Board of Directors. | ||||||||||||||||||
| Konkola North | 0 | 0 | 29 | 137 | 342 | Located in the Zambian copper belt, this is an underground mine and will have an estimated nominal production capacity of 45,000 tpy of copper in concentrate. This project is part of our 50/50 joint venture with ARM in Africa. In addition to the budget of U$ 400 million approved by JV, we estimate investment of U$ 70 million in additional contingencies, social and environmental investments. The start-up is scheduled for 2013. | ||||||||||||||||||
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| Performed | Budget5 | |||||||||||||||||||||||
| million of R$ | ||||||||||||||||||||||||
| Area | Project | 2008 | 2009 | 2010 | 2011 | Total | Status | |||||||||||||||||
| Bayóvar II | 0 | 0 | 0 | 171 | TBA | Bayóvar project brown field expansion in northern Peru, seeking additional production of 1.9 million tons of phosphate rock. Start-up expected for 2S12. The project is still subject to approval by the Board of Directors. | ||||||||||||||||||
| Fertilizers Salitre | 0 | 0 | 44 | 590 | TBA | Project located in Minas Gerais, Brazil, which includes the opening of a new phosphate mine with a production capacity of 2.2 Mtpy of phosphate concentrate and the implementation of fertilizer production plant with capacity of 560,000 tpy of P2O5, interconnected by a 18-kilometer pipeline. Start-up scheduled for 2014. The project is still subject to approval by the Board of Directors. | ||||||||||||||||||
| Rio Colorado | 0 | 0 | 359 | 2,096 | TBA | The project includes the development of a mine with an initial nominal capacity of 2.4 Mtpy of potash - KCl, with potential for a future expansion to 4.35 Mtpy, construction of a railway spur of 350 km, port facilities and a power plant. Start-up expected for 2S13. The project is still subject to approval by the Board of Directors. | ||||||||||||||||||
Fertilizer Nutrients Energy |
Estreito | 292 | 566 | 410 | 68 | 1.203 | The hydroelectric power plant on the Tocantins river, between the states of Maranhão and Tocantins, has already obtained the implementation license, and is being built. Vale has a 30% share in the consortium that will build and operate the plant, which will have a capacity of 1,087 MW. Completion is planned for 1H11. | |||||||||||||||||
| Karebbe | 110 | 106 | 209 | 164 | 702 | Karebbe hydroelectric power plant in Indonesia, aims to supply 130 MW for the Indonesian operations, targeting production cost reduction by substitution of oil as fuel and enabling the potential expansion to 90.000 tpy of nickel in matte. Work started and main equipment purchased. Scheduled to start-up in 2S11. | ||||||||||||||||||
| Biofuel | 0 | 92 | 157 | 79 | 830 | Project to invest in biodiesel to supply our mining and logistics operations in the Northern region of Brazil, using the B20 mix (20% of biodiesel and 80% of ordinary diesel), from 2014 onwards. The oil production related to our stake will be used to feed our own biodiesel plant, with estimated capacity of 160.000 metric tons of biodiesel per year. | ||||||||||||||||||
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| 5 | Amounts converted at the exchange rate on 10/28/2010, date of disclosure of the
investment budget available on our website www.vale.com |
10.11) Other factors with relevant influence
There are no other factors that have relevantly influenced the operational performance and have not
been identified or commented on other items in this section.
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11.1 Identification of forecasts
Vale provides no guidance in the form of quantitative predictions about its future financial
performance (earnings guidance). However, Vale makes an effort to disclose as much information as
possible about its vision of the different markets where it operates, as well as the strategic
guidelines of the company and their execution, so as to provide participants in the capital market
with a sound basis for the formation of expectations about its performance in the medium and long
term.
For information about future investment projections for the company, see item 10.10 of this
Reference form.
a. Object of projections
Not applicable
b. Term under consideration and the validity of forecasts
Not applicable
c. Premises of projections, with an indication of those which can be influenced by the
administration of the Company
Not applicable
d. Values of indicators that are the object of projections for the last 3 fiscal years
Not applicable
11.2 On the hypotheses that the Company disclosed during the last 3 accounting reference periods,
projections on the evolution of its indicators:
| a. | to make known which are being replaced by new projections included in the form and
which ones are being repeated in the form |
Not applicable
| b. | regarding projection periods already elapsed, compare the data projected with the
effective performance of the indicators, indicating clearly the reasons that led to
deviations in the projections |
Not applicable
| c. | regarding projections for periods still ongoing, to make known if projections are
still valid on the date of submission of the form, and, when applicable, explain why they
have been abandoned or replaced |
Not applicable
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12.1 Administrative Structure
a. Powers of each body and committee
Board of Directors:
Under provisions of the Bylaws of the company, the Board of Directors has the powers contemplated
in law:
I. Distributing the compensation set by the general assembly among its members, the two advisory
committees, and the Executive Board;
II. Creating technical and consultative committees to advise it, in addition to the permanent
committees contemplated in the Bylaws;
II. Approving policies of selection, evaluation, development, and compensation of the members of
the Executive Board;
IV. Approving general Human Resource policies;
V. Approving strategic guidelines and the strategic plan of Vale submitted annually by the
Executive Board;
VI. Approving annual and multi-annual budgets;
VII. Monitoring and evaluating the financial and economic performance of the Company;
VIII. Approving investment and/or development opportunities that exceed the limits established for
the Executive Board as defined by the Board of Directors;
IX. Issuing opinions on merger, split-off, or incorporation decisions of which Vale is a party, as
well as share purchases;
X. In accordance with the corporate purpose of the Company, making decisions on the setting-up of
companies or their transformation into a different type of company, direct or indirect
participation or withdrawal from other companies, consortia, foundations, and other organizations
through exercise of withdrawal rights, exercise or non-exercise of rights of preference in
subscription and acquisition, directly or indirectly, of corporate equity or of any other form of
participation or withdrawal as prescribed by law, including, but not limited to, merger, split-off,
and incorporation of companies in which it participates;
XI. Approving the corporate risk and financial policies of Vale;
XII. Approving the issuance of simple debentures, not convertible into shares and without
collateral;
XIII. Appointing and removing the person responsible for internal auditing and for the Ombudsman,
who shall report directly to the Board of Directors;
XIV. Approving policies and the annual internal audit plan of Vale, as well as to acknowledge the
respective reports and determine the adoption of any necessary measures;
XV. Approving alterations in corporate governance rules;
XVI. Approving policies on employee conduct based on the ethical and moral standards described in
the Code of Ethical Conduct of Vale;
XVII. Approving policies to avoid conflicts of interest between the Company and its shareholders or
managers, as well as on the adoption of measures considered necessary in the event such conflicts
arise;
XVIII. Approving policies of institutional responsibility, especially those related to: the
environment, work health and safety, and the social responsibility of the Company;
XIX. Approving the provision of guarantees in general, establishing criteria for the Executive
Board for purchase of, financed sale of, or placing liens on, fixed assets and for the constitution
of encumbrances for obtaining loans, financing, and other contracts, execution of commitments,
non-exercise of rights and transactions of any nature, except waiver of preemptive rights in the
subscription and purchase of corporate shares;
XX. Approving any reformulations, alterations or amendments to shareholder agreements or consortia
contracts or agreements among shareholders or among consortia parties of companies in which the
company participates and, moreover, signing of new agreements and/or consortia contracts that
address matters of this nature;
XXI. Authorizing the negotiation, signing, or alteration of contracts of any kind or value between
Vale (i) its shareholders, either directly or through intermediary companies, (ii) companies that
directly or indirectly participate, in the capital of a controlling shareholder or which are
controlled by or are under joint control of entities that participate in the capital of the
controlling shareholder and/or (iii) companies in which the controlling shareholder of the Company
participates, and the Board of Directors may establish delegations, with standards and procedures
that
meet the requirements and nature of operations, without prejudice of keeping the aforementioned
group duly informed of all company transactions;
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XXII. Authorizing plans for repurchase of shares of their own issuance for maintenance in treasury,
cancelation or subsequent sale;
XXIII. Approving or delegating to the Executive Board recommendation of persons who should form
part of the administrative, consulting, and financial bodies of those companies and organizations
in which Vale participates, either directly or indirectly;
XXIV. Determining the preparation of balance sheets for periods of less than one year and declaring
dividends or interest on its own capital on the basis of the profits shown on these balance sheets,
as well as declaring them on the basis of accrued profits or existing profit reserves shown on the
most recent annual or intermediate balance sheet;
XXV. [sic: missing]
XXVI. Authorizing increases in corporate capital regardless of changes in bylaws, within the
authorized capital limit and, at its discretion, exclude preemptory rights in the issuance of
stock, debentures convertible into shares and subscription bonuses, the placement of which is done
through sale on the stock market or by public subscription under terms established in Law 6.404/76;
and
XXVII. Approving recommendations submitted by the Fiscal Council of the Company in the exercise of
its legal and statutory attributions.
Advisory Committees:
In order to confer greater efficiency and quality in its decisions, the Board of directors shall
have ford advice on a permanent basis of five (5) technical and advisory committees, as follows:
Executive Development Committee; Strategic Committee; Finance Committee; Accounting Committee, and
Governance and Sustainability Committee.
Executive Development Committee
Under terms of article 21 of the Bylaws, the Executive Development Committee shall be responsible
for:
I — Issuing reports on the human resources general policies of the Company submitted by the
Executive Board to the Board of Directors;
II — Analyzing and issuing reports to the Board of Directors on the appropriateness of remuneration
of members of the Executive Board;
III — Submitting and ensuring up-to-datedness of the methodology of performance evaluation of the
members of the Executive Board; and
IV — Issuing reports on health and safety policies proposed by the Executive Board.
Strategic Committee
Under terms of article 22 of the Bylaws, the Strategic Committee is responsible for:
I — Issuing reports on the strategic guidelines and the strategic plan submitted annually by the
Executive Board;
II — Issuing reports on the company’s annual and multi-annual investment budgets submitted by the
Executive Board to the Board of Directors;
III — Issuing reports on investment and/or divestiture opportunities submitted by the Executive
Board to the Board of Directors; and
IV — Issuing reports on operations relating to merger, split-off, and incorporation in which the
Company and its controlled subsidiaries are a party, and on share purchases submitted by the
Executive Board to the Board of Directors.
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Finance Committee
Under terms of article 23 of the Bylaws, the Financial Committee is responsible for:
I — Issuing reports on the corporate risks and financial policies and the internal financial
control systems of the Company; and
II — Issuing reports on the compatibility between the shareholders remuneration level and the
parameters established in the annual budget and financial planning, as well as their consistency
with the general policy on dividends and the capital structure of the company.
Accounting Committee:
Under terms of article 24 of the Bylaws, the Comptroller’s Committee is responsible for:
I — Recommending to the Board of Directors the appointment of the person responsible for the
internal auditing of the Company;
II — Issuing reports on policies and the Company’s annual auditing plan submitted by the employee
responsible for internal auditing, and on its execution;
III — Tracking the results of the Company’s internal auditing, and identifying, prioritizing, and
submitting to the Board of Directors actions to be monitored by the Executive Board; and
IV — Analyzing the Annual Report, as well as the Financial Statements of the Company and making
recommendations to the Board of Directors.
Governance and Sustainability Committee:
Under terms of article 25 of the Bylaws, the Committee on Governance and sustainability is
responsible for:
I — Evaluating the efficiency of the Company’s governance practices and the workings of the Board
of Directors, and submitting improvements;
II — Submitting improvements to the Code of Ethics and the management system in order to avoid
conflicts of interest between the company and its shareholders or company managers;
III — Issuing reports on potential conflicts of interest between the company and its shareholders
or administrators; and
IV — Issuing reports on policies related to the Company’s institutional social responsibilities,
such as environmental-related issues and the Company’s social responsibilities, as proposed by the
Executive Board.
Executive Board:
Under terms of the Bylaws, the Executive Board has the following responsibilities, in addition to
those contemplated in law:
| I. | Approving the creation and elimination of Executive Departments subordinated to each
Executive Director; |
|
| II. | Preparing and submitting to the Board of Directors the company’s
general policies on human resources, and executing the approved
policies; |
|
| III. | Preparing and submitting, annually, to the Board of Directors, the
company’s strategic guidelines and the strategic plan, and executing
the approved strategic plan; |
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| IV. | Preparing and submitting the Company’s annual and multi-annual
budgets to the Board of Directors, and executing the approved
budgets; |
|
| V. | Planning and conducting the company’s operations and reporting the company’s economic and
financial performance to the Board of Directors, and producing reports with specific
performance indicators; |
|
| VI. | identifying, evaluating and submitting investment and/or divestiture
opportunities to the Board of Directors which exceed the limits of
the Executive Board as defined by the Board of Directors, and
executing the approved investments and/or divestitures; |
|
| VII. | Identifying, evaluating and submitting to the Board of Directors
operations relating to merger, split-off, incorporation in which the
company is a party, as well as share purchases, and conducting the
approved mergers, split-offs, incorporations and purchases; |
|
| VIII. | Preparing and submitting the company’s finance policies to the Board
of Directors, and executing the approved policies; |
|
| IX. | Submitting to the Board of Directors the issuance of simple
debentures, not convertible into shares and without collateral; |
|
| X. | Adhering to and encouraging adhesion to the Company’s Code of Ethics, established by the
Board of Directors; |
|
| XI. | Preparing and submitting to the Board of Directors the company’s
policies on corporate responsibility, such as the environment,
health, safety and social responsibility, and implementing the
approved policies; |
|
| XII. | [skipped in original] |
|
| XIII. | [skipped in original] |
|
| XIV. | Propose to the Board of Directors any reformulations, alterations,
or amendments of shareholders’ agreements or of agreements among
the shareholders of companies in which the Company participates, as
well as suggesting the signing of new agreements and consortia
contracts that address subjects of this nature; |
|
| XV. | Authorizing the opening and closing of branch offices, subsidiary
branch offices, depots, agencies, warehouses, representative office
or any other type of establishment in this country [Brazil] or
abroad; |
|
| XVI. | Authorizing the purchase of, sale of and placing of liens on fixed
and non-fixed assets including securities, contracting of services,
whether the company is the provider or receiver of such services,
being empowered to establish standards and delegate powers, all in
accordance with the criteria and standards established by the Board
of Directors |
|
| XVII. | Authorizing the signing of agreements, contracts and settlements
that constitute liabilities, obligations or commitments on the
Company, being empowered to establish standards and delegate
powers, all in accordance with the criteria and standards
established by the Board of Directors; |
|
| XVIII. | Authorizing the signing of commitments, waiver of rights, and
transactions of any nature, except in regard to the waiver of
preemptory rights in subscription and purchase, and may establish
rules and delegate powers, all within the limits of the Executive
Board as established by the Board of Directors; |
|
| XIX. | Establishing rules and delegating powers, within the limits of the
Executive Board as established by the Board of Directors; |
|
| XX. | Laying down voting guidelines to be followed at the General
Assemblies or their equivalent by its representatives in the
companies, foundations and other organizations in which the Company
participates, directly or indirectly, respecting the investment
opportunities of the Company, and guidelines approved by the Board
of Directors, as well as the respective budget and all within its
respective limits in regard to, among other things, indebtedness,
the sale of or placing of liens on assets, the waiver of rights,
and the increase or reduction of corporate equity. |
Non-Statutory Committees
The Executive Board shall have, for advice on a permanent basis, two (2) technical and advisory
committees, denominated as follows: Risk Management Committee and Disclosure Committee.
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Disclosure Committee
The primary attributes of the Disclosure Committee are the evaluation of the relevance of acts
or events that have occurred and are related to the business of the Company and the oversight of
the disclosure of information to the capital markets pursuant to the terms of the Disclosure
Policy. For more information on the Disclosure Committee see item 21.3 of this Reference Form.
Risk Management Committee
The primary responsibilities of the Risk Management Committee are: (a) issuing an opinion on the
Company’s principles and instruments of risk management; and (b) periodic reporting to the
Executive Board on (i) the primary risks to which Vale is exposed (by type of risk and/or
business) and the impact of these risks on the asset portfolio and cash flow; (ii) how the risks
are being monitored and managed, and (iii) the impact on the profile of risk of the asset
portfolio and on cash flow resulting from the inclusion of new investments and/or projects in
the business plan, and, if necessary, what strategies of risk mitigation are recommended. The
Risk Management Committee reports regularly to the Executive Board, and the latter is
responsible for evaluating and approving strategies for risk attenuation over the long term, as
recommended by the Risk Management Committee.
Fiscal Council:
The Fiscal Council shall be responsible for exercising the functions attributed to it by the
applicable prevailing legislation, these By-Laws, and as regulated by its own Internal Rules to
be approved by its members, as well as those contemplated in applicable American law, especially
the Sarbanes-Oxley Act and applicable standards that regulate listing of securities on the Hong
Kong Stock Market, in accordance with waiver requests granted (“Regulation on Listing”), so long
as not in conflict with Brazilian law.
The Internal Rules of the Fiscal Council regulates, besides the powers already set forth by the
Law of Joint Stock Companies, the following:
The primary responsibilities of the Fiscal Council are:
| (i) | Setting forth the procedures to be used by the company to receive process and deal
with complaints or claims related to accounting and auditing matters, as well as to
guarantee that the mechanisms to receive complaints guarantee the confidentiality and
unknown identity of the individual making the complaint; |
| (ii) | Recommending and help the Board of Directors in the selection, remuneration, and
dismissal of external auditors of the partnership; |
| (iii) | Deliberating on the contracting of new services that may be rendered by the external
auditors of the partnership; as well as mediating eventual disputes between management and
external auditors regarding the financial statements of the partnership. |
b. Date of formation of the Fiscal Council, if it is not permanent, and of the formation of the
committees.
The Fiscal Council has been a permanently functioning body since 9/25/1997.
The five Advisory Committees of the Board of Directors were formed by the Board of Directors
itself on 12/19/2001, and pursuant to resolutions of the Extraordinary General Assembly held on
12/27/2002, upon which date their existence became part of the Bylaws.
The Disclosure Committee and the Risk Management Committee, which advise the Executive Board,
were formed by decision by the Board of Directors on 6/19/2002 and 12/12/2005, respectively.
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c. Mechanisms for evaluating the performance of each body or committee
Pursuant to Chapter Vi of the Internal Regulations of the Fiscal Council and provisions of the
Sarbanes-Oxley Law, the Fiscal Council evaluates its own performance annually at the end of each
audit cycle. The self-evaluation process considers the following: matters covered in monthly
meetings, financial statements, risk management, and internal controls, management and internal
audit responsibility, relationship with external auditors, resources and special research,
formation of the Fiscal Council, and training and professional development of members. Only the
independent auditors of the Company shall have knowledge of the self-evaluation conducted by the
members of the Fiscal Council.
As of December 31, 2010, Vale did not have in place mechanisms of formal evaluation of the
performance of the Board of Directors, The Executive Board, and of the Committees. For a
description of the individual evaluation of the Executive Directors, see item 12.1(e) of this
Reference Form.
d. On Executive Officers, their responsibilities and individual powers
Chief Executive Officer:
Under terms of article 33 of the Bylaws, the Chief Executive Officers has the following
responsibilities:
| I. | Presiding over meetings of the Executive Board; |
|
| II. | Exercising executive direction of the Company, with powers to coordinate and supervise
the activities of the other Executive Officers, exerting his best efforts to ensure
faithful compliance with the decisions and guidelines laid down by the Board of Directors
and the General Assembly; |
|
| III. | Coordinating and supervising the activities of the business areas and units that are
directly subordinated to him; |
|
| IV. | Selecting and submitting to the Board of Directors the names of candidates for
Executive Officer posts to be elected by the Board of Directors, as well as to propose
their respective removal; |
|
| V. | Coordinating and processing the decision-making of the Executive Board in order to
prioritize consensual decision among its members. If consensus is not achieved, the Chief
Executive Officer may (i) withdraw the subject in debate; (ii) articulate the position of
the majority, including making use of the deciding vote or (iii) in the interest of the
Company and through well-based reasoning, decide individually on matters of joint
deliberation; in this case he must report to the Board of Directors on the use of this
prerogative at the first meeting of the Board of Directors that occurs after the
corresponding decision. Decisions related to annual and multi-annual budgets and the
Strategic Plan and the Annual Report on Administration of the Company shall be taken by a
majority of votes, when considering all of the Executive Officers, so long as the favorable
vote of the Chief Executive Officer is among them; |
|
| VI. | Indicating who among the Executive Officers shall replace an Executive Officer in case
of a temporary impairment or absence; |
|
| VII. | Keeping the Board of Directors informed about the activities of the Company; |
|
| VIII. | Preparing the annual report and draw up the balance sheet together with the other
Executive Officers. |
Executive Officers
Under terms of article 34 of the Bylaws, the Executive Officers have the following
responsibilities:
I — Performing the services for which they are responsible;
II —Participating in meetings of the Executive Board, contributing to the definition of the
policies to be followed by the company and reporting on matters of the respective areas of
responsibility;
III — Complying with and ensure compliance with the policy and general guidance of the company’s
business laid down by the Board of Directors, each being responsible for his specific area of
activities;
IV — Contracting the services of attorneys, consultants, analysts, and other resources necessary
for performance of the functions of the Fiscal Council, within budget, as well as contracting
experts under terms of article 163 §8 of Law 6,404/76.
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In addition to this, under terms of article 28 of the Bylaws and within the limits established for
each Executive Officer, decisions on matters affecting the specific area of responsibility of each
one shall be made by him alone, so long as the matter does not affect the area of responsibility of
another Executive Officer, or in conjunction with the Chief Executive Officer in matters or
situations pre-established by the latter.
e. Mechanisms of evaluation of the performance of members of the Board of Directors, of the
Committees, and of the Committees and directorate
As of 31 December, 2010, Vale did not have mechanisms in place for formal evaluation of the
performance of members of the Board of Directors, of the Fiscal Council, and of the Committees.
The members of the Board of Directors, are evaluated annually based on their performance according
to goals previously defined formally by the Board of Directors. These goals are based on the
Company’s performance, through measurement of the following indicators: asset cash flow and general
indicators of productivity, safety, and the environment. The definition of these indicators and
goals derive from the strategic planning and the budget approved by the Board of Directors. The
goals are monitored by the area of budget and performance management. The final result is approved
by Vale’s Board of Directors.
12.2 Description of the rules, policies, and practices relating to General Assemblies
a. Notification Periods
Vale customarily calls for the General Shareholders’ Assemblies by notification, at least 30 days
before the meeting in the first convocation, and 15 days prior in the second convocation, in
accordance with the recommendations of the CVM and commitments assumed before the Hong Kong Stock
Market.
In addition, pursuant to article 8, §2 of the Bylaws of the Company, a holder of special class
preferred shares (Golden Shares) shall be called formally by the company, by means of personal
correspondence directed to his legal representative at least fifteen (15) days in advance, for the
purpose of considering any matter subject to the right of veto specified in Article 7 of the Bylaws
and in item 18 of this Form of Reference.
b. Powers
Vale’s General Shareholders’ Assembly has powers pursuant to Law 6.404/76.
c. Addresses (physical or electronic) at which documents relating to the General Meeting shall be
available to shareholders for their review
At Vale’s headquarters at Avenida Graça Aranha n° 26, 12º andar, Centro, Rio de Janeiro, RJ, Brazil
and at the electronic addresses of the Company (www.vale.com), the CVM (www.cvm.gov.br), the
Securities and Exchange Commission (www.sec.gov) and the Hong Kong Stock Market (www.hkex.com.hk).
d. Identification and handling of conflicts of interests
According to Vale’s Bylaws, the Board of Directors may set policies to avoid conflicts of interest
between the Company and its shareholders or its managers, as well as on the adoption of provisions
deemed necessary should conflicts of interest arise.
In addition, under terms of the Bylaws, the Governance and Sustainability Committee may issue
reports related to potential conflicts of interest between the Company and its shareholders or its
managers, upon request of the Board of Directors. The Committee may also analyze proposals to be
considered by the Board of Directors.
e. Request for power-of-attorney by the directors to exercise voting rights
There are no rules, policies or practices for requesting powers-of-attorney by the directors to
exercise voting rights in General Shareholders’ Meetings.
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f. Necessary formalities to accept powers-of-attorney granted for shareholders, indicating whether
the Company accepts powers from shareholders electronically
A shareholder who wishes to attend the General Meetings must provide identification and proof of
Vale share ownership issued by the depositary financial institution.
Any shareholder may appoint a proxy or more, if the case may be, to attend meetings and vote in his
name. If represented by proxy, the shareholder shall comply with the terms of Art. 126, Law No.
6,404/76, and must have been appointed by power-of-attorney no earlier than one year and qualify as
a shareholder, manager, attorney who is a member of the Order of Attorneys of Brazil, or be a
financial institution. If the power-of-attorney is in a foreign language, it should be accompanied
by corporate documents in the case of a legal entity, and of a letter of mandate duly translated
into Portuguese, and notarized and with a consular stamp.
For the purposes of facilitating the Assemblies, shareholders represented by proxy may, at their
exclusive discretion, deliver the documents within 72 hours prior to the Assemblies.
Vale does not accept powers-of-attorney granted electronically by shareholders.
g. Maintenance of Internet forums and pages intended to receive and share shareholder comments
relating to meetings.
The Company does not keep Internet forums and pages for shareholders to receive and share comments
relating to meeting minutes.
h. Transmission of meetings by live video or audio.
The Company does not transmit meetings by live video or audio.
i. Mechanisms allowing for inclusion of shareholders’ proposals.
There are no mechanisms allowing for inclusion on the agenda of proposals formulated by
shareholders, except for those mechanisms contemplated in applicable law.
12.3. Dates and newspapers of publication of information required by Law no. 6.404/76.
| Fiscal Year | Publication | Newspaper — State or Territory | Dates | |||
12/31/2010
|
Financial Statements | Diário Comércio Indústria & Serviços — SP | 3/16/2011 | |||
| Diário Oficial do Estado — RJ | 3/16/2011 | |||||
| Jornal do Commercio — RJ | 3/16/2011 | |||||
| Call to Ordinary General Assemblies to consider the Financial Statements | Diário Comércio Indústria & Serviços — SP | 3/18/2011; 3/21/2011 & 3/22/2011 | ||||
| Diário Oficial do Estado — RJ | 3/18/2011; 3/21/2011 & 3/22/2011 | |||||
| Jornal do Commercio — RJ | 3/18/2011; 3/21/2011 & 3/22/2011 | |||||
| Minutes of Ordinary General Assemblies | Diário Oficial do Estado — RJ | 4/20/2011 | ||||
| that considered the Financial Statements | Diário Oficial do Estado — SP | 4/20/2011 | ||||
| Jornal do Commercio — RJ | 4/20/2011 |
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| Fiscal Year | Publication | Newspaper — State or Territory | Dates | |||
12/31/2009
|
Financial Statements | Diário Comércio Indústria & Serviços — SP | 3/4/2010 | |||
| Diário Oficial do Estado — RJ | 3/4/2010 | |||||
| Jornal do Commercio — RJ | 3/4/2010 | |||||
| Call to the Ordinary General Assembly that considered the Financial Statements | Diário Comércio Indústria & Serviços — SP | 3/26/2010; 3/27/2010 & 3/30/2010 | ||||
| Diário Oficial do Estado — RJ | 3/26/2010; 3/29/2010 & 3/30/2010 | |||||
| Jornal do Commercio — RJ | 3/30/2010 | |||||
| Minutes of Ordinary General Assemblies | Diário Oficial do Estado — RJ | 4/28/2010 | ||||
| that considered the Financial Statements | Diário Oficial do Estado — SP | 4/28/2010 | ||||
| Jornal do Commercio — RJ | 4/28/2010 | |||||
12/31/2008
|
Financial Statements | Diário Comércio Indústria & Serviços — SP | 3/14/2009 | |||
| Diário Oficial do Estado — RJ | 3/16/2009 | |||||
| Jornal do Commercio — RJ | 3/16/2009 | |||||
| Gazeta Mercantil — SP | 3/16/2009 | |||||
| Valor Econômico — SP | 3/16/2009 | |||||
| Call to the Ordinary General Assembly that considered the Financial Statements | Diário Comércio Indústria & Serviços — SP | 3/14/2009; 3/17/2009 & 3/18/2009 | ||||
| Diário Oficial do Estado — RJ | 3/16/2009; 3/17/2099 & 3/18/2009 | |||||
| Jornal do Commercio — RJ | 3/16/2009; 3/17/2009 & 3/18/2009 | |||||
| Minutes of Ordinary General Assemblies | Diário Comércio Indústria & Serviços — SP | 4/18/2009 | ||||
| that considered the Financial Statements | Diário Oficial do Estado — RJ | 4/22/2009 | ||||
| Jornal do Commercio — RJ | 4/20/2009 |
12.4 Board of Director’s rules, policies and practices
a. Frequency of meetings
The Board of Directors ordinarily holds meetings once a month, and extraordinary meetings whenever
called by the Chairman or, in his absence, by the Vice-Chairman or by any other two board members.
b. Shareholder provisions establishing voting restrictions on members of the Board of Directors
See item 15.5 (d) in this Form of Reference.
c. Rules on identifying and handling conflicts of interest
The Company does not have a corporate policy on conflicts of interest in meetings of the Board of
Directors, apart from the Brazilian laws applicable in this regard. Vale’s practice is to require
that a member of the Board of Directors who considers himself to have a conflict leave the Board
meeting during deliberation of the relevant matters and abstain from any material intervention.
In addition, Vale has a Code of Ethical Conduct that must be followed by the members of the Board
of Directors and its Advisory Committees, members of the Fiscal Council, Officers, employees and
interns, and controlled companies (provided that they are subject to the laws of the local
jurisdiction). It prevails over, and serves as guidelines for, all Vale rules and policies.
Under the Code of Ethics, the abovementioned individuals are required to defend the interests of
Vale in matters in which they are participating and avoid situations in which conflicts of interest
with Vale may arise, and when that is not possible, to abstain from representing the Company in the
matter in question, immediately disclosing the conflict to his immediate superior.
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Violations of the Code of Ethics, rules, and disciplinary standards of the Company subject
violators to disciplinary penalties, which may include warning, suspension, and termination of
employment. In applying disciplinary penalties, the nature and seriousness of the infraction shall
be considered, noting Company human resources rules and applicable law.
12.5 Description of binding clause, if applicable, in the Bylaws for the resolution of conflicts by
and between shareholders and the Company through arbitration
There are no binding clauses in the Bylaws for the resolution of conflicts by and between
shareholders and the Company through arbitration.
12.6 For manager and members of the Fiscal Council, indicate the following information:
Board of Directors
| Elected by | ||||||||||||
| Name / Federal Tax No. | Elected Position/ | Date of Election | the | |||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | Controller | ||||||
Ricardo José da Costa Flores 285.080.334-00
|
47 years | Economist | Chairman / Member of the Strategic Committee |
4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
José Ricardo Sasseron 003.404.558-96 |
55 years | Banker | Member of the Board / Member of the Executive Development Committee |
4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Robson Rocha 298.270.436-68 |
52 years | Manager | Member of the Board / N/A | 4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Nelson Henrique Barbosa Filho 009.073.727-08
|
41 years | Economist | Member of the Board / N/A |
4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Renato da Cruz Gomes 426.961.277-00
|
58 years | Engineer | Member of the Board / Member of the Governance and Sustainability Committee | 4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Mário da Silveira Teixeira Júnior 113.119.598-15
|
55 years | Banker | Vice Chairman / Member of the Strategic Committee |
4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Fuminobu Kawashima N/A |
59 years | Economist | Member of the Board / N/A |
4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Oscar Augusto de Camargo Filho 030.754.948-87
|
73 years | Attorney | Member of the Board / Member of the Strategic Committee and the Executive Development Committee | 4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Luciano Galvão Coutinho 636.831.808-20
|
64 years | Economist | Member of the Board / Member of the Strategic Committee |
4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Paulo Soares de Souza 541.150.276-49
|
47 years | Electrician | Member of the Board / N/A |
4/19/2011 4/19/2011 |
AUG 2013 | No | ||||||
José Mauro Mettrau Carneiro da Cunha 299.637.297-20 |
61 years | Engineer | Member of the Board / N/A |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Marco Geovanne Tobias da Silva 263.225.791-34
|
45 years | Banker | Member of the Board (Alternate) / N/A | 4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Sandro Kohler Marcondes 485.322.749-00
|
47 years | Banker | Member of the Board (Alternate) / N/A |
4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Deli Soares Pereira 369.030.198-04 |
61 years | Banker | Member of the Board (Alternate) / N/A |
4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Eustáquio Wagner Guimarães Gomes 009.513.746-72 |
63 years | Manager | Member of the Board (Alternate) / N/A |
4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
João Moiséis de Oliveira 090.620.258-20
|
66 years | Economist | Member of the Board (Alternate) / Member of the Executive Development Committee | 4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Luiz Carlos de Freitas 659.575.638-20 |
58 years | Accountant | Member of the Board (Alternate) / Member of the Accounting Committee | 4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Hajime Tonoki 628.127.266-87 |
51 years | Manager | Member of the Board (Alternate) / N/A |
4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Eduardo de Oliveira Rodrigues Filho 442.810.487-15
|
56 years | Engineer | Member of the Board (Alternate) / Member of the Finance Committee |
4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Paulo Sérgio Moreira da Fonseca 268.745.477-04
|
60 years | Economist | Member of the Board (Alternate) / N/A | 4/19/2011 4/19/2011 |
AUG 2013 | Yes | ||||||
Raimundo Nonato Alves Morim 147.611.573-72
|
52 years | Electro-mechanical Technician | Member of the Board (Alternate) / N/A |
4/19/2011 4/19/2011 |
AUG 2013 | No |
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Executive Officers
| Elected by | ||||||||||||
| Name / Federal Tax No. | Elected Position/ | Date of Election | the | |||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | Controller | ||||||
Vânia Lucia Chaves Somavilla 456.117.426-53
|
51 years | Civil Engineer | Officer / N/A | 5/26/2011 5/26/2011 | May/2013 | No | ||||||
Eduardo de Salles Bartolomeo 845.567.307-91
|
47 years | Engineer | Officer / N/A | 5/26/2011 5/26/2011 | May/2013 | No | ||||||
Eduardo Jorge Ledsham 542.689.406-00
|
48 years | Geologist | Officer / N/A | 5/26/2011 5/26/2011 | May/2013 | No | ||||||
Guilherme Perboyre Cavalcanti 010.981.437-10
|
42 years | Economist | Officer / Permanent Member of the Finance Committee, Member of the Disclosure Committee, and Permanent Member of the Risk Management Committee | 5/26/2011 5/26/2011 | May/2013 | No | ||||||
José Carlos Martins 304.880.288-68 |
61 years | Economist | Officer / Permanent Member of the Risk Management Committee | 5/26/2011 5/26/2011 | May/2013 | No | ||||||
Mário Alves Barbosa Neto 269.275.278-34
|
64 years | Engineer | Officer / N/A | 5/26/2011 5/26/2011 | May/2013 | No | ||||||
Murilo Pinto de Oliveira Ferreira 212.466.706-82
|
57 years | Manager | Chief Executive Officer; Superintendent / Permanent Member of the Strategic Committee and Member of the Disclosure Committee | 19/05/2011 20/05/2011 | May/2013 | |||||||
Tito Botelho Martins Junior 501.888.956-04
|
48 years | Economist | Officer / Member of the Risk Management Committee | 5/26/2011 5/26/2011 | May/2013 | No |
Fiscal Council
| Elected by | ||||||||||||
| Name / Federal Tax No. | Elected Position/ | Date of Election | the | |||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | Controller | ||||||
Aníbal Moreira dos Santos 011.504.567-87
|
72 years | Accounting Technician | Member of Fiscal Committee / N/A |
4/19/2011 4/19/2011 |
AUG 2012 | Yes | ||||||
Cícero da Silva 045.747.611-72 |
60 years | Accountant | Member of Fiscal Committee (Alternate) / N/A |
4/19/2011 4/19/2011 |
AUG 2012 | Yes | ||||||
Marcelo Amaral Moraes 929.390.077-72 |
43 years | B.S. in Economics | Member of Fiscal Committee / N/A |
4/19/2011 4/19/2011 |
AUG 2012 | Yes | ||||||
Oswaldo Mário Pêgo de Amorim Azevedo 005.065.327-04 |
69 years | Engineer | Member of Fiscal Committee (Alternate) / N/A | 4/19/2011 4/19/2011 |
AUG 2012 | Yes | ||||||
Arnaldo José Vollet 375.560.618-68 |
62 years | B.S. in Mathematics | Member of Fiscal Committee / N/A |
4/19/2011 4/19/2011 |
AUG 2012 | Yes | ||||||
Antônio Henrique Pinheiro Silveira 010.394.107-07 |
46 years | Economist | Member of Fiscal Committee / N/A |
4/19/2011 4/19/2011 |
AUG 2012 | No | ||||||
Marcus Pereira Aucélio 393.486.601-87 |
44 years | Engineer | Member of Fiscal Committee (Alternate) / N/A |
4/19/2011 4/19/2011 |
AUG 2012 | No |
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12.7 Provide information mentioned in item 12.6 for members of the statutory committees, as well as
for the auditing, risk, financial, compensation committees, whether those committees are statutory
or not.
ADVISORY COMMITTEES
Executive Development Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
João Moisés de Oliveira 090.620.258-20 |
66 years | Economist | Committee Member (Full) / Alternate Member of the Board of Directors |
12/19/2001 12/192001 |
AUG 2013 | |||||
José Ricardo Sasseron 003.404.558-96 |
55 years | Banker | Committee Member (Full) / Full Member of the Board of Directors |
5/24/2007 5/24/2007 |
AUG 2013 | |||||
Oscar Augusto de Camargo Filho 030.754.948-87 |
73 years | Attorney | Committee Member (Full) / Full Member of the Board of Directors and Full Member of the Strategic Committee |
11/19/2003 11/19/2003 |
AUG 2013 |
Strategic Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
Luciano Galvão Coutinho 636.831.808-20 |
64 years | Economist | Committee Member (Full) / Full Member of the Board of Directors |
5/21/2009 5/21/2009 |
AUG 2013 | |||||
Mário da
Silveira Teixeira Júnior 113.119.598-15 |
65 years | Banker | Committee Member (Full) / Full Member of the Board of Directors |
3/6/2006 3/6/2006 |
AUG 2013 | |||||
Oscar Augusto de Camargo Filho 030.754.948-87 |
73 years | Attorney | Committee Member (Full) / Full Member of the Board of Directors and Member of the Executive Development Committee |
3/6/2006 3/6/2006 |
AUG 2013 | |||||
Ricardo José da Costa Flores 285.080.334-00 |
47 years | Economist | Committee Member (Full) / Chairman of the Board of Directors |
11/25/2010 11/25/2010 |
AUG 2013 | |||||
Murilo Pinto de Oliveira Ferreira 212.466.706-82 |
57 years | Manager | Committee Member (Full) / Chief Executive Officer and Member of the Disclosure Committee |
5/19/2011 5/20/2011 |
MAY/2013 |
Finance Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
Eduardo de Oliveira Rodrigues Filho 442.810.487-15 |
56 years | Engeneer | Committee Member (Full) Alternate Member of the Board of Directors | 5/28/2011 5/28/2011 |
AUG 2013 | |||||
Guilherme Perboyre Cavalcanti 010.981.437-10 |
42 years | Economist | Permanent Member Chief Financial Officer and Investor Relations, Permanent Member of the Risk Management Committee and Member of the Disclosure Committee |
8/26/2010 8/26/2010 |
MAY/2013 | |||||
Luciana Freitas Rodrigues 759.395.847-72
|
44 years | Statistician and Actuary | Committee Member(Full) N/A | 4/28/2011 4/28/2011 |
AUG 2013 | |||||
Luiz Maurício Leuzinger 009.623.687-68 |
69 years | Engineer | Committee Member(Full) N/A | 5/24/2007 5/24/2007 |
AUG 2013 |
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Accounting Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
Luiz Carlos de Freitas 659.575.638-20
|
58 years | Accountant | Committee Member (Full) Alternate Member of the Board of Directors | 5/24/2007 5/24/2007 | AUG 2013 | |||||
Paulo Ricardo Ultra Soares 599.057.437-15
|
50 years | B.A. in Law | Independent Member N/A | 5/21/2008 5/21/2008 | AUG 2013 | |||||
Paulo Roberto Ferreira de Medeiros 024.772.117-49 |
69 years | Manager | Independent Member N/A | 12/17/2003 12/17/2003 | AUG 2013 |
Governance and Sustainability Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
Gilmar Dalilo Cezar Wanderley
084.489.987-90
|
31 years | Banker | Committee Member(Full) N/A | 4/28/2001 4/28/2001 |
AUG 2013 | |||||
Renato da Cruz Gomes
426.961.277-00
|
58 years | Engineer | Committee Member(Full) Full Member of the Board of Directors | 12/19/2001 12/19/2001 |
AUG 2013 | |||||
Ricardo Simonsen
733.322.167-91
|
49 years | Mechanical Engineer | Independent Member N/A | 12/19/2001 12/19/2001 |
AUG 2013 |
NON-STATUTORY COMMITTEES
Disclosure Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
Fabio Eduardo de Pieri Spina
153.084.478-96
|
38 years | Attorney | Committee Member(Full) General Legal Advisor and Institutional Relations | 05/19/2011 05/19/2011 |
05/08/2013 | |||||
Guilherme Perboyre Cavalcanti
010.981.437-10 |
42 years | Economist | Committee Member(Full) Chief Financial Officer and Investor Relations and Permanent Member of the Finance Committee and of the Risk Management Committee | 8/26/2010 8/26/2010 |
MAY/2013 | |||||
Murillo Pinto de Oliveira Ferreira
212.466.706.83 |
57 years | Administrator | Committee Member(Full) Chairman and Member of the Strategic Committee | 2/6/2006 2/6/2006 |
Indeterminate | |||||
Roberto da Cunha Castello Branco
031.389.097-87 |
66 years | Economist | Committee Member(Full) Director of Investor Relations | 6/19/2002 6/19/2002 |
Indeterminate |
Risk Management Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
Guilherme Perboyre Cavalcanti
010.981.437-10
|
42 years | Economist | Permanent Member Chief Financial Officer and Investor Relations, Permanent Member of the Finance Committee and Member of the Disclosure Committee | 8/26/2010 8/26/2010 |
MAY/2013 | |||||
José Carlos Martins
304.880.288-68
|
61 years | Economist | Permanent Member Chief Director of Marketing, Sales, and Strategy | 5/27/2010 5/27/2010 |
MAY/2013 | |||||
Mauro Neves de Moraes
028.790.477-65
|
37 years | Mechanical Engineer | Committee Member(Full) Director of Planning and Engineering Center of Excellence | 8/2/2010 8/2/2010 |
Indeterminate | |||||
Pedro Zinner
034.007.097-86 |
37 years | Economist | Committee Member(Full) Global Director of Treasury and Finance | 8/2/2010 8/2/2010 |
Indeterminate | |||||
Tito Botelho Martins Junior
501.888.956-04
|
48 years | Economist | Committee Member(Full) Executive Director of Base Metals Operations | 8/2/2010 8/2/2010 |
MAY/2013 |
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12.8 FOR EVERY OFFICER AND MEMBER OF THE FISCAL COUNCIL, PLEASE PROVIDE:
Board of Directors
Ricardo José da Costa Flores — Chairman of Vale’s Board of Directors and Member of the Strategic
Committee (since November 2010). His main professional experiences over the last 5 years include:
Chief Executive Officer of Caixa de Previdência dos Funcionários do Banco do Brasil — (“PREVI”)
(since 2010), a complementary pension fund; (ii) Chief Executive Officer of Valepar S.A. (since
November 2010), a privately-held holding company and controlling shareholder of Vale, where he
serves as Chairman of the Board of Directors (since December 2010); (iii) Vice-President for
Credit, Controlling and Global Risk Management of Banco do Brasil S.A. (2009 to 2010), a financial
institution where he also held the position of Vice-President of Government Affairs (2008 to 2009),
Director of Insurance, Pension Plans, and Capitalization (2007 to 2008) and Director of Operational
Assets Restructuring (2004 to 2007); (iv) Chairman of the Board of Directors of (a) Banco Nossa
Caixa S.A. (January to November 2009); (b) Brasilcap Capitalização S.A. (since 2007); and (c)
Ativos S.A. — Securitizadora de Créditos Financeiros (2004 to 2007), all private financial
institutions; (v) Regular Member of the Board of Directors of (a) Brasilveículos Companhia de
Seguros S.A. (2007 to 2008); (b) Brasilprev Seguros e Previdência S.A. (2007 to 2008); and (c)
Brasilsaúde Companhia de Seguros S.A. (2007 to 2008), all private companies engaged in the
insurance sector; (vi) Member of the Fiscal Council of (a) Companhia Energética do Rio Grande do
Norte — COSERN (2006 to 2008), (b) Companhia Energética de Pernambuco — CELPE (2004 to 2006), (c)
CPFL Geração de Energia S.A. and (d) Companhia Paulista de Força e Luz (both from 2002 to 2004),
all publicly-held companies engaged in the energy sector. He also holds the position of (vii)
Deputy Director of the Deliberative Council of CODEFAT — Fundo de Amparo ao Trabalhador (Ministry
of Labor and Employment), representative of Federação Nacional das Empresas de Seguros Privados e
Capitalização (“FENASEG”) (since 2010); (viii) Executive Officer of Federação Brasileira de Bancos
(“FEBRABAN”) (2009 to 2010); (ix) Chief Executive Officer of FENACAP — Federação Nacional de
Capitalização (since 2008); (x) Vice-President of Confederação Nacional das Empresas de Seguros
Gerais, Previdência Privada e Vida, Saúde Complementar e Capitalização (“CNSEG”) (since 2008). He
holds a degree in Economics from Centro de Ensino de Brasília (“CEUB”), School of Economic
Sciences, Accounting and Management of the Federal District, in Brasilia (March, 1990); a Master’s
degree in General Basic Training for Top Executives from Universidade de São Paulo (“USP”),
concluded in December 1994 and a in Controller from FIPECAFI/USP (December 1996). Mr. Ricardo José
da Costa Flores has declared for all lawful purposes that, in the last five (5) years, he has not
been convicted by any criminal court or any administrative proceeding conducted by the Brazilian
Securities and Exchange Commission, nor has ever been disqualified or suspended by a final decision
of either a judicial court or the regulatory authorities from practicing any professional or
commercial activities for the previous five years.
José Ricardo Sasseron — Regular Member of Vale’s Board of Directors and Member of the Executive
Development Committee (since 2007). His main professional experiences over the last 5 years
include: (i) Regular Member of the Board of Directors of Valepar S.A. (since 2007), a
privately-held holding company and controlling shareholder of Vale); (ii) Social Security Officer
of Caixa de Previdência dos Funcionários do Banco do Brasil (“PREVI”) (since 2006), a complementary
pension fund, where he also held the position of Member of the Deliberative Council (2004 to 2006);
(iii) Chairman of the Board of Directors of Sauípe S.A. (in 2005), a publicly-held company engaged
in the hospitality and tourism sector; (iv) Officer of Litel Participações S.A. (since 2007), a
publicly-held holding company and shareholder of Valepar S.A.; (v) Officer of LitelB Participações
S.A. (since 2008), a privately-held holding
company and (vi) Officer of Litela Participações S.A. (since 2007), a private holding company and
shareholder of Valepar S.As). He holds a degree in History from Universidade de São Paulo (“USP”)
(November 1983). Mr. José Ricardo Sasseron has declared for all lawful purposes that, in the last
five (5) years, he has not been convicted by any criminal court or any administrative proceeding
conducted by the Brazilian Securities and Exchange Commission, nor has ever been disqualified or
suspended by a final decision of either a judicial court or the regulatory authorities from
practicing any professional or commercial activities for the previous five years.
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Robson Rocha — Regular Member of Vale’s Board of Directors (since 2011). He acts as Vice-President
for Human Resources Management and Sustainable Development of Banco do Brasil S.A., (since 2009), a
public financial institution, where he also served as Executive Officer (2008 to 2009). His main
professional experiences over the last 5 years include: (i) Vice-Chairman of the Board of Directors
of CPFL Energia S.A. (since 2010), a publicly-held holding company engaged in the energy sector;
and (ii) Member of the Board of Directors of Banco Nossa Caixa S.A. (from May to November 2009), a
financial institution that went private in 2009. Mr. Rocha holds a degree in Business
Administration from UNICENTRO — Newton Paiva, Belo Horizonte, (December 1998), General Basic
Information Course for Executives from UFMG (December 1997), a graduate certification in Strategic
Management from Universidade Federal de Minas Gerais (“UFMG”) (concluded in December 2000); a
Master’s degree in Finance from Fundação Dom Cabral (December 2000), and a Master’s degree in
Marketing from Fundação Ciências Humanas — Pedro Leopoldo (December 2002). Mr. Robson Rocha has
declared for all lawful purposes that, in the last five (5) years, he has not been convicted by any
criminal court or any administrative proceeding conducted by the Brazilian Securities and Exchange
Commission, nor has ever been disqualified or suspended by a final decision of either a judicial
court or the regulatory authorities from practicing any professional or commercial activities for
the previous five years.
Nelson Henrique Barbosa Filho — Regular Member of Vale’s Board of Directors (since 2011). His main
professional experiences over the last 5 years include: (i) Chairman of Banco do Brasil S.A. (since
2009), a publicly-held financial institution; (ii) Regular Member of the Board of Directors of
BrasilVeículos Cia de Seguros (since 2011), a privately-held company engaged in insurance; (iii)
Regular Member of the Board of Directors of Brasilcap — Capitalização S.A., (2010 to 2011), a
privately-held company engaged in the commercialization of capitalization bonds); (iv) Executive
Secretary of the Ministry of Finance (since 2011), where he also served as Secretary of Economic
Policy (2008 to 2010), Secretary of Economic Monitoring (2007 to 2008) and Assistant Secretary of
Economic Policy (2006 to 2007); (v) Member of the Board of Directors of EPE — Empresa de Pesquisa
Energética (2007 TO 2009), a private research energy company; and (vi) Advisor to the Presidency of
Banco Nacional de Desenvolvimento Econômico Social (“BNDES”), a Brazilian development bank, (2005 a
2006). He holds a degree in Economics from Universidade Federal do Rio de Janeiro (“UFRJ”) (March
1992), and Master’s degree in Economics from the same university (concluded in March 1995), and a
Ph.D. in Economics from New School for Social Research, concluded in January 2001. Mr. Nelson
Henrique Barbosa Filho has declared for all lawful purposes that, in the last five (5) years, he
has not been convicted by any criminal court or any administrative proceeding conducted by the
Brazilian Securities and Exchange Commission, nor has ever been disqualified or suspended by a
final decision of either a judicial court or the regulatory authorities from practicing any
professional or commercial activities for the previous five years.
Renato da Cruz Gomes — Regular Member of Vale’s Board of Directors and Member of the Governance and
Sustainability Committee (since 2001). His main professional experiences over the last 5 years
include the positions of Officer and Regular Member of the Board of Directors of Valepar S.A.
(since 2001), a privately-held holding company and controlling shareholder of Vale, and Officer of
Investor Relations of Bradespar S.A. (since 2000), a publicly-held holding company and shareholder
of Valepar S.A. He also acted as Officer in the following publicly-held companies: (i) Regular
Member of the Board of Directors of Aracruz Celulose S.A., now known as Fibria S.A., a
privately-held company engaged in the production of bleached eucalyptus kraft pulp; (ii) Regular
Member of the Board of Directors of Iochpe-Maxion S.A., a publicly-held manufacturing company of
parts and accessories for automotive vehicles; (iii) Regular Member of the Board of Directors of
Bahia Sul Celulose S.A., currently known as Suzano Celulose S.A., a publicly-held manufacturing
company of pulp and other products for the production of paper; (iv) Regular Member of the Board of
Directors of Globo Cabo S.A., now known as Net Serviços de Comunicação S.A., a publicly-held
company engaged in cable television services and (v) Alternate Member of the Board of Directors of
Latasa Alumínio S.A., now known as Rexam Beverage Can South America S.A., a privately-held company
that manufactures metallic packagings. He holds a degree in Engineering from Universidade Federal
do Estado do Rio de Janeiro (“UFRJ”) (December 1976) and a graduate certification in Management
Development from Sociedade de Desenvolvimento Empresarial (“SDE”/“IBMEC”). Mr. Renato da Cruz Gomes
has declared for all lawful purposes that, in the last five (5) years, he has not been convicted by
any criminal court or any administrative proceeding conducted by the Brazilian Securities and
Exchange Commission, nor has ever been disqualified or suspended by a final decision
of either a judicial court or the regulatory authorities from practicing any professional or
commercial activities for the previous five years.
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Mário da Silveira Teixeira Júnior — Vice-Chairman of Vale’s Board of Directors (since 2003) and
Member of the Strategic Committee (since 2006). His main professional experiences over the last 5
years include: (i) Vice-Chairman of the Board of Directors of Valepar S.A. (since 2003), a
privately-held holding company and controlling shareholder of Vale; (ii) Member of the Board of
Directors of Banco Bradesco S.A. (since 1999), a financial institution, where he also holds the
position of Member and Coordinator of the Internal Controls and Compliance Committee and Member of
the Remuneration Committee (since 2004), and where he also served as Member and Coordinator of the
Audit Committee (2004 to 2009); (iii) Member of the Board of Directors of Bradesco Leasing S.A. —
Arrendamento Mercantil (since 2004), a privately-held company engaged in the leasing; (iv) Member
of the Board of Directors of Bradespar S.A. (since 2002), a publicly-held holding company and
shareholder of Valepar S.A.; (v) Member of the Board of Directors of Cidade de Deus — Companhia
Comercial de Participações (since 2002), a privately-held holding company; (vi) Officer and Member
of the Board of Directors of Elo Participações e Investimentos S.A. (since 2006), a privately-held
holding company; (vii) Executive Managing Officer and Member of the “Mesa Regedora” of Fundação
Bradesco (since 2002, a Federal, State and Municipal public interest entity; (viii) Officer of NCF
Participações S.A. (since 2002), a privately-held holding company and (ix) Officer of Nova Cidade
de Deus Participações S.A. (since 2002), a privately-held holding company; (x) Voting Member of the
Board of Directors Banco Espírito Santo de Investimento S.A. (2002 to 2009), a financial
institution; (xi) Regular Member of the Board of Directors of Cia. Paulista de Força e Luz —
(“CPFL”) (2001 to 2005), a publicly-held company engaged in the energy sector; (xii) Regular Member
of the Board of Directors of CPFL Energia S.A., (2003 to 2006), a publicly-held holding company;
(xiii) Regular Member of the Board of Directors of CPFL Geração de Energia S.A., (2003 to 2005), a
publicly-held company of energy sector; (xiv) Regular Member of the Board of Directors of Companhia
Piratininga de Força e Luz (2003 to 2005), a publicly-held company of energy sector; (xv) Member of
the Board of Directors of VBC Energia S.A. (2003 to 2005), a publicly-held holding company. He also
served as Member of the Board of Directors of the following publicly-held companies: (xvi)
Companhia Siderúrgica Nacional (1996 to 2000), a steelmaking company; (xvii) Latas de Alumínio S.A.
— LATASA (1992 to 2000), currently known as Rexam Beverage Can South America S.A., which went
private and is engaged in the manufacturing of metallic packagings; (xviii) São Paulo Alpargatas
S.A. (1997 to 1999), company engaged in cotton processing and spinning; and (xix) Tigre S.A. —
Tubos e Conexões (1997 to 1998), currently a privately-held company engaged in the manufacturing of
plastic pipes and fittings for civil construction. He holds a degree in Civil Engineering (1970)
and Business Administration from Universidade Presbiteriana Mackenzie (December 1980). Mr. Mário da
Silveira Teixeira Júnior has declared for all lawful purposes that, in the last five (5) years, he
has not been convicted by any criminal court or any administrative proceeding conducted by the
Brazilian Securities and Exchange Commission, nor has ever been disqualified or suspended by a
final decision of either a judicial court or the regulatory authorities from practicing any
professional or commercial activities for the previous five years.
Fuminobu Kawashima — Regular Member of Vale’s Board of Directors (since 2001). His main
professional experiences over the last 5 years include: (i) Executive Managing Officer responsible
for the operation of Marine & Aerospace Business Unit of Mitsui & Co., Ltd. (since 2010), a
publicly traded company and controlling shareholder of Valepar S.A. He also held the position of
Chief Operating Officer responsible for the operation of the energy unit (2007 to 2010), General
Manager of Energy Operations (2005 to 2007) and General Manager of Natural Gas & Energy (from May
to September 2005). He also served as Member of the Board of Directors of the following
privately-held companies: (ii) Japan Australia LNG (MIMI) Pty Ltd., (2005 to 2007), an Oil and Gas
company; (iii) Mitsui Oil Co., Ltd., (2007 to 2009), a company engaged in the sales of oil-derived
products; and (iv) Kyokuto Petroleum Industries, Ltd., (2007 to 2009), an oil refinery. He holds a
degree in Economics from Hitotsubashi University, Japan (March 1976), and a graduate certification
in Economic Development from Keble Collegue, Oxford (June 980). Mr. Fuminobu Kawashima has declared
for all lawful purposes that, in the last five (5) years, he has not been convicted by any criminal
court or any administrative proceeding conducted by the Brazilian Securities and Exchange
Commission, nor has ever been disqualified or suspended by a final decision of either a judicial
court or the regulatory authorities from practicing any professional or commercial activities for
the previous five years.
Oscar Augusto de Camargo Filho — Regular Member of Vale’s Board of Directors (since 2003), Member
of the Strategic Committee (since 2006), and Member of the Executive Development Committee (since
2003). His main professional experiences over the last 5 years include: (i) Sitting Member of the
Board of Directors of Valepar S.A. (since 2003), a private holding company and controlling
shareholder of Vale; and (ii) Partner of CWH Consultoria Empresarial (since 2003), a consulting
company. He also held the position of Officer in the following publicly-held companies: (iii)
Chairman of the Board of Directors of MRS Logística S.A., (1999 to 2003), a publicly-held cargo
railway company; and (iv) Chief Executive Officer and Member of the Board of Directors of Caemi
Mineração e Metalurgia S.A. (1996 to 2003), a publicly-held mining and metallurgy company that
merged with Vale in 2006. He
holds a Law degree from Universidade de São Paulo (“USP”) (December 1963) and a graduate
certification in International Marketing from Cambridge University (September 1970). Mr. Oscar
Augusto de Camargo Filho has declared for all lawful purposes that, in the last five (5) years, he
has not been convicted by any criminal court or any administrative proceeding conducted by the
Brazilian Securities and Exchange Commission, nor has ever been disqualified or suspended by a
final decision of either a judicial court or the regulatory authorities from practicing any
professional or commercial activities for the previous five years.
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Luciano Galvão Coutinho — Regular Member of Vale’s Board of Directors (since 2007) and Member of
the Strategic Committee (since 2009), which position he previously held from 2005 to 2006. His main
professional experiences over the last 5 years include: (i) Chief Executive Officer of Banco
Nacional de Desenvolvimento Econômico e Social — (“BNDES”) (since 2007), a Brazilian development
bank; (ii) Member of the Board of Directors of Petróleo Brasileiro S.A. — PETROBRAS (since 2009),
a publicly-traded company connected to the activities of exploration and production of oil and gas
and refining and production of oil-derivates; (iii) Partner of LCA Consultores (1995 to 2007), a
consulting company,; (iv) Partner of Macrotempo Consultoria (1990 to 2007), a consulting company;
(v) Member of the Board of Directors of Ripasa S.A. Celulose e Papel (2002 to 2005), a
publicly-held company in the manufacturing of pulp and paper. He also served as (vi) Member of the
Board of Directors of Guaraniana, now known as Neoenergia S.A. (2003 to 2004), a publicly-held
electricity holding company; (vii) Member of the International Advisory Council of Fundação Dom
Cabral (since 2009), an educational institution focused on improving the skills of executives,
entrepreneurs and corporations; (viii) Member of the Curator Council of Fundação Nacional da
Qualidade (since 2009), an entity focused in promoting the development of the basics of management
excellence; and (ix) Member of the Director Council of Fundo Nacional de Desenvolvimento Científico
e Tecnológico (since 2007), a financial assistance entity. He holds a degree in Economics from
Universidade de São Paulo (“USP”) (June 1969), a Master’s degree in Economics from Instituto de
Pesquisas Econômicas (“USP”), (June 1970) and a Ph.D also in Economics from Cornell University
(January 1975). Mr. Luciano Galvão Coutinho has declared for all lawful purposes that, in the last
five (5) years, he has not been convicted by any criminal court or any administrative proceeding
conducted by the Brazilian Securities and Exchange Commission, nor has ever been disqualified or
suspended by a final decision of either a judicial court or the regulatory authorities from
practicing any professional or commercial activities for the previous five years.
Paulo Soares de Souza — He served as Alternate Member of Vale’s Board of Directors of Vale (2007 to
2009). His main professional experiences over the last 5 years include: (i) Union leader (since
1997); (ii) President of Itabira’s Employees Union (Sindicato dos Trabalhadores nas Indústrias de
Extração Mineral e de Pesquisa, Prospecção, Extração e Beneficiamento do Ferro e Metais Básicos e
demais Minerais Metálicos e não Metálicos de Itabira e região) (Sindicato Metabase de Itabira e
Região) (since 2003). He holds a technical degree from Serviço Social da Indústria (“SESI”)
(December 1988) Mr. Paulo Soares de Souza has declared for all lawful purposes that, in the last
five (5) years, he has not been convicted by any criminal court or any administrative proceeding
conducted by the Brazilian Securities and Exchange Commission, nor has ever been disqualified or
suspended by a final decision of either a judicial court or the regulatory authorities from
practicing any professional or commercial activities for the previous five years.
José Mauro Mettrau Carneiro da Cunha — Regular Member of Vale’s Board of Directors (since 2010).
His main professional experiences over the last 5 years include: (i) Chairman of the Board of
Directors of (a) Tele Norte Leste Participações S.A. (“TNL”) (since 2007), (b) Telemar Norte Leste
S.A. (since 2007), (c) Brasil Telecom S.A. (since 2009), (d) Tele Norte Celular Participações S.A.
(since 2008), all publicly-held telecommunications companies, (ii) Chairman of the Board of
Directors of (a) Coari Participações S.A. (since 2007) and (b) Calais Participações S.A. (since
2007), both publicly-held holding companies. He also serves as (iii) Sitting Member of the Board of
Directors of Santo Antonio Energia S.A. (since 2008), a privately-held energy producer, and (iv)
Alternate member of the Board of Directors of Telemar Participações S.A, a publicly-held
telecommunication company (since 2008); (v) Chairman of the Board of Directors of TNL PCS S.A.
(since 2007), a telecommunications company, and (vi) Sitting Member of the Board of Directors of
Log-In Logística Intermodal S/A (since 2007), a publicly-held company engaged in intermodal
logistics activities, wherein Vale holds 31.3% of the stockholder’s capital; and (vii) Sitting
Member of the Board of Directors of Lupatech S/A (since 2006), a publicly-held energy products,
flow control and metallurgy company. In addition to the companies mentioned hereinabove, he also
served as (viii) Sitting Member of the Board of Directors of the following publicly-held companies:
(a) Braskem S.A. (2007 to 2010), a petrochemical company, where he previously served as
Vice-President of Strategic Planning (2003 to 2005); (b) LIGHT Serviços de Eletricidade S/A (1997
to 2000), an energy distributor; (c) Aracruz Celulose S.A. (1997 to 2002), a paper plant; (d)
Politeno Indústria e Comércio S/A (2003 to 2004), a petrochemical company; (e) BANESTES S.A. -
Banco do Estado do Espírito Santo (2008 to 2009), a financial institution; and (f) TNL (1999 to
2003), where he served as Alternate Member of the Board of Directors (2006). He holds a degree in
Mechanical Engineering from Universidade Católica de Petrópolis, RJ
(December 1971), and attended an Executive Program in Management at Anderson School, University of
California, (United States), December 2002. Mr. José Mauro Mettrau Carneiro da Cunha has declared
for all lawful purposes that, in the last five (5) years, he has not been convicted by any criminal
court or any administrative proceeding conducted by the Brazilian Securities and Exchange
Commission, nor has ever been disqualified or suspended by a final decision of either a judicial
court or the regulatory authorities from practicing any professional or commercial activities for
the previous five years.
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Marco Geovanne Tobias da Silva — Alternate Member of Vale’s Board of Directors (since 2011). His
main professional experiences over the last 5 years include: (i) Investor Relations Manager of
Banco do Brasil S.A. (1999 to 2010), a publicly-held financial institution; (ii) Participation’s
Officer of Caixa de Previdência dos Funcionários do Banco do Brasil (“PREVI”) (since 2010), a
complementary pension fund; (iii) Member of the Fiscal Council of Companhia de Energia Elétrica da
Bahia — (“Coelba”) (2002 to 2010), a publicly-held company of distribution and commercialization
of energy; (iv) Chairman of the Board of Directors of Neoenergia S.A. (since 2011), a publicly-held
holding company engaged in the electricity sector. He holds a degree in Economics from Universidade
de Brasília (1990) and a graduate certification in Marketing from COPPEAD/Universidade Federal do
Rio de Janeiro (March 1997). Mr. Marco Geovanne Tobias da Silva has declared for all lawful
purposes that, in the last five (5) years, he has not been convicted by any criminal court or any
administrative proceeding conducted by the Brazilian Securities and Exchange Commission, nor has
ever been disqualified or suspended by a final decision of either a judicial court or the
regulatory authorities from practicing any professional or commercial activities for the previous
five years.
Sandro Kohler Marcondes — Regular Member of Vale’s Board of Directors (since 2007). His main
professional experiences over the last 5 years include: (i) Alternate Member of the Board of
Directors of Valepar S.A. (since 2009), a privately-held holding company and controlling
shareholder of Vale; (ii) Officer of Banco do Brasil S.A. (since 2005), a financial institution;
(iii) Officer of BB Leasing S.A. Arrendamento Mercantil (since 2005), a privately-held company
engaged in the leasing activity; (iv) Chairman of the Board of Directors of Banco do Brasil A.G.,
Viena, (2008 to 2009), a subsidiary of Banco do Brasil S.A. in Austria; (v) Member of the Board of
the Directors of BB Securities Ltd London (since 2005), a brokerage company abroad; (vi) Regular
Member of the Board of Directors of BB Securities LLC New York (since 2005), also a brokerage firm
abroad; (vii) Member of the Deliberative Council of BBTur Viagens e Turismo Ltda, a corporate
travel agency (since 2005); and (viii) Alternate Member of the Board of Directors of Banco
Patagônia S.A. (since 2011.), a publicly-held financial institution. He holds a degree in Business
Administration from Universidade Estadual Centro Oeste Paraná (December 1986) and a Master’s degree
from Fundação Getulio Vargas (“FGV”) in São Paulo (April 1994). Mr. Sandro Kohler Marcondes has
declared for all lawful purposes that, in the last five (5) years, he has not been convicted by any
criminal court or any administrative proceeding conducted by the Brazilian Securities and Exchange
Commission, nor has ever been disqualified or suspended by a final decision of either a judicial
court or the regulatory authorities from practicing any professional or commercial activities for
the previous five years.
Deli Soares Pereira — Alternate Member of Vale’s Board of Directors (since 2009). His main
professional experiences over the last 5 years include: (i) Alternate Member of the Board of
Directors of Valepar S.A. (since 2009), a privately-held holding company and controlling
shareholder of Vale; (ii) Sitting Member of the Board of Directors of (a) Cia. Piratininga de Força
e Luz (2004 to 2006); (b) Cia. Paulista de Força e Luz — CPFL Paulista (2004 to 2006) e (c) CPFL
Geração de Energia S.A. (2004 to 2006), all publicly-held companies in the electricity sector;
(iii) Sitting Member of the Board of Directors of CPFL Energia S.A. (2004 to 2006), a publicly-held
electric energy holding company; (iv) Sitting Member of the Board of Directors of SOLPART
Participações S.A. (2006 to 2008), a privately-held holding company; (v) Executive Officer of the
Confederação Nacional dos Bancários (2003 to 2006), a labor union; and (vi) Member of the Board of
Directors of Tigre S.A. — Tubos e Conexões (2001 to 2003), now a privately-held company engaged in
the manufacturing of plastic pipes and fittings for civil construction. He holds a degree in Social
Sciences from Universidade de São Paulo (“USP”) (November 1979) and a graduate certification in
Economics and Management of Labor Relations from Pontifícia Universidade Católica (“PUC”) in São
Paulo (March 2010). Mr. Deli Soares Pereira has declared for all lawful purposes that, in the last
five (5) years, he has not been convicted by any criminal court or any administrative proceeding
conducted by the Brazilian Securities and Exchange Commission, nor has ever been disqualified or
suspended by a final decision of either a judicial court or the regulatory authorities from
practicing any professional or commercial activities for the previous five years.
Eustáquio Wagner Guimarães Gomes — Alternate Member of Vale’s Board of Directors (since 2011). His
main professional experiences over the last 5 years include: (i) Regular Member of the Board of
Directors of the following publicly-held companies: (a) Companhia de Energia Elétrica da Bahia —
Coelba, (1998 to 1999), a company involved in the distribution and commercialization of energy
sector; (b) Companhia Energética do Rio Grande do Norte — COSERN (1998 to 1999), a company
involved in the distribution and commercialization of energy sector; (c)
Guaraniana, currently known as Neoenergia S.A. (1998 to 1999), an electrical energy holding
company; (d) Centrais Telefônicas de Ribeirão Preto S.A. (1999 to 2000), acquired by Telesp S.A., a
telecommunications holding company); and (e) Cia de Armazéns e Silos do Estado de Minas Gerais-
CASEMG (2002 to 2003), a privately-held company engaged in the grain warehousing sector. He also
held the position of (ii) Member of the Fiscal Council of the following companies: (a) Telesp
Participações S.A. (200 to 2001), a publicly-held telecommunications holding company; (b) Banco do
Brasil S.A. (2006 to 2010), a publicly-held financial institution); (c) Cia de Seguros Aliança
Brasil (2007 to 2010), a private insurance company; (d) Banco Popular do Brasil (2008 to 2010), a
privately-held financial institution; (e) BESC — Financeira S.A., Crédito, Financiamento e
Investimentos — “BESCREDI” (2008 to 2010), a publicly-held financial institution; (f) BB
Investimentos (since 2003), a privately-held investment bank; (g) Fundação Banco do Brasil (since
2006), an association for the development and management of sustainable actions for social
inclusion and social change; and (h) BB Corretora de Seguros (since 2010), a privately-held
insurance company. He holds a degree in Business Administration from the School of Economic
Sciences of Universidade Federal de Minas Gerais — (“UFMG”) (July 1977). Mr. Eustáquio Wagner
Guimarães Gomes has declared for all lawful purposes that, in the last five (5) years, he has not
been convicted by any criminal court or any administrative proceeding conducted by the Brazilian
Securities and Exchange Commission, nor has ever been disqualified or suspended by a final decision
of either a judicial court or the regulatory authorities from practicing any professional or
commercial activities for the previous five years.
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João Moisés de Oliveira — Alternate Member of Vale’s Board of Directors (since 2003) and Member of
the Executive Development Committee (since 2001), where he also served as Regular Member (2001 to
2003) and as Alternate Member of the Board of Directors (2000 to 2001). His main professional
experiences over the last 5 years include: (i) Sitting Member of the Board of Directors of Valepar
S.A. (since 2003), a privately-held holding company and controlling shareholder of Vale; (ii) Chief
Executive Officer of Bradespar S.A. (since 2003), a public holding company and controlling
shareholder of Valepar S.A.; (v) Officer and Chief Executive Officer of Bradesplan Participações
S.A. (2000 to 2006), a privately-held holding company); (iv) Officer of Millennium Security Holding
Corp. (since 2003), a privately-held holding company; and (v) Chief Executive Officer of (a)
Brumado Holdings Ltda. and (b) Antares Holdings Ltda. (in both since 2006), privately-held holding
companies). He also held Officer positions in the following publicly-held companies: (vi) Officer
of Banco Bradesco S.A. (1992 to 2000), a publicly-held financial institution; (vii) Sitting Member
of the Board of Directors of COFAP Companhia Fabricadora de Peças (1999), a manufacturer of parts
and accessories for automotive vehicles; (viii) Sitting member of the Board of Directors of
Companhia Siderúrgica Belgo Mineira, currently known as Arcelor Brasil S.A. (1999 to 2001), a
holding company; (ix) Member of the Board of Directors of Companhia Siderúrgica Nacional (1996 to
2001), a steelmaking company); (x) Sitting Member of the Board of Directors of Indústrias Romi S.A.
(1998 to 2000), a manufacturing company of machinery and machine tools, parts and accessories; (xi)
Sitting Member of the Board of Directors of Mahle Metal Leve S.A. (1998 to 2001), a manufacturing
company engaged in the manufacturing of parts and accessories for the engine system of automotive
vehicles; (xii) Sitting Member of the Board of Directors of São Paulo Alpargatas S.A. (1999 to
2001), a company engaged in cotton processing, spinning, weaving and fabric finishing; (xiii)
Regular Member of the Board of Directors of Telecelular Sul Participações S.A., now known as Tim
Participações S.A. (1998 to 1999), a holding company engaged in telecommunications; and (xiv)
Alternate Member of the Board of Directors of Tigre S.A. — Tubos e Conexões (1998 to 2001), now a
privately-held company engaged in the manufacturing of plastic pipes and fittings for civil
construction. He holds a degree in Economics from the School of Economics, Accounting and Actuarial
Studies of Pontifícia Universidade Católica (“PUC”) (March 1972) and a graduate certification in
Finance Management from Faculdades Metropolitanas Unidas (concluded in July 1978). Mr. João Moisés
de Oliveira has declared for all lawful purposes that, in the last five (5) years, he has not been
convicted by any criminal court or any administrative proceeding conducted by the Brazilian
Securities and Exchange Commission, nor has ever been disqualified or suspended by a final decision
of either a judicial court or the regulatory authorities from practicing any professional or
commercial activities for the previous five years.
Luiz Carlos de Freitas — Alternate Member of Vale’s Board of Directors and Member of the Accounting
Committee (since 2007). His main professional experiences over the last 5 years include: (i)
Alternate Member of the Board of Directors of Valepar S.A. (since 2005), a privately-held holding
company and controlling shareholder of Vale; (ii) Chief Executive Officer of Bradespar S.A. (2000
to 2007), a publicly-held holding company and controlling shareholder of Valepar S.A. He holds a
degree in Accounting Sciences from Faculdade de Ciências Econômicas e Administrativas de Osasco
(December 1990). Mr. Luiz Carlos de Freitas has declared for all lawful purposes that, in the last
five (5) years, he has not been convicted by any criminal court or any administrative proceeding
conducted by the Brazilian Securities and Exchange Commission, nor has ever been disqualified or
suspended by a final decision of either a judicial court or the regulatory authorities from
practicing any professional or commercial activities for the previous five years.
Hajime Tonoki — Alternate Member of Vale’s Board of Directors (since 2009). His main professional
experiences over the last 5 years include: (i) Regular Member of the Board of Directors and
Director and Executive Vice-President of Mitsui & Co. (Brasil) S.A. (since 2009), a privately-held
trading company; (ii) General International Corporate Department Manager for Strategy and Planning
of Mitsui & Co., Ltd. (2008 to 2009), a publicly-held holding company and controlling shareholder
of Valepar S.A.; and (iii) Officer responsible for the Steel Products Department of Mitsui
Brasileira Imp. e Exp. S.A. (2004 to 2008), a privately-held trading company. He holds a degree in
Economics from Keio Univesrity (in March 1983). Mr. Hajime Tonoki has declared for all lawful
purposes that, in the last five (5) years, he has not been convicted by any criminal court or any
administrative proceeding conducted by the Brazilian Securities and Exchange Commission, nor has
ever been disqualified or suspended by a final decision of either a judicial court or the
regulatory authorities from practicing any professional or commercial activities for the previous
five years.
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Eduardo de Oliveira Rodrigues Filho — Alternate Member of Vale’s Board of Directors (since 2011).
His main professional experiences over the last 5 years include: (i) Alternate Member of the Board
of Directors of Valepar S.A. (since 2008), a privately-held holding company and controlling
shareholder of Vale; (ii) Partner or CWH Consultoria Empresarial (since 2008), a consulting
company; (iii) Commercial Director of Rio Tinto Brasil Ltda. (a company that merged with Vale in
2009, now known as Mineração Corumbaense Reunida S.A.), a privately-held mining company (1994 to
2008). He holds a degree in Civil Engineering from Pontifícia Universidade Católica do Rio de
Janeiro (1978) and a graduate certification in Transport Planning from PCL Politechnic of Central
London (October 2000). Mr. Eduardo de Oliveira Rodrigues Filho has declared for all lawful purposes
that, in the last five (5) years, he has not been convicted by any criminal court or any
administrative proceeding conducted by the Brazilian Securities and Exchange Commission, nor has
ever been disqualified or suspended by a final decision of either a judicial court or the
regulatory authorities from practicing any professional or commercial activities for the previous
five years.
Paulo Sérgio Moreira da Fonseca — Alternate Member of Vale’s Board of Director (since May 2008).
His main professional experiences over the last 5 years include: (i) Alternate Member of the Board
of Directors of Valepar S.A. (2005 to 2008), a privately-held holding company and controlling
shareholder of Vale; (ii) Chief of Base Industry Department of Banco Nacional de Desenvolvimento
Econômico e Social — (“BNDES”) (2005 to 2010), a Brazilian development bank and (iii) Alternate
Member of the Board of Directors of Aços Villares S.A. (2003 to 2006), a publicly-held steelmaking
company. He holds a degree in Economics from Universidade Federal do Rio de Janeiro (“UFRJ”)
(December 1973) and a Master’s degree in Finance from COPPEAD/Universidade Federal do Rio de
Janeiro (September 1975). Mr. Paulo Sérgio Moreira da Fonseca has declared for all lawful purposes
that, in the last five (5) years, he has not been convicted by any criminal court or any
administrative proceeding conducted by the Brazilian Securities and Exchange Commission, nor has
ever been disqualified or suspended by a final decision of either a judicial court or the
regulatory authorities from practicing any professional or commercial activities for the previous
five years.
Raimundo Nonato Alves Amorim — Currently an Alternate Member of Vale’s Board of Directors (since
2009). His main professional experiences over the last 5 years include the positions of President
of the iron ore and basic metals employees union in Marabá, Paraupebas, Curionópolis and Canaãn dos
Carajás (since 2001). He holds a technical degree in Electrotechnics from the Teaching Department
of High School equivalency Education DESU/SEDUC (1992). Currently he is attending a Management
Technical Program at Universidade da Amazônica — (“UNAMA”). Mr. Raimundo Nonato Alves Amorim has
declared for all lawful purposes that, in the last five (5) years, he has not been convicted by any
criminal court or any administrative proceeding conducted by the Brazilian Securities and Exchange
Commission, nor has ever been disqualified or suspended by a final decision of either a judicial
court or the regulatory authorities from practicing any professional or commercial activities for
the previous five years.
Executive Board
Eduardo de Salles Bartolomeo — Executive Officer responsible for the Integrated Operations of Vale
(since May 2010). Previously he had served as Executive Officer of Logistics, Project Management
and Sustainability (from April 2009 to May 2010); Executive Officer of Logistics, Engineering and
Project Management (from November 2008 to March 2009), Executive Officer of Logistics (from January
2007 to October 2008) and Officer of the Logistics Operations Department (from January 2004 to July
2006). His main professional experiences over the last 5 years within Vale’s group include: (i)
Chairman of the Board of Directors of Ferrovia Norte Sul S.A. (since 2007), a publicly-held cargo
transport company, wherein directly or indirectly Vale holds 100% of the total capital; (ii)
Chairman of the Board of Directors of Log-In Logística Intermodal S.A. (since 2007), a public
company engaged in intermodal logistics activities, wherein Vale holds 31.3% of the total capital;
and (iii) Sitting Member of the Board of Directors of MRS
Logística S.A. (from 2008 to 2009), a publicly-held cargo railroad company, wherein Vale holds
41.50% of the total capital. In addition to the hereinabove, Mr. Bartolomeo has held the following
positions in publicly-held companies: (iv) Chief Executive Officer of Petroflex Indústria e
Comércio S.A. (from August to December 2006), a company engaged in the production of rubber; and
(v) Regional Plant Director of Cia. de Bebidas das Américas — AmBev, (2003 to 2004), a company
engaged in the production of beverages. He holds a degree in Metallurgical Engineering from
Universidade Federal Fluminense (“UFF”), Rio de Janeiro, a Master’s degree in Business
Administration from Katholieke Universiteit Leuven, in Belgium. Mr. Eduardo de Salles Bartolomeo as
declared for all lawful purposes that, in the last five (5) years, he has not been convicted by any
criminal court or any administrative proceeding conducted by the Brazilian Securities and Exchange
Commission, nor has ever been disqualified or suspended by a final decision of either a judicial
court or the regulatory authorities from practicing any professional or commercial activities for
the previous five years
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Eduardo Jorge Ledsham — Executive Officer responsible for Vale’s Exploration, Energy, and Projects
since 2010. Previously, Mr. Ledsham served as Global Officer of Exploration and Development of
Energy and Fertilizer Projects (2008 to 2010) and Officer of Exploration and Development of Mineral
Projects — Brazil, the Americas, Africa, Asia and Oceania (2005 to 2007). His main professional
experiences over the last 5 years within Vale’s group include: (i) Chairman of the Board of
Directors of Vale Óleo e Gás S.A. (since May 2009), Vale’s subsidiary that develops practices
related to research, prospection, exploration and development and production of marine and land
deposits of hydrocarbons and derived products; (ii) Chairman of the Board of Directors of CADAM
S.A. (since December 2009), a privately-held company involved in the mineral extraction sector -
kaolin; (iii) Member of the Board of Directors of Pará Pigmentos S.A. (since 2009), a
privately-held company engaged in the exploration, production, and, sale of kaolin for paper
coating sector; (iv) Member of the Board of Directors of Rio Doce Australia Pty Ltd. (since 2006;),
a privately-held company engaged in the business coal exploration sector; and (v) Member of the
Board of Directors of Vale Australia (EA) Pty Ltd. (since April 2010), a privately-held company
engaged in coal exploration. He holds a degree in Geology from Universidade Federal de Minas Gerais
(“UFMG”), and has a graduate certification in Finance from Instituto Brasileiro de Mercado de
Capitais (IBMEC), in Enterprise and Project Evaluation from Fundação Getúlio Vargas (“FGV”) and in
Management from Fundação Dom Cabral. He is also a graduate certification in M&A from Harvard
Business School and in Management from IMD and MIT. Mr. Eduardo Jorge Ledsham has declared for all
lawful purposes that, in the last five (5) years, he has not been convicted by any criminal court
or any administrative proceeding conducted by the Brazilian Securities and Exchange Commission, nor
has ever been disqualified or suspended by a final decision of either a judicial court or the
regulatory authorities from practicing any professional or commercial activities for the previous
five years.
Guilherme Perboyre Cavalcanti — Chief Financial and Investor Relations Officer (since August 2010)
and Regular Member of Vale’s Finance Committee (since August 2010), Member of Vale’s Risk
Management and Disclosure Committee (since August 2010) and Permanent Member of the Risk Management
Executive Committee (since August 2010). His main professional experiences over the last 5 years
include: (i) Vale’s Global Officer of Corporate Finance Director (from 2005 to 2010), (ii) Sitting
Member of the Board of Directors of Log-In Logística Intermodal S.A. (since 2007), a publicly-held
company engaged in intermodal logistics activities, wherein Vale holds 31.3% of the total capital;
(iii) Member of the Board of Directors of Net Serviços de Comunicação (from 2002 to 2005), a
publicly-held telecommunications company; and (iv) Treasury officer of Globo Comunicações e
Participações S.A., a publicly-held media company. He holds a degree and Master’s degree in
Economics from Pontifícia Universidade Católica of Rio de Janeiro. Mr. Guilherme Perboyre
Cavalcanti has declared for all lawful purposes that, in the last five (5) years, he has not been
convicted by any criminal court or any administrative proceeding conducted by the Brazilian
Securities and Exchange Commission, nor has ever been disqualified or suspended by a final decision
of either a judicial court or the regulatory authorities from practicing any professional or
commercial activities for the previous five years.
José Carlos Martins — Executive Officer for Marketing, Sales, and Strategy of Vale (since May
2010), where he also served as Executive Officer for Ferrous Minerals (from 2005 to May 2010),
Executive Officer for Business Development (from April 2004 to May 2005) and Permanent Member of
the Risk Management Executive Committee (since May 2010). His main professional experiences in the
past 5 years including companies wherein Vale holds direct or indirect participation are: (i)
Vice-Chairman of the Board of Directors of Baosteel CSV — Companhia Siderúrgica de Vitória, now
Companhia Siderúrgica Ubu (from 2008 to 2009), a privately-held steelmaking company, wherein Vale
holds 100% of the total capital; (ii) Chairman of the Board of Directors of Samarco Mineração S.A.
(since 2005), a privately-held company engaged in the activities of mining and pelletizing, wherein
Vale holds 50% of the total capital; (iii) Vice-President of the Deliberative Council of
Thyssenkrupp CSA Siderúrgica do Atlântico Ltda., a limited liability steel making company (since
2008), wherein Vale holds 25.94% of the total capital; and (iv) Chairman of the Board of Directors
of Vale International SA (since 2006), Vale’s subsidiary that develops practices related to trading
and holding. In addition to the companies mentioned hereinabove, he also held the following
positions in the
publicly-held companies: (v) Sitting Member of the Board of Directors of Usinas Siderúrgicas de
Minas Gerais S.A. — USIMINAS, (2005 to 2006 / 2008 to 2009), a publicly-held steel manufacturing
company; (vi) Officer for Steel Production of Companhia Siderúrgica Nacional, a steel making
company; (vii) Chief Executive Officer of Latas de Alumínio S.A. — LATASA, now known as Rexam
Beverage Can South America S.A., and which went private, is engaged in the production of metallic
packaging; and (viii) Chief Executive Officer and Officer of Aços Villares S.A., a special
steelmaking company. He holds a degree in Economics from Pontifícia Universidade Católica de São
Paulo (PUC/SP). Mr. José Carlos Martins has declared for all lawful purposes that, in the last five
(5) years, he has not been convicted by any criminal court or any administrative proceeding
conducted by the Brazilian Securities and Exchange Commission, nor has ever been disqualified or
suspended by a final decision of either a judicial court or the regulatory authorities from
practicing any professional or commercial activities for the previous five years.
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Mário Alves Barbosa Neto — Executive Officer of Fertilizers (since May 2010). His main professional
experiences over the last 5 years include: (i) Chief Executive Officer of Bunge Fertilizantes S.A.
(from 2000 to 2010), which company went private and conducts business related to the production of
pesticides, manure harvests, fertilizers and soil correctives, and Member of the Advisory Board
(since 2005); (ii) Chief Executive Officer of ANDA — Associação Nacional para Difusão de Adubos
(from 1992 to 2010), an entity responsible for marketing and the correct use of fertilizers; (iii)
Chairman of the Board of Directors of Fosbrasil S.A. (from 1996 to 2010), a privately-held chemical
company; (iv) Chairman of the Board of Directors of Fertifos — Administração e Participações S.A.
(from 1997 to 2009), a privately-held holding company; (v) Chairman of the Board of Directors of
Fertilizantes Fosfatados S.A. — Fosfertil (since 2005), a publicly-held company that develops
practices related to the production of fertilizers and other products for agriculture and
livestock), where he also held the position of Chief Executive Officer and Officer of Market (from
1992 to 1996); (vi) Chairman of the Board of Directors or Ultrafertil S.A. (since 2007), which went
private and conducts business related to the production of intermediaries for fertilizaers; (vii)
Member of the Board of Director and Chief Executive Officer of Bunge Brasil S.A. (1996 to 2005),
formely known as Serrana S.A., and before that, S.A. Moinho Santista Indústrias Gerais, a holding
company that went private; (viii) Executive Officer of BPI — Bunge Participações e Investimentos
S.A. (from 2006 to 2010), a privately-held holding company; (ix) Member of the Board of Directors
of Santista Têxtil S.A. (from 1996 to 2000) now known as Tavex Brasil Participações S.A., a company
that went private and is specialized in cotton fabrics and (x) Chief Financial Officer and Market
Relations Officer of Manah S.A.. (from 1980 to 1992), a company that produced fertilizers and was
merged into Bunge in 2000). He holds a degree in Production Engineering from Escola Politécnica da
Universidade de São Paulo (“USP”) and a graduate certification in Business Management from Fundação
Getúlio Vargas (FGV). Mr. Mário Alves Barbosa Neto has declared for all lawful purposes that, in
the last five (5) years, he has not been convicted by any criminal court or any administrative
proceeding conducted by the Brazilian Securities and Exchange Commission, nor has ever been
disqualified or suspended by a final decision of either a judicial court or the regulatory
authorities from practicing any professional or commercial activities for the previous five years.
Murilo Pinto de Oliveira Ferreira 285.080.334-00, Vale’s Chief Executive Officer and Member of the
Strategic and Disclosure Committees (since May 2011). He started his professional career at Vale in
1977, where he held various positions as Officer of the Aluminum Department (2003 to 2005),
Executive Officer for Business Development (2005 to 2006) and Executive Officer of Niquel and
Commercialization of Base Metals (2007 to 2008) He was also partner of Studio Investimentos (from
October 2009 to March 2011), management company focused on Brazilian stock market. His main
professional experiences over the last 5 years include the positions of (i) Chairman of the Board
of Directors of Alunorte (2005 to 2008), a privately-held alumina producer; (ii) Member of the
Advisory Council of Albrás (2005 to 2007), a privately-held company engaged in the production of
aluminum, in which companies Vale’s participation has been transferred to Hydro on February 2011;
(iii) Advisor at CSA Companhia Siderúrgica do Atlântico (2005 to 2007), a privately-held
steelmaking company; (iv) Chairman of Ferro Gusa Carajás S.A. (2005 to 2006), a privately-held
company engaged in the production of pig iron and merged into Vale in 2008; (v) Chief Executive
Officer of Vale do Rio Doce Energia S.A., currently known as Vale Energia S.A., (2005 to 2007), a
privately-held energy company; (vi) Chairman of the Board of Directors of Mineração Rio do Norte
S.A. (2006 to 2008), a privately-held company, engaged in bauxite exploration, wherein Vale holds
40% of the voting capital; (vii) Advisor of Mineração Onça Puma Ltda. (2007 to 2008), a
privately-held nickel mining company merged into Vale in 2008; (viii) Chairman of the Board of
Directors of Valesul Alumínio S.A. (2006 to 2008), a privately-held company related to the activity
of producing aluminum and its alloys in primary form; (ix) Chief Executive Officer of Vale Canada
Limited (2007 to 2008), a nickel producing company, which went private in 2007, and where he also
served as Advisor (2006 to 2007); (x) Advisor of Vale Canada Holdings (2006 to 2008), a
privately-held holding company, where he held the positions of Officer and Vice-President of the
Executive Committee (2007 to 2008); (xi) Member of the Board of Commissioners of PT International
Nickel Indonesia Tbk (2007 to 2008), a publicly-held mining company, wherein Vale holds 59.14% of
the stockholder’s capital; (xii) Officer and Chairman of the Board of Directors of Vale
Nouvelle-Calédonie S.A.S. (2007 to 2008); (xiii) USIMINAS Advisor (2006 to 2008), a publicly-held
steelmaking company; and (xiv) Financial Manager of Caraíba Metais S.A. (1978 to 1980), a company
that went private in 2009 and is engaged in metallurgy of copper and derived products. He holds a
degree in Business Management from Fundação Getúlio Vargas of São Paulo on 08/16/1977, a graduate
certification in Management and Finance from Fundação Getúlio Vargas of Rio de Janeiro (concluded
on 05/04/1982) and a graduate certification in Senior Executive from IMD Business School, Lausanne,
Switzerland (concluded on 12/09/2007. Mr. Murilo Pinto de Oliveira Ferreira has declared for all
lawful purposes that he was not convicted by any criminal court or any administrative proceeding
conducted by the Brazilian Securities and Exchange Commission, or has ever been disqualified or
suspended by a final decision of either a judicial court or the regulatory authorities from
practicing any professional or commercial activities for the previous five years.
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Tito Botelho Martins Junior — Executive Officer of Base Metals Operations (since May 2010) and
Member of the Risk Management Executive Committee (since 2008) of Vale, where he also held the
following positions: Executive Officer of Non-Ferrous (December 2008 to May 2010); Executive
Officer of Non-Ferrous and Energy (from April to November 2008); Executive Officer of Corporate
Affairs and Energy (2007-2008); Executive Officer for Corporate Affairs (2006-2007) and Manager
Officer of Corporate Finance(1999-2003). His main professional experiences in the past 5 years
including companies wherein Vale holds direct or indirect participation are: (i) Chief Executive
Officer and President of Vale Inco (since 2008), one of Vale’s privately-held subsidiaries
established in Canada; (ii) Chief Executive Officer and Investor Relations Officer of Caemi
(2003-2006), a publicly-held mining and metallurgy company that merged with Vale in 2006; (iii)
Chairman of the Board of Directors of Albras (since 2008), a privately-held company engaged in
aluminum operations, wherein Vale holds 51% of the total capital; (iv) Chairman of the Board of
Directors of Alunorte (since 2008), a privately-held company that produces aluminum, wherein Vale
holds 57% of the total capital; (v) Chairman of the Board of Directors of Cia de Alumina do Pará
(since 2008), a privately-held company that produces aluminum, wherein Vale holds 61% of the total
capital); (vi) Vice-Chairman of the Board of Directors of “FNS” (2007-2008), a publicly-held
railroad company, wherein Vale holds directly and indirectly 100% of the total capital; (vii)
Member of the Board of Directors of MRS (2004-2006), privately-held cargo transport company,
wherein Vale holds 41.50% of the total capital; (viii) Chairman of the Board of Directors of
Fundação Vale (2007), a foundation supported by Vale; and (ix) Chief Financial Officer and Member
of the Board of Directors of “FCA”, a publicly-held company engaged in logistics (2002-2003),
wherein Vale holds 99.99% of the total capital. In addition to the companies mentioned hereinabove,
he also held the following positions in publicly-held companies as: (x) Sitting member of the Board
of Directors of FERROBAN, currently known as Brasil Ferrovias S.A., a cargo transport company and
which capital went private; and (xi) Açominas, now known as Gerdau Açominas S.A., a siderurgical
company which capital went private. He holds a degree in Economic Sciences from Universidade
Federal of Minas Gerais (“UFMG”), a graduate certification in Business Management from IEAD, a
Master’s degree from Kellogg School of Management — Northwestern University in the United States
and from INSEAD, in France. Mr. Tito Botelho was convicted (i) on January 17, 2007 to pay a fine of
R$500,000.00 for not disclosing promptly a “Fato Relevante” [Relevant Fact] regarding the execution
of loan agreements with related parties. The appeal to the CRSFN — Conselho de Recursos do Sistema
Financeiro Nacional for reversal of this decision is still pending; (ii) on August 22, 2006, all
the officers of Ferrovia Centro-Atlântica “FCA”) including Mr. Botelllho as as Chief Financial
Officer were reprimanded for not observing the provision contained in §7º of article 170 of the
Brazilian Corporate Law 6.404/76, in the context that the capital increase proposed by FCA’s
Executive Officers did not contain a detailed economic basis determining the issuance of FCA’s
shares. The decision has been confirmed by CRSFN.
Vânia Lucia Chaves Somavilla — She is the Executive Director of Human Resources and Corporate
Services for Vale (since May 2011). She started her professional career at Vale in August 2001 as a
General Manager for Energy Marketing, and was responsible for the administration of the energy
portfolio. Later, she became the Area Manager in March 15, 2004, where she acted as Manager of
the Department of Sustainable Development of the Environment in April 01, 2010. Her main
professional experience for the past 5 years include (i) Member of the Board of Directors of
several consortia within the energy sector, such as: (a) Consórcio Energético Foz do Chapecó (2004
to 2007); (b) Consórcio Estreito Energia — CESTE (2006 to 2010); (c) Consórcio Geração Santa
Isabel — GESAI (2006) and (2008 to 2010); (d) Consórcio Capim Branco Energia (2006 to 2008); (e)
Consórcio da Usina Hidrelétrica de Aimorés (2007 to 2010); and (e) Consórcio Brasileiro de Produção
de Óleo de Palma — CBOP, of the oil and natural gas sector (alternate since 2010); (ii) Member of
the Board of Directors Vale Soluções Energia S.A. — VSE, a private company that belongs to the
energy sector (2007 to 2009); (iii) Administrator (since 2008) of PGT — Petroleum Geoscience
Technology Ltda, currently Vale Óleo e Gás S.A., a private company devoted to the exploration and
development of maritime and ground mineral quarries, research and development of technologies
related to exploration activities, where she was also
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Managing Director and Member of the Board of
Directors (2009 to 2010); (iv) Director (2005 to
2009) and Managing Director (2009 to 2010) for Vale Energia S.A., a private company that belongs to
the energy sector; (v) Member of the Board of Directors of Albrás — Alumínio Brasileiro S.A.
(since 2009), a private company that engages in the production of aluminium, companhia de capital
fechado que desenvolve a atividade de produção de alumínio, with participation of Vale in this
company it was sold to Norsk Hydro ASA (Hydro) in Feb/2011; (vi) Alternate Member of the Board of
Directors of Ultrafértil S.A. (2010 a 2011), a private company devoted to the production,
industrialization and commercialization of fertilizers and similar products, pesticides, soil
treatment and other agricultural and livestock products; (vii) Managing Director of Vale Florestar
S.A. (since 2010), a private company devoted to developing forestry projects; (viii) Managing
Director of the Instituto Ambiental Vale (since 2010). This institute is devoted to biodiversity
defense, preservation and conservation and to the promotion of sustainable development; (ix)
Alternate Member of the Board of Directors of S.A. (since 2011), a public company devoted to
commerce, transportation, exportation and importation of phosphate ores and related minerals; (x)
Coordinator of Development of New Businesses in the area of energy generation and Generation and
Monitoring Projects for the implementation of small and large hydroelectric plants for Companhia
Energética de Minas Gerais — CEMIG (1995 to 2001), a public company devoted to the operation and
exploration of generation, transmission, distribution and commercialization of electric energy; and
(xi) Managing Director of Associação Vale para o Desenvolvimento Sustentável (since 2010), an
association devoted to the monitoring and the conservation of the environment and the creation of
new conservation areas in biomes relevant to sustaintability. She graduated as a Civil Englineer at
Universidade Federal de Minas Gerais (UFMG), on April 28, 1984. She has post graduate studies in
Engineering for Dams, Universidade Federal de Ouro Preto, which she concluded on April 13, 1990;
Extension Course in Management of Hydro Power Utilities offered by SIDA, Stockholm, concluded in
November 1996, amd MBA in Business Finance obtained at IBMEC Business School, Belo Horizonte,
concluded on July 16, 1998. She took part of the Transformational Leadership Programa offered by
MIT in March 2005 and the Mastering Leadership Program offered by IMD on December 15, 2006.
Fiscal Council
Aníbal Moreira dos Santos — Sitting Member of Vale’s Fiscal Council since 2005 and Alternate Member
from April to July 2005. Her main professional experiences over the last 5 years include: (i) Chief
Accounting Manager of Caemi Mineração e Metalurgia S.A. (“Caemi”) (1981 to 2003), a company that
merged with Vale in 2006; (ii) Officer of various of Caemi’s subsidiaries abroad; (iii) Alternate
Member of the Board of Directors of Minerações Brasileiras Reunidas S.A. (1998 a 2003), a
privately-held company. — MBR, a privately-held mining company e Empreendimentos Brasileiros de
Mineração S.A. — EBM, a privately-held holding company; and (iv) Sitting Member of the Fiscal
Council of Log-In Logística Intermodal S.A. (since April 2009), a publicly-held company engaged in
intermodal logistics activities, wherein Vale holds 31.3% of total capital He attended a technical
course in Accounting at Escola Técnica de Comércio da Fundação Getúlio Vargas (April 1962). Mr.
Aníbal Moreira dos Santos has declared for all lawful purposes that, in the last five (5) years, he
has not been convicted by any criminal court or any administrative proceeding conducted by the
Brazilian Securities and Exchange Commission, nor has ever been disqualified or suspended by a
final decision of either a judicial court or the regulatory authorities from practicing any
professional or commercial activities for the previous five years.
Cícero da Silva — Alternate Member of Vale’s Fiscal Council (since 2009). Mr. da Silva joined Banco
do Brasil S.A. (in 1986), a publicly-held financial institution, where he held various positions
including in the Internal Audit. His main professional experiences over the last years include: (i)
Chief of Division at PREVISUL — Instituto de Previdência Social do Mato Grosso (1999 to 2000); and
(ii) Alternate Member of the Board of Directors of CPFL — Cia. Paulista de Força e Luz, a company
engaged in the energy sector. Degree in Accounting Sciences from Universidade Federal do Mato
Grosso do Sul (“UFMS”) (December 1980), and a Law degree from Anhanguera — Centro Universitário de
Campo Grande (June 2008). He holds a Master’s degree in Auditing from FIPECAFI/USP (January 1997)
and a graduate certification in Investigative, Accounting, Finance and Corporate Forensic from
Universidade Católica Dom Bosco (September 2002). Mr. Cícero da Silva has declared for all lawful
purposes that, in the last five (5) years, he has not been convicted by any criminal court or any
administrative proceeding conducted by the Brazilian Securities and Exchange Commission, nor has
ever been disqualified or suspended by a final decision of either a judicial court or the
regulatory authorities from practicing any professional or commercial activities for the previous
five years.
Marcelo Amaral Moraes — Sitting Member of Vale’s Fiscal Council since 2004. He also served as an
Alternate Member of Vale’s Board of Directors in 2003. His main professional experiences over the
last 5 years include: (i) Investments manager at Bradespar S.A. (2000 a 2006), a publicly-held
holding company and controlling shareholder of Valepar S.A.; (ii) Alternate Member of the Board of
Directors of Net Serviços de Comunicação S.A., a cable television operating company, (2004 a 2005);
and (iii) Executive Officer of Stratus Investimentos Ltda. (2006 a 2010), a private equity
management firm. He holds a degree in Economics from Universidade Federal do Rio de Janeiro,
(January
1991), a Master’s degree from COPPEAD/UFRJ (November 1993), and a graduate certification in
Corporate Law and Arbitration from Fundação Getúlio Vargas (“FGV”) (November 2003). Mr. Marcelo
Amaral Moraes has declared for all lawful purposes that, in the last five (5) years, he has not
been convicted by any criminal court or any administrative proceeding conducted by the Brazilian
Securities and Exchange Commission, nor has ever been disqualified or suspended by a final decision
of either a judicial court or the regulatory authorities from practicing any professional or
commercial activities for the previous five years.
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Oswaldo Mário Pêgo de Amorim Azevedo — Alternate Member of Vale’s Fiscal Council since 2005. He
served as Sitting Member of Vale’s Fiscal Council (2004 to 2005), and Engineer of the Industrial
Procurement (Pelletizing) (1964 to 1976). He also holds the position of (i) Officer of Sul América
Cia de Seguros Gerais (since 2008), a privately-held insurance company. His main professional
experiences over the last 5 years include: (ii) Ombusdman of Conglomerado Sul America Seguros, an
insurance company (since 2005), where he also served as (a) Vice-President of Institutional
Relations and Branches Abroad (1990 to 2010); (b) Officer (1980 to 1990) and (c) Deputy Officer
(1976 to 1980). He also held the positions as (iii) Vice-President of Federação Nacional das
Empresas de Seguros Privados e de Capitalização (2004 to 2007); (iv) Vice-President of Sindicato
das Empresas de Seguros Privados, de Capitalização e de Resseguros do Rio de Janeiro (since 2007),
where he also held the position of Chief Executive Officer (2001 to 2004); (v) Alternate Member of
the Board of Directors of (a) BrasilVeículos Cia de Seguros (2006 to 2010) and (b) BrasilSaúde Cia
de Seguros (2006 to 2010), both privately-held insurance companies; (vi) Vice-President of Sul
América S.A., a publicly-held company engaged in the asset management and participation interest
sector (2006 to 2007); (vii) Officer and Vice-President of Sul America Cia. Nacional de Seguros, an
insurance company that went private in 2008 (1980 to 2010); (viii) Executive Officer and
Vice-President of Nova Ação Participações S.A., a publicly-held engaged in asset management and
especially financial investment (2008 to 2010); (ix) Officer and Vice-President of Sul América
Terrestres, Marítimos e Acidentes Cia de Seguros, a company that went private and then merged with
Sul America Cia. Nacional de Seguros (1980 to 1998); (x) Officer of Sul América Cia de Seguros
S.A., a publicly-held insurance company headquartered in Lima, Peru (1996 to 2003); (xi) Officer of
Corcovado S.A., a real state company established in Lima, Peru, which went private in 2004 (2003 to
2009); and (xii) Officer of Sul América Capitalização S.A., a privately-held company engaged in the
commercialization capitalization bonds (1987 to 1998). He holds a degree in Industrial and
Production Engineering from Pontifícia Universidade Católica do Rio de Janeiro (“PUC”) January
1964). Mr. Oswaldo Mário Pêgo de Amorim Azevedo has declared for all lawful purposes that, in the
last five (5) years, he has not been convicted by any criminal court or any administrative
proceeding conducted by the Brazilian Securities and Exchange Commission, nor has ever been
disqualified or suspended by a final decision of either a judicial court or the regulatory
authorities from practicing any professional or commercial activities for the previous five years.
Arnaldo José Vollet — Member of Vale’s Fiscal Council (since 2011). His main professional
experiences over the last 5 years include: (i) Executive Officer of BB DTVM (2002 to 2009), a
privately-held stock brokerage securities firm; (ii) Chief Financial Executive and Investor
Relations of Companhia de Energia Elétrica da Bahia — Coelba (2000 to 2002), publicly-held company
engaged in the distribution and commercialization of electric energy; (iii) Member of the Fiscal
Council of Telesp Celular — Participações (1999 to 2000) a publicly-held telecommunications
company; (iv) Member of the Fiscal Council of CELP — Cia de Eletricidade de Pernambuco (2004 to
2009), a publicly-held company engaged in the distribution of electric energy; (v) Member of the
Board of Directors of Guaraniana, now known as Neoenergia S.A (2002 to 2003), a publicly-held
electricity holding company; (vi) Alternate Member of the Board of Directors of CEMIG — Cia de
Energia de Minas Gerais (2003 to 2005), a publicly-held company engaged in generation and
distribution of energy. He holds a degree in Mathematics from Universidade de São Paulo (USP)
(December 1975), and a Master’s degree in Finance from Instituto Brasileiro de Mercado de Capitais
(“IBMEC”/RJ) in June 1992. Mr. Arnaldo José Vollet has declared for all lawful purposes that, in
the last five (5) years, he has not been convicted by any criminal court or any administrative
proceeding conducted by the Brazilian Securities and Exchange Commission, nor has ever been
disqualified or suspended by a final decision of either a judicial court or the regulatory
authorities from practicing any professional or commercial activities for the previous five years.
Antônio Henrique Pinheiro Silveira — He was elected as Member of Vale’s Fiscal Council on April 19,
2011. He is Secretary of Economic Monitoring at Brazil’s Ministry of Finance (since 2008), where he
also served as Deputy Secretary of Economic Monitoring (2007 to 2008). He is also a Regular Member
of the Board of Directors of Companhia de Seguros Aliança do Brasil (since March 2010), a
privately-held insurance company; and of Norte Energia S.A (since July 2010), a privately-held
energy company. His main professional experiences over the last 5 years include: (i) Chairman of
Banco Nordeste do Brasil (2008 to 2010), a privately-held financial institution; (ii) Member of the
Board of Directors of Empresa Gestora de Ativos —EMGEA (2007 to 2008), a private asset management
institution; (iii) Deputy-Head of the Economic Advisor to the Ministry of Planning, Budget and
Management (2004 to 2007); (iv) he was also took part of the administration of Cia Docas do Estado
da Bahia, a port
services entity (2005 to 2007). He holds a degree in Economic Sciences from Universidade Federal do
Rio de Janeiro (“UFRJ”) (January 1987). He also holds a graduate certification, a Master’s and Ph.d
degree in Economics from UFRJ, concluded respectively in December 1992 and October 2000. Mr.
Antônio Henrique Pinheiro Silveira has declared for all lawful purposes that, in the last five (5)
years, he has not been convicted by any criminal court or any administrative proceeding conducted
by the Brazilian Securities and Exchange Commission, nor has ever been disqualified or suspended by
a final decision of either a judicial court or the regulatory authorities from practicing any
professional or commercial activities for the previous five years.
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Alternate Member of Vale’s Fiscal Council, elected on April 27, 2010. Previously he had already
held the position of Alternate Member of Vale’s Fiscal Council from April 16, 2009 to October 3rd.,
2009, replacing Mr. Bernard Appy after his resignation. His main professional experiences over the
last years include: (i) Sitting Member of the Fiscal Council of Eletropaulo Metropolitana
Eletricidade de São Paulo S.A. (AES Eletropaulo), a distributor of electric energy, since May 2009;
(ii) Subsecretary of Fiscal Policy of the National Treasury Secretariat since January 2007; (iii)
Head of the General Coordination of the Fiscal Operation Funds Management from June 2002 to July
2006; (iv) Member of the Fiscal Council of Banespa S.A., a financial institution; (v) Member of the
Fiscal Council of Banco do Brasil S.A., a financial institution; (vi) Member of the Fiscal Council
of Caixa de Consórcios, ia financial institution; (vii) Member of the Board of Directors of
Centrais Elétricas Brasileiras S.A. — Eletrobrás, an energy company; (viii) Member of the Fiscal
Council of Petrobras — Petróleo Brasileiro S.A., a company engaged in the petroleum sector. He
holds a degree in Forest Engineering Universidade de Brasília, a Master’s degree in Finance from
Instituto Brasileiro de Mercado de Capitais and a graduate certification in Public Sector Economics
from Fundação Getúlio Vargas (FGV). Mr. Marcus has declared for all lawful purposes that, in the
last five (5) years, he has not been convicted by any criminal court or any administrative
proceeding conducted by the Brazilian Securities and Exchange Commission, nor has ever been
disqualified or suspended by a final decision of either a judicial court or the regulatory
authorities from practicing any professional or commercial activities for the previous five years.
12.9 Relationship (as a spouse or significant other) or kinship to the second degree between:
a. Managers of the Company;
b. (i) Managers of the Company and (ii) members of management of entities controlled by Vale,
either directly or indirectly;
c. (i) Managers of the Company or members of management of entities controlled by Vale, either
directly or indirectly; and (ii) Vale’s direct or indirect controlling shareholders; and
d. (i) Managers of the Company and (ii) Managers of Vale’s direct or indirect controlling
shareholders.
Justification for not completing the chart:
Each and every member of the Board of Directors, Executive Board and Fiscal Council have declared,
individually for all lawful purposes, that he or she is not related (as spouse, or significant
other) or has any other kindred relationship to the second degree to (i) managers of Vale; (ii)
managers of companies controlled directly or indirectly by Vale; (iii) Vale’s direct or indirect
controlling shareholders; and (iv) the members of management of Vale’s direct or indirect
controlled entities.
In addition, all members of the Board of Directors, the Executive Board and of the Fiscal Council
of companies controlled directly or indirectly by the Company have declared individually for all
lawful purposes that they have no conjugal or stable union or kinship to the second degree with
entities controlled directly or indirectly by Vale.
12.10 Subordination, rendering of services or control relationships for the previous three years
between directors/officers and:
a. Entities controlled by Vale, either directly or indirectly;
b. Direct or indirect controlling shareholders of Vale; and
c. In case it is relevant, Vale’s or its subsidiaries’ or controlling shareholders’ material
supplier, client, debtor, or creditor.
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Justification for not completing the chart:
All members of the Board of Directors, the Executive Board, and the Fiscal Council have declared
individually for all legal purposes that there have been no relationships for rendering services or
for control, maintained over the past three (3) fiscal years between them and (i) a company
controlled directly or indirectly by Vale; (ii) the controllers, direct or indirect, of Vale; or
(iii) relevant suppliers, clients, debtors, or creditors of Vale, its controlled companies or its
controllers.
12.11 Insurance for Managers
Vale maintains a liability insurance policy with Zurich Brasil Seguros S/A, valid from 01/12/10 to
01/12/11, through payment of a premium of US$1,158,891.00, plus the amount of US$85,526 as IOF [Tax
on Financial Transactions], and with an upper limit of compensation of US$150 million. This
insurance covers members of the Board of Directors, Executive Board, Fiscal Council, and any other
body mentioned in the Bylaws, as well as certain employees at the management and strategic levels,
in both the Company and its subsidiaries (collectively referred to as the “Insured”). The policy
covers financial losses resulting from claims against the Insured for acts or omissions in the
exercise of their functions of employment. The policy, in addition to contemplating the repair of
damages caused to third parties, the Company, and its controlled companies brought by government
agencies, also covers agreements previously authorized by the insurer for the purpose of bringing
to a close judicial or administrative suits. In addition, the policy provides coverage for payment
of defense costs of the Insured, if and when incurred. In addition to those coverages mentioned
above, the insurance provides additional guarantees for liability cases that may affect spouses,
heirs, successors, legal representatives, and persons designated by Vale to act as managers of
external entities.
12.12 Other information that the Company considers relevant
All information that the Company considers relevant in regard to the Assembly and Management of the
Company has been disseminated in items 12.1 through 12.11 in this Form of Reference.
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12.1 Administrative Structure
a. Powers of each body and committee
Board of Directors:
Under provisions of the Bylaws of the company, the Board of Directors has the powers contemplated
in law:
I. Distributing the compensation set by the general assembly among its members, the two advisory
committees, and the Executive Board;
II. Creating technical and consultative committees to advise it, in addition to the permanent
committees contemplated in the Bylaws;
II. Approving policies of selection, evaluation, development, and compensation of the members of
the Executive Board;
IV. Approving general Human Resource policies;
V. Approving strategic guidelines and the strategic plan of Vale submitted annually by the
Executive Board;
VI. Approving annual and multi-annual budgets;
VII. Monitoring and evaluating the financial and economic performance of the Company;
VIII. Approving investment and/or development opportunities that exceed the limits established for
the Executive Board as defined by the Board of Directors;
IX. Issuing opinions on merger, split-off, or incorporation decisions of which Vale is a party, as
well as share purchases;
X. In accordance with the corporate purpose of the Company, making decisions on the setting-up of
companies or their transformation into a different type of company, direct or indirect
participation or withdrawal from other companies, consortia, foundations, and other organizations
through exercise of withdrawal rights, exercise or non-exercise of rights of preference in
subscription and acquisition, directly or indirectly, of corporate equity or of any other form of
participation or withdrawal as prescribed by law, including, but not limited to, merger, split-off,
and incorporation of companies in which it participates;
XI. Approving the corporate risk and financial policies of Vale;
XII. Approving the issuance of simple debentures, not convertible into shares and without
collateral;
XIII. Appointing and removing the person responsible for internal auditing and for the Ombudsman,
who shall report directly to the Board of Directors;
XIV. Approving policies and the annual internal audit plan of Vale, as well as to acknowledge the
respective reports and determine the adoption of any necessary measures;
XV. Approving alterations in corporate governance rules;
XVI. Approving policies on employee conduct based on the ethical and moral standards described in
the Code of Ethical Conduct of Vale;
XVII. Approving policies to avoid conflicts of interest between the Company and its shareholders or
managers, as well as on the adoption of measures considered necessary in the event such conflicts
arise;
XVIII. Approving policies of institutional responsibility, especially those related to: the
environment, work health and safety, and the social responsibility of the Company;
XIX. Approving the provision of guarantees in general, establishing criteria for the Executive
Board for purchase of, financed sale of, or placing liens on, fixed assets and for the constitution
of encumbrances for obtaining loans, financing, and other contracts, execution of commitments,
non-exercise of rights and transactions of any nature, except waiver of preemptive rights in the
subscription and purchase of corporate shares;
XX. Approving any reformulations, alterations or amendments to shareholder agreements or consortia
contracts or agreements among shareholders or among consortia parties of companies in which the
company participates and, moreover, signing of new agreements and/or consortia contracts that
address matters of this nature;
XXI. Authorizing the negotiation, signing, or alteration of contracts of any kind or value between
Vale (i) its shareholders, either directly or through intermediary companies, (ii) companies that
directly or indirectly participate, in the capital of a controlling shareholder or which are
controlled by or are under joint control of entities that participate in the capital of the
controlling shareholder and/or (iii) companies in which the controlling shareholder of the Company
participates, and the Board of Directors may establish delegations, with standards and procedures
that meet the requirements and nature of operations, without prejudice of keeping the aforementioned
group duly informed of all company transactions;
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XXII. Authorizing plans for repurchase of shares of their own issuance for maintenance in treasury,
cancelation or subsequent sale;
XXIII. Approving or delegating to the Executive Board recommendation of persons who should form
part of the administrative, consulting, and financial bodies of those companies and organizations
in which Vale participates, either directly or indirectly;
XXIV. Determining the preparation of balance sheets for periods of less than one year and declaring
dividends or interest on it own capital on the basis of the profits shown on these balance sheets,
as well as declaring them on the basis of accrued profits or existing profit reserves shown on the
most recent annual or intermediate balance sheet;
XXV. [sic: missing]
XXVI. Authorizing increases in corporate capital regardless of changes in bylaws, within the
authorized capital limit and, at its discretion, exclude preemptory rights in the issuance of
stock, debentures convertible into shares and subscription bonuses, the placement of which is done
through sale on the stock market or by public subscription under terms established in Law 6.404/76;
and
XXVII. Approving recommendations submitted by the Fiscal Council of the Company in the exercise of
its legal and statutory attributions.
Advisory Committees:
In order to confer greater efficiency and quality in its decisions, the Board of directors shall
have ford advice on a permanent basis of five (5) technical and advisory committees, as follows:
Executive Development Committee; Strategic Committee; Finance Committee; Accounting Committee, and
Governance and Sustainability Committee.
Executive Development Committee
Under terms of article 21 of the Bylaws, the Executive Development Committee shall be responsible
for:
I — Issuing reports on the human resources general policies of the Company submitted by the
Executive Board to the Board of Directors;
II — Analyzing and issuing reports to the Board of Directors on the appropriateness of remuneration
of members of the Executive Board;
III — Submitting and ensuring up-to-datedness of the methodology of performance evaluation of the
members of the Executive Board; and
IV — Issuing reports on health and safety policies proposed by the Executive Board.
Strategic Committee
Under terms of article 22 of the Bylaws, the Strategic Committee is responsible for:
I — Issuing reports on the strategic guidelines and the strategic plan submitted annually by the
Executive Board;
II — Issuing reports on the company’s annual and multi-annual investment budgets submitted by the
Executive Board to the Board of Directors;
III — Issuing reports on investment and/or divestiture opportunities submitted by the Executive
Board to the Board of Directors; and
IV — Issuing reports on operations relating to merger, split-off, and incorporation in which the
Company and its controlled subsidiaries are a party, and on share purchases submitted by the
Executive Board to the Board of Directors.
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Finance Committee
Under terms of article 23 of the Bylaws, the Financial Committee is responsible for:
I — Issuing reports on the corporate risks and financial policies and the internal financial
control systems of the Company; and
II — Issuing reports on the compatibility between the shareholders remuneration level and the
parameters established in the annual budget and financial planning, as well as their consistency
with the general policy on dividends and the capital structure of the company.
Accounting Committee:
Under terms of article 24 of the Bylaws, the Comptroller’s Committee is responsible for:
I — Recommending to the Board of Directors the appointment of the person responsible for the
internal auditing of the Company;
II — Issuing reports on policies and the Company’s annual auditing plan submitted by the employee
responsible for internal auditing, and on its execution;
III — Tracking the results of the Company’s internal auditing, and identifying, prioritizing, and
submitting to the Board of Directors actions to be monitored by the Executive Board; and
IV — Analyzing the Annual Report, as well as the Financial Statements of the Company and making
recommendations to the Board of Directors.
Governance and Sustainability Committee:
Under terms of article 25 of the Bylaws, the Committee on Governance and sustainability is
responsible for:
I — Evaluating the efficiency of the Company’s governance practices and the workings of the Board
of Directors, and submitting improvements;
II — Submitting improvements to the Code of Ethics and the management system in order to avoid
conflicts of interest between the company and its shareholders or company managers;
III — Issuing reports on potential conflicts of interest between the company and its shareholders
or administrators; and
IV — Issuing reports on policies related to the Company’s institutional social responsibilities,
such as environmental-related issues and the Company’s social responsibilities, as proposed by the
Executive Board.
Executive Board:
Under terms of the Bylaws, the Executive Board has the following responsibilities, in addition to
those contemplated in law:
| I. | Approving the creation and elimination of Executive Departments subordinated to each
Executive Director; |
|
| II. | Preparing and submitting to the Board of Directors the company’s
general policies on human resources, and executing the approved
policies; |
|
| III. | Preparing and submitting, annually, to the Board of Directors, the
company’s strategic guidelines and the strategic plan, and executing
the approved strategic plan; |
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| IV. | Preparing and submitting the Company’s annual and multi-annual
budgets to the Board of Directors, and executing the approved
budgets; |
|
| V. | Planning and conducting the company’s operations and reporting the company’s economic and
financial performance to the Board of Directors, and producing reports with specific
performance indicators; |
|
| VI. | identifying, evaluating and submitting investment and/or divestiture
opportunities to the Board of Directors which exceed the limits of
the Executive Board as defined by the Board of Directors, and
executing the approved investments and/or divestitures; |
|
| VII. | Identifying, evaluating and submitting to the Board of Directors
operations relating to merger, split-off, incorporation in which the
company is a party, as well as share purchases, and conducting the
approved mergers, split-offs, incorporations and purchases; |
|
| VIII. | Preparing and submitting the company’s finance policies to the Board
of Directors, and executing the approved policies; |
|
| IX. | Submitting to the Board of Directors the issuance of simple
debentures, not convertible into shares and without collateral; |
|
| X. | Adhering to and encouraging adhesion to the Company’s Code of Ethics, established by the
Board of Directors; |
|
| XI. | Preparing and submitting to the Board of Directors the company’s
policies on corporate responsibility, such as the environment,
health, safety and social responsibility, and implementing the
approved policies; |
|
| XII. | [skipped in original] |
|
| XIII. | [skipped in original] |
|
| XIV. | Propose to the Board of Directors any reformulations, alterations,
or amendments of shareholders’ agreements or of agreements among
the shareholders of companies in which the Company participates, as
well as suggesting the signing of new agreements and consortia
contracts that address subjects of this nature; |
|
| XV. | Authorizing the opening and closing of branch offices, subsidiary
branch offices, depots, agencies, warehouses, representative office
or any other type of establishment in this country [Brazil] or
abroad; |
|
| XVI. | Authorizing the purchase of, sale of and placing of liens on fixed
and non-fixed assets including securities, contracting of services,
whether the company is the provider or receiver of such services,
being empowered to establish standards and delegate powers, all in
accordance with the criteria and standards established by the Board
of Directors |
|
| XVII. | Authorizing the signing of agreements, contracts and settlements
that constitute liabilities, obligations or commitments on the
Company, being empowered to establish standards and delegate
powers, all in accordance with the criteria and standards
established by the Board of Directors; |
|
| XVIII. | Authorizing the signing of commitments, waiver of rights, and
transactions of any nature, except in regard to the waiver of
preemptory rights in subscription and purchase, and may establish
rules and delegate powers, all within the limits of the Executive
Board as established by the Board of Directors; |
|
| XIX. | Establishing rules and delegating powers, within the limits of the
Executive Board as established by the Board of Directors; |
|
| XX. | Laying down voting guidelines to be followed at the General
Assemblies or their equivalent by its representatives in the
companies, foundations and other organizations in which the Company
participates, directly or indirectly, respecting the investment
opportunities of the Company, and guidelines approved by the Board
of Directors, as well as the respective budget and all within its
respective limits in regard to, among other things, indebtedness,
the sale of or placing of liens on assets, the waiver of rights,
and the increase or reduction of corporate equity. |
Non-Statutory Committees
The Executive Board shall have, for advice on a permanent basis, two (2) technical and advisory
committees, denominated as follows: Risk Management Committee and Disclosure Committee.
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Disclosure Committee
The primary attributes of the Disclosure Committee are the evaluation of the relevance of acts
or events that have occurred and are related to the business of the Company and the oversight of
the disclosure of information to the capital markets pursuant to the terms of the Disclosure
Policy. For more information on the Disclosure Committee see item 21.3 of this Reference Form.
Risk Management Committee
The primary responsibilities of the Risk Management Committee are: (a) issuing an opinion on the
Company’s principles and instruments of risk management; and (b) periodic reporting to the
Executive Board on (i) the primary risks to which Vale is exposed (by type of risk and/or
business) and the impact of these risks on the asset portfolio and cash flow; (ii) how the risks
are being monitored and managed, and (iii) the impact on the profile of risk of the asset
portfolio and on cash flow resulting from the inclusion of new investments and/or projects in
the business plan, and, if necessary, what strategies of risk mitigation are recommended. The
Risk Management Committee reports regularly to the Executive Board, and the latter is
responsible for evaluating and approving strategies for risk attenuation over the long term, as
recommended by the Risk Management Committee.
Fiscal Council:
The Fiscal Council shall be responsible for exercising the functions attributed to it by the
applicable prevailing legislation, these By-Laws, and as regulated by its own Internal Rules to
be approved by its members, as well as those contemplated in applicable American law, especially
the Sarbanes-Oxley Act and applicable standards that regulate listing of securities on the Hong
Kong Stock Market, in accordance with waiver requests granted (“Regulation on Listing”), so long
as not in conflict with Brazilian law.
The Internal Rules of the Fiscal Council regulates, besides the powers already set forth by the
Law of Joint Stock Companies, the following:
The primary responsibilities of the Fiscal Council are:
| (i) | Setting forth the procedures to be used by the company to receive process and deal
with complaints or claims related to accounting and auditing matters, as well as to
guarantee that the mechanisms to receive complaints guarantee the confidentiality and
unknown identity of the individual making the complaint; |
|
| (ii) | Recommending and help the Board of Directors in the selection, remuneration, and
dismissal of external auditors of the partnership; |
|
| (iii) | Deliberating on the contracting of new services that may be rendered by the external
auditors of the partnership; as well as mediating eventual disputes between management and
external auditors regarding the financial statements of the partnership. |
b. Date of formation of the Fiscal Council, if it is not permanent, and of the formation of the
committees.
The Fiscal Council has been a permanently functioning body since 9/25/1997.
The five Advisory Committees of the Board of Directors were formed by the Board of Directors
itself on 12/19/2001, and pursuant to resolutions of the Extraordinary General Assembly held on
12/27/2002, upon which date their existence became part of the Bylaws.
The Disclosure Committee and the Risk Management Committee, which advise the Executive Board,
were formed by decision by the Board of Directors on 6/19/2002 and 12/12/2005, respectively.
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c. Mechanisms for evaluating the performance of each body or committee
Pursuant to Chapter Vi of the Internal Regulations of the Fiscal Council and provisions of the
Sarbanes-Oxley Law, the Fiscal Council evaluates its own performance annually at the end of each
audit cycle. The self-evaluation process considers the following: matters covered in monthly
meetings, financial statements, risk management, and internal controls, management and internal
audit responsibility, relationship with external auditors, resources and special research,
formation of the Fiscal Council, and training and professional development of members. Only the
independent auditors of the Company shall have knowledge of the self-evaluation conducted by the
members of the Fiscal Council.
As of December 31, 2010, Vale did not have in place mechanisms of formal evaluation of the
performance of the Board of Directors, The Executive Board, and of the Committees. For a
description of the individual evaluation of the Executive Directors, see item 12.1(e) of this
Reference Form.
d. On Executive Officers, their responsibilities and individual powers
Chief Executive Officer:
Under terms of article 33 of the Bylaws, the Chief Executive Officers has the following
responsibilities:
| I. | Presiding over meetings of the Executive Board; |
|
| II. | Exercising executive direction of the Company, with powers to coordinate and supervise
the activities of the other Executive Officers, exerting his best efforts to ensure
faithful compliance with the decisions and guidelines laid down by the Board of Directors
and the General Assembly; |
|
| III. | Coordinating and supervising the activities of the business areas and units that are
directly subordinated to him; |
|
| IV. | Selecting and submitting to the Board of Directors the names of candidates for
Executive Officer posts to be elected by the Board of Directors, as well as to propose
their respective removal; |
|
| V. | Coordinating and processing the decision-making of the Executive Board in order to
prioritize consensual decision among its members. If consensus is not achieved, the Chief
Executive Officer may (i) withdraw the subject in debate; (ii) articulate the position of
the majority, including making use of the deciding vote or (iii) in the interest of the
Company and through well-based reasoning, decide individually on matters of joint
deliberation; in this case he must report to the Board of Directors on the use of this
prerogative at the first meeting of the Board of Directors that occurs after the
corresponding decision. Decisions related to annual and multi-annual budgets and the
Strategic Plan and the Annual Report on Administration of the Company shall be taken by a
majority of votes, when considering all of the Executive Officers, so long as the favorable
vote of the Chief Executive Officer is among them; |
|
| VI. | Indicating who among the Executive Officers shall replace an Executive Officer in case
of a temporary impairment or absence; |
|
| VII. | Keeping the Board of Directors informed about the activities of the Company; |
|
| VIII. | Preparing the annual report and draw up the balance sheet together with the other
Executive Officers. |
Executive Officers
Under terms of article 34 of the Bylaws, the Executive Officers have the following
responsibilities:
I — Performing the services for which they are responsible;
II —Participating in meetings of the Executive Board, contributing to the definition of the
policies to be followed by the company and reporting on matters of the respective areas of
responsibility;
III — Complying with and ensure compliance with the policy and general guidance of the company’s
business laid down by the Board of Directors, each being responsible for his specific area of
activities;
IV — Contracting the services of attorneys, consultants, analysts, and other resources necessary
for performance of the functions of the Fiscal Council, within budget, as well as contracting
experts under terms of article 163 §8 of Law 6,404/76.
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In addition to this, under terms of article 28 of the Bylaws and within the limits established for
each Executive Officer, decisions on matters affecting the specific area of responsibility of each
one shall be made by him alone, so long as the matter does not affect the area of responsibility of
another Executive Officer, or in conjunction with the Chief Executive Officer in matters or
situations pre-established by the latter.
e. Mechanisms of evaluation of the performance of members of the Board of Directors, of the
Committees, and of the Committees and directorate
As of 31 December, 2010, Vale did not have mechanisms in place for formal evaluation of the
performance of members of the Board of Directors, of the Fiscal Council, and of the Committees.
The members of the Board of Directors, are evaluated annually based on their performance according
to goals previously defined formally by the Board of Directors. These goals are based on the
Company’s performance, through measurement of the following indicators: asset cash flow and general
indicators of productivity, safety, and the environment. The definition of these indicators and
goals derive from the strategic planning and the budget approved by the Board of Directors. The
goals are monitored by the area of budget and performance management. The final result is approved
by Vale’s Board of Directors.
12.2 Description of the rules, policies, and practices relating to General Assemblies
a. Notification Periods
Vale customarily calls for the General Shareholders’ Assemblies by notification, at least 30 days
before the meeting in the first convocation, and 15 days prior in the second convocation, in
accordance with the recommendations of the CVM and commitments assumed before the Hong Kong Stock
Market.
In addition, pursuant to article 8, §2 of the Bylaws of the Company, a holder of special class
preferred shares (Golden Shares) shall be called formally by the company, by means of personal
correspondence directed to his legal representative at least fifteen (15) days in advance, for the
purpose of considering any matter subject to the right of veto specified in Article 7 of the Bylaws
and in item 18 of this Form of Reference.
b. Powers
Vale’s General Shareholders’ Assembly has powers pursuant to Law 6.404/76.
c. Addresses (physical or electronic) at which documents relating to the General Meeting shall be
available to shareholders for their review
At Vale’s headquarters at Avenida Graça Aranha n° 26, 12º andar, Centro, Rio de Janeiro, RJ, Brazil
and at the electronic addresses of the Company (www.vale.com), the CVM (www.cvm.gov.br), the
Securities and Exchange Commission (www.sec.gov) and the Hong Kong Stock Market (www.hkex.com.hk).
d. Identification and handling of conflicts of interests
According to Vale’s Bylaws, the Board of Directors may set policies to avoid conflicts of interest
between the Company and its shareholders or its managers, as well as on the adoption of provisions
deemed necessary should conflicts of interest arise.
In addition, under terms of the Bylaws, the Governance and Sustainability Committee may issue
reports related to potential conflicts of interest between the Company and its shareholders or its
managers, upon request of the Board of Directors. The Committee may also analyze proposals to be
considered by the Board of Directors.
e. Request for power-of-attorney by the directors to exercise voting rights
There are no rules, policies or practices for requesting powers-of-attorney by the directors to
exercise voting rights in General Shareholders’ Meetings.
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f. Necessary formalities to accept powers-of-attorney granted for shareholders, indicating whether
the Company accepts powers from shareholders electronically
A shareholder who wishes to attend the General Meetings must provide identification and proof of
Vale share ownership issued by the depositary financial institution.
Any shareholder may appoint a proxy or more, if the case may be, to attend meetings and vote in his
name. If represented by proxy, the shareholder shall comply with the terms of Art. 126, Law No.
6,404/76, and must have been appointed by power-of-attorney no earlier than one year and qualify as
a shareholder, manager, attorney who is a member of the Order of Attorneys of Brazil, or be a
financial institution. If the power-of-attorney is in a foreign language, it should be accompanied
by corporate documents in the case of a legal entity, and of a letter of mandate duly translated
into Portuguese, and notarized and with a consular stamp.
For the purposes of facilitating the Assemblies, shareholders represented by proxy may, at their
exclusive discretion, deliver the documents within 72 hours prior to the Assemblies.
Vale does not accept powers-of-attorney granted electronically by shareholders.
g. Maintenance of Internet forums and pages intended to receive and share shareholder comments
relating to meetings.
The Company does not keep Internet forums and pages for shareholders to receive and share comments
relating to meeting minutes.
h. Transmission of meetings by live video or audio.
The Company does not transmit meetings by live video or audio.
i. Mechanisms allowing for inclusion of shareholders’ proposals.
There are no mechanisms allowing for inclusion on the agenda of proposals formulated by
shareholders, except for those mechanisms contemplated in applicable law.
12.3. Dates and newspapers of publication of information required by Law no. 6.404/76.
| Fiscal Year | Publication | Newspaper — State or Territory | Dates | |||
12/31/2010
|
Financial Statements | Diário Comércio Indústria & Serviços — SP | 3/16/2011 | |||
| Diário Oficial do Estado — RJ | 3/16/2011 | |||||
| Jornal do Commercio — RJ | 3/16/2011 | |||||
| Call to Ordinary General Assemblies to consider the Financial Statements | Diário Comércio Indústria & Serviços — SP | 3/18/2011; 3/21/2011 e 3/22/2011 | ||||
| Diário Oficial do Estado — RJ | 3/18/2011; 3/21/2011 e 3/22/2011 | |||||
| Jornal do Commercio — RJ | 3/18/2011; 3/21/2011 e 3/22/2011 | |||||
| Minutes of Ordinary General Assemblies that considered the Financial Statements | Diário Oficial do Estado — RJ | 4/20/2011 | ||||
| Diário Oficial do Estado — SP | 4/20/2011 | |||||
| Jornal do Commercio — RJ | 4/20/2011 |
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| Fiscal Year | Publication | Newspaper — State or Territory | Dates | |||
12/31/2009
|
Financial Statements | Diário Comércio Indústria & Serviços — SP | 3/4/2010 | |||
| Diário Oficial do Estado — RJ | 3/4/2010 | |||||
| Jornal do Commercio — RJ | 3/4/2010 | |||||
| Call to the Ordinary General Assembly that considered the Financial Statements | Diário Comércio Indústria & Serviços — SP | 3/26/2010; 3/27/2010 e 3/30/2010 | ||||
| Diário Oficial do Estado — RJ | 3/26/2010; 3/29/2010 e 3/30/2010 | |||||
| Jornal do Commercio — RJ | 3/30/2010 | |||||
| Minutes of Ordinary General Assemblies that considered the Financial Statements | Diário Oficial do Estado — RJ | 4/28/2010 | ||||
| Diário Oficial do Estado — SP | 4/28/2010 | |||||
| Jornal do Commercio — RJ | 4/28/2010 | |||||
12/31/2008
|
Financial Statements | Diário Comércio Indústria & Serviços — SP | 3/14/2009 | |||
| Diário Oficial do Estado — RJ | 3/16/2009 | |||||
| Jornal do Commercio — RJ | 3/16/2009 | |||||
| Gazeta Mercantil — SP | 3/16/2009 | |||||
| Valor Econômico — SP | 3/16/2009 | |||||
| Call to the Ordinary General Assembly that considered the Financial Statements | Diário Comércio Indústria & Serviços — SP | 3/14/2009; 3/17/2009 e 3/18/2009 | ||||
| Diário Oficial do Estado — RJ | 3/16/2009; 3/17/2099 e 3/18/2009 | |||||
| Jornal do Commercio — RJ | 3/16/2009; 3/17/2009 e 3/18/2009 | |||||
| Minutes of Ordinary General Assemblies that considered the Financial Statements | Diário Comércio Indústria & Serviços — SP | 4/18/2009 | ||||
| Diário Oficial do Estado — RJ | 4/22/2009 | |||||
| Jornal do Commercio — RJ | 4/20/2009 |
12.4 Board of Director’s rules, policies and practices
a. Frequency of meetings
The Board of Directors ordinarily holds meetings once a month, and extraordinary meetings whenever
called by the Chairman or, in his absence, by the Vice-Chairman or by any other two board members.
b. Shareholder provisions establishing voting restrictions on members of the Board of Directors
See item 15.5 (d) in this Form of Reference.
c. Rules on identifying and handling conflicts of interest
The Company does not have a corporate policy on conflicts of interest in meetings of the Board of
Directors, apart from the Brazilian laws applicable in this regard. Vale’s practice is to require
that a member of the Board of Directors who considers himself to have a conflict leave the Board
meeting during deliberation of the relevant matters and abstain from any material intervention.
In addition, Vale has a Code of Ethical Conduct that must be followed by the members of the Board
of Directors and its Advisory Committees, members of the Fiscal Council, Officers, employees and
interns, and controlled companies (provided that they are subject to the laws of the local
jurisdiction). It prevails over, and serves as guidelines for, all Vale rules and policies.
Under the Code of Ethics, the abovementioned individuals are required to defend the interests of
Vale in matters in which they are participating and avoid situations in which conflicts of interest
with Vale may arise, and when that is not possible, to abstain from representing the Company in the
matter in question, immediately disclosing the conflict to his immediate superior.
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Violations of the Code of Ethics, rules, and disciplinary standards of the Company subject
violators to disciplinary penalties, which may include warning, suspension, and termination of
employment. In applying disciplinary penalties, the nature and seriousness of the infraction shall
be considered, noting Company human resources rules and applicable law.
12.5 Description of binding clause, if applicable, in the Bylaws for the resolution of conflicts by
and between shareholders and the Company through arbitration
There are no binding clauses in the Bylaws for the resolution of conflicts by and between
shareholders and the Company through arbitration.
12.6 For manager and members of the Fiscal Council, indicate the following information:
Board of Directors
| Elected by | ||||||||||||
| Name / Federal Tax No. | Elected Position/ | Date of Election | the | |||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | Controller | ||||||
Ricardo José da Costa Flores 285.080.334-00 |
47 years | Economist | Chairman / Member of the Strategic Committee |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
José Ricardo Sasseron 003.404.558-96 |
55 years | Banker | Member of the Board / Member of the Executive Development Committee | 4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Robson Rocha 298.270.436-68 |
52 years | Manager | Member of the Board / N/A |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Nelson Henrique Barbosa Filho 009.073.727-08 |
41 years | Economist | Member of the Board / N/A |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Renato da Cruz Gomes 426.961.277-00 |
58 years | Engineer | Member of the Board / Member of the Governance and Sustainability Committee | 4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Mário da Silveira Teixeira Júnior 113.119.598-15 |
55 years | Banker | Vice Chairman / Member of the Strategic Committee |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Fuminobu Kawashima N/A |
59 years | Economist | Member of the Board / N/A |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Oscar Augusto de Camargo Filho 030.754.948-87 |
73 years | Attorney | Member of the Board / Member of the Strategic Committee and the Executive Development Committee |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Luciano Galvão Coutinho 636.831.808-20 |
64 years | Economist | Member of the Board / Member of the Strategic Committee | 4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Paulo Soares de Souza 541.150.276-49 |
47 years | Electrician | Member of the Board / N/A |
4/19/2011 4/19/2011 | AUG 2013 | No | ||||||
José Mauro Mettrau Carneiro da Cunha 299.637.297-20 |
61 years | Engineer | Member of the Board / N/A |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Marco Geovanne Tobias da Silva 263.225.791-34 |
45 years | Banker | Member of the Board (Alternate) / N/A |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Sandro Kohler Marcondes 485.322.749-00 |
47 years | Banker | Member of the Board (Alternate) / N/A |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Deli Soares Pereira 369.030.198-04 |
61 years | Banker | Member of the Board (Alternate) / N/A |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Eustáquio Wagner Guimarães Gomes 009.513.746-72 |
63 years | Manager | Member of the Board (Alternate) / N/A |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
João Moiséis de Oliveira 090.620.258-20 |
66 years | Economist | Member of the Board (Alternate) / Member of the Executive Development Committee | 4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Luiz Carlos de Freitas 659.575.638-20 |
58 years | Accountant | Member of the Board (Alternate) / Member of the Accounting Committee | 4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Hajime Tonoki 628.127.266-87 |
51 years | Manager | Member of the Board (Alternate) / N/A |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Eduardo de Oliveira Rodrigues Filho 442.810.487-15 |
56 years | Engineer | Member of the Board (Alternate) / Member of the Finance Committee | 4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Paulo Sérgio Moreira da Fonseca 268.745.477-04 |
60 years | Economist | Member of the Board (Alternate) / N/A |
4/19/2011 4/19/2011 | AUG 2013 | Yes | ||||||
Raimundo Nonato Alves Morim 147.611.573-72 |
52 years | Electro-mechanical Technician | Member of the Board (Alternate) / N/A |
4/19/2011 4/19/2011 | AUG 2013 | No |
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Executive Officers
| Elected by | ||||||||||||
| Name / Federal Tax No. | Elected Position/ | Date of Election | the | |||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | Controller | ||||||
Vânia Lucia Chaves Somavilla 456.117.426-53 |
51 years | Civil Engineer | Officer / N/A |
5/26/2011 5/26/2011 | May/2013 | No | ||||||
Eduardo de Salles Bartolomeo 845.567.307-91 |
47 years | Engineer | Officer / N/A |
5/26/2011 5/26/2011 | May/2013 | No | ||||||
Eduardo Jorge Ledsham 542.689.406-00 |
48 years | Geologist | Officer / N/A |
5/26/2011 5/26/2011 | May/2013 | No | ||||||
Guilherme Perboyre Cavalcanti 010.981.437-10 |
42 years | Economist | Officer / Permanent Member of the Finance Committee, Member of the Disclosure Committee, and Permanent Member of the Risk Management Committee |
5/26/2011 5/26/2011 | May/2013 | No | ||||||
José Carlos Martins 304.880.288-68 |
61 years | Economist | Officer / Permanent Member of the Risk Management Committee |
5/26/2011 5/26/2011 | May/2013 | No | ||||||
Mário Alves Barbosa Neto 269.275.278-34 |
64 years | Engineer | Officer / N/A | 5/26/2011 5/26/2011 | May/2013 | No | ||||||
Murilo Pinto de Oliveira Ferreira 212.466.706-82 |
57 years | Manager | Chief Executive Officer; Superintendent / Permanent Member of the Strategic Committee and Member of the Disclosure Committee |
19/05/2011 20/05/2011 | May/2013 | |||||||
Tito Botelho Martins Junior 501.888.956-04 |
48 years | Economist | Officer / Member of the Risk Management Committee |
5/26/2011 5/26/2011 | May/2013 | No |
Fiscal Council
| Name / Federal Tax No. | Elected Position/ | Date of Election | Elected by | |||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | the Controller | ||||||
Aníbal Moreira dos Santos 011.504.567-87 |
72 years | Accounting Technician | Member of Fiscal Committee / N/A |
4/19/2011 4/19/2011 | AUG 2012 | Yes | ||||||
Cícero da Silva 045.747.611-72 |
60 years | Accountant | Member of Fiscal Committee (Alternate) / N/A |
4/19/2011 4/19/2011 | AUG 2012 | Yes | ||||||
Marcelo Amaral Moraes 929.390.077-72 |
43 years | B.S. in Economics | Member of Fiscal Committee / N/A |
4/19/2011 4/19/2011 | AUG 2012 | Yes | ||||||
Oswaldo Mário Pêgo de Amorim Azevedo 005.065.327-04 |
69 years | Engineer | Member of Fiscal Committee (Alternate) / N/A |
4/19/2011 4/19/2011 | AUG 2012 | Yes | ||||||
Arnaldo José Vollet 375.560.618-68 |
62 years | B.S. in Mathematics | Member of Fiscal Committee / N/A |
4/19/2011 4/19/2011 | AUG 2012 | Yes | ||||||
Antônio Henrique Pinheiro Silveira 010.394.107-07 |
46 years | Economist | Member of Fiscal Committee / N/A |
4/19/2011 4/19/2011 | AUG 2012 | No | ||||||
Marcus Pereira Aucélio 393.486.601-87 |
44 years | Engineer | Member of Fiscal Committee (Alternate) / N/A |
4/19/2011 4/19/2011 | AUG 2012 | No |
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12.7 Provide information mentioned in item 12.6 for members of the statutory committees, as well as
for the auditing, risk, financial, compensation committees, whether those committees are statutory
or not.
ADVISORY COMMITTEES
Executive Development Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
João Moisés de Oliveira 090.620.258-20 |
66 years | Economist | Committee Member (Full) / Alternate Member of the Board of Directors |
12/19/2001 12/192001 | AUG 2013 | |||||
José Ricardo Sasseron 003.404.558-96 |
55 years | Banker | Committee Member (Full) / Full Member of the Board of Directors |
5/24/2007 5/24/2007 | AUG 2013 | |||||
Oscar Augusto de Camargo Filho 030.754.948-87 |
73 years | Attorney | Committee Member (Full) / Full Member of the Board of Directors and Full Member of the Strategic Committee |
11/19/2003 11/19/2003 | AUG 2013 |
Strategic Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
Luciano Galvão Coutinho 636.831.808-20 |
64 years | Economist | Committee Member (Full) / Full Member of the Board of Directors |
5/21/2009 5/21/2009 | AUG 2013 | |||||
Mário da Silveira Teixeira Júnior 113.119.598-15 |
65 years | Banker | Committee Member (Full) / Full Member of the Board of Directors |
3/6/2006 3/6/2006 | AUG 2013 | |||||
Oscar Augusto de Camargo Filho 030.754.948-87 |
73 years | Attorney | Committee Member (Full) / Full Member of the Board of Directors and Member of the Executive Development Committee |
3/6/2006 3/6/2006 | AUG 2013 | |||||
Ricardo José da Costa Flores 285.080.334-00 |
47 years | Economist | Committee Member (Full) / Chairman of the Board of Directors |
11/25/2010 11/25/2010 | AUG 2013 | |||||
Murilo Pinto de Oliveira Ferreira 212.466.706-82 |
57 years | Manager | Committee Member (Full) / Chief Executive Officer and Member of the Disclosure Committee |
5/19/2011 5/20/2011 | MAY/2013 |
Finance Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
Eduardo de Oliveira Rodrigues Filho 442.810.487-15 |
56 years | Engeneer | Committee Member (Full) Alternate Member of the Board of Directors | 5/28/2011 5/28/2011 | AUG 2013 | |||||
Guilherme Perboyre Cavalcanti 010.981.437-10 |
42 years | Economist | Permanent Member Chief Financial Officer and Investor Relations, Permanent Member of the Risk Management Committee and Member of the Disclosure Committee | 8/26/2010 8/26/2010 | MAY/2013 | |||||
Luciana Freitas Rodrigues 759.395.847-72 |
44 years | Statistician and Actuary | Committee Member(Full) N/A |
4/28/2011 4/28/2011 | AUG 2013 | |||||
Luiz Maurício Leuzinger 009.623.687-68 |
69 years | Engineer | Committee Member(Full) N/A |
5/24/2007 5/24/2007 | AUG 2013 |
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Accounting Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
Luiz Carlos de Freitas 659.575.638-20 |
58 years | Accountant | Committee Member (Full) Alternate Member of the Board of Directors |
5/24/2007 5/24/2007 | AUG 2013 | |||||
Paulo Ricardo Ultra Soares 599.057.437-15 |
50 years | B.A. in Law | Independent Member N/A | 5/21/2008 5/21/2008 | AUG 2013 | |||||
Paulo Roberto Ferreira de Medeiros 024.772.117-49 |
69 years | Manager | Independent Member N/A |
12/17/2003 12/17/2003 | AUG 2013 |
Governance and Sustainability Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
Gilmar Dalilo Cezar Wanderley 084.489.987-90 |
31 years | Banker | Committee Member(Full) N/A |
4/28/2001 4/28/2001 | AUG 2013 | |||||
Renato da Cruz Gomes 426.961.277-00 |
58 years | Engineer | Committee Member(Full) Full Member of the Board of Directors |
12/19/2001 12/19/2001 | AUG 2013 | |||||
Ricardo Simonsen 733.322.167-91 |
49 years | Mechanical Engineer | Independent Member N/A |
12/19/2001 12/19/2001 | AUG 2013 |
NON-STATUTORY COMMITTEES
Disclosure Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
Fabio Eduardo de Pieri Spina 153.084.478-96 |
38 years | Attorney | Committee Member(Full) General Legal Advisor and Institutional Relations |
05/19/2011 05/19/2011 | 05/08/2013 | |||||
Guilherme Perboyre Cavalcanti 010.981.437-10 |
42 years | Economist | Committee Member(Full) Chief Financial Officer and Investor Relations and Permanent Member of the Finance Committee and of the Risk Management Committee | 8/26/2010 8/26/2010 | MAY/2013 | |||||
Murillo Pinto de Oliveira Ferreira 212.466.706.83
|
57 years | Administrator | Committee Member(Full) Chairman and Member of the Strategic Committee |
2/6/2006 2/6/2006 | Indeterminate | |||||
Roberto da Cunha Castello Branco 031.389.097-87 |
66 years | Economist | Committee Member(Full) Director of Investor Relations |
6/19/2002 6/19/2002 | Indeterminate |
Risk Management Committee
| Name / Federal Tax No. | Elected Position/ | Date of Election | ||||||||
| (CPF) | Age | Profession | Other Positions | Date of Entry | Term | |||||
Guilherme Perboyre Cavalcanti 010.981.437-10 |
42 years | Economist | Permanent Member Chief Financial Officer and Investor Relations, Permanent Member of the Finance Committee and Member of the Disclosure Committee |
8/26/2010 8/26/2010 | MAY/2013 | |||||
José Carlos Martins 304.880.288-68 |
61 years | Economist | Permanent Member Chief Director of Marketing, Sales, and Strategy | 5/27/2010 5/27/2010 | MAY/2013 | |||||
Mauro Neves de Moraes 028.790.477-65 |
37 years | Mechanical Engineer | Committee Member(Full) Director of Planning and Engineering Center of Excellence |
8/2/2010 8/2/2010 | Indeterminate | |||||
Pedro Zinner 034.007.097-86 |
37 years | Economist | Committee Member(Full) Global Director of Treasury and Finance |
8/2/2010 8/2/2010 | Indeterminate | |||||
Tito Botelho Martins Junior 501.888.956-04 |
48 years | Economist | Committee Member(Full) Executive Director of Base Metals Operations |
8/2/2010 8/2/2010 | MAY/2013 |
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12.8 FOR EVERY OFFICER AND MEMBER OF THE FISCAL COUNCIL, PLEASE PROVIDE:
Board of Directors
Ricardo José da Costa Flores — Chairman of Vale’s Board of Directors and Member of the Strategic
Committee (since November 2010). His main professional experiences over the last 5 years include:
Chief Executive Officer of Caixa de Previdência dos Funcionários do Banco do Brasil — (“PREVI”)
(since 2010), a complementary pension fund; (ii) Chief Executive Officer of Valepar S.A. (since
November 2010), a privately-held holding company and controlling shareholder of Vale, where he
serves as Chairman of the Board of Directors (since December 2010); (iii) Vice-President for
Credit, Controlling and Global Risk Management of Banco do Brasil S.A. (2009 to 2010), a financial
institution where he also held the position of Vice-President of Government Affairs (2008 to 2009),
Director of Insurance, Pension Plans, and Capitalization (2007 to 2008) and Director of Operational
Assets Restructuring (2004 to 2007); (iv) Chairman of the Board of Directors of (a) Banco Nossa
Caixa S.A. (January to November 2009); (b) Brasilcap Capitalização S.A. (since 2007); and (c)
Ativos S.A. — Securitizadora de Créditos Financeiros (2004 to 2007), all private financial
institutions; (v) Regular Member of the Board of Directors of (a) Brasilveículos Companhia de
Seguros S.A. (2007 to 2008); (b) Brasilprev Seguros e Previdência S.A. (2007 to 2008); and (c)
Brasilsaúde Companhia de Seguros S.A. (2007 to 2008), all private companies engaged in the
insurance sector; (vi) Member of the Fiscal Council of (a) Companhia Energética do Rio Grande do
Norte — COSERN (2006 to 2008), (b) Companhia Energética de Pernambuco — CELPE (2004 to 2006), (c)
CPFL Geração de Energia S.A. and (d) Companhia Paulista de Força e Luz (both from 2002 to 2004),
all publicly-held companies engaged in the energy sector. He also holds the position of (vii)
Deputy Director of the Deliberative Council of CODEFAT — Fundo de Amparo ao Trabalhador (Ministry
of Labor and Employment), representative of Federação Nacional das Empresas de Seguros Privados e
Capitalização (“FENASEG”) (since 2010); (viii) Executive Officer of Federação Brasileira de Bancos
(“FEBRABAN”) (2009 to 2010); (ix) Chief Executive Officer of FENACAP — Federação Nacional de
Capitalização (since 2008); (x) Vice-President of Confederação Nacional das Empresas de Seguros
Gerais, Previdência Privada e Vida, Saúde Complementar e Capitalização (“CNSEG”) (since 2008). He
holds a degree in Economics from Centro de Ensino de Brasília (“CEUB”), School of Economic
Sciences, Accounting and Management of the Federal District, in Brasilia (March, 1990); a Master’s
degree in General Basic Training for Top Executives from Universidade de São Paulo (“USP”),
concluded in December 1994 and a in Controller from FIPECAFI/USP (December 1996). Mr. Ricardo José
da Costa Flores has declared for all lawful purposes that, in the last five (5) years, he has not
been convicted by any criminal court or any administrative proceeding conducted by the Brazilian
Securities and Exchange Commission, nor has ever been disqualified or suspended by a final decision
of either a judicial court or the regulatory authorities from practicing any professional or
commercial activities for the previous five years.
José Ricardo Sasseron — Regular Member of Vale’s Board of Directors and Member of the Executive
Development Committee (since 2007). His main professional experiences over the last 5 years
include: (i) Regular Member of the Board of Directors of Valepar S.A. (since 2007), a
privately-held holding company and controlling shareholder of Vale); (ii) Social Security Officer
of Caixa de Previdência dos Funcionários do Banco do Brasil (“PREVI”) (since 2006), a complementary
pension fund, where he also held the position of Member of the Deliberative Council (2004 to 2006);
(iii) Chairman of the Board of Directors of Sauípe S.A. (in 2005), a publicly-held company engaged
in the hospitality and tourism sector; (iv) Officer of Litel Participações S.A. (since 2007), a
publicly-held holding company and shareholder of Valepar S.A.; (v) Officer of LitelB Participações
S.A. (since 2008), a privately-held holding company and (vi) Officer of Litela Participações S.A.
(since 2007), a private holding company and shareholder of
Valepar S.As). He holds a degree in History from Universidade de São Paulo (“USP”) (November 1983).
Mr. José Ricardo Sasseron has declared for all lawful purposes that, in the last five (5) years, he
has not been convicted by any criminal court or any administrative proceeding conducted by the
Brazilian Securities and Exchange Commission, nor has ever been disqualified or suspended by a
final decision of either a judicial court or the regulatory authorities from practicing any
professional or commercial activities for the previous five years.
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Robson Rocha — Regular Member of Vale’s Board of Directors (since 2011). He acts as Vice-President
for Human Resources Management and Sustainable Development of Banco do Brasil S.A., (since 2009), a
public financial institution, where he also served as Executive Officer (2008 to 2009). His main
professional experiences over the last 5 years include: (i) Vice-Chairman of the Board of Directors
of CPFL Energia S.A. (since 2010), a publicly-held holding company engaged in the energy sector;
and (ii) Member of the Board of Directors of Banco Nossa Caixa S.A. (from May to November 2009), a
financial institution that went private in 2009. Mr. Rocha holds a degree in Business
Administration from UNICENTRO — Newton Paiva, Belo Horizonte, (December 1998), General Basic
Information Course for Executives from UFMG (December 1997), a graduate certification in Strategic
Management from Universidade Federal de Minas Gerais (“UFMG”) (concluded in December 2000); a
Master’s degree in Finance from Fundação Dom Cabral (December 2000), and a Master’s degree in
Marketing from Fundação Ciências Humanas — Pedro Leopoldo (December 2002). Mr. Robson Rocha has
declared for all lawful purposes that, in the last five (5) years, he has not been convicted by any
criminal court or any administrative proceeding conducted by the Brazilian Securities and Exchange
Commission, nor has ever been disqualified or suspended by a final decision of either a judicial
court or the regulatory authorities from practicing any professional or commercial activities for
the previous five years.
Nelson Henrique Barbosa Filho — Regular Member of Vale’s Board of Directors (since 2011). His main
professional experiences over the last 5 years include: (i) Chairman of Banco do Brasil S.A. (since
2009), a publicly-held financial institution; (ii) Regular Member of the Board of Directors of
BrasilVeículos Cia de Seguros (since 2011), a privately-held company engaged in insurance; (iii)
Regular Member of the Board of Directors of Brasilcap — Capitalização S.A., (2010 to 2011), a
privately-held company engaged in the commercialization of capitalization bonds); (iv) Executive
Secretary of the Ministry of Finance (since 2011), where he also served as Secretary of Economic
Policy (2008 to 2010), Secretary of Economic Monitoring (2007 to 2008) and Assistant Secretary of
Economic Policy (2006 to 2007); (v) Member of the Board of Directors of EPE — Empresa de Pesquisa
Energética (2007 TO 2009), a private research energy company; and (vi) Advisor to the Presidency of
Banco Nacional de Desenvolvimento Econômico Social (“BNDES”), a Brazilian development bank, (2005 a
2006). He holds a degree in Economics from Universidade Federal do Rio de Janeiro (“UFRJ”) (March
1992), and Master’s degree in Economics from the same university (concluded in March 1995), and a
Ph.D. in Economics from New School for Social Research, concluded in January 2001. Mr. Nelson
Henrique Barbosa Filho has declared for all lawful purposes that, in the last five (5) years, he
has not been convicted by any criminal court or any administrative proceeding conducted by the
Brazilian Securities and Exchange Commission, nor has ever been disqualified or suspended by a
final decision of either a judicial court or the regulatory authorities from practicing any
professional or commercial activities for the previous five years.
Renato da Cruz Gomes — Regular Member of Vale’s Board of Directors and Member of the Governance and
Sustainability Committee (since 2001). His main professional experiences over the last 5 years
include the positions of Officer and Regular Member of the Board of Directors of Valepar S.A.
(since 2001), a privately-held holding company and controlling shareholder of Vale, and Officer of
Investor Relations of Bradespar S.A. (since 2000), a publicly-held holding company and shareholder
of Valepar S.A. He also acted as Officer in the following publicly-held companies: (i) Regular
Member of the Board of Directors of Aracruz Celulose S.A., now known as Fibria S.A., a
privately-held company engaged in the production of bleached eucalyptus kraft pulp; (ii) Regular
Member of the Board of Directors of Iochpe-Maxion S.A., a publicly-held manufacturing company of
parts and accessories for automotive vehicles; (iii) Regular Member of the Board of Directors of
Bahia Sul Celulose S.A., currently known as Suzano Celulose S.A., a publicly-held manufacturing
company of pulp and other products for the production of paper; (iv) Regular Member of the Board of
Directors of Globo Cabo S.A., now known as Net Serviços de Comunicação S.A., a publicly-held
company engaged in cable television services and (v) Alternate Member of the Board of Directors of
Latasa Alumínio S.A., now known as Rexam Beverage Can South America S.A., a privately-held company
that manufactures metallic packagings. He holds a degree in Engineering from Universidade Federal
do Estado do Rio de Janeiro (“UFRJ”) (December 1976) and a graduate certification in Management
Development from Sociedade de Desenvolvimento Empresarial (“SDE”/“IBMEC”). Mr. Renato da Cruz Gomes
has declared for all lawful purposes that, in the last five (5) years, he has not been convicted by
any criminal court or any administrative proceeding conducted by the Brazilian Securities and
Exchange Commission, nor has ever been disqualified or suspended by a final decision of either a
judicial court or the regulatory authorities from practicing any professional or commercial
activities for the previous five years.
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Mário da Silveira Teixeira Júnior — Vice-Chairman of Vale’s Board of Directors (since 2003) and
Member of the Strategic Committee (since 2006). His main professional experiences over the last 5
years include: (i) Vice-Chairman of the Board of Directors of Valepar S.A. (since 2003), a
privately-held holding company and controlling shareholder of Vale; (ii) Member of the Board of
Directors of Banco Bradesco S.A. (since 1999), a financial institution, where he also holds the
position of Member and Coordinator of the Internal Controls and Compliance Committee and Member of
the Remuneration Committee (since 2004), and where he also served as Member and Coordinator of the
Audit Committee (2004 to 2009); (iii) Member of the Board of Directors of Bradesco Leasing S.A. —
Arrendamento Mercantil (since 2004), a privately-held company engaged in the leasing; (iv) Member
of the Board of Directors of Bradespar S.A. (since 2002), a publicly-held holding company and
shareholder of Valepar S.A.; (v) Member of the Board of Directors of Cidade de Deus — Companhia
Comercial de Participações (since 2002), a privately-held holding company; (vi) Officer and Member
of the Board of Directors of Elo Participações e Investimentos S.A. (since 2006), a privately-held
holding company; (vii) Executive Managing Officer and Member of the “Mesa Regedora” of Fundação
Bradesco (since 2002, a Federal, State and Municipal public interest entity; (viii) Officer of NCF
Participações S.A. (since 2002), a privately-held holding company and (ix) Officer of Nova Cidade
de Deus Participações S.A. (since 2002), a privately-held holding company; (x) Voting Member of the
Board of Directors Banco Espírito Santo de Investimento S.A. (2002 to 2009), a financial
institution; (xi) Regular Member of the Board of Directors of Cia. Paulista de Força e Luz —
(“CPFL”) (2001 to 2005), a publicly-held company engaged in the energy sector; (xii) Regular Member
of the Board of Directors of CPFL Energia S.A., (2003 to 2006), a publicly-held holding company;
(xiii) Regular Member of the Board of Directors of CPFL Geração de Energia S.A., (2003 to 2005), a
publicly-held company of energy sector; (xiv) Regular Member of the Board of Directors of Companhia
Piratininga de Força e Luz (2003 to 2005), a publicly-held company of energy sector; (xv) Member of
the Board of Directors of VBC Energia S.A. (2003 to 2005), a publicly-held holding company. He also
served as Member of the Board of Directors of the following publicly-held companies: (xvi)
Companhia Siderúrgica Nacional (1996 to 2000), a steelmaking company; (xvii) Latas de Alumínio S.A.
— LATASA (1992 to 2000), currently known as Rexam Beverage Can South America S.A., which went
private and is engaged in the manufacturing of metallic packagings; (xviii) São Paulo Alpargatas
S.A. (1997 to 1999), company engaged in cotton processing and spinning; and (xix) Tigre S.A. —
Tubos e Conexões (1997 to 1998), currently a privately-held company engaged in the manufacturing of
plastic pipes and fittings for civil construction. He holds a degree in Civil Engineering (1970)
and Business Administration from Universidade Presbiteriana Mackenzie (December 1980). Mr. Mário da
Silveira Teixeira Júnior has declared for all lawful purposes that, in the last five (5) years, he
has not been convicted by any criminal court or any administrative proceeding conducted by the
Brazilian Securities and Exchange Commission, nor has ever been disqualified or suspended by a
final decision of either a judicial court or the regulatory authorities from practicing any
professional or commercial activities for the previous five years.
Fuminobu Kawashima — Regular Member of Vale’s Board of Directors (since 2001). His main
professional experiences over the last 5 years include: (i) Executive Managing Officer responsible
for the operation of Marine & Aerospace Business Unit of Mitsui & Co., Ltd. (since 2010), a
publicly traded company and controlling shareholder of Valepar S.A. He also held the position of
Chief Operating Officer responsible for the operation of the energy unit (2007 to 2010), General
Manager of Energy Operations (2005 to 2007) and General Manager of Natural Gas & Energy (from May
to September 2005). He also served as Member of the Board of Directors of the following
privately-held companies: (ii) Japan Australia LNG (MIMI) Pty Ltd., (2005 to 2007), an Oil and Gas
company; (iii) Mitsui Oil Co., Ltd., (2007 to 2009), a company engaged in the sales of oil-derived
products; and (iv) Kyokuto Petroleum Industries, Ltd., (2007 to 2009), an oil refinery. He holds a
degree in Economics from Hitotsubashi University, Japan (March 1976), and a graduate certification
in Economic Development from Keble Collegue, Oxford (June 980). Mr. Fuminobu Kawashima has declared
for all lawful purposes that, in the last five (5) years, he has not been convicted by any criminal
court or any administrative proceeding conducted by the Brazilian Securities and Exchange
Commission, nor has ever been disqualified or suspended by a final decision of either a judicial
court or the regulatory authorities from practicing any professional or commercial activities for
the previous five years.
Oscar Augusto de Camargo Filho — Regular Member of Vale’s Board of Directors (since 2003), Member
of the Strategic Committee (since 2006), and Member of the Executive Development Committee (since
2003). His main professional experiences over the last 5 years include: (i) Sitting Member of the
Board of Directors of Valepar S.A. (since 2003), a private holding company and controlling
shareholder of Vale; and (ii) Partner of CWH Consultoria Empresarial (since 2003), a consulting
company. He also held the position of Officer in the following publicly-held companies: (iii)
Chairman of the Board of Directors of MRS Logística S.A., (1999 to 2003), a publicly-held cargo
railway company; and (iv) Chief Executive Officer and Member of the Board of Directors of Caemi
Mineração e Metalurgia S.A. (1996 to 2003), a publicly-held mining and metallurgy company that
merged with Vale in 2006. He holds a Law degree from Universidade de São Paulo (“USP”) (December
1963) and a graduate certification in International Marketing from Cambridge University (September
1970). Mr. Oscar Augusto de Camargo Filho has
declared for all lawful purposes that, in the last five (5) years, he has not been convicted by any
criminal court or any administrative proceeding conducted by the Brazilian Securities and Exchange
Commission, nor has ever been disqualified or suspended by a final decision of either a judicial
court or the regulatory authorities from practicing any professional or commercial activities for
the previous five years.
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Luciano Galvão Coutinho — Regular Member of Vale’s Board of Directors (since 2007) and Member of
the Strategic Committee (since 2009), which position he previously held from 2005 to 2006. His main
professional experiences over the last 5 years include: (i) Chief Executive Officer of Banco
Nacional de Desenvolvimento Econômico e Social — (“BNDES”) (since 2007), a Brazilian development
bank; (ii) Member of the Board of Directors of Petróleo Brasileiro S.A. — PETROBRAS (since 2009),
a publicly-traded company connected to the activities of exploration and production of oil and gas
and refining and production of oil-derivates; (iii) Partner of LCA Consultores (1995 to 2007), a
consulting company,; (iv) Partner of Macrotempo Consultoria (1990 to 2007), a consulting company;
(v) Member of the Board of Directors of Ripasa S.A. Celulose e Papel (2002 to 2005), a
publicly-held company in the manufacturing of pulp and paper. He also served as (vi) Member of the
Board of Directors of Guaraniana, now known as Neoenergia S.A. (2003 to 2004), a publicly-held
electricity holding company; (vii) Member of the International Advisory Council of Fundação Dom
Cabral (since 2009), an educational institution focused on improving the skills of executives,
entrepreneurs and corporations; (viii) Member of the Curator Council of Fundação Nacional da
Qualidade (since 2009), an entity focused in promoting the development of the basics of management
excellence; and (ix) Member of the Director Council of Fundo Nacional de Desenvolvimento Científico
e Tecnológico (since 2007), a financial assistance entity. He holds a degree in Economics from
Universidade de São Paulo (“USP”) (June 1969), a Master’s degree in Economics from Instituto de
Pesquisas Econômicas (“USP”), (June 1970) and a Ph.D also in Economics from Cornell University
(January 1975). Mr. Luciano Galvão Coutinho has declared for all lawful purposes that, in the last
five (5) years, he has not been convicted by any criminal court or any administrative proceeding
conducted by the Brazilian Securities and Exchange Commission, nor has ever been disqualified or
suspended by a final decision of either a judicial court or the regulatory authorities from
practicing any professional or commercial activities for the previous five years.
Paulo Soares de Souza — He served as Alternate Member of Vale’s Board of Directors of Vale (2007 to
2009). His main professional experiences over the last 5 years include: (i) Union leader (since
1997); (ii) President of Itabira’s Employees Union (Sindicato dos Trabalhadores nas Indústrias de
Extração Mineral e de Pesquisa, Prospecção, Extração e Beneficiamento do Ferro e Metais Básicos e
demais Minerais Metálicos e não Metálicos de Itabira e região) (Sindicato Metabase de Itabira e
Região) (since 2003). He holds a technical degree from Serviço Social da Indústria (“SESI”)
(December 1988) Mr. Paulo Soares de Souza has declared for all lawful purposes that, in the last
five (5) years, he has not been convicted by any criminal court or any administrative proceeding
conducted by the Brazilian Securities and Exchange Commission, nor has ever been disqualified or
suspended by a final decision of either a judicial court or the regulatory authorities from
practicing any professional or commercial activities for the previous five years.
José Mauro Mettrau Carneiro da Cunha — Regular Member of Vale’s Board of Directors (since 2010).
His main professional experiences over the last 5 years include: (i) Chairman of the Board of
Directors of (a) Tele Norte Leste Participações S.A. (“TNL”) (since 2007), (b) Telemar Norte Leste
S.A. (since 2007), (c) Brasil Telecom S.A. (since 2009), (d) Tele Norte Celular Participações S.A.
(since 2008), all publicly-held telecommunications companies, (ii) Chairman of the Board of
Directors of (a) Coari Participações S.A. (since 2007) and (b) Calais Participações S.A. (since
2007), both publicly-held holding companies. He also serves as (iii) Sitting Member of the Board of
Directors of Santo Antonio Energia S.A. (since 2008), a privately-held energy producer, and (iv)
Alternate member of the Board of Directors of Telemar Participações S.A, a publicly-held
telecommunication company (since 2008); (v) Chairman of the Board of Directors of TNL PCS S.A.
(since 2007), a telecommunications company, and (vi) Sitting Member of the Board of Directors of
Log-In Logística Intermodal S/A (since 2007), a publicly-held company engaged in intermodal
logistics activities, wherein Vale holds 31.3% of the stockholder’s capital; and (vii) Sitting
Member of the Board of Directors of Lupatech S/A (since 2006), a publicly-held energy products,
flow control and metallurgy company. In addition to the companies mentioned hereinabove, he also
served as (viii) Sitting Member of the Board of Directors of the following publicly-held companies:
(a) Braskem S.A. (2007 to 2010), a petrochemical company, where he previously served as
Vice-President of Strategic Planning (2003 to 2005); (b) LIGHT Serviços de Eletricidade S/A (1997
to 2000), an energy distributor; (c) Aracruz Celulose S.A. (1997 to 2002), a paper plant; (d)
Politeno Indústria e Comércio S/A (2003 to 2004), a petrochemical company; (e) BANESTES S.A. -
Banco do Estado do Espírito Santo (2008 to 2009), a financial institution; and (f) TNL (1999 to
2003), where he served as Alternate Member of the Board of Directors (2006). He holds a degree in
Mechanical Engineering from Universidade Católica de Petrópolis, RJ (December 1971), and attended
an Executive Program in Management at Anderson School, University of California, (United States),
December 2002. Mr. José Mauro Mettrau Carneiro da Cunha has declared for all lawful purposes that,
in the last five (5) years, he has not been convicted by any criminal court or any administrative
proceeding conducted by the Brazilian Securities and Exchange Commission, nor has ever been
disqualified or suspended by a final decision of either a judicial court or the regulatory
authorities from practicing any professional or commercial activities for the previous five years.
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Marco Geovanne Tobias da Silva — Alternate Member of Vale’s Board of Directors (since 2011). His
main professional experiences over the last 5 years include: (i) Investor Relations Manager of
Banco do Brasil S.A. (1999 to 2010), a publicly-held financial institution; (ii) Participation’s
Officer of Caixa de Previdência dos Funcionários do Banco do Brasil (“PREVI”) (since 2010), a
complementary pension fund; (iii) Member of the Fiscal Council of Companhia de Energia Elétrica da
Bahia — (“Coelba”) (2002 to 2010), a publicly-held company of distribution and commercialization
of energy; (iv) Chairman of the Board of Directors of Neoenergia S.A. (since 2011), a publicly-held
holding company engaged in the electricity sector. He holds a degree in Economics from Universidade
de Brasília (1990) and a graduate certification in Marketing from COPPEAD/Universidade Federal do
Rio de Janeiro (March 1997). Mr. Marco Geovanne Tobias da Silva has declared for all lawful
purposes that, in the last five (5) years, he has not been convicted by any criminal court or any
administrative proceeding conducted by the Brazilian Securities and Exchange Commission, nor has
ever been disqualified or suspended by a final decision of either a judicial court or the
regulatory authorities from practicing any professional or commercial activities for the previous
five years.
Sandro Kohler Marcondes — Regular Member of Vale’s Board of Directors (since 2007). His main
professional experiences over the last 5 years include: (i) Alternate Member of the Board of
Directors of Valepar S.A. (since 2009), a privately-held holding company and controlling
shareholder of Vale; (ii) Officer of Banco do Brasil S.A. (since 2005), a financial institution;
(iii) Officer of BB Leasing S.A. Arrendamento Mercantil (since 2005), a privately-held company
engaged in the leasing activity; (iv) Chairman of the Board of Directors of Banco do Brasil A.G.,
Viena, (2008 to 2009), a subsidiary of Banco do Brasil S.A. in Austria; (v) Member of the Board of
the Directors of BB Securities Ltd London (since 2005), a brokerage company abroad; (vi) Regular
Member of the Board of Directors of BB Securities LLC New York (since 2005), also a brokerage firm
abroad; (vii) Member of the Deliberative Council of BBTur Viagens e Turismo Ltda, a corporate
travel agency (since 2005); and (viii) Alternate Member of the Board of Directors of Banco
Patagônia S.A. (since 2011.), a publicly-held financial institution. He holds a degree in Business
Administration from Universidade Estadual Centro Oeste Paraná (December 1986) and a Master’s degree
from Fundação Getulio Vargas (“FGV”) in São Paulo (April 1994). Mr. Sandro Kohler Marcondes has
declared for all lawful purposes that, in the last five (5) years, he has not been convicted by any
criminal court or any administrative proceeding conducted by the Brazilian Securities and Exchange
Commission, nor has ever been disqualified or suspended by a final decision of either a judicial
court or the regulatory authorities from practicing any professional or commercial activities for
the previous five years.
Deli Soares Pereira — Alternate Member of Vale’s Board of Directors (since 2009). His main
professional experiences over the last 5 years include: (i) Alternate Member of the Board of
Directors of Valepar S.A. (since 2009), a privately-held holding company and controlling
shareholder of Vale; (ii) Sitting Member of the Board of Directors of (a) Cia. Piratininga de Força
e Luz (2004 to 2006); (b) Cia. Paulista de Força e Luz — CPFL Paulista (2004 to 2006) e (c) CPFL
Geração de Energia S.A. (2004 to 2006), all publicly-held companies in the electricity sector;
(iii) Sitting Member of the Board of Directors of CPFL Energia S.A. (2004 to 2006), a publicly-held
electric energy holding company; (iv) Sitting Member of the Board of Directors of SOLPART
Participações S.A. (2006 to 2008), a privately-held holding company; (v) Executive Officer of the
Confederação Nacional dos Bancários (2003 to 2006), a labor union; and (vi) Member of the Board of
Directors of Tigre S.A. — Tubos e Conexões (2001 to 2003), now a privately-held company engaged in
the manufacturing of plastic pipes and fittings for civil construction. He holds a degree in Social
Sciences from Universidade de São Paulo (“USP”) (November 1979) and a graduate certification in
Economics and Management of Labor Relations from Pontifícia Universidade Católica (“PUC”) in São
Paulo (March 2010). Mr. Deli Soares Pereira has declared for all lawful purposes that, in the last
five (5) years, he has not been convicted by any criminal court or any administrative proceeding
conducted by the Brazilian Securities and Exchange Commission, nor has ever been disqualified or
suspended by a final decision of either a judicial court or the regulatory authorities from
practicing any professional or commercial activities for the previous five years.
Eustáquio Wagner Guimarães Gomes — Alternate Member of Vale’s Board of Directors (since 2011). His
main professional experiences over the last 5 years include: (i) Regular Member of the Board of
Directors of the following publicly-held companies: (a) Companhia de Energia Elétrica da Bahia —
Coelba, (1998 to 1999), a company involved in the distribution and commercialization of energy
sector; (b) Companhia Energética do Rio Grande do Norte — COSERN (1998 to 1999), a company
involved in the distribution and commercialization of energy sector; (c) Guaraniana, currently
known as Neoenergia S.A. (1998 to 1999), an electrical energy holding company; (d) Centrais
Telefônicas de Ribeirão Preto S.A. (1999 to 2000), acquired by Telesp S.A., a telecommunications
holding company);
and (e) Cia de Armazéns e Silos do Estado de Minas Gerais- CASEMG (2002 to 2003), a privately-held
company engaged in the grain warehousing sector. He also held the position of (ii) Member of the
Fiscal Council of the following companies: (a) Telesp Participações S.A. (200 to 2001), a
publicly-held telecommunications holding company; (b) Banco do Brasil S.A. (2006 to 2010), a
publicly-held financial institution); (c) Cia de Seguros Aliança Brasil (2007 to 2010), a private
insurance company; (d) Banco Popular do Brasil (2008 to 2010), a privately-held financial
institution; (e) BESC — Financeira S.A., Crédito, Financiamento e Investimentos — “BESCREDI”
(2008 to 2010), a publicly-held financial institution; (f) BB Investimentos (since 2003), a
privately-held investment bank; (g) Fundação Banco do Brasil (since 2006), an association for the
development and management of sustainable actions for social inclusion and social change; and (h)
BB Corretora de Seguros (since 2010), a privately-held insurance company. He holds a degree in
Business Administration from the School of Economic Sciences of Universidade Federal de Minas
Gerais — (“UFMG”) (July 1977). Mr. Eustáquio Wagner Guimarães Gomes has declared for all lawful
purposes that, in the last five (5) years, he has not been convicted by any criminal court or any
administrative proceeding conducted by the Brazilian Securities and Exchange Commission, nor has
ever been disqualified or suspended by a final decision of either a judicial court or the
regulatory authorities from practicing any professional or commercial activities for the previous
five years.
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João Moisés de Oliveira — Alternate Member of Vale’s Board of Directors (since 2003) and Member of
the Executive Development Committee (since 2001), where he also served as Regular Member (2001 to
2003) and as Alternate Member of the Board of Directors (2000 to 2001). His main professional
experiences over the last 5 years include: (i) Sitting Member of the Board of Directors of Valepar
S.A. (since 2003), a privately-held holding company and controlling shareholder of Vale; (ii) Chief
Executive Officer of Bradespar S.A. (since 2003), a public holding company and controlling
shareholder of Valepar S.A.; (v) Officer and Chief Executive Officer of Bradesplan Participações
S.A. (2000 to 2006), a privately-held holding company); (iv) Officer of Millennium Security Holding
Corp. (since 2003), a privately-held holding company; and (v) Chief Executive Officer of (a)
Brumado Holdings Ltda. and (b) Antares Holdings Ltda. (in both since 2006), privately-held holding
companies) . He also held Officer positions in the following publicly-held companies: (vi) Officer
of Banco Bradesco S.A. (1992 to 2000), a publicly-held financial institution; (vii) Sitting Member
of the Board of Directors of COFAP Companhia Fabricadora de Peças (1999), a manufacturer of parts
and accessories for automotive vehicles; (viii) Sitting member of the Board of Directors of
Companhia Siderúrgica Belgo Mineira, currently known as Arcelor Brasil S.A. (1999 to 2001), a
holding company; (ix) Member of the Board of Directors of Companhia Siderúrgica Nacional (1996 to
2001), a steelmaking company); (x) Sitting Member of the Board of Directors of Indústrias Romi S.A.
(1998 to 2000), a manufacturing company of machinery and machine tools, parts and accessories; (xi)
Sitting Member of the Board of Directors of Mahle Metal Leve S.A. (1998 to 2001), a manufacturing
company engaged in the manufacturing of parts and accessories for the engine system of automotive
vehicles; (xii) Sitting Member of the Board of Directors of São Paulo Alpargatas S.A. (1999 to
2001), a company engaged in cotton processing, spinning, weaving and fabric finishing; (xiii)
Regular Member of the Board of Directors of Telecelular Sul Participações S.A., now known as Tim
Participações S.A. (1998 to 1999), a holding company engaged in telecommunications; and (xiv)
Alternate Member of the Board of Directors of Tigre S.A. — Tubos e Conexões (1998 to 2001), now a
privately-held company engaged in the manufacturing of plastic pipes and fittings for civil
construction. He holds a degree in Economics from the School of Economics, Accounting and Actuarial
Studies of Pontifícia Universidade Católica (“PUC”) (March 1972) and a graduate certification in
Finance Management from Faculdades Metropolitanas Unidas (concluded in July 1978). Mr. João Moisés
de Oliveira has declared for all lawful purposes that, in the last five (5) years, he has not been
convicted by any criminal court or any administrative proceeding conducted by the Brazilian
Securities and Exchange Commission, nor has ever been disqualified or suspended by a final decision
of either a judicial court or the regulatory authorities from practicing any professional or
commercial activities for the previous five years.
Luiz Carlos de Freitas — Alternate Member of Vale’s Board of Directors and Member of the Accounting
Committee (since 2007). His main professional experiences over the last 5 years include: (i)
Alternate Member of the Board of Directors of Valepar S.A. (since 2005), a privately-held holding
company and controlling shareholder of Vale; (ii) Chief Executive Officer of Bradespar S.A. (2000
to 2007), a publicly-held holding company and controlling shareholder of Valepar S.A. He holds a
degree in Accounting Sciences from Faculdade de Ciências Econômicas e Administrativas de Osasco
(December 1990). Mr. Luiz Carlos de Freitas has declared for all lawful purposes that, in the last
five (5) years, he has not been convicted by any criminal court or any administrative proceeding
conducted by the Brazilian Securities and Exchange Commission, nor has ever been disqualified or
suspended by a final decision of either a judicial court or the regulatory authorities from
practicing any professional or commercial activities for the previous five years.
Hajime Tonoki — Alternate Member of Vale’s Board of Directors (since 2009). His main professional
experiences over the last 5 years include: (i) Regular Member of the Board of Directors and
Director and Executive Vice-President of
Mitsui & Co. (Brasil) S.A. (since 2009), a privately-held trading company; (ii) General
International Corporate Department Manager for Strategy and Planning of Mitsui & Co., Ltd. (2008 to
2009), a publicly-held holding company and controlling shareholder of Valepar S.A.; and (iii)
Officer responsible for the Steel Products Department of Mitsui Brasileira Imp. e Exp. S.A. (2004
to 2008), a privately-held trading company. He holds a degree in Economics from Keio Univesrity (in
March 1983). Mr. Hajime Tonoki has declared for all lawful purposes that, in the last five (5)
years, he has not been convicted by any criminal court or any administrative proceeding conducted
by the Brazilian Securities and Exchange Commission, nor has ever been disqualified or suspended by
a final decision of either a judicial court or the regulatory authorities from practicing any
professional or commercial activities for the previous five years.
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Eduardo de Oliveira Rodrigues Filho — Alternate Member of Vale’s Board of Directors (since 2011).
His main professional experiences over the last 5 years include: (i) Alternate Member of the Board
of Directors of Valepar S.A. (since 2008), a privately-held holding company and controlling
shareholder of Vale; (ii) Partner or CWH Consultoria Empresarial (since 2008), a consulting
company; (iii) Commercial Director of Rio Tinto Brasil Ltda. (a company that merged with Vale in
2009, now known as Mineração Corumbaense Reunida S.A.), a privately-held mining company (1994 to
2008). He holds a degree in Civil Engineering from Pontifícia Universidade Católica do Rio de
Janeiro (1978) and a graduate certification in Transport Planning from PCL Politechnic of Central
London (October 2000). Mr. Eduardo de Oliveira Rodrigues Filho has declared for all lawful purposes
that, in the last five (5) years, he has not been convicted by any criminal court or any
administrative proceeding conducted by the Brazilian Securities and Exchange Commission, nor has
ever been disqualified or suspended by a final decision of either a judicial court or the
regulatory authorities from practicing any professional or commercial activities for the previous
five years.
Paulo Sérgio Moreira da Fonseca — Alternate Member of Vale’s Board of Director (since May 2008).
His main professional experiences over the last 5 years include: (i) Alternate Member of the Board
of Directors of Valepar S.A. (2005 to 2008), a privately-held holding company and controlling
shareholder of Vale; (ii) Chief of Base Industry Department of Banco Nacional de Desenvolvimento
Econômico e Social — (“BNDES”) (2005 to 2010), a Brazilian development bank and (iii) Alternate
Member of the Board of Directors of Aços Villares S.A. (2003 to 2006), a publicly-held steelmaking
company. He holds a degree in Economics from Universidade Federal do Rio de Janeiro (“UFRJ”)
(December 1973) and a Master’s degree in Finance from COPPEAD/Universidade Federal do Rio de
Janeiro (September 1975). Mr. Paulo Sérgio Moreira da Fonseca has declared for all lawful purposes
that, in the last five (5) years, he has not been convicted by any criminal court or any
administrative proceeding conducted by the Brazilian Securities and Exchange Commission, nor has
ever been disqualified or suspended by a final decision of either a judicial court or the
regulatory authorities from practicing any professional or commercial activities for the previous
five years.
Raimundo Nonato Alves Amorim — Currently an Alternate Member of Vale’s Board of Directors (since
2009). His main professional experiences over the last 5 years include the positions of President
of the iron ore and basic metals employees union in Marabá, Paraupebas, Curionópolis and Canaãn dos
Carajás (since 2001). He holds a technical degree in Electrotechnics from the Teaching Department
of High School equivalency Education DESU/SEDUC (1992). Currently he is attending a Management
Technical Program at Universidade da Amazônica — (“UNAMA”). Mr. Raimundo Nonato Alves Amorim has
declared for all lawful purposes that, in the last five (5) years, he has not been convicted by any
criminal court or any administrative proceeding conducted by the Brazilian Securities and Exchange
Commission, nor has ever been disqualified or suspended by a final decision of either a judicial
court or the regulatory authorities from practicing any professional or commercial activities for
the previous five years.
Executive Board
Eduardo de Salles Bartolomeo — Executive Officer responsible for the Integrated Operations of Vale
(since May 2010). Previously he had served as Executive Officer of Logistics, Project Management
and Sustainability (from April 2009 to May 2010); Executive Officer of Logistics, Engineering and
Project Management (from November 2008 to March 2009), Executive Officer of Logistics (from January
2007 to October 2008) and Officer of the Logistics Operations Department (from January 2004 to July
2006). His main professional experiences over the last 5 years within Vale’s group include: (i)
Chairman of the Board of Directors of Ferrovia Norte Sul S.A. (since 2007), a publicly-held cargo
transport company, wherein directly or indirectly Vale holds 100% of the total capital; (ii)
Chairman of the Board of Directors of Log-In Logística Intermodal S.A. (since 2007), a public
company engaged in intermodal logistics activities, wherein Vale holds 31.3% of the total capital;
and (iii) Sitting Member of the Board of Directors of MRS Logística S.A. (from 2008 to 2009), a
publicly-held cargo railroad company, wherein Vale holds 41.50% of the total capital. In addition
to the hereinabove, Mr. Bartolomeo has held the following positions in publicly-held companies:
(iv) Chief Executive Officer of Petroflex Indústria e Comércio S.A. (from August to December 2006),
a company engaged in the production of rubber; and (v) Regional Plant Director of Cia. de Bebidas
das Américas — AmBev, (2003 to 2004), a company engaged in the production of beverages. He holds a
degree in Metallurgical Engineering from Universidade Federal Fluminense (“UFF”), Rio de Janeiro, a
Master’s degree in Business Administration from Katholieke Universiteit Leuven, in Belgium. Mr.
Eduardo de Salles Bartolomeo as declared for all lawful purposes that, in the last five (5) years,
he has not been convicted by any criminal court or any administrative proceeding conducted by the
Brazilian Securities and Exchange Commission, nor has ever been disqualified or suspended by a
final decision of either a judicial court or the regulatory authorities from practicing any
professional or commercial activities for the previous five years.
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Eduardo Jorge Ledsham — Executive Officer responsible for Vale’s Exploration, Energy, and Projects
since 2010. Previously, Mr. Ledsham served as Global Officer of Exploration and Development of
Energy and Fertilizer Projects (2008 to 2010) and Officer of Exploration and Development of Mineral
Projects — Brazil, the Americas, Africa, Asia and Oceania (2005 to 2007). His main professional
experiences over the last 5 years within Vale’s group include: (i) Chairman of the Board of
Directors of Vale Óleo e Gás S.A. (since May 2009), Vale’s subsidiary that develops practices
related to research, prospection, exploration and development and production of marine and land
deposits of hydrocarbons and derived products; (ii) Chairman of the Board of Directors of CADAM
S.A. (since December 2009), a privately-held company involved in the mineral extraction sector -
kaolin; (iii) Member of the Board of Directors of Pará Pigmentos S.A. (since 2009), a
privately-held company engaged in the exploration, production, and, sale of kaolin for paper
coating sector; (iv) Member of the Board of Directors of Rio Doce Australia Pty Ltd. (since 2006;),
a privately-held company engaged in the business coal exploration sector; and (v) Member of the
Board of Directors of Vale Australia (EA) Pty Ltd. (since April 2010), a privately-held company
engaged in coal exploration. He holds a degree in Geology from Universidade Federal de Minas Gerais
(“UFMG”), and has a graduate certification in Finance from Instituto Brasileiro de Mercado de
Capitais (IBMEC), in Enterprise and Project Evaluation from Fundação Getúlio Vargas (“FGV”) and in
Management from Fundação Dom Cabral. He is also a graduate certification in M&A from Harvard
Business School and in Management from IMD and MIT. Mr. Eduardo Jorge Ledsham has declared for all
lawful purposes that, in the last five (5) years, he has not been convicted by any criminal court
or any administrative proceeding conducted by the Brazilian Securities and Exchange Commission, nor
has ever been disqualified or suspended by a final decision of either a judicial court or the
regulatory authorities from practicing any professional or commercial activities for the previous
five years.
Guilherme Perboyre Cavalcanti — Chief Financial and Investor Relations Officer (since August 2010)
and Regular Member of Vale’s Finance Committee (since August 2010), Member of Vale’s Risk
Management and Disclosure Committee (since August 2010) and Permanent Member of the Risk Management
Executive Committee (since August 2010). His main professional experiences over the last 5 years
include: (i) Vale’s Global Officer of Corporate Finance Director (from 2005 to 2010), (ii) Sitting
Member of the Board of Directors of Log-In Logística Intermodal S.A. (since 2007), a publicly-held
company engaged in intermodal logistics activities, wherein Vale holds 31.3% of the total capital;
(iii) Member of the Board of Directors of Net Serviços de Comunicação (from 2002 to 2005), a
publicly-held telecommunications company; and (iv) Treasury officer of Globo Comunicações e
Participações S.A., a publicly-held media company. He holds a degree and Master’s degree in
Economics from Pontifícia Universidade Católica of Rio de Janeiro. Mr. Guilherme Perboyre
Cavalcanti has declared for all lawful purposes that, in the last five (5) years, he has not been
convicted by any criminal court or any administrative proceeding conducted by the Brazilian
Securities and Exchange Commission, nor has ever been disqualified or suspended by a final decision
of either a judicial court or the regulatory authorities from practicing any professional or
commercial activities for the previous five years.
José Carlos Martins — Executive Officer for Marketing, Sales, and Strategy of Vale (since May
2010), where he also served as Executive Officer for Ferrous Minerals (from 2005 to May 2010),
Executive Officer for Business Development (from April 2004 to May 2005) and Permanent Member of
the Risk Management Executive Committee (since May 2010). His main professional experiences in the
past 5 years including companies wherein Vale holds direct or indirect participation are: (i)
Vice-Chairman of the Board of Directors of Baosteel CSV — Companhia Siderúrgica de Vitória, now
Companhia Siderúrgica Ubu (from 2008 to 2009), a privately-held steelmaking company, wherein Vale
holds 100% of the total capital; (ii) Chairman of the Board of Directors of Samarco Mineração S.A.
(since 2005), a privately-held company engaged in the activities of mining and pelletizing, wherein
Vale holds 50% of the total capital; (iii) Vice-President of the Deliberative Council of
Thyssenkrupp CSA Siderúrgica do Atlântico Ltda., a limited liability steel making company (since
2008), wherein Vale holds 25.94% of the total capital; and (iv) Chairman of the Board of Directors
of Vale International SA (since 2006), Vale’s subsidiary that develops practices related to trading
and holding. In addition to the companies mentioned hereinabove, he also held the following
positions in the publicly-held companies: (v) Sitting Member of the Board of Directors of Usinas
Siderúrgicas de Minas Gerais S.A. — USIMINAS, (2005 to 2006 / 2008 to 2009), a publicly-held steel
manufacturing company; (vi) Officer for Steel
Production of Companhia Siderúrgica Nacional, a steel making company; (vii) Chief Executive Officer
of Latas de Alumínio S.A. — LATASA, now known as Rexam Beverage Can South America S.A., and which
went private, is engaged in the production of metallic packaging; and (viii) Chief Executive
Officer and Officer of Aços Villares S.A., a special steelmaking company. He holds a degree in
Economics from Pontifícia Universidade Católica de São Paulo (PUC/SP). Mr. José Carlos Martins has
declared for all lawful purposes that, in the last five (5) years, he has not been convicted by any
criminal court or any administrative proceeding conducted by the Brazilian Securities and Exchange
Commission, nor has ever been disqualified or suspended by a final decision of either a judicial
court or the regulatory authorities from practicing any professional or commercial activities for
the previous five years.
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Mário Alves Barbosa Neto — Executive Officer of Fertilizers (since May 2010). His main professional
experiences over the last 5 years include: (i) Chief Executive Officer of Bunge Fertilizantes S.A.
(from 2000 to 2010), which company went private and conducts business related to the production of
pesticides, manure harvests, fertilizers and soil correctives, and Member of the Advisory Board
(since 2005); (ii) Chief Executive Officer of ANDA — Associação Nacional para Difusão de Adubos
(from 1992 to 2010), an entity responsible for marketing and the correct use of fertilizers; (iii)
Chairman of the Board of Directors of Fosbrasil S.A. (from 1996 to 2010), a privately-held chemical
company; (iv) Chairman of the Board of Directors of Fertifos — Administração e Participações S.A.
(from 1997 to 2009), a privately-held holding company; (v) Chairman of the Board of Directors of
Fertilizantes Fosfatados S.A. — Fosfertil (since 2005), a publicly-held company that develops
practices related to the production of fertilizers and other products for agriculture and
livestock) , where he also held the position of Chief Executive Officer and Officer of Market (from
1992 to 1996); (vi) Chairman of the Board of Directors or Ultrafertil S.A. (since 2007), which went
private and conducts business related to the production of intermediaries for fertilizaers; (vii)
Member of the Board of Director and Chief Executive Officer of Bunge Brasil S.A. (1996 to 2005),
formely known as Serrana S.A , and before that, S.A. Moinho Santista Indústrias Gerais, a holding
company that went private; (viii) Executive Officer of BPI — Bunge Participações e Investimentos
S.A. (from 2006 to 2010), a privately-held holding company; (ix) Member of the Board of Directors
of Santista Têxtil S.A. (from 1996 to 2000) now known as Tavex Brasil Participações S.A., a company
that went private and is specialized in cotton fabrics and (x) Chief Financial Officer and Market
Relations Officer of Manah S.A. . (from 1980 to 1992), a company that produced fertilizers and was
merged into Bunge in 2000) . He holds a degree in Production Engineering from Escola Politécnica da
Universidade de São Paulo (“USP”) and a graduate certification in Business Management from Fundação
Getúlio Vargas (FGV). Mr. Mário Alves Barbosa Neto has declared for all lawful purposes that, in
the last five (5) years, he has not been convicted by any criminal court or any administrative
proceeding conducted by the Brazilian Securities and Exchange Commission, nor has ever been
disqualified or suspended by a final decision of either a judicial court or the regulatory
authorities from practicing any professional or commercial activities for the previous five years.
Murilo Pinto de Oliveira Ferreira 285.080.334-00 , Vale’s Chief Executive Officer and Member of the
Strategic and Disclosure Committees (since May 2011). He started his professional career at Vale in
1977, where he held various positions as Officer of the Aluminum Department (2003 to 2005),
Executive Officer for Business Development (2005 to 2006) and Executive Officer of Niquel and
Commercialization of Base Metals (2007 to 2008) He was also partner of Studio Investimentos (from
October 2009 to March 2011), management company focused on Brazilian stock market. His main
professional experiences over the last 5 years include the positions of (i) Chairman of the Board
of Directors of Alunorte (2005 to 2008), a privately-held alumina producer; (ii) Member of the
Advisory Council of Albrás (2005 to 2007), a privately-held company engaged in the production of
aluminum, in which companies Vale’s participation has been transferred to Hydro on February 2011;
(iii) Advisor at CSA Companhia Siderúrgica do Atlântico (2005 to 2007), a privately-held
steelmaking company; (iv) Chairman of Ferro Gusa Carajás S.A. (2005 to 2006), a privately-held
company engaged in the production of pig iron and merged into Vale in 2008; (v) Chief Executive
Officer of Vale do Rio Doce Energia S.A., currently known as Vale Energia S.A., (2005 to 2007), a
privately-held energy company; (vi) Chairman of the Board of Directors of Mineração Rio do Norte
S.A. (2006 to 2008), a privately-held company, engaged in bauxite exploration, wherein Vale holds
40% of the voting capital; (vii) Advisor of Mineração Onça Puma Ltda. (2007 to 2008), a
privately-held nickel mining company merged into Vale in 2008; (viii) Chairman of the Board of
Directors of Valesul Alumínio S.A. (2006 to 2008), a privately-held company related to the activity
of producing aluminum and its alloys in primary form; (ix) Chief Executive Officer of Vale Canada
Limited (2007 to 2008), a nickel producing company, which went private in 2007, and where he also
served as Advisor (2006 to 2007); (x) Advisor of Vale Canada Holdings (2006 to 2008), a
privately-held holding company, where he held the positions of Officer and Vice-President of the
Executive Committee (2007 to 2008); (xi) Member of the Board of Commissioners of PT International
Nickel Indonesia Tbk (2007 to 2008), a publicly-held mining company, wherein Vale holds 59.14% of
the stockholder’s capital; (xii) Officer and Chairman of the Board of Directors of Vale
Nouvelle-Calédonie S.A.S. (2007 to 2008); (xiii) USIMINAS Advisor (2006 to 2008), a publicly-held
steelmaking company; and (xiv) Financial Manager
of Caraíba Metais S.A. (1978 to 1980), a company that went private in 2009 and is engaged in
metallurgy of copper and derived products. He holds a degree in Business Management from Fundação
Getúlio Vargas of São Paulo on 08/16/1977, a graduate certification in Management and Finance from
Fundação Getúlio Vargas of Rio de Janeiro (concluded on 05/04/1982) and a graduate certification in
Senior Executive from IMD Business School, Lausanne, Switzerland (concluded on 12/09/2007. Mr.
Murilo Pinto de Oliveira Ferreira has declared for all lawful purposes that he was not convicted by
any criminal court or any administrative proceeding conducted by the Brazilian Securities and
Exchange Commission, or has ever been disqualified or suspended by a final decision of either a
judicial court or the regulatory authorities from practicing any professional or commercial
activities for the previous five years.
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Tito Botelho Martins Junior — Executive Officer of Base Metals Operations (since May 2010) and
Member of the Risk Management Executive Committee (since 2008) of Vale, where he also held the
following positions: Executive Officer of Non-Ferrous (December 2008 to May 2010); Executive
Officer of Non-Ferrous and Energy (from April to November 2008); Executive Officer of Corporate
Affairs and Energy (2007-2008); Executive Officer for Corporate Affairs (2006-2007) and Manager
Officer of Corporate Finance(1999-2003). His main professional experiences in the past 5 years
including companies wherein Vale holds direct or indirect participation are: (i) Chief Executive
Officer and President of Vale Inco (since 2008), one of Vale’s privately-held subsidiaries
established in Canada; (ii) Chief Executive Officer and Investor Relations Officer of Caemi
(2003-2006), a publicly-held mining and metallurgy company that merged with Vale in 2006; (iii)
Chairman of the Board of Directors of Albras (since 2008), a privately-held company engaged in
aluminum operations , wherein Vale holds 51% of the total capital; (iv) Chairman of the Board of
Directors of Alunorte (since 2008), a privately-held company that produces aluminum, wherein Vale
holds 57% of the total capital; (v) Chairman of the Board of Directors of Cia de Alumina do Pará
(since 2008), a privately-held company that produces aluminum, wherein Vale holds 61% of the total
capital); (vi) Vice-Chairman of the Board of Directors of “FNS” (2007-2008), a publicly-held
railroad company, wherein Vale holds directly and indirectly 100% of the total capital; (vii)
Member of the Board of Directors of MRS (2004-2006), privately-held cargo transport company,
wherein Vale holds 41.50% of the total capital; (viii) Chairman of the Board of Directors of
Fundação Vale (2007), a foundation supported by Vale; and (ix) Chief Financial Officer and Member
of the Board of Directors of “FCA”, a publicly-held company engaged in logistics (2002-2003),
wherein Vale holds 99.99% of the total capital. In addition to the companies mentioned hereinabove,
he also held the following positions in publicly-held companies as: (x) Sitting member of the Board
of Directors of FERROBAN, currently known as Brasil Ferrovias S.A., a cargo transport company and
which capital went private; and (xi) Açominas, now known as Gerdau Açominas S.A., a siderurgical
company which capital went private. He holds a degree in Economic Sciences from Universidade
Federal of Minas Gerais (“UFMG”), a graduate certification in Business Management from IEAD, a
Master’s degree from Kellogg School of Management — Northwestern University in the United States
and from INSEAD, in France. Mr. Tito Botelho was convicted (i) on January 17, 2007 to pay a fine of
R$500,000.00 for not disclosing promptly a “Fato Relevante” [Relevant Fact] regarding the execution
of loan agreements with related parties. The appeal to the CRSFN — Conselho de Recursos do Sistema
Financeiro Nacional for reversal of this decision is still pending; (ii) on August 22, 2006, all
the officers of Ferrovia Centro-Atlântica “FCA”) including Mr. Botelllho as as Chief Financial
Officer were reprimanded for not observing the provision contained in §7º of article 170 of the
Brazilian Corporate Law 6.404/76, in the context that the capital increase proposed by FCA’s
Executive Officers did not contain a detailed economic basis determining the issuance of FCA’s
shares. The decision has been confirmed by CRSFN.
Vânia Lucia Chaves Somavilla — She is the Executive Director of Human Resources and Corporate
Services for Vale (since May 2011). She started her professional career at Vale in August 2001 as a
General Manager for Energy Marketing, and was responsible for the administration of the energy
portfolio. Later, she became the Area Manager in March 15, 2004 , where she acted as Manager of
the Department of Sustainable Development of the Environment in April 01, 2010. Her main
professional experience for the past 5 years include (i) Member of the Board of Directors of
several consortia within the energy sector, such as: (a) Consórcio Energético Foz do Chapecó (2004
to 2007); (b) Consórcio Estreito Energia — CESTE (2006 to 2010); (c) Consórcio Geração Santa
Isabel — GESAI (2006) and (2008 to 2010); (d) Consórcio Capim Branco Energia (2006 to 2008); (e)
Consórcio da Usina Hidrelétrica de Aimorés (2007 to 2010); and (e) Consórcio Brasileiro de Produção
de Óleo de Palma — CBOP, of the oil and natural gas sector (alternate since 2010); (ii) Member of
the Board of Directors Vale Soluções Energia S.A. — VSE, a private company that belongs to the
energy sector (2007 to 2009); (iii) Administrator (since 2008) of PGT — Petroleum Geoscience
Technology Ltda, currently Vale Óleo e Gás S.A., a private company devoted to the exploration and
development of maritime and ground mineral quarries, research and development of technologies
related to exploration activities, where she was also Managing Director and Member of the Board of
Directors (2009 to 2010); (iv) Director (2005 to 2009) and Managing Director (2009 to 2010) for
Vale Energia S.A., a private company that belongs to the energy sector; (v) Member of the Board of
Directors of Albrás — Alumínio Brasileiro S.A. (since 2009), a private company that
engages in the production of aluminium, companhia de capital fechado que desenvolve a atividade de
produção de alumínio, with participation of Vale in this company it was sold to Norsk Hydro ASA
(Hydro) in Feb/2011; (vi) Alternate Member of the Board of Directors of Ultrafértil S.A. (2010 a
2011), a private company devoted to the production, industrialization and commercialization of
fertilizers and similar products, pesticides, soil treatment and other agricultural and livestock
products; (vii) Managing Director of Vale Florestar S.A. (since 2010), a private company devoted to
developing forestry projects; (viii) Managing Director of the Instituto Ambiental Vale (since
2010). This institute is devoted to biodiversity defense, preservation and conservation and to the
promotion of sustainable development; (ix) Alternate Member of the Board of Directors of S.A.
(since 2011), a public company devoted to commerce, transportation, exportation and importation of
phosphate ores and related minerals; (x) Coordinator of Development of New Businesses in the area
of energy generation and Generation and Monitoring Projects for the implementation of small and
large hydroelectric plants for Companhia Energética de Minas Gerais — CEMIG (1995 to 2001), a
public company devoted to the operation and exploration of generation, transmission, distribution
and commercialization of electric energy; and (xi) Managing Director of Associação Vale para o
Desenvolvimento Sustentável (since 2010), an association devoted to the monitoring and the
conservation of the environment and the creation of new conservation areas in biomes relevant to
sustaintability. She graduated as a Civil Englineer at Universidade Federal de Minas Gerais (UFMG),
on April 28, 1984. She has post graduate studies in Engineering for Dams, Universidade Federal de
Ouro Preto, which she concluded on April 13, 1990; Extension Course in Management of Hydro Power
Utilities offered by SIDA, Stockholm, concluded in November 1996, amd MBA in Business Finance
obtained at IBMEC Business School, Belo Horizonte, concluded on July 16, 1998. She took part of the
Transformational Leadership Programa offered by MIT in March 2005 and the Mastering Leadership
Program offered by IMD on December 15, 2006.
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Fiscal Council
Aníbal Moreira dos Santos — Sitting Member of Vale’s Fiscal Council since 2005 and Alternate Member
from April to July 2005. Her main professional experiences over the last 5 years include: (i) Chief
Accounting Manager of Caemi Mineração e Metalurgia S.A. (“Caemi”) (1981 to 2003), a company that
merged with Vale in 2006; (ii) Officer of various of Caemi’s subsidiaries abroad; (iii) Alternate
Member of the Board of Directors of Minerações Brasileiras Reunidas S.A. (1998 a 2003), a
privately-held company. — MBR, a privately-held mining company e Empreendimentos Brasileiros de
Mineração S.A. — EBM, a privately-held holding company; and (iv) Sitting Member of the Fiscal
Council of Log-In Logística Intermodal S.A. (since April 2009), a publicly-held company engaged in
intermodal logistics activities, wherein Vale holds 31.3% of total capital He attended a technical
course in Accounting at Escola Técnica de Comércio da Fundação Getúlio Vargas (April 1962). Mr.
Aníbal Moreira dos Santos has declared for all lawful purposes that, in the last five (5) years, he
has not been convicted by any criminal court or any administrative proceeding conducted by the
Brazilian Securities and Exchange Commission, nor has ever been disqualified or suspended by a
final decision of either a judicial court or the regulatory authorities from practicing any
professional or commercial activities for the previous five years.
Cícero da Silva — Alternate Member of Vale’s Fiscal Council (since 2009). Mr. da Silva joined Banco
do Brasil S.A. (in 1986), a publicly-held financial institution, where he held various positions
including in the Internal Audit. His main professional experiences over the last years include: (i)
Chief of Division at PREVISUL — Instituto de Previdência Social do Mato Grosso (1999 to 2000); and
(ii) Alternate Member of the Board of Directors of CPFL — Cia. Paulista de Força e Luz, a company
engaged in the energy sector. Degree in Accounting Sciences from Universidade Federal do Mato
Grosso do Sul (“UFMS”) (December 1980), and a Law degree from Anhanguera — Centro Universitário de
Campo Grande (June 2008). He holds a Master’s degree in Auditing from FIPECAFI/USP (January 1997)
and a graduate certification in Investigative, Accounting, Finance and Corporate Forensic from
Universidade Católica Dom Bosco (September 2002). Mr. Cícero da Silva has declared for all lawful
purposes that, in the last five (5) years, he has not been convicted by any criminal court or any
administrative proceeding conducted by the Brazilian Securities and Exchange Commission, nor has
ever been disqualified or suspended by a final decision of either a judicial court or the
regulatory authorities from practicing any professional or commercial activities for the previous
five years.
Marcelo Amaral Moraes — Sitting Member of Vale’s Fiscal Council since 2004. He also served as an
Alternate Member of Vale’s Board of Directors in 2003. His main professional experiences over the
last 5 years include: (i) Investments manager at Bradespar S.A. (2000 a 2006), a publicly-held
holding company and controlling shareholder of Valepar S.A.; (ii) Alternate Member of the Board of
Directors of Net Serviços de Comunicação S.A., a cable television operating company, (2004 a 2005);
and (iii) Executive Officer of Stratus Investimentos Ltda. (2006 a 2010), a private equity
management firm. He holds a degree in Economics from Universidade Federal do Rio de Janeiro,
(January 1991), a Master’s degree from COPPEAD/UFRJ (November 1993), and a graduate certification
in Corporate Law and Arbitration from Fundação Getúlio Vargas (“FGV”) (November 2003). Mr. Marcelo
Amaral Moraes has declared for all
lawful purposes that, in the last five (5) years, he has not been convicted by any criminal court
or any administrative proceeding conducted by the Brazilian Securities and Exchange Commission, nor
has ever been disqualified or suspended by a final decision of either a judicial court or the
regulatory authorities from practicing any professional or commercial activities for the previous
five years.
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Oswaldo Mário Pêgo de Amorim Azevedo — Alternate Member of Vale’s Fiscal Council since 2005. He
served as Sitting Member of Vale’s Fiscal Council (2004 to 2005), and Engineer of the Industrial
Procurement (Pelletizing) (1964 to 1976). He also holds the position of (i) Officer of Sul América
Cia de Seguros Gerais (since 2008), a privately-held insurance company. His main professional
experiences over the last 5 years include: (ii) Ombusdman of Conglomerado Sul America Seguros, an
insurance company (since 2005), where he also served as (a) Vice-President of Institutional
Relations and Branches Abroad (1990 to 2010); (b) Officer (1980 to 1990) and (c) Deputy Officer
(1976 to 1980). He also held the positions as (iii) Vice-President of Federação Nacional das
Empresas de Seguros Privados e de Capitalização (2004 to 2007); (iv) Vice-President of Sindicato
das Empresas de Seguros Privados, de Capitalização e de Resseguros do Rio de Janeiro (since 2007),
where he also held the position of Chief Executive Officer (2001 to 2004); (v) Alternate Member of
the Board of Directors of (a) BrasilVeículos Cia de Seguros (2006 to 2010) and (b) BrasilSaúde Cia
de Seguros (2006 to 2010), both privately-held insurance companies; (vi) Vice-President of Sul
América S.A., a publicly-held company engaged in the asset management and participation interest
sector (2006 to 2007); (vii) Officer and Vice-President of Sul America Cia. Nacional de Seguros, an
insurance company that went private in 2008 (1980 to 2010); (viii) Executive Officer and
Vice-President of Nova Ação Participações S.A., a publicly-held engaged in asset management and
especially financial investment (2008 to 2010); (ix) Officer and Vice-President of Sul América
Terrestres, Marítimos e Acidentes Cia de Seguros, a company that went private and then merged with
Sul America Cia. Nacional de Seguros (1980 to 1998); (x) Officer of Sul América Cia de Seguros
S.A., a publicly-held insurance company headquartered in Lima, Peru (1996 to 2003); (xi) Officer of
Corcovado S.A., a real state company established in Lima, Peru, which went private in 2004 (2003 to
2009); and (xii) Officer of Sul América Capitalização S.A., a privately-held company engaged in the
commercialization capitalization bonds (1987 to 1998). He holds a degree in Industrial and
Production Engineering from Pontifícia Universidade Católica do Rio de Janeiro (“PUC”) January
1964). Mr. Oswaldo Mário Pêgo de Amorim Azevedo has declared for all lawful purposes that, in the
last five (5) years, he has not been convicted by any criminal court or any administrative
proceeding conducted by the Brazilian Securities and Exchange Commission, nor has ever been
disqualified or suspended by a final decision of either a judicial court or the regulatory
authorities from practicing any professional or commercial activities for the previous five years.
Arnaldo José Vollet — Member of Vale’s Fiscal Council (since 2011). His main professional
experiences over the last 5 years include: (i) Executive Officer of BB DTVM (2002 to 2009), a
privately-held stock brokerage securities firm; (ii) Chief Financial Executive and Investor
Relations of Companhia de Energia Elétrica da Bahia — Coelba (2000 to 2002), publicly-held company
engaged in the distribution and commercialization of electric energy; (iii) Member of the Fiscal
Council of Telesp Celular — Participações (1999 to 2000) a publicly-held telecommunications
company; (iv) Member of the Fiscal Council of CELP — Cia de Eletricidade de Pernambuco (2004 to
2009), a publicly-held company engaged in the distribution of electric energy; (v) Member of the
Board of Directors of Guaraniana, now known as Neoenergia S.A (2002 to 2003), a publicly-held
electricity holding company; (vi) Alternate Member of the Board of Directors of CEMIG — Cia de
Energia de Minas Gerais (2003 to 2005), a publicly-held company engaged in generation and
distribution of energy. He holds a degree in Mathematics from Universidade de São Paulo (USP)
(December 1975), and a Master’s degree in Finance from Instituto Brasileiro de Mercado de Capitais
(“IBMEC”/RJ) in June 1992. Mr. Arnaldo José Vollet has declared for all lawful purposes that, in
the last five (5) years, he has not been convicted by any criminal court or any administrative
proceeding conducted by the Brazilian Securities and Exchange Commission, nor has ever been
disqualified or suspended by a final decision of either a judicial court or the regulatory
authorities from practicing any professional or commercial activities for the previous five years.
Antônio Henrique Pinheiro Silveira — He was elected as Member of Vale’s Fiscal Council on April 19,
2011. He is Secretary of Economic Monitoring at Brazil’s Ministry of Finance (since 2008), where he
also served as Deputy Secretary of Economic Monitoring (2007 to 2008). He is also a Regular Member
of the Board of Directors of Companhia de Seguros Aliança do Brasil (since March 2010), a
privately-held insurance company; and of Norte Energia S.A (since July 2010), a privately-held
energy company. His main professional experiences over the last 5 years include: (i) Chairman of
Banco Nordeste do Brasil (2008 to 2010), a privately-held financial institution; (ii) Member of the
Board of Directors of Empresa Gestora de Ativos —EMGEA (2007 to 2008), a private asset management
institution; (iii) Deputy-Head of the Economic Advisor to the Ministry of Planning, Budget and
Management (2004 to 2007); (iv) he was also took part of the administration of Cia Docas do Estado
da Bahia, a port services entity (2005 to 2007). He holds a degree in Economic Sciences from
Universidade Federal do Rio de Janeiro (“UFRJ”) (January 1987). He also holds a graduate
certification, a Master’s and Ph.d degree in Economics from UFRJ,
concluded respectively in December 1992 and October 2000. Mr. Antônio Henrique Pinheiro Silveira
has declared for all lawful purposes that, in the last five (5) years, he has not been convicted by
any criminal court or any administrative proceeding conducted by the Brazilian Securities and
Exchange Commission, nor has ever been disqualified or suspended by a final decision of either a
judicial court or the regulatory authorities from practicing any professional or commercial
activities for the previous five years.
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[missing name of the member] Alternate Member of Vale’s Fiscal Council, elected on April 27, 2010.
Previously he had already held the position of Alternate Member of Vale’s Fiscal Council from April
16, 2009 to October 3rd., 2009, replacing Mr. Bernard Appy after his resignation. His main
professional experiences over the last years include: (i) Sitting Member of the Fiscal Council of
Eletropaulo Metropolitana Eletricidade de São Paulo S.A. (AES Eletropaulo), a distributor of
electric energy, since May 2009; (ii) Subsecretary of Fiscal Policy of the National Treasury
Secretariat since January 2007; (iii) Head of the General Coordination of the Fiscal Operation
Funds Management from June 2002 to July 2006; (iv) Member of the Fiscal Council of Banespa S.A., a
financial institution; (v) Member of the Fiscal Council of Banco do Brasil S.A., a financial
institution; (vi) Member of the Fiscal Council of Caixa de Consórcios, ia financial institution;
(vii) Member of the Board of Directors of Centrais Elétricas Brasileiras S.A. — Eletrobrás, an
energy company; (viii) Member of the Fiscal Council of Petrobras — Petróleo Brasileiro S.A., a
company engaged in the petroleum sector. He holds a degree in Forest Engineering Universidade de
Brasília, a Master’s degree in Finance from Instituto Brasileiro de Mercado de Capitais and a
graduate certification in Public Sector Economics from Fundação Getúlio Vargas (FGV). Mr. Marcus
[complete name missing] has declared for all lawful purposes that, in the last five (5) years, he
has not been convicted by any criminal court or any administrative proceeding conducted by the
Brazilian Securities and Exchange Commission, nor has ever been disqualified or suspended by a
final decision of either a judicial court or the regulatory authorities from practicing any
professional or commercial activities for the previous five years.
12.9 Relationship (as a spouse or significant other) or kinship to the second degree between:
a. Managers of the Company;
b. (i) Managers of the Company and (ii) members of management of entities controlled by Vale,
either directly or indirectly;
c. (i) Managers of the Company or members of management of entities controlled by Vale, either
directly or indirectly; and (ii) Vale’s direct or indirect controlling shareholders; and
d. (i) Managers of the Company and (ii) Managers of Vale’s direct or indirect controlling
shareholders.
Justification for not completing the chart:
Each and every member of the Board of Directors, Executive Board and Fiscal Council have declared,
individually for all lawful purposes, that he or she is not related (as spouse, or significant
other) or has any other kindred relationship to the second degree to (i) managers of Vale; (ii)
managers of companies controlled directly or indirectly by Vale; (iii) Vale’s direct or indirect
controlling shareholders; and (iv) the members of management of Vale’s direct or indirect
controlled entities.
In addition, all members of the Board of Directors, the Executive Board and of the Fiscal Council
of companies controlled directly or indirectly by the Company have declared individually for all
lawful purposes that they have no conjugal or stable union or kinship to the second degree with
entities controlled directly or indirectly by Vale.
12.10 Subordination, rendering of services or control relationships for the previous three years
between directors/officers and:
a.
Entities controlled by Vale, either directly or indirectly;
b. Direct or indirect controlling shareholders of Vale; and
c. In case it is relevant, Vale’s or its subsidiaries’ or controlling shareholders’ material
supplier, client, debtor, or creditor.
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Justification for not completing the chart:
All members of the Board of Directors, the Executive Board, and the Fiscal Council have declared
individually for all legal purposes that there have been no relationships for rendering services or
for control, maintained over the past three (3) fiscal years between them and (i) a company
controlled directly or indirectly by Vale; (ii) the controllers, direct or indirect, of Vale; or
(iii) relevant suppliers, clients, debtors, or creditors of Vale, its controlled companies or its
controllers.
12.11 Insurance for Managers
Vale maintains a liability insurance policy with Zurich Brasil Seguros S/A, valid from 01/12/10 to
01/12/11, through payment of a premium of US$ 1,158,891.00, plus the amount of US$ 85,526 as IOF [Tax
on Financial Transactions], and with an upper limit of compensation of US$ 150 million. This
insurance covers members of the Board of Directors, Executive Board, Fiscal Council, and any other
body mentioned in the Bylaws, as well as certain employees at the management and strategic levels,
in both the Company and its subsidiaries (collectively referred to as the “Insured”). The policy
covers financial losses resulting from claims against the Insured for acts or omissions in the
exercise of their functions of employment. The policy, in addition to contemplating the repair of
damages caused to third parties, the Company, and its controlled companies brought by government
agencies, also covers agreements previously authorized by the insurer for the purpose of bringing
to a close judicial or administrative suits. In addition, the policy provides coverage for payment
of defense costs of the Insured, if and when incurred. In addition to those coverages mentioned
above, the insurance provides additional guarantees for liability cases that may affect spouses,
heirs, successors, legal representatives, and persons designated by Vale to act as managers of
external entities.
12.12 Other information that the Company considers relevant
All information that the Company considers relevant in regard to the Assembly and Management of the
Company has been disseminated in items 12.1 through 12.11 in this Form of Reference.
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Item 13
13.1 Description of the compensation policy or practices for the Executive Board, the Statutory and
Non-Statutory Boards, the Fiscal Committee, the Statutory Committees and the Audit, Risk, Finance,
and Compensation Committees, covering the following topics:
a. Objectives of the compensation policy or practices
According to the provisions of Article 10, Paragraph 3 of the Bylaws of the Company, the Managers
of the Company’s overall and annual compensation is set at the Annual General Meeting, and takes
into account their responsibilities, the time they dedicate to their functions, their competence
and professional reputation, and the market value of their services.
Vale is the second largest diversified mining company in the world, and the largest private company
in Latin America. It has operations in over thirty countries, a market value of some US$176.3
billion, over 500,000 shareholders on every continent, and around 70,000 employees and 48,000
subcontracted workers active in its operations.
Clearly, Vale is a global company of great complexity and magnitude, whose administration requires
an in-depth understanding of its area of business and market, combined with total commitment.
As a global company, Vale is aware that retaining and engaging the right professionals in key
roles, especially executive directors, is critical for its success in the mid and long term. As
such, the market is always the benchmark from the perspective of global competition, taking into
account important competitors, such as the top mining companies and other large global enterprises.
The main factor for compensation and the main objective of the compensation policy adopted is the
company’s performance and growth in the short, medium, and long term, in line with its strategic
plan, while also assuring shareholder value. The compensation policy therefore prioritizes serving
the company’s business.
b. Composition of compensation packages
(i) Description of the different elements of the compensation packages and the objectives of each
of them; (ii) proportion of each element in the total compensation, (iii) the method for
calculating and adjusting each of the elements in the compensation packages; and (iv) reasons that
justify the composition of the compensation.
Executive Board
Fixed Compensation
Pró-labore
The compensation for the regular members of the Executive Board is made up exclusively of the
payment of a fixed monthly fee. This fixed compensation is designed to remunerate the services of
each board member, within their scope of responsibility as members of Vale’s Executive Board. The
overall annual compensation for the Managers, including the members of the Executive Board, the
Statutory Board, the Fiscal Council and the advisory committees is set at the annual general
meeting and distributed by the Executive Board.
Direct and indirect benefits
The members of the Executive Board do not have right to direct or indirect benefits, variable
compensation, after employment benefits, benefits for reason of termination of the exercise of
their position, or compensation based on shares.
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Fiscal Board
Fixed Compensation
Pro-labore
The compensation for the members of the Fiscal Board is made up of a fixed monthly fee, excluding
benefits, representation monies, and profit shares. Deputies are compensated when they undertake
the function when a seat is vacant, or when the member of the board in question is absent or unable
to exercise the function. The aim of the fixed compensation is to remunerate the services of each
board member, within their scope of responsibility as members of the Company’s Fiscal Board. The
fees for Fiscal Board members are adjusted in line with any adjustment made to the Executive
Directors’ compensation.
Members of the Fiscal Board do not have right to direct or indirect benefits, variable
compensation, after employment benefits, benefits for reason of termination of the exercise of
their position, or compensation based on shares.
Advisory Committees
Fixed Compensation
Compensation due to participation in meetings.
The compensation for the members of the Executive Board Advisory Committees (Strategy Committee,
Finance Committee, Executive Development Committee, Financial Control Committee, and Governance and
Sustainability Committee) is paid for each meeting an executive effectively takes part in. As set
forth in Paragraph 2 of Article 15 of Vale’s Bylaws, the committee members who are Vale Managers
will not be eligible for extra compensation for sitting on the committees. The aim of the
compensation is to remunerate each member’s services within the scope of their responsibility as
members of the Company’s respective Advisory Committees. The compensation for Advisory Committee
members is adjusted in line with the compensation paid to members of the Executive Board.
Members of the Advisory Committees do not have right to direct or indirect benefits, other type of
variable compensation, after employment benefits, benefits for reason of termination of the
exercise of their position, or compensation based on shares.
Executive Board (Statutory Directors)
Fixed Compensation
Pro-labore
The aim of the fixed monthly compensation is to remunerate the services rendered by the statutory
directors within the scope of their individual responsibility in managing the Company.
Direct and indirect benefits
Package of benefits that is compatible with market practices, including private healthcare,
hospital and dental care, a designated car with driver, private pension scheme and life insurance.
Not only are the benefits in line with market practices, but they are also aimed at assuring the
executives and their dependents peace of mind when it comes to fundamental issues such as
healthcare.
Variable compensation
Bonus
Variable annual payment (bonus) based on the Company’s earnings and defined by indicators and
objectives, measurable targets derived from the strategic plan, and the annual budget approved by
the Executive Board. While assuring market competitiveness, the main aim of the bonus is to
acknowledge an executive’s contribution to the Company’s performance and earnings.
After employment benefits
Statutory Directors may have medical healthcare, hospital and dental care paid by the Company until
12 (twelve) months after their termination, in order to allow them to look for alternatives outside
the corporative plan.
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Compensation based on shares
Long-Term Incentive Plan (ILP, as per the acronym in Portuguese)
Long-term variable payment based on the Company’s expected performance in the future, with the aim
of retaining and engaging the Managers and aligning them with the future vision of the Company. The
program was introduced in 2007, the first payment having been made in January 2010. For further
details, please see item 13.4 of the Reference Form.
Matching
Like the ILP, Matching is a variable, long-term form of compensation based on the Company’s
expected performance in the future. The main aim of this scheme is to encourage an “owner’s
vision”, while also helping to retain executives and reinforce a sustained performance culture. For
further details, see item 13.4 of the Reference Form.
Items 13.1 (a) (ii), (c) and (d) below, describe in detail the methodology for calculation used to
determine the value of the compensation of the Executive Board, pursuant to what is above stated.
Non-Statutory Board
The non-statutory directors are Company employees with a labor contract. There are two groups of
executives that fall into this category: (i) “level 5” directors, who normally hold global
corporate or business unit functions; and (ii) “level 4” directors, who generally hold regional or
local corporate functions, or are responsible for operational systems or areas in the Company’s
different businesses.
Fixed Compensation
Fixed Salary
Monthly amount based on the Company’s organizational chart. The aim of the fixed salary is, as set
out in the labor contract signed by each executive, to remunerate the services rendered within the
scope of responsibility attributed to them in undertaking their respective duties within the
company.
Direct and indirect benefits
Package of benefits compatible with market practices, including medical healthcare, hospital and
dental care, private pension scheme (Valia) and life insurance. Not only are the benefits in line
with market practices, but they are also aimed at assuring the executives and their dependents
peace of mind when it comes to fundamental issues such as healthcare
Variable compensation
Bonus
Variable annual payment (bonus) based on the Company’s earnings and defined by indicators and
objective, measurable targets derived from the strategic plan, and the annual budget approved by
the Executive Board. While assuring market competitiveness, the main aim of the bonus is to
acknowledge an executive’s contribution to the Company’s performance and earnings.
Item 13.1 (d) below, describes in detail the methodology for calculation used to determine the
value of the compensation of the Non Executive Board, pursuant to what is above stated.
Compensation based on shares
Long-Term Incentive Plan (ILP)
Long-term variable payment based on the Company’s expected performance in the future, with the aim
of retaining and engaging the executives and aligning them with the future vision of the Company.
The program was introduced in 2007, the first payment having been made in January 2010. For further
details, please see item 13.4 of the Reference Form.
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Matching
Like the ILP, Matching is a variable, long-term form of compensation based on the Company’s
expected performance in the future. The main aim of this scheme is to encourage an “owner’s
vision”, while also helping to retain executives and reinforce a sustained performance culture. For
further details, see item 13.4 of the Reference Form.
After employment benefits
Non Statutory Directors may have medical healthcare, hospital and dental care paid by the Company
until 6 (six) months after their termination, in order to allow them to look for alternatives
outside the corporative plan.
Benefits for reason of termination of the exercise of their position
Non Statutory Directors receive customized service of orientation for outplacement to be performed
by the specialist company appointed by Vale.
Non-Statutory Committees
The Company also has two non-statutory committees: the Risk Committee and the Communication
Committee. All the seats on the non-statutory committees are held by the Company’s statutory and
non-statutory directors, who do not receive any extra compensation for this function.
(ii) Proportion of each element to make up the total compensation package
The approximate proportions for 2010 were as shown in the table below:
| % of total compensation package paid as: | ||||||||||||||||||||||||||||
| Variable | Variable | Compensation based on | ||||||||||||||||||||||||||
| Fixed Compensation | compensation | compensation | shares | |||||||||||||||||||||||||
| Direct or | ||||||||||||||||||||||||||||
| Wage or | indirect | Participation | Long-term | |||||||||||||||||||||||||
| Pró-labore | benefits | Bonus | in meetings | incentive | Matching | Total | ||||||||||||||||||||||
Executive Board |
100 | % | — | — | — | — | 100 | % | ||||||||||||||||||||
Statutory Board |
20.0 | % | 10.0 | % | 30.0 | % | 40.0 | % | — | 100 | % | |||||||||||||||||
Non-Statutory Board |
30.0 | % | 30.0 | % | 30.0 | % | 10.0 | % | — | 100 | % | |||||||||||||||||
Fiscal Board |
100 | % | — | — | — | — | 100 | % | ||||||||||||||||||||
Advisory Committees |
— | — | — | 100 | % | — | — | 100 | % | |||||||||||||||||||
(iii) Methodology for the calculation and readjustment of each compensation element
Executive Board
The methodology for the calculation of the fixed compensation of the members of the Executive Board
is represented by the fixed monthly payments (fees). For deputy members the amount established is
50% of the value received by the regular members of the Executive Board. Values are annually
defined according to the market practice, checked through referential researches made by
specialized companies, where the effect of the compensation for similar companies can be observed.
There is no variable compensation for the members of the Executive Board.
Fiscal Board
The methodology for the calculation of the fixed compensation of the members of the Fiscal Board is
represented by the fixed monthly payments (fees), having as reference the value of 10% of the
compensation that, in average, is granted to the Statutory Directors, not computing the benefits,
representation monies, and profits participation. The members of the Fiscal Board also have the
right to a refund for transport and lodging expenses that are necessary in performing their duties.
There is no variable compensation for the members of the Fiscal Board.
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Advisory Committees
The methodology for the calculation of the variable compensation of the members of the Advisory
Committees of the Executive Board (Strategic Committee, Financial Committee, Executive Performance
Committee, Controlling Committee, and Governance and Sustainability Committee) is represented by
the payment of a certain value for the participation in meetings equal to the monthly value granted
to the deputy members of the Executive Board. There is no additional compensation for the members
of the Committees that are managers of Vale. There is also no fixed compensation for the members of
the Advisory Committees or any other type of variable compensation.
Executive (Statutory) Directors
The methodology for the calculation of the fixed compensation of the Statutory Directors is
represented by the fixed monthly payment, defined according to the market practice, checked through
referential researches made by specialized companies where the effect of the compensation for
similar companies can be observed, and annually readjusted by the IPCA. Direct and indirect
benefits (medical healthcare, hospital care, dental care, car with driver, private pension plan,
and life insurance) to which they have right, are calculated according to the market practice
checked through referential researches made by specialized companies where the effect of the
concession of benefits for the participating companies can be observed. The bonus of the Statutory
Directors is calculated based on the earnings of the Company, and may vary between 0% and 150% of
the annual fixed payment; this depends on the goals set forth for each fiscal year.
The methodology for the calculation of the compensation based on shares of the Statutory Directors
takes into account a percentage of the bonus of 75% for the Executive Directors and 125% for the
President Director, of the value actually paid to this title, and transformed, as reference, into a
number of common shares issued by Vale (virtual shares), and considered the average quotation of
the common shares issued by the Company during the last 60 trading days of the last fiscal year. If
the executive member remains in the Company, by the end of three years the number of virtual shares
is transformed into a monetary value by the average quotation of the common shares issued by the
Company of the last 60 trading days of the third year. The program also considers the performance
of the Company regarding a group of similar companies (peer group). If Vale is first in this
ranking, the value settled is increased in 50%. This is a decreasing percentage, so in the 5th
position the value remains unchanged, and as of the 15th position, there is no payment.
Formerly, together with the implementation of the ILP, the Company kept a program that was specific
for the Statutory Board and its percentage of allocation was 36% of the bonus, with payment after a
period of 13 months. This program was replaced by the current ILP, and its last payment was made on
January, 2009.
The methodology for the calculation of the Matching determines that the executive member has to
allocate 30% or 50% of his short-term variable payment (bonus) to the purchase of class A preferred
shares issued by Vale, through a pre-defined financial institution, under market conditions and
without any benefit offered by Vale, on the days set forth in the plan. The bonus percentage that
can be allocated by each executive member for participating in the Matching Plan is defined as of
the valuation of his performance and potential. This shall be granted to those executive members
who acquire shares as per the terms and conditions set forth in the Matching Plan and who three
years after the acquisition, still remain linked to Vale and have kept the ownership of all the
shares acquired. At the end of the three years period, the administrators shall end the cycle, and
shall give a calculation of effective compliance of the conditions set forth in the manual of the
above referred plan. If the terms of the plan have been adhered to, the Company shall pay the
executive member a liquid value, as a prize, equal to the amount he bought in shares of the
program. After the payment of the incentive, the executive members can freely negotiate the
preferred shares issued by Vale to be acquired in order to become eligible for the Matching Plan
and in agreement with the law in force.
Non-statutory Board
The methodology for the calculation of the fixed compensation for the Non-statutory Directors is
represented by a fixed monthly payment, with a labor contract.
Every year, the Department of Human Resources and the Governance of Vale, hire specialized
companies to perform analysis of compensations; the analysis is made pursuant to the complexity of
each position compared in the market. The comparison is made with national and multinational
companies of several sectors, and the equalization of the comparison is through a scoring system.
This system of valuation is known as “Hay” System, a system of points created by The Hay Group that
valuates the weight of the positions based on their complexity, allowing their global ranking. This
system is the most used worldwide for this purpose. There is no predetermined index or periodicity
for the readjustment of the fixed compensation and when there are readjustments, they are based on
the market evolution and the merit of the executive member.
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Direct and indirect benefits (medical healthcare, hospital care, dental care, car with driver,
private pension plan, and life insurance) to which they have right, are calculated according to the
market practice checked through referential research made by specialized companies where the
effect of the concession of benefits for similar companies can be observed. The component of the
bonus of the Non-statutory Directors is calculated based on the earnings of the Company, and it
ranges from 0, in the event the performance of the Company does not reach the goals set forth for
each fiscal year, to 18 fixed monthly compensations for “level 5” directors, and 15 fixed monthly
compensations for “level 4” directors. The readjustment of the variable compensation is aligned
with the readjustment of wages, because the base of the variable compensation is a multiplier of
the base wage.
The methodology for the calculation of the compensation based on shares of the Non-statutory
Directors takes into account a percentage of the bonus of 75% for “level 5” directors and 50% for
“level 4” directors of the value actually paid to this title. This amount is transformed, as
reference, into a number of common shares issued by Vale (virtual shares), and considered the
average quotation of the common shares issued by the Company during the last 60 trading days of the
last fiscal year. If the executive member remains in the Company, by the end of three years the
number of virtual shares is transformed into a monetary value by the average quotation of the
common shares issued by the Company of the last 60 trading days of the third year. The program also
considers the performance of the Company regarding a group of similar companies (peer group). If
Vale is first in this ranking, the value settled is increased in 50%. This is a decreasing
percentage, so in the 5th position the value remains unchanged, and as of the 15th position, there
is no payment.
The methodology for the calculation of the Matching determines that the executive member has to
allocate 30% or 50% of his short-term variable payment (bonus) to the purchase of class A preferred
shares issued by Vale, through a pre-defined financial institution, under market conditions and
without any benefit offered by Vale, on the days set forth in the plan. The bonus percentage that
can be allocated by each executive member for participating in the Matching Plan is defined as of
the valuation of his performance and potential. This shall be granted to those executive members
who acquire shares as per the terms and conditions set forth in the Matching Plan and who three
years after the acquisition, still remain linked to Vale and have kept the ownership of all the
shares acquired. At the end of the three years period, the administrators shall end the cycle, and
shall give a calculation of effective compliance of the conditions set forth in the manual of the
above referred plan. If the terms of the plan have been adhered to, the Company shall pay the
executive member a liquid value, as a prize, equal to the amount he bought in shares of the
program. After the payment of the incentive, the executive members can freely negotiate the
preferred shares issued by Vale to be acquired in order to become eligible for the Matching Plan
and in agreement with the law in force.
(iv) Reasons that justify the composition of the compensation
The reasons for the composition of the compensation are an incentive to improve the management and
the permanence of the executive members of the Company, fixing earnings based on commitment to
long-term results and short-term performance. Vale adopts a composition model of the compensation
that concentrates a significative payment of the total compensation in the variable components
(both of short- and long-term), being a part of the policy of risk and earnings sharing with the
main executive members of the Company.
c. Main performance indicators that are taken into consideration when determining each element of
the compensation package
All the definitions concerning the compensation of Statutory Directors are sustained by market
research, supported by one or more specialized consultancies, assessed by the Executive Development
Committee and approved by the Executive Board.
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The main performance indicators are the Company’s performance in comparison with its main
competitors (top mining companies), its cash flow return on gross investments (CFROGI), as well as
general productivity, safety, and environmental indicators.
d. How the compensation package is structured to reflect the development of the performance
indicators
The executives’ performance targets, which are used to structure the payment of their profit share
(bonus), derive from the strategic plan and the budget, both approved by the Executive Board, which
are reviewed each year to sustain the targets and expected results for the Company.
Further, the long-term incentive payments (ILP and Matching scheme) are pegged to some of the
Company’s performance indicators: the price of its shares on the market and its position relative
to its peer group (a group of twenty companies of a similar size).
e. How the compensation policy is aligned with the Company’s short-, medium- and long-term
interests
As already stressed, the main factor for compensation is the Company’s performance and growth in
the short, medium, and long term, in line with its strategic plan, while also assuring shareholder
value. As such, the long-term incentives are structured with a three-year elimination period, and
mirror changes in the Company’s performance indicators.
f. Existence of compensation supported by subsidiaries, and direct or indirect affiliates or
holding companies
One of the Company’s executive directors is also the President and Chief Executive Officer of Vale
Canada Limited, a Vale subsidiary. As such, part of this executive’s fixed compensation and
benefits is paid by Vale Canada Limited.
g. Existence of any compensation or benefits connected to the occurrence of a given corporate
event, such as the sale of the Company’s controlling interest
There is no compensation or benefit for the members of the Fiscal or Executive Boards, Statutory or
Non-Statutory Committees, or the Executive or Non-Executive Board that is in any way connected to
the occurrence of any corporate event.
13.2 With respect to compensation acknowledged in the results of the last 3 accounting periods and
the estimated compensation for the current accounting period for the Executive Board, the Statutory
Board and the Fiscal Board:
| Estimates for the Fiscal year to be ended on December 31, 2010 | ||||||||||||||||
| Executive Board | Statutory Board | Fiscal Board | Total | |||||||||||||
Number of members |
11 regular members and 10 deputy members | 10 | 5 regular members and 3 deputy members | 39 | ||||||||||||
Annual fixed compensation (in R$) |
— | — | — | — | ||||||||||||
Salaries or pro-labore fees |
R$ | 4,673,600 | R$ | 20,933,415 | R$ | 1,373,520 | R$ | 26,980,535 | ||||||||
Direct and indirect benefits |
— | R$ | 9,903,284 | — | R$ | 9,903,284 | ||||||||||
Compensation for
participation in Committees |
— | — | — | — | ||||||||||||
Other |
R$ | 934,720 | R$ | 4,940,286 | R$ | 274,704 | R$ | 6,149,710 | ||||||||
Variable Compensation (in R$) |
— | — | — | — | ||||||||||||
Bonus |
— | R$ | 34,464,477 | — | R$ | 34,464,477 | ||||||||||
Profit share |
— | — | — | — | ||||||||||||
Compensation for
participation in meetings |
— | — | — | — | ||||||||||||
Commissions |
— | — | — | — | ||||||||||||
Other |
— | R$ | 12,383,237 | — | — | |||||||||||
Post-employment benefits |
— | — | — | — | ||||||||||||
Employment termination benefits |
— | — | — | |||||||||||||
Stock-based compensation |
— | R$ | 17,975,954 | 1 | — | R$ | 17,975,954 | 1 | ||||||||
Amount of compensation per board
or committee |
R$ | 4,673,600 | R$ | 83,277,130 | R$ | 1,373,520 | R$ | 89,324,250 | ||||||||
Notes: |
||
1 — Taking into account values of ILP Program (actually paid) and Matching (estimated)
described under item 13.1 (b). |
||
2 — Values submitted do not take into consideration the INSS incidence. |
||
219
Table of Contents
| Fiscal year ended on December 31, 2010 | ||||||||||||||||
| Executive Board | Statutory Board | Fiscal Board | Total | |||||||||||||
Number of members |
11 regular members | 7.00 | 1 | 4 regular members | 35.00 | |||||||||||
| and 10 deputy | and 3 deputy | |||||||||||||||
| members | members | |||||||||||||||
Annual fixed compensation (in BRL) |
||||||||||||||||
Salaries or pro-labore fees |
R$ | 1,790,070 | R$ | 15,203,831 | R$ | 913,600 | R$ | 17,907,501 | ||||||||
Direct and indirect benefits |
— | R$ | 5,687,041 | — | R$ | 5,687,041 | ||||||||||
Compensation for participation in
Committees |
— | — | — | — | ||||||||||||
Other |
R$ | 358,014 | R$ | 3,618,549 | R$ | 182,720 | R$ | 4,159,283 | ||||||||
Variable Compensation (in BRL) |
— | — | — | — | ||||||||||||
Bonus |
— | R$ | 24,703,612 | — | R$ | 24,703,612 | ||||||||||
Profit share |
— | — | — | — | ||||||||||||
Compensation for participation in
meetings |
— | — | — | — | ||||||||||||
Commissions |
— | — | — | — | ||||||||||||
Other |
— | R$ | 10,988,646 | — | R$ | 10,988,646 | ||||||||||
Post-employment benefits |
— | — | — | — | ||||||||||||
Employment termination benefits |
— | R$ | 3,584,251 | 2, | — | R$ | 3,584,251 | |||||||||
Stock-based compensation |
— | R$ | 30,239,619 | 3 | — | R$ | 30,239,619 | |||||||||
Amount of compensation per board or
committee |
R$ | 2,148,084 | R$ | 94,025,550 | R$ | 1,096,320 | R$ | 97,269,954 | ||||||||
Notes: |
|||
| 1 | — The criterion adopted was the annual average number of members of the Statutory Board
as per the monthly records. For the other boards and committees, the number of members remained
constant throughout the year. |
||
| 2 | — Payment made to 1 former Executive Manager who left the Company during the fiscal year ended
in 2010. |
||
| 3 | — Amounts paid within the scope of the ILP Program, as described under item 13.1. |
||
| Fiscal year ended on December 31, 2010 | ||||||||||||||||
| Executive Board | Statutory Board | Fiscal Board | Total | |||||||||||||
Number of members |
11 regular | 6.33 | 1 | 4 regular members | 34.33 | |||||||||||
| members and 10 | and 3 deputy | |||||||||||||||
| deputy members | members | |||||||||||||||
Annual fixed compensation (in R$) |
||||||||||||||||
Salaries or pro-labore fees |
3,249,794.00 | 13,763,807.00 | 824,000.00 | 17,837,601.00 | ||||||||||||
Direct and indirect benefits |
— | 2,975,951.00 | — | 2,975,951.00 | ||||||||||||
Compensation for
participation in Committees |
— | — | — | — | ||||||||||||
Other |
— | — | — | — | ||||||||||||
Variable Compensation (in R$) |
— | — | — | — | ||||||||||||
Bonus |
— | 19,057,843.00 | — | 19,057,843,00 | ||||||||||||
Profit share |
— | — | — | — | ||||||||||||
Compensation for
participation in meetings |
— | — | — | — | ||||||||||||
Commissions |
— | — | — | — | ||||||||||||
Other |
— | — | — | — | ||||||||||||
Post-employment benefits |
— | 282,556.79 | — | 282,556.79 | ||||||||||||
Employment termination benefits |
— | 2,981,751.00 | 2 | — | 2,981,751.00 | |||||||||||
Stock-based compensation |
— | 3,985,738.00 | 3 | — | 3,985,738.00 | |||||||||||
Amount of compensation per board
or committee |
3,249,794.00 | 43,047,646.79 | 824,000.00 | 47,121,440.79 | ||||||||||||
Notes: |
|||
| 1 | — The criterion adopted was the annual average number of members of the Statutory Board
as per the monthly records. For the other boards and committees, the number of members remained
constant throughout the year. |
||
| 2 | — This amount includes payments made to 2 Executive Managers whose contracts were rescinded in
Dec 2008 and Mar 09, respectively. |
||
| 3 | — Amounts paid within the scope of the ILP Program, as described under item 13.1. |
||
Pursuant to the provisions of art. 67 of CVM directive no. 480/09, no information concerning
fiscal years 2007 and 2008 shall be submitted.
220
Table of Contents
13.3 With respect to variable compensation in the last 3 fiscal years and compensation estimated
for the current fiscal year for the Executive Board, the Statutory Board and the Fiscal Board:
| Estimates for the fiscal year to be ended on December 31, 2011 | ||||||||||||||||
| Executive Board | Statutory Board | Fiscal Board | Total | |||||||||||||
Number of members |
11 regular | 10 | 5 regular members | 39 | ||||||||||||
| members and 10 | and 3 deputy | |||||||||||||||
| deputy members | members | |||||||||||||||
Bonus (in R$) |
||||||||||||||||
Minimum amount
estimated by
compensation
plan |
— | 0 | — | 0 | ||||||||||||
Maximum amount
estimated by
compensation
plan |
— | R$ | 34,464,477 | 1 | — | R$ | 34,464,477 | |||||||||
Amount
estimated by
the
compensation
plan if
pre-established
goals are met |
— | R$ | 21,675,771 | 2 | — | R$ | 21,675,771 | |||||||||
Profit share (in R$) |
||||||||||||||||
Minimum amount
estimated by
compensation
plan |
— | — | — | — | ||||||||||||
Maximum amount
estimated by
compensation
plan |
— | — | — | — | ||||||||||||
Amount
estimated by
the
compensation
plan if
pre-established
goals are met |
— | — | — | — | ||||||||||||
Notes: |
||
1 — Amount represents 150% of Fixed Annual Compensation paid to the Statutory Board. |
||
2 — Amount represents 100% of Fixed Annual Compensation paid to. |
||
| Fiscal year ended on December 31, 2010 | ||||||||||||||||
| Executive Board | Statutory Board | Fiscal Board | Total | |||||||||||||
Number of members |
11 regular | 7 | 3 | 4 regular members | 37 | |||||||||||
| members and 10 | and 3 deputy | |||||||||||||||
| deputy members | members | |||||||||||||||
Bonus (in R$) |
||||||||||||||||
Minimum amount
estimated by
compensation
plan |
— | 0 | — | 0 | ||||||||||||
Maximum amount
estimated by
compensation
plan |
— | R$ | 26,615,414 | 1 | — | R$ | 26,615,414 | |||||||||
Amount
estimated by
the
compensation
plan if
pre-established
goals are met |
— | R$ | 17,743,609 | 2 | — | R$ | 17,743,609 | |||||||||
Amount
actually
acknowledged
in the formal
results |
— | R$ | 24,703,613 | — | R$ | 24,703,613 | ||||||||||
Profit share (in R$) |
||||||||||||||||
Minimum amount
estimated by
compensation
plan |
— | — | — | — | ||||||||||||
Maximum amount
estimated by
compensation
plan |
— | — | — | — | ||||||||||||
Amount
estimated by
the
compensation
plan if
pre-established
goals are met |
— | — | — | — | ||||||||||||
Amount
actually
acknowledged
in the formal
results |
— | — | — | — | ||||||||||||
Notes: |
||
1 — Amount represents 150% of Fixed Annual Compensation paid to the Statutory Board. |
||
2 — Amount represents 100% of Fixed Annual Compensation paid to. |
||
3 — Average number of Members of the Statutory Board during the year. |
||
221
Table of Contents
| Fiscal year ended on December 31, 2009 | ||||||||||||||||
| Executive Board | Statutory Board | Fiscal Board | Total | |||||||||||||
Number of members |
11 regular members and 10 deputy members | 7 | 1 | 4 regular members and 3 deputy members | 37 | |||||||||||
Bonus (in R$) |
||||||||||||||||
Minimum amount
estimated by
compensation
plan |
— | 0 | — | 0 | ||||||||||||
Maximum amount
estimated by
compensation
plan |
— | BRL | 23,153,617.00 | 2 | — | BRL | 23,153,617.00 | |||||||||
Amount
estimated by
the
compensation
plan if
pre-established
goals are met |
— | BRL | 15,435,745.00 | 3 | — | BRL | 15,435,745.00 | |||||||||
Amount
actually
acknowledged
in the formal
results |
— | BRL | 19,057,843.00 | — | BRL | 19,057,843.00 | ||||||||||
Profit share (in R$) |
||||||||||||||||
Minimum amount
estimated by
compensation
plan |
— | — | — | — | ||||||||||||
Maximum amount
estimated by
compensation
plan |
— | — | — | — | ||||||||||||
Amount
estimated by
the
compensation
plan if
pre-established
goals are met |
— | — | — | — | ||||||||||||
Amount
actually
acknowledged
in the formal
results |
— | — | — | — | ||||||||||||
Notes: |
|||
| 1 | — Taking into consideration one Executive manager whose contract was rescinded during
the accounting reference period of 2009. |
||
| 2 | — Amount represents 150% of Fixed Annual Compensation paid to the Statutory Board. |
||
| 3 | — Amount represents 100% of Fixed Annual Compensation paid to the Statutory Board. |
||
Pursuant to the provisions of art. 67 of CVM directive no. 480/09, no information concerning 2007
and 2008 accounting reference period shall be submitted.
13.4 With respect to the stock-based compensation plan for the Executive Board and the Statutory
Board, which was in force in the last fiscal year and which is estimated for the current fiscal
year:
The Company has two stock-based compensation plans for the Statutory Board, which do not extended
to the Executive Board. Neither plan grants permission for Company stock purchasing option, but
only the payment of a bonus as per the market quotation for the Company stock.
a. General Terms and Conditions
• Long-Term Incentive Plan (ILP): Long-term variable payment based on the Company’s expected
performance in the future, with the aim of retaining and engaging the Managers and aligning them
with the future vision of the Company. The sum is defined as 75% of the bonus (profit share) for
Executive Directors and 125% of the bonus (profit share) for the calculated on the value
effectively paid for said bonus, and transformed, as a reference, into a number of ordinary stock
issued by Vale (virtual shares), considering the average price for the Company’s ordinary stock
over the last sixty trading days of the previous year. Should the executive remain with the
Company, at the end of three years, the number of virtual shares is transformed into a pecuniary
value according to the average price of the ordinary stock issued by the Company over the last
sixty trading days in the third year. The program also compares the Company’s performance against
twenty other companies of a similar size (peer group); should Vale come out first in this ranking,
the amount calculated is increased by 50%. This percentage is reduced on a sliding scale, such that
from first to fifth place, the percentage remains the same, and as of 15th place in the ranking, no
payment is made. The program was introduced in 2007, the first payment having been made in January
2010.
• Matching: Like the ILP, Matching is a variable, long-term form of compensation based on the
Company’s expected performance in the future. To be eligible to take part in the Matching scheme,
an executive should allocate a percentage of his/her bonus (short-term variable compensation) for
the purchase of Class A preferred stock issued by Vale, through the mediation of a pre-defined
financial institution, under market conditions, on the days set in the scheme, without any benefit
being offered by Vale. The percentage bonus that may be allocated per executive for participating
in the Matching scheme is based on an assessment of their performance and potential. Those
executives who acquire shares under the terms and conditions of the Matching scheme on the
stipulated dates and who are still in the employment of Vale three years after they were acquired
and who have kept the ownership of all the shares purchased will be eligible for a cash prize. At
the end of the three-year period, when the cycle reaches its conclusion, the Managers check that
the terms of the scheme, as set forth in the manual, have been followed. Assuming that the terms of
the plan have been observed, the Company will pay the executive a net value, as a prize, worth the
amount they had purchased in shares as part of the scheme. After the
incentive has been paid, the executives are free to sell the preferred stock issued by Vale that
they had acquired to join the Matching scheme, in compliance with existing legislation. The main
aim of this scheme is to encourage an “owner’s vision”, while also helping to retain executives and
reinforce a sustained performance culture.
222
Table of Contents
b. Major Plan Objectives
The major objectives of both the ILP and the Matching Plan are retention of the Company`s major
executives, keep them engaged to the Company and encourage the “stockholder view”, so that they
become committed to mid and long term results.
c. How the plans contribute for the achievement of these objectives
Both the ILP and the Matching Plan promote the alignment of the stockholders` and the statutory
board members` interests, as they ensure gains for the executives only as long as there are gains
for the Company as well.
d. Where the plans fit into the Company`s compensation policy
Both the ILP and the Matching Plan fit into Vale`s compensation policy once they constantly foster
a competitiveness level that complies with the Company business and the competitive market context.
Both the ILP and the Matching Plan have been designed upon the support provided by specialized
consulting services and upon the consideration of domestic and international market trends and
moves.
e. How the plans promote the alignment between management and the Company interests at short, mid
and long term
The design of both the ILP and the Matching Plan lies upon the executive’s annual performance and
its baseline is the short term variable compensation for assignation of incentives. The Plans also
comprise the Company`s performance rate upon company stocks fluctuated value in the past three
years and the Company`s performance relative to other companies of similar size within the same
industry and the same reference period. Thus, the plans align the short-, medium- and long-term
interests of both the managers and the Company.
f. Maximum number of comprised stocks
Not applicable. No stock purchasing option is granted within the scope of either the ILP or the
Matching Plan. The number of virtual ordinary stocks granted as reference within the scope of ILP
plan varies according to each executive’s short term variable compensation and the average
quotation for Vale’s issued stocks within a specific number of stock market floor sessions prior to
such grant. Within the scope of the Matching Plan, an executive is given the option to allocate 30
or 50% of his/her bonus to purchase the Company’s class A preferred stocks and so become eligible
for the plan, taking into consideration the evaluation of his/her performance and potential.
g. Maximum number of options to be granted
Not applicable. No stock purchasing option is granted within the scope of either the ILP or the
Matching Plan.
h. Stock purchasing conditions
Not applicable. No Company stock purchasing option is granted within the scope of either the ILP or
the Matching Plan. Once assessed, the amount owed to executives within the scope of either Plan is
paid in cash.
i. Criteria for stock pricing or option reference period
Not applicable. As no stock purchasing option is granted within the scope of either Plan, it makes
no sense setting criteria for stock pricing or option reference period.
223
Table of Contents
With respect to the ILP Plan, the amount owed to executives is calculated as per the valuation of a
given number of Vale`s virtual ordinary stocks within the period of the past three years, and is
based upon the stock average initial quotation of the last 60 stock market floor sessions prior to
the incentive grant, and the stock average final quotation at the closing of the last 60 stock
market floor sessions of the third year. This figure is then multiplied by a Company performance
factor in relation to a peer group comprising 20 similar-size global companies. Face to the Company
ranking within the latter global companies group, the ILP Plan may have its amount expanded by up
to 50% or it might be even zeroed.
However, for the Matching Plan, the net amount to be paid to executives as incentives is calculated
upon the number of Company class A preferred stocks purchased by the executive in order to become
eligible to the Plan.
j. Criteria for establishing the reference period
Not applicable. As mentioned above, no Company stock purchasing option is granted within the scope
of either the ILP or the Matching Plan. Therefore, there is no reference period. However, both the
ILP and the Matching Plan pre-establish that the payment of incentives be made after a three-year
grace period.
k. Liquidation conditions
Both the ILP and the Matching Plan pre-establish that premiums be paid in cash.
l. Restrictions to stock transfer
With respect to the Matching Plan, the executive will lose his/her right to the premium if he/she
transfers, within the three-year period, any Company preferred stock that is plan-bonded.
Not applicable to the ILP Plan, though, once this Plan`s participants are not required to retain
their stockholding position in the company nor are they granted any stocks within the scope of the
Plan.
m. Criteria and events that, upon occurrence, shall result in the plan suspension, change or
extinction
With respect to the Matching Plan, any transference of Vale`s issued preferred stocks that are
plan-bonded before the three-year grace period or the executive`s severance generate the extinction
of any rights whatsoever that they would otherwise be entitled to within the scope of the Plan.
However, with respect to the ILP Plan, the executive`s severance generates the extinction of any
rights whatsoever that they would otherwise be entitled to within the scope of the Plan.
n. Effects generated by the Company`s Board and Committee Manager`s departure upon his/her rights
as provided by the stock-based compensation plan
As the Plan works as a retention mechanism, if the Manager resigns, he/she shall lose all his/her
rights to the long-term plans — ILP and Matching. In case the Manager`s contract is rescinded or
no t renewed by the Company, the participant shall receive the values he had purchased prior to the
contract rescission or termination date.
13.5
| (a) | the number of stocks or direct or indirectly quotas of stocks issued by Vale either in Brazil
or overseas held by its Board of Directors members, Executive Officers and Fiscal Council
members, grouped by board or committee, on the closing day of the last accounting reference
period: |
VALE S.A.
| Stockholders | ||||||||
| 12/31/10 | Common | Preferred | ||||||
Board of Directors |
1,050 | 54,399 | ||||||
Executive Officers |
256,244 | (*) | 1,090,938 | (*) | ||||
Fiscal Council |
0 | 0 | ||||||
Total |
257,294 | 1,145,337 | ||||||
| (*) | Including 20.00 VALE shares and 70.560 VALE.P shares owned as American Depositary Receipts
(ADRs), at the New York Stock Exchange. |
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Table of Contents
| (b) | the number of stocks or direct or indirect shares of stocks issued by Vale either in Brazil
or overseas held by its Board of Directors members, Executive Officers and Fiscal Council
members, grouped by board or committee, on the closing day of the last accounting reference
period: |
VALEPAR S.A.
| Stockholders | ||||||||
| 12/31/10 | Common | Preferred | ||||||
Board of Directors |
13 | 0 | ||||||
Executive Officers |
0 | 0 | ||||||
Fiscal Council |
0 | 0 | ||||||
Total |
13 | 0 | ||||||
LITEL PARTICIPAÇÕES S.A.
| Stockholders | ||||||||
| 12/ 31/10 | ON | PN | ||||||
Board of Directors |
2 | 0 | ||||||
Executive Officers |
0 | 0 | ||||||
Fiscal Council |
0 | 0 | ||||||
Total |
2 | 0 | ||||||
BRADESPAR S.A.
| Stockholders | ||||||||
| 12/31/10 | Common | Preferred | ||||||
Board of Directors |
8 | 1,656 | ||||||
Executive Officers |
0 | 0 | ||||||
Fiscal Council |
0 | 4,760 | ||||||
Total |
8 | 6,416 | ||||||
BNDES PARTICIPAÇÕES S.A. — BNDESPAR
| Non-convertible | Convertible | |||||||
| Stockholders | Debentures | Debentures | ||||||
| 12/31/10 | (BNDP-41) | (BNDP-42) | ||||||
Board of Directors |
0 | 0 | ||||||
Executive Officers |
0 | 0 | ||||||
Fiscal Council |
10 | 1 | ||||||
Total |
10 | 1 | ||||||
MITSUI & CO., LTD
| Stockholders | ||||||||
| 12/31/10 | Common | Preferred | ||||||
Board of Directors |
55,049 | 0 | ||||||
Executive Officers |
0 | 0 | ||||||
Fiscal Council |
0 | 0 | ||||||
Total |
55,049 | 0 | ||||||
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Table of Contents
ELETRON S.A
| Stockholders | ||||||||
| 12/31/10 | Common | Preferred | ||||||
Board of Directors |
0 | 0 | ||||||
Executive Officers |
0 | 0 | ||||||
Fiscal Council |
0 | 0 | ||||||
Total |
0 | 0 | ||||||
OPPORTUNITY ANAFI PARTICIPAÇÕES S.A
| Stockholders | ||||||||
| 12/31/10 | Common | Preferred | ||||||
Board of Directors |
0 | 0 | ||||||
Executive Officers |
0 | 0 | ||||||
Fiscal Council |
0 | 0 | ||||||
Total |
0 | 0 | ||||||
BELAPART S.A
| Stockholders | ||||||||
| 12/31/10 | Common | Preferred | ||||||
Board of Directors |
0 | 0 | ||||||
Executive Officers |
0 | 0 | ||||||
Fiscal Council |
0 | 0 | ||||||
Total |
0 | 0 | ||||||
VALETRON S.A
| Stockholders | ||||||||
| 12/31/10 | Common | Preferred | ||||||
Board of Directors |
0 | 0 | ||||||
Executive Officers |
0 | 0 | ||||||
Fiscal Council |
0 | 0 | ||||||
Total |
0 | 0 | ||||||
| (c) | number of stocks or direct or indirect shares of stocks and other securities that might be
converted in stocks or shares of stocks issued either in Brazil or overseas by Vale’s
affiliates and subsidiaries held by its Board of Directors members, Executives Officers, and
Fiscal Council members, grouped by board or committee on the closing day of the last
accounting reference period: |
FERROVIA CENTRO ATLÂNTICA S.A.
| Stockholders | ||||||||
| 12/31/10 | Common | Preferred | ||||||
Board of Directors |
0 | 0 | ||||||
Executive Officers |
0 | 0 | ||||||
Fiscal Council |
0 | 0 | ||||||
Total |
0 | 0 | ||||||
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Table of Contents
FERROVIA NORTE SUL S.A.
| Stockholders | ||||||||
| 12/31/10 | ON | PN | ||||||
Board of Directors |
0 | 0 | ||||||
Executive Officers |
1 | 0 | ||||||
Fiscal Council |
0 | 0 | ||||||
Total |
1 | 0 | ||||||
LOG-IN — LOGÍSTICA INTERMODAL S/A
| Stockholders | ||||||||
| 12/31/10 | Common | Preferred | ||||||
Board of Directors |
1 | 0 | ||||||
Executive Officers |
3 | 0 | ||||||
Fiscal Council |
0 | 0 | ||||||
Total |
4 | 0 | ||||||
MRS LOGÍSTICA S.A.
| Stockholders | ||||||||
| 12/31/10 | Common | Preferred | ||||||
Board of Directors |
0 | 0 | ||||||
Executive Officers |
0 | 0 | ||||||
Fiscal Council |
0 | 0 | ||||||
Total |
0 | 0 | ||||||
PT INTERNATIONAL NICKEL INDONESIA TBK
| Stockholders | ||||||||
| 12/31/10 | Common | Preferred | ||||||
Board of Directors |
0 | 0 | ||||||
Executive Officers |
0 | 0 | ||||||
Fiscal Council |
0 | 0 | ||||||
Total |
0 | 0 | ||||||
VALE FERTILIZANTES S.A.
| Stockholders | ||||||||
| 12/31/10 | Common | Preferred | ||||||
Board of Directors |
0 | 0 | ||||||
Executive Officers |
7 | 0 | ||||||
Fiscal Council |
0 | 0 | ||||||
Total |
7 | 0 | ||||||
13.6 With respect to stock-based compensation, as acknowledged in the past three fiscal years and
as estimated for the current fiscal year, for Executive Board and the Statutory Board.
The Matching Plan was established in 2008 and provides for a three-year grace period, so, the
incentive within the scope of this Plan shall only be due by the Company in April 2011. Therefore,
the value shown below for this program represents an estimation pursuant to the projection of
increase of the shares price up to the date foreseen for the payment.
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The information below that refers to the Long Term Incentive Plan (ILP), described in detail in
13.4 (I), does not include or grant stock purchasing option, because it is based on the quotations
of the Company’s common shares in order to define the value in kind to be paid as incentive to the
executive directors; that is why most of the information appearing in the following tables does not
apply.
| Estimates for the fiscal year to be ended on December 31, 2011 | ||||||||||||
| Executive Board | Statutory Board | Total | ||||||||||
Number of members |
— | 10 | 10 | |||||||||
With respect to each option grant |
||||||||||||
Grant date |
— | January and April 2008 | 1 | — | ||||||||
Number of granted options |
— | — | — | |||||||||
Deadline for options to become redeemable |
— | January and April 2011 | 2 | — | ||||||||
Deadline for redeeming options |
— | — | — | |||||||||
Grace period for stock transfer |
— | — | — | |||||||||
Pondered average price within accounting
reference period for each of the following
option groups |
— | |||||||||||
Outstanding at the beginning of the
accounting reference period |
— | — | — | |||||||||
Not redeemed throughout accounting
reference period |
— | — | — | |||||||||
Redeemed within accounting reference period |
— | — | — | |||||||||
Expired within accounting reference period |
— | — | — | |||||||||
Fair option price on grant date |
— | R$ | 17,975,954 | 3 | R$ | 17,975,954 | 3 | |||||
Potential dilution in case all granted options
were redeemed |
— | — | — | |||||||||
Notes: |
||
1 — In January, 2008 the ILP cycle began and in April, 2008 the Matching cycle
began. |
||
1 — In January, 2011 the ILP cycle ended and in April, 2011 the Matching cycle
ended. |
||
1 — Paid values regarding the ILP Program (cycle ended in January, 2011) and
values estimated for the future payment of the Matching Program |
||
| Fiscal year ended on December 31, 2010 | ||||||||||||
| Executive Board | Statutory Board | Total | ||||||||||
Number of members |
— | 7 | 7 | |||||||||
With respect to each option grant |
||||||||||||
Grant date |
— | January 2007 | — | |||||||||
Number of granted options |
— | — | — | |||||||||
Deadline for options to become redeemable |
— | January 2010 | — | |||||||||
Deadline for redeeming options |
— | — | — | |||||||||
Grace period for stock transfer |
— | — | — | |||||||||
Pondered average price within accounting reference period
for each of the following option groups |
||||||||||||
Outstanding at the beginning of the accounting
reference period |
— | — | — | |||||||||
Not redeemed throughout accounting reference period |
— | — | — | |||||||||
Redeemed within accounting reference period |
— | — | — | |||||||||
Expired within accounting reference period |
— | — | — | |||||||||
Fair option price on grant date |
— | R$ | 30,239,619 | 1 | R$ | 30,239,619 | 1 | |||||
Potential dilution in case all granted options were redeemed |
— | — | — | |||||||||
Note: |
||
1 — Values paid regarding the ILP cycle ended in January, 2010. |
||
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| Fiscal year ended on December 31, 2009 | ||||||||||||
| Executive Board | Statutory Board | Total | ||||||||||
Number of members |
— | 7 | 7 | |||||||||
With respect to each option grant |
||||||||||||
Grant date |
— | February 2009 | — | |||||||||
Number of granted options |
— | — | — | |||||||||
Deadline for options to become redeemable |
— | January 2012 | — | |||||||||
Deadline for redeeming options |
— | — | — | |||||||||
Grace period for stock transfer |
— | — | — | |||||||||
Pondered average price within accounting reference period
for each of the following option groups |
||||||||||||
Outstanding at the beginning of the accounting
reference period |
— | — | — | |||||||||
Not redeemed throughout accounting reference period |
— | — | — | |||||||||
Redeemed within accounting reference period |
— | — | — | |||||||||
Expired within accounting reference period |
— | — | — | |||||||||
Fair option price on grant date |
— | R$ | 14,566,434.00 | 1 | R$ | 14,566,434.00 | ||||||
Potential dilution in case all granted options were redeemed |
— | — | — | |||||||||
Note: |
||
1 — Calculation performed upon bonus % (profit share) as paid on February, 2009 |
||
Pursuant to the provisions of art. 67 of CVM directive no. 480/09, no information concerning
fiscal years 2007 and 2008 shall be submitted.
13.7 With respect to outstanding options for the Executive Board and the Statutory Board at the
closing of the last accounting reference period
Not applicable. See items 13.4 and 13.6 above.
13.8 With respect to redeemed and delivered options for the Executive Board and the Statutory
Board, in the past three accounting reference periods
Not applicable. See items 13.4 and 13.6 above.
13.9 Summary of relevant information aiming at a broader understanding of data presented under
items 13.6” through 13.8 above, as well as an explanation of the pricing method used for stock and
option values
Not applicable. See items 13.4 and 13.6 above.
13.10 Private Pension Funds in force granted to members of the Executive Board and the Statutory
Board
Pursuant to contract provisions, the Company pays for both the employer’s and the employee’s share,
up to 9% of the fixed compensation, to Valia — Fundação Vale do Rio Doce de Seguridade Social
(Vale do Rio Doce Social Security Foundation), or to any other private pension fund chosen by the
Statutory Board member.
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At Valia, the minimum required age for a retirement plan is 45 years of age, after having
contributed for the given plan for a minimum grace period of 5 years.
| Valia — Fundação Valor do Rio Doce de Seguridade Social | ||||||||||||
| Executive Board | Statutory Board | Total | ||||||||||
Number of members |
11 regular members | 8 | 29 | |||||||||
| and 10 deputy | ||||||||||||
| members | ||||||||||||
| Plan name | Benefits Plan “Vale Mais” (Plano de Benefícios Vale Mais) | |||||||||||
Number of managers that are eligible for retirement benefits |
— | 5 | 5 | |||||||||
Eligibility for early retirement |
— | — | — | |||||||||
Updated value of accumulated contributions to social
security and pension plan up until the closing of the last
accounting reference period, minus amounts paid by managers |
— | R$ | 7,331,786 | R$ | 7,331,786 | |||||||
Total accumulated amount of contributions paid throughout
the last accounting reference period, minus amounts paid by
managers |
— | R$ | 1,039,644 | R$ | 1,039,644 | |||||||
Eligibility for advanced redemption and conditions |
— | — | — | |||||||||
One of the members of the Statutory Board is a member of a private pension fund managed by Bradesco
Vida e Previdência S.A., which is described below:
| Bradesco Vida e Previdência S.A. | ||||
Plan name |
BD Plan (Pre-established Benefits) and PGBL Plan | |||
| (Pre-established Contribution) | ||||
Number of managers that are eligible for retirement benefits |
1 | |||
Eligibility for early retirement |
1- To have no bounds with Bradesco Organizations | |||
| 2- To be more than 10 years in a private pension plan | ||||
| 3- To be at least, 50 years old | ||||
Updated value of accumulated contributions to social
security and pension plan up until the closing of the last
accounting reference period, minus amounts paid by managers |
R$5,428,019 | |||
Total accumulated amount of contributions paid throughout
the last accounting reference period, minus amounts paid by
managers |
R$475,512 | |||
Eligibility for advanced redemption and conditions |
— | |||
13.11 Managers` Average Compensation
Information not disclosed due to injunctive relief granted in the case of ordinary proceedings No.
2010.51.01.002888-5 by the Honorable Judge of the 5th Circuit Court of Federal Justice of Rio de
Janeiro to IBEF/RJ, to which Vale and the company executives are linked. The concerning preliminary
injunction continuous in force due to the decision of the High Court of Justice in MC 17350-RJ.
13.12 Contract agreements, insurance policies or other instruments that might underlie the
compensation or indemnity mechanisms applicable to managers in the occurrence of dismissal or
retirement, and the financial burden they result in for the Company
The contracts signed by members of the Statutory Board have a provision for indemnity for contract
rescission or non-renewal once such events are generated by the Company. In the latter case, the
following amounts and conditions are provided for: (i) 2 (two) fixed annual salaries for the
Managing President; or (ii) 1 (one) fixed annual salary for the Executive Managers. Indemnity
payment is made in four quarterly payments and conditioned to a non-compete agreement to be in
force for the following 12 months.
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The contract also provides for a Life Insurance Policy, whose insured capital is worth twice as
much as the fixed annual compensation, for the purposes of death or total permanent disability
(TPD).
No other type of contract agreement is drawn with members of the Executive Board or the Fiscal
Board. The same applies to any other types of contract agreements, life insurance policies or any
other instruments that might underlie compensation or indemnity mechanisms in case an executive is
dismissed or retires.
13.13 With respect to the last three accounting reference periods, disclosing the percentage of
total compensation for each board or committee as acknowledged in the Company results and
which applies to members of the Executive Board, of the Statutory Board, or the Fiscal Board,
that are somehow connected to direct or indirect affiliates, in compliance with the accounting
rules that govern this matter.
| Board or Committee | Fiscal year ended on December 31, 2010 | |||
Executive Board |
90,00 | % | ||
Statutory Board |
0.00 | % | ||
Fiscal Board |
14.00 | % | ||
| Board or Committee | Fiscal year ended on December 31, 2009 | |||
Executive Board |
83.37 | % | ||
Statutory Board |
0 | % | ||
Fiscal Board |
25.00 | % | ||
Pursuant to the provisions of art. 67 of CVM directive no. 480/09, no information concerning 2007
and 2008 accounting reference period shall be submitted.
13.14 With respect to the last three accounting reference periods, disclosing the amounts as
acknowledged in the Company results for compensation paid to members of the Executive Board, of the
Statutory Board or the Fiscal Board, grouped by board or committee, for any purpose other than the
function they perform, such as commissions, consulting, or advisory services.
No payments of any other type rather than for the function they perform were made to any member of
the Executive Board, of the Statutory Board, or the Fiscal Board.
13.15 With respect to the last three accounting reference periods, disclose the amounts as
acknowledged in the results released by direct or indirect affiliates, subsidiaries or companies
under common control, by members of the Executive Board, of the Statutory Board or the Fiscal
Board, grouped per board or committee, specifying the purpose of such amounts paid to the referred
individuals.
| Fiscal year ended on 12/31/2010 | ||||||||||||||||
| executive board | statutory board | fiscal board | Total | |||||||||||||
direct and
indirect
controlling
entities |
0 | 0 | 0 | 0 | ||||||||||||
companies controlled by the company |
0 | R$961,667 mil1 (Fixed annual compensation: R$698,809 mil/ Direct and indirect benefits: R$262,858 mil) | 0 | R$961,677 mil | ||||||||||||
companies under common control |
0 | 0 | 0 | 0 | ||||||||||||
Note: |
||||
| 1 — | The above amount refers to compensation paid to an Executive Manager working at
our controlled company Vale Canada. |
|||
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| Fiscal year ended on 12/31/2009 | ||||||||||||||||
| executive board | statutory board | fiscal board | Total | |||||||||||||
direct and
indirect
controlling
entities |
0 | 0 | 0 | 0 | ||||||||||||
companies controlled by the company |
0 | R$707,352.001 (Fixed annual compensation: R$515,523.00 / Direct and indirect benefits: R$191,829.00) | 0 | R$707,352.00 | ||||||||||||
companies under common control |
0 | 0 | 0 | 0 | ||||||||||||
Note: |
||
| 1 — | The above amount refers to compensation paid to an Executive Manager working at
our controlled company Vale Canada |
|
Pursuant to the provisions of art. 67 of CVM directive no. 480/09, no information concerning
fiscal years 2007 and 2008 shall be submitted.
13.16 Other information that the Company might judge relevant
The proposal for global compensation of the managers for the fiscal year 2011 and submitted to the
General Annual Meeting intended to fix as a global sum the amount of up to R$ 108,961,196.00 (one
hundred and eight million, nine hundred and sixty-one thousand, one hundred and ninety-six reais),
to be distributed by the Executive Board, taking into account the responsibilities of the
administrators, the time devoted to their positions, the competence, the professional reputation,
and the value of their services in the market.
The above amount comprises: (a) up to R$6.967.120,00 (six million, nine hundred and sixty-seven
thousand, one hundred and twenty reais) corresponding to the fixed compensation of the members of
the Executive Board, of the Advisory Committees, pursuant to art. 15, paragraph 2 of the bylaws,
and of the members of the Fiscal Board, under the terms of Act No. 6404/76, Art. 163; (b) up to
R$73,373,846.00 (seventy-three million, three hundred and seventy-three thousand, eight hundred and
forty-six reais) corresponding to the fixed and variable compensation of the Executive Directors,
which takes into account an Executive Board comprised by 10 Executive Directors. The individual and
fixed compensation is compatible with the values paid to the executive members of similar
companies, while the payment of the variable compensation, corresponding to the bonus and the
long-term incentive, is linked to the fulfillment of predetermined goals, based on the performance
of the Company. Thus, the payment of the variable compensation is equivalent to the partial or
total fulfillment of the predetermined goals, and they may also be not owed in the event of not
reaching such goals; and (c) up to R$ 28,620,231.00 (twenty-eight million, six hundred and twenty
thousand, two hundred and thirty-one reais) corresponding to taxes and charges that have an
incidence over the compensation and the responsibility of Vale, and also, benefits of any nature.
The difference between the value of the proposal above mentioned and the one stated in item 13.2 —
total compensation of the executive board, statutory board and fiscal board, is due to the fact
that in item 13.2 it was roughly considered the compensation value to be approved for the members
of the Executive Board, the Advisory Boards and the Fiscal Boards of Vale, whilst the proposal of
annual global value to be submitted to consideration of the shareholders during their General
Annual Meeting, comprises also the compensation of the members of the Advisory Committees
(R$1,104,000.00), social charges of Vale’s responsibility (R$18,716,947.00).
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14.1 Description of the Company’s Human Resources
a. number of employees (total, by groups based on activity and by geographic location)
The chart below shows the number of employees of the Company and its controlled companies in the
financial years closed December 31, 2008, 2009 and 2010, by activity and by geographic location:
| Financial Year ended 31st December of: | ||||||||||||
| 2008 | 2009 | 2010 | ||||||||||
Total number of company employees |
62,490 | 60,036 | 70,785 | |||||||||
Per business area |
||||||||||||
Ferrous |
25,871 | 25,006 | 25,465 | |||||||||
Non ferrous |
21,267 | 19,358 | 17,765 | |||||||||
Coal |
901 | 1,103 | 1,776 | |||||||||
Logistics |
14,539 | 14,620 | 14,116 | |||||||||
Fertilizers |
1,276 | 1,576 | 6,284 | |||||||||
Others |
2,138 | 1,798 | 5,379 | |||||||||
Per geographical area |
||||||||||||
Brazil |
50,080 | 48,600 | 56,012 | |||||||||
Canada |
7,994 | 6,757 | 6,390 | |||||||||
Indonesia |
3,800 | 3,467 | 3,144 | |||||||||
New Caledonia |
790 | 856 | 950 | |||||||||
Australia |
833 | 834 | 893 | |||||||||
USA |
623 | 572 | 0 | |||||||||
China |
580 | 517 | 136 | |||||||||
Mozambique |
107 | 125 | 570 | |||||||||
Peru |
213 | 297 | 523 | |||||||||
Colombia |
6 | 177 | 361 | |||||||||
Chile |
56 | 58 | 183 | |||||||||
Others |
910 | 1,201 | 1,623 | |||||||||
b. the number of outsourced employees (total, by groups based on activity and by
geographic location)
the chart below shows the number of outsourced of the Company and its controlled companies in
the financial years closed December 31, 2008, 2009 and 2010, by activity and by geographic
location:
| Financial Year ended 31st December of: | ||||||||||||
| 2008 | 2009 | 2010 | ||||||||||
Total number of outsourced employees |
83,204 | 80,571 | 103,300 | |||||||||
Per business area |
||||||||||||
Ferrous |
23,481 | 20,551 | 12,674 | |||||||||
Non ferrous |
27,490 | 30,139 | 16,024 | |||||||||
Coal |
2,273 | 5,535 | 1,194 | |||||||||
Logistics |
15,560 | 12,932 | 10,392 | |||||||||
Fertilizers |
— | — | 10,043 | |||||||||
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| Financial Year ended 31st December of: | ||||||||||||
| 2008 | 2009 | 2010 | ||||||||||
Others |
15,861 | 14,195 | 52,973 | |||||||||
Per geographical area |
||||||||||||
Brazil |
71,693 | 63,229 | 74,857 | |||||||||
Canada |
2,261 | 1,189 | 3,583 | |||||||||
Indonesia |
3,584 | 2,710 | 3,169 | |||||||||
New Caledonia |
3,291 | 3,756 | 4,701 | |||||||||
Australia |
669 | 842 | 437 | |||||||||
USA |
22 | 16 | 0 | |||||||||
China |
2 | 5 | 0 | |||||||||
Mozambique |
1,631 | 4,104 | 7,729 | |||||||||
Peru |
786 | 3,027 | 575 | |||||||||
Colombia |
3 | 606 | 860 | |||||||||
Chile |
391 | 877 | 1,056 | |||||||||
Others |
332 | 2,991 | 6,333 | |||||||||
c. employee turnover index
The index of employee turnover (churning index) in financial years ending in 2008, 2009 and 2010
was 8.0%, 10.5% and 6.0%, respectively.
d. the company’s exposure to labor liabilities and contingencies
The company is a defendant in 22,102 labor and pension related lawsuits, involving the total value
of R$ 7.87 billion, for which there is a provision for R$ 1.12 billion by reason of the risks
involved. The labor and pension related lawsuits brought against the Company deal with matters such
as: overtime, hours traveling, additional pay for unhealthy and dangerous working conditions, pay
equity, and outsourcing, among others.
14.2 Comments about any relevant change that occurred with regard to the figures in the item “14.1”
above.
There has been no material change that occurred with regard to the figures in the previous item.
14.3 Description of Company employee remuneration policies
a. Salary and variable remuneration policy
The policy for salaries and variable remuneration for statutory and non-statutory Directors is
described in item 13 of this reference form.
Vale follows the practice already adopted in recent years to carry out comparative research on
remunerations offering all its own employees a salary equal to or higher than the legal minimum
practiced in each location. Additionally, by strengthening the culture for better results, the
remuneration package for each employee includes the payment of variable remuneration, calculated
according to the results achieved by the performance of company, department, individual, or team.
In Vale’s own units, performance assessment is based on annual goals aligned to business strategy.
These evaluations are conducted through an interactive process between employees and their
managers, as well as computer systems, in which the results are logged. The goals also serve as a
basis for the Variable Remuneration program, which awards employees for meeting or exceeding job
expectations.
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For the short-term performance (annual), the goals are defined based on the key strategic
objectives and annual budget, established by measuring economical-financial performance, technical
and operational performance and sustainability (management, health and safety and environment).
Since November 2007, Vale is signing collective agreements of two years validity with all trade
unions of workers in Brazil representing 100% of the total number of employees. As a result of the
agreements, there was a salary increase of 7% in each year, completing a total of 14.49% of
readjustment for each period of the Agreement; such periods are 2007/2009 and 2009/2011. In Canada,
Australia, Indonesia, New Caledonia, Mozambique, Peru, England, France, Norway, and Argentina, Vale
negotiates collective agreements with workers’ trade unions, with a duration between one and five
years.
Certain employees who are part of the management framework of Vale participate in incentive
programs, and may also receive deferred bonuses with periods of three years based on the
performance of the
Company, in which one of these programs is evaluated by total shareholder return relative to a
group of similar businesses (peers) during the reference period.
b. Benefits policy
The benefits are part of the total rewards package that ensures the employees’ — and their legal
dependents’ — protection and security during the term of the contract of employment.
Vale establishes global guidelines for granting benefits to ensure that they are offered
consistently in the various countries where Vale is present, bearing in mind the goals of its
business in each locality, the HR philosophy and corporate strategy, in addition to the legal
requirements of the country and the given local market conditions.
Benefits considered essential are welfare, health plan, life and accident insurance, and income
plans for times when the employee leaves the Company.
Benefits such as transport vouchers, education, Employee Assistance Plan, meals at work, and
personal accident insurance are offered in accordance with the specificity of each location.
As a result of globalization of the benefits offered, Vale implemented an offshore pension fund.
This Fund is for foreign employees admitted in countries where their participation in a local plan
is not viable and where it is possible to include them in the global plan. To be effective, a
global pension plan needs to provide a sufficient number of benefits which permit close monitoring
of performance of investments and a wide choice of funds, in addition to a simple and efficient
administration
c. Characteristics of compensation plans based on actions of non-administrator employees
Compensation plans based on actions described in item 13.4 of this Reference Form include the
company’s non-statutory Directors, as well as managerial level employees. The characteristics of
these plans are described in item 13.4 of this Reference Form.
14.4 Description of the relationships between the Company and trade unions
Vale builds a harmonious relationship with trade unions all around the world. In Brazil, in 68
years of Vale’s existence , employees only went on strike once (in 1989) and also only once was no
understanding reached with the unions, leaving the decision to the Labor Courts (collective salary
increase-1988). In all other years Vale signed collective agreements.
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In Brazil, Vale negotiates with approximately 50 trade unions and in the rest of the world with
over 15 unions. The Company has collective agreements with their unionized employees in its
operations in Brazil, Australia, Canada, Indonesia, New Caledonia, France, Norway, the United
Kingdom, Peru, and Argentina. Currently, Vale is negotiating the first labor collective agreement
in Mozambique.
Vale has been a pioneer in Brazil, in the conclusion of Collective Agreements with duration of two
years (the maximum allowed in Brazilian legislation), without annual wage increase clauses, or
indexing, which demonstrates not only the confidence of trade unions, but also that of its
employees. This experience is being extended to other companies in the Vale System in Brazil.
Vale (Brazil) also negotiated the Agreement of the Program of Participation in the earnings with a
duration of two years (2010 and 2011). This is unprecedented in Brazil.
After a strike, Vale signed two collective agreements in Canada, with a duration of 5 years
(Ontario, Newfoundland, and Labrador). Up to that moment the practice was to sign agreements with a
duration of 5 years.
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15.1 / 15.2 Identification of majority shareholder or group of shareholders / Information on
shareholders or groups of shareholders who work in conjunction with or who represent the same
interests, with a share equal to or greater than 5% of the same class or type of shares and which
are not listed in item “15.1”.
| Vale S.A. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common shares | Preferred shares | Total number of shares |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total number of | Date of | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A | Special Class | preferred shares | Shareholders’ | Controlling | last | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shareholder | Nationality | CPF/CNPJ | Quantity | % | Quantity | % | Quantity | % | Quantity | % | Quantity | % | agreement | entity | change | |||||||||||||||||||||||||||||||||||||||||||||
Valepar S.A. |
Brazilian | 01.772.413/0001-57 | 1,716,435,045 | 52.7 | 20,340,000 | 1.0 | 0 | 0.0 | % | 20,340,000 | 1.0 | 1,736,775,045 | 32.4 | No | Yes | 12/31/10 | ||||||||||||||||||||||||||||||||||||||||||||
BNDES Participações S.A. |
Brazilian | 00.383.281/0001-09 | 218,386,481 | 6.7 | 69,432,771 | 3.3 | 0 | 0.0 | % | 69,432,771 | 3.3 | 287,819,252 | 5.4 | No | No | 12/31/10 | ||||||||||||||||||||||||||||||||||||||||||||
Treasury |
— | — | 47,375,394 | 1.5 | 99,649,571 | 4.7 | 0 | 0.0 | % | 99,649,571 | 4.7 | 147,024,965 | 2.7 | — | — | 12/31/10 | ||||||||||||||||||||||||||||||||||||||||||||
Others |
— | — | 1,274,527,562 | 39.1 | 1,919,157,264 | 91.0 | 12 | 100.0 | % | 1,919,157,276 | 91.0 | 3,193,684,838 | 59.5 | — | — | 12/31/10 | ||||||||||||||||||||||||||||||||||||||||||||
Total |
3,256,724,482 | 100.0 | 2,108,579,606 | 100.0 | 12 | 2,108,579,618 | 100.0 | 5,365,304,100 | 100.0 | |||||||||||||||||||||||||||||||||||||||||||||||||||
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h) Information on direct and indirect controlling entities of Valepar, as far as controlling
entities who are individuals:
The table below presents information on Valepar S.A., direct controlling entity of Vale at December
31, 2010:
| Valepar S.A. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common shares | Preferred shares | Total number of shares |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total number of | Date of | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A | Class B | Class C | preferred shares | Shareholders’ | Controlling | last | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shareholder | Nationality | CPF/CNPJ | Qty. | % | Qty. | % | Qty. | % | Qty | % | Qty. | % | Qty. | % | agreement | entity | change | |||||||||||||||||||||||||||||||||||||||||||||||||||
Litel Participações S.A. |
Brazilian | 00.743.065/0001-27 | 637,443,857 | 49.00 | 200,864,272 | 71.41 | — | — | — | — | 200,864,272 | 78.51 | 838,308,129 | 48.79 | Yes | Yes | 12/31/10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Bradespar S.A. |
Brazilian | 03.847.461/0001-92 | 275,965,821 | 21.21 | — | — | — | — | 16,137,193 | 18.25 | 16,137,193 | 6.31 | 292,103,014 | 17.00 | Yes | Yes | 12/31/10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Mitsui & Co., Ltd |
Japanese | 05.466.338/0001-57 | 237,328,059 | 18.24 | — | — | — | — | 20,402,587 | 23.08 | 20,402,587 | 7.98 | 257,730,646 | 15.00 | Yes | Yes | 12/31/10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
BNDES Participações S.A. |
Brazilian | 00.383.281/0001-09 | 149,787,385 | 11.52 | — | — | — | — | 18,394,143 | 20.80 | 18,394,143 | 7.19 | 168,181,528 | 9.79 | Yes | Yes | 12/31/10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Eletron S.A. |
Brazilian | 00.514.998/0001-42 | 380,708 | 0.03 | — | — | — | — | 32,729 | 0.04 | 32,729 | 0.01 | 413,437 | 0.02 | Yes | Yes | 12/31/10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Others |
— | — | 80,416,931 | 28.59 | 47,601,522 | 100.00 | 33,449,068 | 37.83 | 161,467,521 | 38.69 | 161,467,521 | 9.40 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total |
1,300,905,830 | 100.0 | 281,281,203 | 100.00 | 47,601,522 | 100.00 | 88,415,720 | 100.00 | 1,718,204,275 | 100.00 | 1,718,204,275 | 100.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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The following table presents information on Litel Participações S.A., direct controlling entity of
Valepar S.A. at December 31, 2010:
| Litel Participações S.A. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Common shares | Preferred shares | Total number of shares |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total number of | Date of | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Class A | Class B | Class C | preferred shares | Shareholders’ | Controlling | last | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shareholder | Nationality | CPF/CNPJ | Qty. | % | Qty. | % | Qty. | % | Qty | % | Qty. | % | Qty. | % | agreement | entity | change | |||||||||||||||||||||||||||||||||||||||||||||||||||
BB Carteira Ativa |
Brazilian | 01.578.476/0001-77 | 193,740,121 | 78.40 | 103 | 14.11 | 28,385,274 | 100 | — | — | 28,385,377 | 78.50 | 222,125,498 | 78.41 | No | Yes | 12/31/10 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Others |
— | — | 53,388,224 | 21.60 | 627 | 85.89 | — | — | 7,772,020 | 100.00 | 7,772,604 | 21.50 | 61,160,871 | 21.59 | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Total |
247,128,345 | 100.0 | 730 | 100.0 | 28,385,274 | 100.0 | 7,772,020 | 100.0 | 36,158,024 | 100.0 | 283,286,369 | 100.0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
The following table presents information on Bradespar S.A., direct controlling entity of Valepar
S.A. at December 31, 2010:
| Bradespar S.A. | ||||||||||||||||||||||||||||||||||||||||||||
| Total number of | Date of | |||||||||||||||||||||||||||||||||||||||||||
| Common shares | Preferred shares | shares | Shareholders’ | Controlling | last | |||||||||||||||||||||||||||||||||||||||
| Shareholder | Nationality | CPF/CNPJ | Qty. | % | Qty | % | Qty. | % | agreement | entity | change | |||||||||||||||||||||||||||||||||
Nova Cidade de Deus Participações S.A. |
Brazilian | 04.866.462/0001-47 | 1,637,008 | 1.34 | 650,032 | 0.29 | 2,287,040 | 0.65 | No | Yes | 12/30/10 | |||||||||||||||||||||||||||||||||
NCF Participações S.A. |
Brazilian | 04.233.319/0001-18 | 23,767,944 | 19.40 | — | — | 23,767,944 | 6.80 | No | Yes | 12/30/10 | |||||||||||||||||||||||||||||||||
Cidade de Deus Cia. Cial. de Participações S.A. |
Brazilian | 61.529.343/0001-32 | 44,883,224 | 36.63 | 300,960 | 0.13 | 45,184,184 | 12.93 | No | Yes | 12/30/10 | |||||||||||||||||||||||||||||||||
Fundação Bradesco |
Brazilian | 60.701.521/0001-06 | 18,179,304 | 14.84 | 2,210,984 | 0.97 | 20,390,288 | 5.83 | No | Yes | 12/30/10 | |||||||||||||||||||||||||||||||||
Others |
— | — | 34,055,569 | 27.80 | 223,862,920 | 98.61 | 257,918,489 | 73.79 | — | — | 12/30/10 | |||||||||||||||||||||||||||||||||
Total |
122,523,049 | 100.00 | 227,024,896 | 100.00 | 349,547,945 | 100.00 | ||||||||||||||||||||||||||||||||||||||
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The following table presents information on the controlling group of Cidade de Deus Cia. Cial. de
Participações S.A., direct controlling entity of Bradespar S.A., at December 31, 2010:
| Cidade de Deus Cia. Cial. de Participações S.A. | ||||||||||||||||||||||||||||||||||||||||||||
| Total number of | Date of | |||||||||||||||||||||||||||||||||||||||||||
| Common shares | Preferred shares | shares | Shareholders’ | Controlling | last | |||||||||||||||||||||||||||||||||||||||
| Shareholder | Nationality | CPF/CNPJ | Qty. | % | Qty. | % | Qty. | % | agreement | entity | change | |||||||||||||||||||||||||||||||||
Nova Cidade de Deus Participações S.A. |
Brazilian | 04.866.462/0001-47 | 2,875,821,893 | 44.91 | — | — | 2,875,821,893 | 44.91 | No | Yes | 12/30/10 | |||||||||||||||||||||||||||||||||
Fundação Bradesco |
Brazilian | 60.701.521/0001-06 | 2,126,303,394 | 33.20 | — | — | 2,126,303,394 | 33.20 | No | Yes | 12/30/10 | |||||||||||||||||||||||||||||||||
Lina Maria Aguiar |
Brazilian | 017.080.078-49 | 545,065,640 | 8.51 | — | — | 545,065,640 | 8.51 | No | Yes | 12/30/10 | |||||||||||||||||||||||||||||||||
Lia Maria Aguiar |
Brazilian | 003.692.768-68 | 448,931,586 | 7.01 | — | — | 448,931,586 | 7.01 | No | Yes | 12/30/10 | |||||||||||||||||||||||||||||||||
Maria Angela Aguiar |
Brazilian | 000.548.238-03 | 301,985,187 | 4.71 | — | — | 301,985,187 | 4.71 | No | Yes | 12/30/10 | |||||||||||||||||||||||||||||||||
Others |
— | — | 106,084,359 | 1.66 | — | — | 106,084,359 | 1.66 | — | — | 12/30/10 | |||||||||||||||||||||||||||||||||
Total |
6,404,192,059 | 100.00 | — | — | 6,404,192,059 | 100.00 | ||||||||||||||||||||||||||||||||||||||
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The following table presents information on Nova Cidade de Deus Participações S.A., direct
controlling entity of Cidade de Deus Cia. Cial. de Participações S.A. and of Bradespar, at March
16, 2011:
| Nova Cidade de Deus Participações S.A. | ||||||||||||||||||||||||||||||||||||||||||||
| Total number of | Date of | |||||||||||||||||||||||||||||||||||||||||||
| Common shares | Preferred shares | shares | Shareholders’ | Controlling | last | |||||||||||||||||||||||||||||||||||||||
| Shareholder | Nationality | CPF/CNPJ | Qty. | % | Qty. | % | Qty. | % | agreement | entity | change | |||||||||||||||||||||||||||||||||
BBD Participações S.A. |
Brazilian | 07.838.611/0001-52 | 131,373,281 | 53.70 | — | — | 131,373,281 | 25.86 | No | Yes | 03/16/11 | |||||||||||||||||||||||||||||||||
Fundação Bradesco |
Brazilian | 60.701.521/0001-06 | 113,277,179 | 46.30 | 259,240,518 | 98.41 | 372,517,697 | 73.32 | No | Yes | 03/16/11 | |||||||||||||||||||||||||||||||||
Shares in treasury |
— | — | — | — | 4,194,859 | 1.59 | 4,194,859 | 0.83 | — | — | 03/16/11 | |||||||||||||||||||||||||||||||||
Total |
244,650,460 | 100.00 | 263,435,377 | 100.00 | 508,085,837 | 100.00 | ||||||||||||||||||||||||||||||||||||||
The following table presents information on BBD Participações e Investimentos S.A., controlling
entity of Nova Cidade de Deus Participações S.A., at December 31, 2010:
| BBD Participações S.A. | ||||||||||||||||||||||||||||||||||||||||||||
| Total number of | Date of | |||||||||||||||||||||||||||||||||||||||||||
| Common shares | Preferred shares | shares | Shareholders’ | Controlling | last | |||||||||||||||||||||||||||||||||||||||
| Shareholder | Nationality | CPF/CNPJ | Qty. | % | Qty. | % | Qtde | % | agreement | entity | change | |||||||||||||||||||||||||||||||||
Lázaro de Mello Brandão |
Brazilian | 004.637.528-72 | 10,997,761 | 6.24 | — | — | 10,997,761 | 4.44 | No | Yes | 03/16/11 | |||||||||||||||||||||||||||||||||
Shares in treasury |
42,963,095 | 24.38 | 19,324,582 | 26.94 | 62,287,677 | 25.12 | — | — | 03/16/11 | |||||||||||||||||||||||||||||||||||
Others |
122,245,443 | 69.98 | 52,413,954 | 73.06 | 174,659,397 | 70.44 | — | — | 03/16/11 | |||||||||||||||||||||||||||||||||||
Total |
176,206,299 | 100.00 | 71,738,536 | 0 | 247,944,835 | 100.00 | ||||||||||||||||||||||||||||||||||||||
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The following table presents information on NCF Participações S.A., direct controlling entity of
Bradespar S.A., at January 28, 2011:
| NCF Participações S.A. | ||||||||||||||||||||||||||||||||||||||||||||
| Total number of | Date of | |||||||||||||||||||||||||||||||||||||||||||
| Common shares | Preferred shares | shares | Shareholders’ | Controlling | last | |||||||||||||||||||||||||||||||||||||||
| Shareholder | Nationality | CPF/CNPJ | Qty | % | Qty. | % | Qty. | % | agreement | entity | change | |||||||||||||||||||||||||||||||||
Fundação Bradesco |
Brazilian | 60.701.521/0001-06 | 157,787,040 | 25.13 | 559,621,223 | 100.00 | 717,408,263 | 60.41 | No | Yes | 03/16/11 | |||||||||||||||||||||||||||||||||
Cidade de Deus Cia. Cial. De Participações S.A. |
Brazilian | 61.529.343/0001-32 | 469,186,416 | 74.72 | 0 | 0 | 469,186,416 | 39.51 | No | Yes | 03/16/11 | |||||||||||||||||||||||||||||||||
Nova Cidade de Deus Participações S.A. |
Brazilian | 04.866.462/0001-47 | 939,388 | 0.15 | 0 | 0 | 939,388 | 0.08 | No | Yes | 03/16/11 | |||||||||||||||||||||||||||||||||
Total |
176,206,299 | 100.00 | 71,738,536 | 100.00 | 247,944,835 | 100.00 | ||||||||||||||||||||||||||||||||||||||
The following table presents information on BNDES Participações S.A., shareholder of more than the
5% of the voting capital stock of Valepar S.A. at December 31, 2010:
| BNDES Participações S.A. | ||||||||||||||||||||||||||||||||||||
| Date of | ||||||||||||||||||||||||||||||||||||
| Common shares | Total of shares | Shareholders’ | Controlling | last | ||||||||||||||||||||||||||||||||
| Shareholder | Nationality | CPF/CNPJ | Qty. | % | Qty. | % | agreement | entity | change | |||||||||||||||||||||||||||
Banco Nacional de
Desenvolvimento
Econômico e Social
— BNDES |
Brazilian | 33.657.248/0001-89 | 1 | 100.00 | 1 | 100.00 | — | Yes | 12/31/10 | |||||||||||||||||||||||||||
Total |
1 | 100.00 | 1 | 100.00 | ||||||||||||||||||||||||||||||||
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The following table presents information on Eletron S.A., direct controlling entity of Valepar S.A.
at December 31, 2010:
| Elétron S.A. | ||||||||||||||||||||||||||||||||||||||||||||
| Total number of | Date of | |||||||||||||||||||||||||||||||||||||||||||
| Common shares | Preferred shares | shares | Shareholders’ | Controlling | last | |||||||||||||||||||||||||||||||||||||||
| Shareholder | Nationality | CPF/CNPJ | Qty. | % | Qty. | % | Qty | % | agreement | entity | change | |||||||||||||||||||||||||||||||||
Opportunity Anafi Paticipações S.A. |
Brazilian | 02.992.366/0001-10 | 3,957,768 | 99.97 | — | — | 3,957,768 | 99.97 | No | Yes | 12/31/10 | |||||||||||||||||||||||||||||||||
Others |
— | — | 1,087 | 0.03 | — | — | 1,087 | 0.03 | — | — | 12/31/10 | |||||||||||||||||||||||||||||||||
Total |
3,958,855 | 100.00 | — | — | 3,958,855 | 100.00 | ||||||||||||||||||||||||||||||||||||||
The following table gives information on Opportunity Anafi Participações S,A., direct controlling
entity of Eletron S.A., at December 31, 2010:
| Opportunity Anafi Participações S.A. | ||||||||||||||||||||||||||||||||||||||||||||
| Total number of | Date of | |||||||||||||||||||||||||||||||||||||||||||
| Common shares | Preferred shares | shares | Shareholders’ | Controlling | last | |||||||||||||||||||||||||||||||||||||||
| Shareholder | Nationality | CPF/CNPJ | Qty. | % | Qty. | % | Qty. | % | agreement | entity | change | |||||||||||||||||||||||||||||||||
Belapart S.A. |
Brazilian | 01.608.571/0001-76 | 1,236,116 | 38.47 | — | — | 1,236,116 | 38.47 | No | Yes | 12/31/10 | |||||||||||||||||||||||||||||||||
Opportunity Holding FIP |
Brazilian | 08.277.553/0001-06 | 741,264 | 23.06 | — | — | 741,264 | 23.07 | No | Yes | 12/31/10 | |||||||||||||||||||||||||||||||||
Valetron S.A. |
Brazilian | 01.772.313/0001-20 | 1,236,116 | 38.47 | — | — | 1,236,116 | 38.47 | No | Yes | 12/31/10 | |||||||||||||||||||||||||||||||||
Others |
— | — | 6 | 0.00 | — | — | 6 | 0.00 | — | — | 12/31/10 | |||||||||||||||||||||||||||||||||
Total |
3,213,502 | 100.00 | — | — | 3,213,502 | 100.00 | ||||||||||||||||||||||||||||||||||||||
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The table below presents information on Belapart S.A. and Valetron S.A., direct controlling
entities of Opportunity Anafi Participações S,A., at December 31, 2010:
| Valetron S.A. | ||||||||||||||||||||||||||||||||||||||||||||
| Total number of | Date of | |||||||||||||||||||||||||||||||||||||||||||
| Common shares | Preferred shares | shares | Shareholders’ | Controlling | last | |||||||||||||||||||||||||||||||||||||||
| Shareholder | Nationality | CPF/CNPJ | Qty. | % | Qty | % | Qtde | % | agreement | entity | change | |||||||||||||||||||||||||||||||||
Verônica Valente Dantas |
Brazilian | 262.853.205-00 | 505 | 50.50 | 0 | 0 | 505 | 50.50 | No | Yes | 12/31/10 | |||||||||||||||||||||||||||||||||
Others |
— | — | 495 | 49.50 | — | — | 495 | 49.50 | — | — | 12/31/10 | |||||||||||||||||||||||||||||||||
Total |
1,000 | 100.00 | — | — | 1,000 | 100.00 | ||||||||||||||||||||||||||||||||||||||
| Belapart S.A. | ||||||||||||||||||||||||||||||||||||||||||||
| Total number of | Date of | |||||||||||||||||||||||||||||||||||||||||||
| Common shares | Preferred shares | shares | Shareholders’ | Controlling | last | |||||||||||||||||||||||||||||||||||||||
| Shareholder | Nationality | CPF/CNPJ | Qty | % | Qty. | % | Qty. | % | agreement | entity | change | |||||||||||||||||||||||||||||||||
Verônica Valente Dantas |
Brazilian | 262.853.205-00 | 505 | 50.50 | 0 | 0 | 505 | 50.50 | No | Yes | 12/31/10 | |||||||||||||||||||||||||||||||||
Others |
— | — | 495 | 49.50 | — | — | 495 | 49.50 | — | — | 12/31/10 | |||||||||||||||||||||||||||||||||
Total |
1,000 | 100,00 | — | — | 1,000 | 100.00 | ||||||||||||||||||||||||||||||||||||||
15.3 Distribution of Capital
Date of last meeting |
05/18/11 | |||
Number of individual shareholders |
171,555 | |||
Number of corporate shareholders |
2,470 | |||
Number of institutional investors |
3,336 |
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Outstanding shares
Outstanding shares corresponding to all shares issued by the Company, except for the shares kept by
the controlling entity, by people related to it, by the managers of the Company, and by the shares
held in treasury
Quantity of common shares (Units) |
1.274.270,212 | 39.1 | % | |||||
Quantity of class A preferred shares (Units) |
1,914,932.776 | 90.8 | % | |||||
Quantity of special class preferred shares (Units) |
0 | 0.0 | % | |||||
Total |
3,189,202,988 | 59.4 | % |
15.4 In case the issuer desires to do so, please insert the organizational chart of company
shareholders identifying all direct and indirect controlling entities as well as shareholders with
a participation equal to or more than 5% of one class or type of shares, compatible with the
information stated in 15.1 and 15.2:
Vale decided not to disclose the organizational chart of its shareholders at that moment.
15.5 Shareholders’ Agreements filed at the headquarters of the Company in which the controlling
entity participates, which regulate the exercise of voting rights or rights to transfer Company
shares:
Vale does not have a shareholders’ agreement. However, the controlling shareholders of Valepar S.A.
signed a Private Instrument of Agreement for Valepar S.A. shareholders (Shareholders’ Agreement).
a) Parties
Litel Participações S.A., Bradespar S.A., Mitsui & Co. Ltd., BNDES Participações S.A. and Eletron
S.A. (Signatories)
b) Date of Signing
April 24, 1997
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c) Term
20 years from the date signed, extendable for equal periods of 10 years.
d) Description of clauses relative to the exercise of the right to vote and controlling votes.
The Shareholders’ Agreement stipulates that the Signatories shall be obliged to orientate their
representatives in the General Meetings and the meetings of Vale’s Board of Directors to vote as
per agreed in the prior Meeting of Valepar.
With the exception of permitted quorums mentioned below, items in the Prior Meetings will be
decided by a simple majority of the votes of the Signatories present.
In accordance with the Shareholders’ Agreement, it is necessary to have the support of at least 75%
of the holders of the relevant common shares for the adoption of the following items:
• amendment of Vale’s bylaws, except for a legal requirement;
• increase of Vale’s share capital by share subscription, creation of a new class of shares, change
in the characteristics of the existing shares or any reduction of Vale’s share capital;
• issuance of debentures of Vale, whether or not convertible into shares of Vale, call options or
any other security of Vale;
• determination of issuance price for any new shares of share capital or other security of Vale;
• amalgamation, spin-off, or merger to which Vale is a party, as well as any change to Vale’s
corporate form;
• dissolution, receivership, bankruptcy or any other voluntary act for financial reorganization or
any suspension thereof;
• the election and replacement of Vale’s Board of Directors, including the Chairman of the Board,
and any executive officer of Vale;
• the disposal or acquisition by Vale of an equity interest in any company, as well as the
acquisition of any shares of share capital of Vale for maintenance in treasury;
• the participation by Vale in a group of companies or in a consortium of any kind;
• the execution by Vale of agreements relating to distribution, investment, sales, exportation,
technology transfer, trademark license, patent exploration, license to use, and leases in which
Vale is a part;
• the approval and amendment of Vale’s business plan;
• the determination of the compensation of the executive officers and directors of Vale, as well as
the duties of the Board of Directors and the Board of Executive Officers;
• any profit sharing among the members of the Board of Directors or Board of Executive Officers of
Vale
• any change in the corporate purpose of Vale;
• the distribution or non-distribution of any dividends (including distributions classified as
interest on shareholders’ equity) on any shares of share capital of Vale other than as provided in
Vale’s bylaws;
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• the appointment and replacement of Vale’s independent auditor;
• the creation of any “in rem” guarantee, granting of guarantees including rendering of sureties by
Vale with respect to obligations of any unrelated party, including any affiliates or subsidiaries;
• the passing of any resolution on any matter which, pursuant to applicable law, entitles a
shareholder to withdrawal rights through reimbursement of his shares;
• the appointment and replacement by the Board of Directors of any representative of Vale in
subsidiaries, companies related to Vale or other companies in which Vale is entitled to appoint
directors and officers; and
• any change in the maximum debt limit and debt to equity threshold, as defined in the
shareholders’ agreement, among others.
e) Description of clauses relative to the appointment of directors
The management of Vale’s business will be carried out by experienced, independent, competent
professionals, who have the required qualifications for the positions that they hold.
For the purpose of electing Members of the Board at the respective General Meetings, the
Signatories will indicate the total number of Board members, whose designation will fall to
Valepar, proportionately to its share in the share capital of Valepar. The CEO of Vale will be
selected from names in a triple list put forward by an international executive search company and
elected in a meeting of the Board of Directors summoned for this purpose. It will fall to the CEO
of Vale to propose to the Board of Executive Officers the names of the other directors.
Each Signatory will, during the period of his or her respective mandate, be able to replace the
Board member they indicated. In this situation, all Signatories will vote in favor of the name thus
proposed at the General Meeting called for this purpose.
f) Description of clauses relative to the transfer of shares and the preference for acquiring them
The Shareholder Agreement stipulates that Valepar S.A. will have preference as regards the
Signatories for the acquisition at any time of Vale’s shares, as well as vetoing the direct
acquisition of Vale shares by the Signatories, unless there is authorization from the remaining
Signatories, to be granted in a Prior Shareholder Meeting, at which the issue must be approved by a
quorum of 75% of the total of the common Valepar shares, related to the shareholder agreement.
In line with the Shareholder Agreement, it is necessary to have the Approval of the Shareholders of
100% of the common shares related to the Agreement in question for the disposal in any form of Vale
shares owned by Valepar.
g) Description of clauses which restrict or tie voting rights of members of the Board of Directors
See line “d)”.
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15.6 Significant Changes in the shareholdings of Members of the Control Group and directors of the
Company in the last 3 financial years
There were no significant changes in the shareholdings of Members of the Control Group and
directors of the Company in the last 3 financial years.
15.7 Other information which the Company deems relevant
The following is additional information related to Vale controlling group:
1) As described in item 15.1, Litel Participações S.A., is one of the indirect controllers of Vale,
and it is controlled by BB Carteira Ativa.
BB Carteira Ativa shares are 100% owned by PREVI — Caixa de Previdência dos Funcionários do Banco
do Brasil (“PREVI”). BB Carteira Ativa is managed by BB Gestão de Recursos — Distribuidora de
Títulos e Valores Mobiliários S.A.
Previ is a private pension fund and its participants are employees of the Banco do Brasil and of
Previ itself. Previ management is divided between the Board of Directors and the Board of Executive
Officers. The Board of Executive Officers is composed of six members: President, Director of
Administration, and Directors for Investments, Security, Participations, and Planning. The Board of
Directors is composed of six members and their substitutes. Three are elected by the participants
and users of the security, and three others indicated by the Banco do Brasil. According to the
Statutes of Previ, the Board of Directors is the part of the organizational structure responsible
for defining the general policy of the administration of the entity.
On December 31, 2010 the Board of Directors was composed of the following board members: Robson
Rocha (President), Ivan de Souza Monteiro, Alexandre Correa Abreu, Mirian Cleusa Fochi, Celia Maria
Xavier Larichia and William José Alves Bento; and their respective substitutes: Carlos Eduardo Leal
Neri, Amauri Sebastião Niehues, Eduardo Cesar Pasa, Waldenor Moreira Borges, Jr., Luiz Carlos
Teixeira, and José Souza de Jesus. The Board of Executive Officers was composed of the following
members: Ricardo José da Costa Flores (President), Paulo Assunção de Sousa (Director of
Administration), Renê Sanda (Director of Investments), Marco Geovanne Tobias da Silva (Director of
Participations), Vitor Paulo Camargo Gonçalves (Director of Planning), José Ricardo Sasseron
(Diretor of Security). The Audit Committee was composed of the following members: Romildo Gouveia
Pinto (President), Fabiano Félix do Nascimento, Renato Donatello Ribeiro and Lúcio Tameirão
Machado; and by their corresponding substitutes: Francisco de Assis Chaves Costa, Aldo Bastos
Alfano, Sérgio Iunes Brito e Rudinei dos Santos. Additionally, the CEO, Sr. Sérgio Ricardo Silva
Rosa, was responsible, among other things, for representing Previ, and the Director of
Participations, Mr. Marco Geovanne Tobias da Silva, for monitoring the companies which make up the
variable income portfolio and the real estate portfolio, especially as concerns the shareholdings
and Previ’s share and representation in the administrative and supervisory organs of the companies
or undertakings, with a view to adopting any measures necessary to assure good corporate governance
for companies in which investments have been made.
2) As described in the item 15.1, Fundação Bradesco is one of the indirect controlling of Vale
The Fundação Bradesco is a non-profit entity which has worked to foster and develop children and
adolescents through schools in low income areas. The activities of the Bradesco Foundation are
financed exclusively by resources coming from donations which Bradesco and its affiliates make, as
well as from dividends and interest on its own capital from its share in Bradesco capital.
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According to the terms of the Fundação Bradesco bylaws, all Bradesco directors, members of the
Board and department directors, as well as all directors and responsible for Cidade de Deus Cia.
Cial. de Participações S.A., act as members of the board of trustees of the Fundação Bradesco,
known as the Mesa Regedora,
3) As described in the item 15.1, Mitsui & Co. Ltd. is one of the indirect controlling of Vale
Mitsui & Co. Ltd., direct controlling entity of Valepar S.A., has share control spread among many
shareholders. The following table presents information regarding Mitsui & Co. Ltd. on March 31,
2011:
| Mitsui & Co. Ltd. | ||||||||||||||||||||||||||||||||||||
| Total number of | Date of | |||||||||||||||||||||||||||||||||||
| Common shares | Preferred shares | shares | Shareholder’s | Controlling | last | |||||||||||||||||||||||||||||||
| Shareholder | Qty | % | Qty. | % | Qty | % | agreement | entity | change | |||||||||||||||||||||||||||
The Master Trust Bank of Japan, Ltd. (trust account) |
165,510,000 | 9.05 | % | — | — | 165,510,000 | 9.05 | % | No | No | 03/31/11 | |||||||||||||||||||||||||
Japan Trustee Services Bank, Ltd. (trust account) |
124,499,000 | 6.81 | % | — | — | 124,499,000 | 6.81 | % | No | No | 03/31/11 | |||||||||||||||||||||||||
Sumitomo Mitsui Banking Corporation |
38,500,000 | 2.10 | % | — | — | 38,500,000 | 2.10 | % | No | No | 03/31/11 | |||||||||||||||||||||||||
SSBT OD05 Omnibus Account (Treaty Clients) |
36,662,000 | 2.00 | % | — | — | 36,662,000 | 2.00 | % | No | No | 03/31/11 | |||||||||||||||||||||||||
Nippon Life Insurance Company |
35,070,000 | 1.92 | % | — | — | 35,070,000 | 1.92 | % | No | No | 03/31/11 | |||||||||||||||||||||||||
Japan Trustee Services Bank, Ltd.(Trust account 9) |
30,509,000 | 1.67 | % | — | — | 30,509,000 | 1.67 | % | No | No | 03/31/11 | |||||||||||||||||||||||||
State Street Bank and Trust Company |
30,491,000 | 1.67 | % | — | — | 30,491,000 | 1.67 | % | No | No | 03/31/11 | |||||||||||||||||||||||||
Others |
1,367,912,527 | 74.78 | % | — | — | 1,367,912,527 | 74.78 | % | — | — | 03/31/11 | |||||||||||||||||||||||||
Total |
1,829,153,527 | 100,0 | % | — | — | 1,829,153,527 | 100.0 | % | ||||||||||||||||||||||||||||
4) As described in item 15.1, Banco Nacional de Desenvolvimento Econômico e Social — BNDES is one
of the indirect controlling entities of Vale. BNDES is a public company with legal personality
under private law, whose shares are 100% owned by the Federal Government.
5) As described in item 15.1, Opportunity Holding FIP is one of the indirect controlling entities
of Vale. Opportunity Holding FIP is an investment fund, and the person responsible for its
investment decisions is the fund manager, Mr. Marco Nascimento Ferreira, CPF No. 489.614.185-72.
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16.1 Rules, Policies, and Practices for Transactions with Related Parties.
Vale is the largest private Brazilian company, and operates in various segments of the economy,
with cash flow and wealth consistent with its size. For this reason, in view of the constant search
for better trading conditions for the achievement of its activities and the investment of its
resources, the Company often negotiates the terms of the transactions inherent in its businesses,
which inevitably leads to agreeing on transactions with related parties whenever its best interests
and those of its shareholders are served.
Thus, transactions with related parties are made by the Company in a strictly exchanged based
manner, observing usual price and market conditions, and therefore do not generate any undue
advantage to their counterparts nor damage to the Company.
As provided in the Bylaws, it is Vale’s Board of Directors’ responsibility to discuss any
business between the Company and (i) its shareholders, directly or through interposed companies,
(ii) companies that participate, directly or indirectly, in the capital of a controlling
shareholder or are Subsidiary by or under common control of entities that participate in the
capital of the controlling shareholder, and / or (iii) companies in which the controlling
shareholder of the company is involved. Accordingly, the Board of Directors may delegate
responsibilities with limits and procedures that meet the peculiarities and nature of operations,
without withholding due information on all the Company’s transactions with related parties.
Additionally, Vale has a Governance and Sustainability Committee committed to reviewing and
proposing improvements to its management system to avoid conflicts of interest, as well as
advising on potential conflicts of interest between the Company, its shareholders, and directors.
The procedures for making decisions for the conduct of transactions with related parties follow
the terms of Corporate Law, which stipulate that the shareholder or director, as appropriate, in
general meetings or meetings of directors, abstain from voting on resolutions concerning: (i) the
valuation report of assets, which contribute to the formation of equity capital, (ii) the
approval of its accounts as administrator, and (iii) any matters that may benefit them in any
particular way. Additionally, in accordance with the provisions of Corporate Law and the
practices adopted by Vale, its administrators must abstain from intervening in any matter in
which they have conflicting interests with the Company, including withdrawing from the room or
area where the administration meeting is being held.
Finally, according to the Rules of Corporate Governance Practice Level I, the Company will send to
the BM & F BOVESPA Exchange, and disseminate information of any contract between the Company and
its subsidiaries and affiliates, directors, controlling shareholders, and also between the Company
and subsidiaries and affiliates of its directors and controlling shareholders, as well as other
firms with any of these people forming part of the same group de facto or de jure, whenever, in any
single contract or successive contracts, with or without the same purpose in any one year an amount
equal to or more than R$ 200 thousand, or an amount greater than or equal to 1.0% of equity,
whichever is the greater, is proposed. These disclosures should identify the purpose of the
contract, the term, the value, the conditions for recision or termination of the contract and its
potential influence on the administration or conduct of the Company’s affairs.1
16.2 Information on Transactions with Related Parties
Name of related party
|
Banco Nacional de Desenvolvimento Econômico e Social — BNDES | |
Date of transaction
|
10/08/2007 | |
Amount (R$)
|
774,568,410.00 | |
Current balance (R$) (12/31/2010)
|
629,407,154.71 | |
Amount of related party
|
Not applicable | |
Duration
|
09/15/2019 | |
Loan or other type of debt
|
YES | |
Interest rate
|
1.8% | |
Relationship with the Issuer
|
Indirect controlling shareholder | |
Purpose of the contract
|
Funding for expansion of transport capacity of Carajás Railroad |
| 1 | Highlighted text not in the Portuguese version |
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Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
BNDES may terminate the contract in advance, with the enforceability of the debt and immediate suspension of any disbursement, if in addition to the cases set forth in Articles 39 and 40 of “PROVISIONS APPLICABLE TO BNDES CONTRACTS, the following are certified by BNDES: | |
| a) reducing Vale’s staff without offering training programs and/or replacement programs for workers in other companies; | ||
| b) inclusion in Vale bylaws, statute or contract, of a provision by which a special quorum is required for deliberation or approval of matters limiting or restricting Vale or its controlling shareholders, or even the inclusion therein, of conditions leading to: | ||
i) restrictions on Vale’s ability to grow or its technological development; |
||
ii) restrictions on Vale’s access to new markets, or |
||
iii) restrictions or loss of ability to pay financial obligations resulting from this
operation; |
||
| c) the use of proceeds to finance any purpose other than the expansion of Carajás railroad’s transport capacity to 103 million tons transported annually; d) give, without prior authorization from BNDES, guaranties of any kind in operations with other creditors without the same quality of guaranties provided to BNDES, with equal priority of payment; | ||
| e) not observing the following ratios during the term of the contract: | ||
• Adjusted EBITDA debt ratio less than or equal to 4.5, and |
||
• Adjusted EBITDA ratio of Interest Expense greater than or equal to 2.0. |
||
| f) And, in case these ratios are not observed, guarantees an amount equivalent to at least 130% of the debt, as stipulated by BNDES within 60 days from the date of written communication. | ||
| In case the proceeds granted under this Contract are used for any purpose other than the expansion of the Carajás railroad’s annual transport capacity to 103 million tons, BNDES, without prejudice to the provisions, will inform the Federal Public Prosecutor, pursuant to the terms of Law No. 7492 of 16.06.86. | ||
| This contract will also expire, with the enforceability of the debt and suspension of any immediate disbursement, at the date of installing as a Federal Deputy or Senator or any person remunerated by Vale, or any owner, shareholder, or director of Vale, or any person listed in the prohibitions provided by the Federal Constitution, article 54, paragraphs I and II. There will be no impact on charges of default, provided that the debt payment occurs within five (5) business days as of the date of installing, under risk of, if in default, assuming all charges related to the assumptions set forth above for early expiration by default. | ||
| The change in indirect control of Vale, during the term of the Contract, is excluded from the possibility of early expiration by default. | ||
Nature and reason for the transaction/other relevant information
|
Applicable interest rate is: TJLP (long-term interest rate) +1.8% a.a. This is funding for expansion of transport capacity of Carajás Railroad | |
Name of related party
|
Banco Nacional de Desenvolvimento Econômico e Social — BNDES | |
Date of transaction
|
03/28/2008 | |
Amount (R$)
|
808,350,800.00 | |
Current balance (R$) (12/31/2010)
|
885,193,114.09 | |
Amount of related party
|
Not applicable | |
Duration
|
09/15/2029 | |
Loan or other type of debt
|
YES | |
Interest rate
|
1.46% p.a. | |
Relationship with the Company
|
Indirect controlling shareholder | |
Purpose of the contract
|
Financing for installation of the UHE Estreito Hydroelectric Power Plant | |
Guaranties and insurance
|
None |
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Conditions of termination or expiration
|
BNDES may terminate this contract in advance, with the enforceability of the debt and immediate suspension of any disbursement, if in addition to the cases set forth in Articles 39 and 40 of “PROVISIONS APPLICABLE TO BNDES CONTRACTS, the following are certified by BNDES: | |
| a) reducing Vale’s staff without providing training programs and/or replacement programs for workers in other companies; | ||
| b) inclusion in Vale bylaws, statute, or contract, of a provision by which a special quorum is required for deliberation or approval of matters limiting or restricting control of any of these companies by the respective controlling shareholders, or even the inclusion therein, of conditions leading to: | ||
i) restrictions on Vale’s ability to grow or its technological development; |
||
ii) restrictions on Vale’s access to new markets, or |
||
iii) restrictions or loss of ability to pay financial obligations resulting from this
operation; |
||
| c) give, without prior authorization from BNDES, guaranties of any kind in operations with other creditors without the same quality of guaranties provided to BNDES, with equal priority of payment; | ||
| d) not observing the following ratios during the term of the contract: | ||
| • Adjusted EBITDA debt ratio less than or equal to 4.5, and | ||
| • Adjusted EBITDA ratio of Interest Expense greater than or equal to 2.0. | ||
| And, in case these ratios are not observed, guarantees an amount equivalent to at least 130% of the debt, as stipulated by BNDES, and within 60 days from the date of written communication. | ||
| In case the proceeds granted under this Contract are used for any purpose other than the installment of the UHE Estreito Hydroelectric Power Plant and its transmission system, BNDES, without prejudice to the terms set forth above in this Clause, will inform the Federal Public Prosecutor, pursuant to the terms of Law No. 7492 of 16.06.86. | ||
| The contract will also expire, with the enforceability of the debt and immediate suspension of any disbursement, at the date of installing as a Federal Deputy or Senator or any person remunerated by Vale, or any owner, holder or director of Vale, or any person listed in the prohibitions provided by the Federal Constitution, article 54, paragraphs I and II. There will be no impact on charges of default, provided that the debt payment occurs within five (5) business days as of the date of installing, under risk of, if in default, assuming all charges related to the assumptions set forth above for early expiration by default. | ||
| The change in indirect control of Vale, during the term of the Contract, is excluded from the possibility of early expiration by default. | ||
Nature and reasons for the operation / other relevant information
|
The applicable interest rates are: TJLP+1.46% p.a. (subcredits A and B), and TJLP
(subcredit C). This is financing for installation of UHE Estreito Hydroelectric Power Plant |
|
Name of related party
|
Banco Nacional de Desenvolvimento Econômico e Social — BNDES | |
Date of Transaction
|
12/26/2008 | |
Amount (R$)
|
7,300,000.00 | |
Current balance (R$) (12/31/2010)
|
1,667,733,748.42 | |
Amount of related party
|
Not applicable | |
Duration
|
04/15/2019 | |
Loan or other type of debt
|
YES | |
Interest rate
|
1.5% p.a. | |
Relationship with the Company
|
Indirect controlling shareholder | |
Purpose of the contract
|
Credit line | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
BNDES may terminate this contract in advance, with the enforceability of the debt and immediate suspension of any disbursement, if in addition to the cases set forth in Articles 39 and 40 of “PROVISIONS APPLICABLE TO BNDES CONTRACTS, the following are certified by BNDES: | |
| a) reducing Vale’s staff without providing training programs and / or replacement programs for workers in other companies | ||
| b) the existence of a definitive legal judgment on the performance of acts by Vale consisting of an infringement of legislation which deals with combating discrimination based on race or gender, child labor and forced labor; | ||
| c) inclusion in Vale bylaws, statute, or contract, of a provision by which a special quorum is required for deliberation or approval of matters limiting or restrictingcontrol of any of these companies by the respective controlling shareholders, or even the inclusion therein, of conditions leading to: | ||
i) restrictions on Vale’s ability to grow or its technological development; |
||
ii) restrictions on Vale’s access to new markets, or |
||
iii) restrictions or loss of ability to pay financial obligations resulting from this
operation; |
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| d) not observing the following ratios during the term of the agreement: | ||
| • Adjusted EBITDA debt ratio less than or equal to 4.5, and | ||
| • Adjusted EBITDA ratio of Interest Expense greater than or equal to 2.0
And, in case these ratios are not observed, guarantees an amount equivalent to at least 130% of the debt, as stipulated by BNDES, and within 60 days from the date of written communication. |
||
| In case of change of indirect control of VALE, without prior authorization from BNDES, not submit a letter of guaranty issued according to the BNDES model. In the event proceeds granted under this contract are used for a purpose different from that provided for in Clause First: revolving credit limit, BNDES, notwithstanding above provisions, will notify the fact to the Federal Public Prosecutor pursuant to the terms of Law No. 7,492 of 16.06.86. | ||
| The contract will also expire, with the enforceability of the debt and immediate suspension of any disbursement, at the date of installing as a Federal Deputy or Senator or anyone who is remunerated by Vale, or any owner, holder or director of Vale, or any person listed the prohibitions provided by the Federal Constitution, article 54, paragraphs I and II. There will be no impact on charges of default, provided that the debt payment occurs within five (5) business days as of the date of installing, under risk of, if in default, assuming all charges related to the assumptions set forth above for early expiration by default. | ||
Nature and Reasons for the operation / other relevant information
|
The applicable interest rates are: Libor 3M+1.5% p.a. (subcredit A), TJLP (subcredits B4 and B11), TJLP + 1.36% p.a. (subcredits B2, B3, B6, B7, B9, and B10). TJLP + 1.76% p.a. (subcredits B1, B5, and B8). This is a credit line for financing Projects Salobo, Mineração Onça Puma, and Usina VIII. | |
Name of related party
|
Banco Nacional de Desenvolvimento Econômico e Social — BNDES | |
Date of transaction
|
11/16/2005 | |
Amount (R$)
|
225,793,697.00 | |
Current balance (R$) (12/31/2010)
|
64,332,888.76 | |
Amount of related party
|
Not applicable | |
Duration
|
01/15/2013 | |
Loan of other type of debt
|
YES | |
Interest rate
|
4.35% p.a. | |
Relationship with the Company
|
Indirect controlling shareholder | |
Purpose of the contract
|
Financing for investments in the railway system of the Federal Railway leased by Ferrovia Centro Atlantica SA | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
BNDES may terminate this contract in advance, with the enforceability of the debt and immediate suspension of any disbursement, if in addition to the cases set forth in Articles 39 and 40 of “PROVISIONS APPLICABLE TO BNDES CONTRACTS, the following are certified by BNDES: | |
| I) inclusion in FCA bylaws, statute or contract, of a provision by which a special quorum is required for deliberation or approval of matters limiting or restricting Vale’s control of FCA, or even the inclusion therein, of conditions leading to: | ||
i) restrictions on FCA’s ability to grow or its technological development; |
||
ii) restrictions on FCA’s access to new markets, or |
||
iii) restrictions or loss of ability to pay financial obligations resulting from this
operation; |
||
| II) the reduction of FCA’s staff while meeting its obligations with environmental agencies; | ||
| III) non-compliance by Vale with the project’s goals such as investments made by the FCA in the railway system leased by the Federal Network Rail and invalidity of the bank guaranty in accordance with the model provided by BNDES. | ||
| IV) non-registration by Vale of this Amendment within 60 days as of December 13, 2005. |
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| In case proceeds granted under this Contract are used for any purpose other than investments made by the FCA in the railway system leased by the Federal Network Rail, BNDES, without prejudice to the terms of this clause, will notify the fact to the Federal Public Prosecutor pursuant to the terms of Law No. 7492 of 16.06.86. The change of control by Vale contemplated in section III of Article 39 of “PROVISIONS APPLICABLE TO BNDES CONTRACTS” referred to in the Eleventh Clause is excluded from the possibility of early maturity contemplated in this Clause during the term of this Amendment. | ||
Nature and reasons for the operation / other relevant information
|
MC + 4.35% p.a. (tranche in USD) and TJLP + 3% (tranche in URTJLP). This is financing for investments in the railway system of the Federal Railway leased by Ferrovia Centro Atlantica SA. |
|
Name of related party
|
Banco Nacional de Desenvolvimento Econômico e Social — BNDES | |
Date of transaction
|
12/14/2009 | |
Amount (R$)
|
23,608,437 | |
Current balance (R$) (12/31/2010)
|
15,992,846.07 | |
Amount of related party
|
Not applicable | |
Duration
|
05/15/2013 | |
Loan or other type of debt
|
YES | |
Interest rate
|
1.2% p.a. | |
Relationship with the Company
|
Indirect controlling shareholder | |
Purpose of the contract
|
Debt assumption of Usina Tecpar | |
Amount of related party
|
Not applicable | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
BNDES may terminate this contract in advance, with the enforceability of the debt and immediate suspension of any disbursement, if in addition to the cases set forth in Articles 39 and 40 of “PROVISIONS APPLICABLE TO BNDES CONTRACTS”, the following are certified by BNDES: | |
| a) reducing TECPAR’s staff without providing training programs and / or replacement programs for workers in other companies; | ||
| b) the existence of a definitive legal judgment on the performance of acts by Vale or by TECPAR consisting of an infringement of legislation which deals with combating discrimination based on race or gender, child labor and forced labor; | ||
| c) inclusion in Vale bylaws, statute or contract, of a provision by which a special quorum is required for deliberation or approval of matters limiting or restricting Vale or its controlling shareholders, or even the inclusion therein, of conditions leading to: | ||
i) restrictions on Vale’s ability to grow or its technological development; |
||
ii) restrictions on Vale’s access to new markets, or |
||
iii) restrictions or loss of ability to pay financial obligations resulting from this
operation; |
||
| d) not observing the following ratios during the term of the contract: | ||
| • Adjusted EBITDA debt ratio less than or equal to 4.5, and | ||
| • Adjusted EBITDA ratio of Interest Expense greater than or equal to 2.0. | ||
| And, in case these ratios are not observed, guarantees an amount equivalent to at least 130% of debt, as stipulated by BNDES, and within 60 days from the date of written communication. | ||
| In case proceeds granted under this Contract are used for any purpose other than those set forth in the First Clause, BNDES, without prejudice to the terms set forth above in this clause, will inform the Federal Public Prosecutor, pursuant to the terms of Law No. 7492 of 16.06.86. | ||
| This contract will also expire, with the enforceability of the debt and immediate suspension of any disbursement, at the date of installing as a Federal Deputy or Senator or any person remunerated by Vale, or any owner, controller or director of Vale, or any person listed in the prohibitions provided by the Federal Constitution, article 54, paragraphs I and II. There will be no impact on charges of default, provided that the debt payment occurs within five (5) business days as of the date of installing, under risk of, if in default, assuming all charges related to the assumptions set forth above for early expiration by default. | ||
| In the event proceeds granted under the contract are used for a purpose different from that provided for in Clause First, as described above, and in the instances mentioned in Paragraph “b” above, BNDES may terminate the Contract in advance within five (5) business days from the date of notification to Vale of occurrence of these events, excluding reciprocal power of attorney, made among VALE, TECPAR and TECNOLOGOS until the final debt settlement. |
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| BNDES may terminate the Contract in advance on the day following the date determined by BNDES or by judicial or extrajudicial notification, without the non-financial default having been remedied by Vale or TECPAR. | ||
Nature and reasons for the operation / other relevant information
|
Applicable interest rate: TJLP+1.2% p.a. This is a debt assumption of Companhia Usina Tecpar intended for installation of a pig iron production plant in Pindamonhangaba, SP, using residues from mining slices and other metal debris. | |
Name of related party
|
Banco Nacional de Desenvolvimento Econômico e Social — BNDES | |
Date of transaction
|
11/23/2010 | |
Amount (R$)
|
208,026,000.00 | |
Current balance (R $) (12/31/2009)
|
150,510,500.95 | |
Amount of related party
|
Not applicable | |
Duration
|
09/15/2029 | |
Loan or other type of debt
|
YES | |
Interest rate
|
1.46% | |
Relationship with the Issuer
|
Indirect controlling shareholder | |
Purpose of the contract
|
Financing for supplementation of resources relative to installation of (UHE) Estreito Hydroelectric Power Plant | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
BNDES may terminate this contract in advance, with the enforceability of the debt and immediate suspension of any disbursement, if in addition to the cases set forth in Articles 39 and 40 of “PROVISIONS APPLICABLE TO BNDES CONTRACTS”, the following are certified by BNDES: | |
| a) reducing Vale’s staff without providing training programs and / or replacement programs for workers in other companies; | ||
| b) the existence of a definitive legal judgment on the performance of acts by the Beneficiary consisting of a crime against the environment or an infringement of legislation which deals with combating discrimination based on child labor and forced labor, in accordance with following provision; | ||
| c) inclusion in the bylaws, statute, or contract of Vale or of the other controlling companies, of a provision by which a special quorum is required for deliberation or approval of matters limiting or restricting its controlling shareholders, or even the inclusion therein, of conditions leading to: | ||
i) restrictions on Vale’s ability to grow or its technological development; |
||
ii) restrictions on Vale’s access to new markets, or |
||
iii) restrictions or loss of ability to pay financial obligations resulting from this
operation; |
||
| d) give, without prior authorization from BNDES, guaranties of any kind in operations with other creditors without the same quality of guaranties provided to BNDES, with equal priority of payment; | ||
| e) not observing the following ratios during the term of the contract: | ||
| • Adjusted EBITDA debt ratio less than or equal to 4.5, and | ||
| • Adjusted EBITDA ratio of Interest Expense greater than or equal to 2.0. | ||
| And, in case these ratios are not observed, guarantees an amount equivalent to at least 130% of the debt, as stipulated by BNDES, and within 60 days from the date of written communication. | ||
| Termination of the contract in advance based on provisions of Paragraph “b” above will not occur provided the remedy imposed has been fulfilled or while the penalty imposed to the Beneficiary is being fulfilled following the due legal procedure. | ||
| In the event of any of the situations provided for in Paragraph “b” above, observing the provisions of above paragraph, BNDES may only declare the expiration in advance of the debt resulting from the Contract within 60 days after giving notice to the Beneficiary. | ||
| In case proceeds granted under this Contract are used for any purpose other than general investments for installation of UHE Estreito Hydroelectric Power Plant and its transmission system, BNDES, without prejudice to the terms set forth above in this clause, will inform the Federal Public Prosecutor, pursuant to the terms of Law No. 7492 of 16.06.86. |
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| The contract will also expire, with the enforceability of the debt and immediate suspension of any disbursement, at the date of installlation as a Federal Deputy or Senator or any person remunerated by Vale, or any owner, controller or director of Vale, or any person listed in the prohibitions provided by the Federal Constitution, article 54, paragraphs I and II. There will be no impact on charges of default, provided that the debt payment occurs within five (5) business days as of the date of installing, under risk of, if in default, assuming all charges related to the assumptions set forth above for early expiration by default. | ||
| The change in indirect control of Vale, during the term of the Contract, is excluded from the possibility of early expiration by default. | ||
Nature and reasons for the operation / other relevant information
|
Applicable interest rate: TJLP+1.46% p.a. This is financing for supplementation of resources relative to installation of the (UHE) Estreito Hydroelectric Power Plant. |
|
Name of related party
|
Banco Nacional de Desenvolvimento Econômico e Social — BNDES | |
Date of transaction
|
06/29/2010 | |
Amount (R$)
|
135,127,397.00 | |
Current balance (R$) (12/31/2010)
|
83,865,435.35 | |
Amount of related party
|
Not applicable | |
Duration
|
07/15/2020 | |
Loan or other type of debt
|
YES | |
Interest rate
|
4.50% | |
Relationship with the Issuer
|
Indirect controlling shareholder | |
Purpose of the contract
|
Financing to purchase machinery and equipment for Project Pier IV, and for installation of a simple mobile waste material crushing, transportation, and deposit system of Carajás, in Parauapebas (PA). | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
BNDES may terminate this contract in advance, with the enforceability of the debt and immediate suspension of any disbursement, if in addition to the cases set forth in Articles 39 and 40 of “PROVISIONS APPLICABLE TO BNDES CONTRACTS, the following are certified by BNDES: | |
| a) reducing Vale’s staff without providing training programs and / or replacement programs for workers in other companies | ||
| b) the existence of a definitive legal judgment on the performance of acts by the Beneficiary consisting of a crime against the environment or an infringement of legislation which deals with combating discrimination based child labor and forced labor, in accordance with following provision; | ||
| c) inclusion in the bylaws, statute or contract of Vale or of the other controlling companies, of a provision by which a special quorum is required for deliberation or approval of matters limiting or restricting its controlling shareholders, or even the inclusion therein, of conditions leading to: | ||
i) restrictions on Vale’s ability to grow or its technological development; |
||
ii) restrictions on Vale’s access to new markets, or |
||
iii) restrictions or loss of ability to pay financial obligations resulting from this
operation; |
||
| d) give, without prior authorization from BNDES, guaranties of any kind in operations with other creditors without the same quality of guaranties provided to BNDES, with equal priority of payment; | ||
| e) not observing the following ratios during the term of the contract: | ||
| • Adjusted EBITDA debt ratio less than or equal to 4.5, and | ||
| • Adjusted EBITDA ratio of Interest Expense greater than or equal to 2.0. | ||
| And, in case these ratios are not observed, guarantees an amount equivalent to at least 130% of the debt, as stipulated by BNDES, and within 60 days from the date of written communication. | ||
| In case proceeds granted under this Contract are used for any purpose other than general investments for purchase of machinery and equipment, BNDES, without prejudice to the terms set forth above in this clause, will inform the Federal Public Prosecutor, pursuant to the terms of Law No. 7492 of 16.06.86. | ||
| This contract will also expire, with the enforceability of the debt and immediate suspension of any disbursement, at the date of installing as a Federal Deputy or Senator or any person remunerated by Vale, or any owner, controller or director of Vale, or any person listed in the prohibitions provided by the Federal Constitution, article 54, paragraphs I and II. There will be no impact on charges of default, provided that the debt payment occurs within five (5) business days as of the date of installing, under risk of, if in default, assuming all charges related to the assumptions set forth above for early expiration by default. | ||
| Termination of the contract in advance based on provisions of Paragraph “b” above will not occur provided the remedy imposed has been fulfilled or while the penalty imposed to the Beneficiary is being fulfilled following the due legal procedure. |
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| In the event of any of the situations provided for in Paragraph “b” above, observing the provisions of above paragraph, BNDES may only terminate the debt in advance arising from the Contract within 60 days after giving notice to the Beneficiary. | ||
Nature and reasons for the operation / other relevant information
|
Available interest rate: 4.5% p.a. This is financing to purchase machinery and equipment for Project Pier IV, and for installation of a simple mobile waste material crushing, transportation and deposit system of Carajás, in Parauapebas (PA). | |
Name of related party
|
Banco Nacional de Desenvolvimento Econômico e Social — BNDES | |
Date of transaction
|
03/31/1997 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/312010)
|
Not applicable | |
Amount of related party
|
Not applicable | |
Duration
|
Determined. Until full execution of its purpose. Contract was changed and consolidated on 06/28/2007. | |
Loan or other type of debt
|
No | |
Interest rate
|
— | |
Relationship with the Company
|
Indirect controlling shareholder | |
Purpose of the contract
|
Regulate the relationship between Vale and BNDES to determine mineral rights for deposits which existence, size and economic validity are undefined in the Carajás mineral province, there being, therefore, no record of the asset’s worth when privatized. The Contract stipulates bilateral rules with the purpose of regulating: survey taks by Vale; the cases and manner for BNDES to provide financial resources to Vale for reimbursement of additional expenses resulting from survey tasks and payment of the respective administration fee; BNDES participatory rights; abandonment or assignment of exploratory targets or mining rights to third parties; payment of the finder’s fee owed by BNDES to Vale. | |
Guaranties and insurance
|
Not applicable | |
Conditions of termination or expiration
|
Not applicable | |
Nature and reasons for the operation / other relevant information
|
— | |
Name of related party
|
BNDES Participações SA — BNDESPAR | |
Date of Transaction
|
12/17/2007 | |
Amount (R$)
|
1,050,300,000.00 | |
Current balance (R$) (12/31/2010)
|
232,071,382.73 | |
Amount of related party
|
Not applicable | |
Duration
|
12/17/2027 | |
Interest rate
|
0.8% p.a. | |
Loand or any other debt
|
YES | |
Relationship with the Company
|
Indirect controlling shareholder | |
Purpose of the contract
|
Private issuance of debentures for financing of the expansion project of the Norte-Sul Railroad | |
Conditions of termination or expiration
|
In addition to the terms under Articles 39, 40 and 47(a) of APPLICABLE PROVISIONS, the debenture-holders may declare early maturity of all debentures and require payment by Vale, of the outstanding debt, plus interest and other fees accrued to date of payment, in the event of the following: | |
a) Vale non-compliance of any financial obligation related to DEBENTURES not remedied
within 10 (ten) business days from the date of maturity; |
||
b) Bankruptcies requested for Vale made by third parties not resolved by Vale within legal
term; application for judicial or extrajudicial recovery made by Vale, or even a
declaration of bankruptcy by Vale; |
||
c) dissolution and liquidation of Vale; |
||
d) the breach of any non-monetary obligation under this Deed not being remedied within 45
(forty five) days; |
||
e) declaration of early maturity of any debt of VALE due to breach of contract where the
individual amount is equal to or greater than R$ 125,000,000.00 or whose value, in a
period of twelve (12 ) consecutive months, is equal to or greater than R $ 1,000,000,000.00; |
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f) inclusion in the statutes or bylaws by Vale and FNS of a mechanism by which a quorum
is required to determine or approve particular matters restricting or limiting Vale’s and
FNS’s control by their respective controlling shareholders and also the inclusion in those
documents of the mechanism which leads to restrictions on Vale’s and FNS’s ability to grow
or its technological development, restrictions on Vale’s and FNS’s ability to access new
markets, or restrictions or loss of ability to pay financial obligations of the DEED. |
||
g) If the effective direct controlling shareholding of Vale or FNS is modified in any
way, unless previously approved by DEBENTURE holders; |
||
h) acquisition by FNS of the controlling interest or capital stock in other companies,
joint ventures or consortia consisting of non-complementary activities to the normal
development of FNS’s corporate goals and a move away from these, unless approved in
advance by DEBENTURE holders; |
||
i) in relation to FNS, any merger, consolidation, division, transformation or any other
corporate reorganization, whether strictly corporate or related to a disposition of
relevant assets, and, in relation to Vale, corporate reorganizations that may result in
transfer to third parties that are not controlled by Vale, of share ownership issued by
FNS, being the object of the exchange in the terms of this DEED, with the observation that
this subparagraph will not apply if any of the transactions referred to in this item has
been previously approved by debentures holders representing at least 50% plus one of
outstanding debentures; |
||
j) non-compliance by Vale of any provision for interchangeability of the debentures; |
||
k) constitution, by Vale, of a collateralized guaranty with the other creditors, without
the present ISSUANCE being given the same quality of guaranty and equal priority of
payment unless previously approved by DEBENTURE holders; |
||
l) If Vale does not promote and maintain the block on exchange of common shares issued by
FNS corresponding to the Percentage of Shares in the permutation; |
||
m) if Vale does not use the proceeds of this ISSUANCE for FNS’s capitalization, within 3
(three) business days of redemption of the DEBENTURES, and |
||
| Vale should redeem all of the outstanding debentures within 30 (thirty) days from the occurrence of the following events: | ||
a) termination of the subconcession contract between Vale and FNS due to expiry,
expropriation, rescision, contract between the parties, cancellation of concession or
subconcession, or declaration of nullity of the administrative proceeding for the bidding,
and |
||
b) intervention by the Public Authority responsible for the subconcession or concession
for the administration and operation of public transport service. |
||
Nature and reasons for the operation / other relevant information
|
Transacton for financing the Norte-Sul railroad expansion project. Two issuances of debentures: 17/12/2007 (1st issuance), and 15/10/2009 (2nd issuance). The amount reported above is the sum of both issuances. The interest rate is of TJLP+0.8% p.a. | |
Name of related party
|
Banco Bradesco S.A. | |
Date of transaction
|
01/28/2008 | |
Amount (R$)
|
658,028,999.52 | |
Current balance (R$) (12/31/2010)
|
470,193,559.60 | |
Amount of related party
|
Not applicable | |
Duration
|
Maturites between 01/12/2011 and 12/31/2020 | |
Loan or any other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Bradespar SA, indirect controlling shareholder of Vale, and Banco Bradesco S.A. are under common control. | |
Purpose of the contract
|
87CDs issued by Banco Bradesco S.A. and contracted by Vale in the period from 01/28/2008 to 12/30/2010. Financial investment — 100.75% of CDI (average open transactions) | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information |
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Table of Contents
Name of related party
|
Banco Bradesco S.A. Grand Cayman Branch | |
Date of transaction
|
11/16/2010 | |
Amount (R$)
|
333,080,000.00 | |
Current balance (R$) (12/31/2010)
|
333,446,388.73 | |
Amount of related party
|
Not applicable | |
Duration
|
Expiry date on 02/25/2011 | |
Loand or any other debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Bradespar S.A., Vale indirect controlling shareholder, and Banco Bradesco S.A. are under common control. | |
Purpose of the contract
|
Investments in Time Deposits contracted by Vale on 11/16/2010. Financial investment — 0.88% p.a. | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information |
||
Name of related party
|
CBSS — Companhia Brasileira de Soluções e Serviços | |
Date of transaction
|
09/02/2008 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
1,366,257,270.50 | |
Amount of related party
|
Not applicable | |
Duration
|
09/01/2013 | |
Loan or any other debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
CBSS is a company controlled by Banco Bradesco S.A. Bradespar S.A., indirect controlling shareholder of Vale, and Banco Bradesco S.A. are under common control. | |
Purpose of the contract
|
Provision of meal vouchers and food stamps, and services to purchase bus passes for officials of Vale and affiliate companies. | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
The Contract may be lawfully terminated at the discretion of the innocent party, by simple written communication, under the following instances: | |
| a) breach of any provision of this instrument or the laws and regulations under which it is subject to, if not remedied within five (5) days from the date of notification receipt sent by the non-defaulting party to the infringing party, or within a reasonable time as agreed by the parties at the time; | ||
| b) bankruptcy, or extrajudicial dissolution or judicial or extrajudicial liquidation, requested or approved; | ||
| c) occurrence of unforeseeable circumstances or force majeure, duly verified, excluding the execution of the Contract for more than 30 days; | ||
| d) technical failure, negligence, recklessness, malpractice or bad faith of the CONTRACTED. | ||
| Subject to the satisfaction of its other rights, Vale may, at its sole discretion, terminate this Contract upon prior written notice to the CONTRACTED, said CONTRACTED forbearing any rights to claim, indemnification or compensation, for whatever the reason, in the following cases: | ||
a) occurrence of lawsuits brought by the CONTRACTED, shareholders or companies forming part of the same group against
Vale, its subsidiaries, controlling companies and affiliate companies. |
||
b) assignment, and / or transfer of all or part of their obligations to third parties, or of credits under this Contract
without prior written authorization of Vale. |
||
| Notwithstanding the above, the Contract may be terminated at any time by the parties by notice of at least 90 (ninety) days. |
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Table of Contents
| In the event of termination of this Contract for any reason, VISA Vale CARDS delivered to Vale and the respective current balances of benefits, will be valid for use for a period of ninety (90) calendar days after the effective termination and, after that period, will automatically be canceled. | ||
| If any of the Parties are temporarily prevented from fulfilling its obligations in whole or in part as a result of unforeseeable circumstances or force majeure, it will report it immediately to the other party and ratify the communication in writing within 10 (ten) days of informing the harmful effects of the event. | ||
| In the event of unforeseeable circumstances or force majeure, the obligations which the parties remain unable to fulfill will be suspended while the situation lasts. However, if the impediment resulting from force majeure or unforeseeable circumstances lasts for more than 30 (thirty) days, or if, from the outcome, delays indefinitely the fulfilment of this Contract, either party may opt for termination, mutually satisfying obligations due until the date of this impediment | ||
Nature and reasons for the operation / other relevant information |
||
Name of related party
|
—Banco Bradesco S.A. | |
Date of transaction
|
04/12/10 | |
Amount (R$)
|
554,464,602.61 | |
Current balance (R $) (12/31/2010)
|
N/A (corporate card agreement) | |
Amount of related party
|
554,464,602.61 | |
Duration
|
04/11/2013 | |
Loan or other type of debt
|
No | |
Interest rate
|
— | |
Relationship with the Company
|
Bradespar S.A., indirect controlling shareholder of Vale, and Banco Bradesco S.A., are under common control. | |
Purpose of the contract
|
Issuing international corporate credit cards, purchasing cards, and virtual credit cards for air tickets and hotels, intended for purchasing services and items for consumers. | |
Guaranties and insurance
|
N/A | |
Conditions of termination or expiration
|
Not applicable | |
| Contract may be terminated by any Party by giving written notice to the other, without there being any right of claim, indemnification or compensation for the benefit of the Party receiving the notice of termination, in following cases: | ||
(i) Petition or declaration of bankruptcy or liquidation, or judicial or extrajudicial recovery by the other Party; |
||
(ii) In accordance with paragraph 11.4 of the Contract, ocurrence of unforeseeable circumstance or force majeure which
causes execution of SERVICES to be suspended for more than thirty (30) days. |
||
(iii) In
the event the fines on the other Party reach 10% (ten percent) of the value indicated in paragraph 9.3 of the
Contract. |
||
| Without failing to satisfy its other rights, Vale may, at their exclusive discretion, terminate this Contract by giving prior and express communication with the CONTRACTED PARTY, at least thirty (30) days in advance, without there being any right by the CONTRACTED PARTY to any claim, indemnification or compensation for whatever reason, in following cases: | ||
(i) Non-compliance of any contractual obligations by the CONTRACTED PARTY for more than thirty (30) days after receipt of
the relevant notice by Vale; and |
||
(ii) Assignment, subcontracting, and/or partial or total transfer of the undertaken obligations to third parties, or of
the credits arising from this Contract, without prior and express authorization by the CONTRACTING PARTY, except in case
of the CONTRACTED PARTY for its affiliates, controlling companies, subsidiaries or for any financial institution that is
part of its group of companies. |
||
| Without failing to satisfy its other rights, the CONTRACTED PARTY may, at their discretion, terminate this Contract by giving prior and express notice to Vale, with at least 30 (thirty) days in advance, without there being any right by the CONTRACTED PARTY to any claim, indemnification or compensation for whatever reason, in following cases: | ||
(i) Arrears exceeding 60 (sixty) days; (ii) Delays in providing information which endangers regular fulfillment of the obligations of this Contract and is not
remedied within thirty (30) days after receipt of the relevant notice by the CONTRACTED PARTY; and |
||
(iii) Non-fulfillment of any of the obligations resulting from the Contract by Vale as a result of which the CONTRACTED
PARTY is directly unable to continue regular fulfillment of its contractual obligations, and which is not remedied within
30 (thirty) days after receipt of the relevant notice by the CONTRACTED PARTY. |
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| In the event of termination by any Party, a cancellation fine of 10% (ten percent) will be imposed to the Party causing termination over the value stated in paragraph 9.3, as updated to variations of IGP-M/FGV (General Market Price Index), from the date of signature of this Contract until the date of actual payment of such fine, without detracting from eventual losses or damages. | ||
Nature and reasons for the operation / other relevant information
|
— | |
Name of related party
|
Vale Energy S.A. | |
Amount (R$)
|
239,168,659.06 | |
Current balance (R $) (12/31/2010)
|
0.00 | |
Amount of related party
|
Not applicable | |
Duration
|
12/31/2009 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Power Supply. In 2009, short term power supply agreements were entered into at the market price, to cover demand of Vale units. | |
Date of transaction
|
01/01/2009 | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information
|
— | |
Name of related party
|
Vale Energy S.A. | |
Amount (R$)
|
382,118,565.16 | |
Current balance (R$) (12/31/2010)
|
435,330,920.75 | |
Amount of related party
|
Not applicable | |
Duration
|
31/12/2010 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Power Supply. In 2010, short-term power supply agreements were entered into at the market price, to cover demand of Vale units. | |
Date of transaction
|
01/01/2010 | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information
|
— | |
Name of related party
|
Vale Energy S.A. | |
Amount (R$)
|
122,821,857.01 | |
Current balance (R $) (12/31/2009)
|
0.00 | |
Amount of related party
|
Not applicable | |
Duration
|
12/31/2008 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Power Supply. In 2008, 12 short-term power supply agreements were entered into at the market price, to cover demand of Vale units. | |
Date of transaction
|
01/01/2008 | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information |
||
Name of related party
|
Mineração Rio de Norte S.A. (MRN) e Alunorte — Alumina do Norte do Brasil S.A. | |
Date of transaction
|
05/29/1995 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (31/12/2010)
|
297,248,790.00 | |
Amount of related party
|
Not applicable | |
Duration
|
01/01/2022 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Purchase of bauxite | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information
|
— |
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Table of Contents
Name of related party
|
Albras — Alumínio Brasileiro S.A. | |
Date of transaction
|
03/01/2009 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (31/12/2010)
|
0.00 | |
Amount of related party
|
Not applicable | |
Duration
|
12/31/2009 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Calcined alumina supply | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information
|
— | |
Name of related party
|
Albras — Alumínio Brasileiro S.A. | |
Date of transaction
|
04/31/2010 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
158,555,862.00 | |
Amount of related party
|
Not applicable | |
Duration
|
12/31/2010 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Calcined alumina supply | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information
|
— | |
Name of related party
|
Alunorte — Alumina do Norte in Brazil S.A. | |
Date of transaction
|
03/01/2009 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
150,807,220.85 | |
Amount of related party
|
Not applicable | |
Duration
|
12/31/2010 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Purchase of Alunorte calcined alumina | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information
|
— | |
Name of related party
|
Alunorte — Alumina do Norte in Brazil S.A. | |
Date of transaction
|
01/01/2009 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
283,503,330.00 | |
Amount of related party
|
Not applicable | |
Duration
|
2027 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Bauxite supply for Alunorte. | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information
|
— | |
Name of related party
|
Alunorte — Alumina do Norte in Brazil S.A. | |
Amount (R$)
|
25,406,935.49 | |
Current balance (R$) (12/31/2010)
|
Not applicable |
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Table of Contents
Amount of related party
|
Not applicable | |
Duration
|
12/31/2008 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Power Supply. In 2008, short-term power supply agreements were entered into at the market price, to cover demand of Vale units. | |
Date of transaction
|
01/01/2008 | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information |
Name of related party
|
Alunorte — Alumina do Norte in Brazil S.A. | |
Date of transaction
|
12/16/1996 | |
Amount (R$)
|
284,492,600.00 (equivalent to USD 200,000,000.00) | |
Current balance (R$) (12/31/2010)
|
16,713,333.37 (equivalent to USD 10,030,808.65) | |
Amount of related party
|
Not applicable | |
Duration
|
03/23/2011 | |
Loan or other type of debt
|
YES | |
Interest rate
|
0.625% p.a. | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Funds transfer contract for Alunorte entered into between Vale and Nippon Amazon Aluminium Co., Ltd. (NAAC). | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
ALUNORTE may not prepay principal of the funds transfer contract, in whole or in part, except as expressly authorized by Vale and NAAC, plus a price of 0.5% of the pre-paid value, the contractual provisions being observed. | |
| Vale will consider the funds transfer contract has expired after simple notice to ALUNORTE, in following cases, namely: | ||
(a) Failure by ALUNORTE to settle, in whole or in part, the principal, interests or other rates resulting from the tansfer, provided such situation is not remedied within 14 days after notice has been given to Vale; |
||
(b) Failure to fulfill, in whole or in part, any of the obligations undertaken by ALUNORTE pursuant to the Contract in question or to any other Contract where it is an integral part thereof, provided such situation is not remedied within 30 days after notice has been given to Vale; |
||
(c) Dissolution, merger, liquidation or disposition of a substantial portion of ALUNORTE assets without the prior consent of NAAC, which in turn may not unjustifiably deny it. |
||
(d) Suspension by ALUNORTE of their business; |
||
(e) In the event Vale is considered non-compliant by NACC regarding the funds transfer contract (base contract) with the resulting acceleration of expirations provided for in the basic contract. |
||
Nature and reasons for the operation / other relevant information
|
Transfer of the loan signed between NAAC and Vale for Alunorte, for the purpose of financing expansion of Alunorte production capacity from 800,000 tons to 1,100,000 tons. Interest rate: Libor 6M 0.625% p.a. |
Name of related party
|
Companhia Portuária Baía de Sepetiba (CPBS) | |
Date of transaction
|
01/01/2004 | |
Amount (R$)
|
2,808,894,097.76 | |
Current balance (R $) (12/31/2010)
|
1,016,901,786.41 | |
Amount of related party
|
Not applicable | |
Duration
|
2014. Contract will be automatically renewed for equal periods, provided there is no order to the contrary from any of the parties until 24 months before the date scheduled to close contract. | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Providing operating services and iron ore shipping. Contract purpose is to ensure the use of port infrastructure and loading capacity of iron ore for an annual quantity of 11,000,000 t (eleven million tons). | |
Guaranties and insurance
|
None |
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Conditions of termination or expiration
|
The contract may be terminated by operation of law, at the discretion of the innocent party, by simple written communication addressed by the interested party to the other party in any of the following cases: | |
• Bankruptcy, liquidation agreement, dissolution or liquidation, declared or approved; |
||
• Default of obligation established in any clause, Item or subitem of the contract, not resolved; |
||
• Suspension or termination of services and / or the occurrence of unforeseeable circumstances
or force majeure, for more than sixty (60) calendar days. |
||
| In the event of contract termination, CPBS will provide Vale its whole cargo/ property which is in the TERMINAL and all documents owned by Vale in its possession. After the release of cargo and documents, Vale will pay all expenses and service costs, and perhaps not yet settled, offsetting any claims and arranging the withdrawal of the product within 30 (thirty) days, any failing of which will be deemed to be abandoned pursuant to the terms of the Civil Code. | ||
| In the event of default, a letter identifying the breach of contract should be presented to the other party, which will have fifteen (15) days to remedy the default. If after this time the default has not been remedied, the aggrieved party may terminate this contract by operation of law, subject to judicial collection, corresponding to the obligations arising from this; | ||
| In the event of suspension of service determined by Vale or contract termination, the following will be owed to CPBS: (i) the amounts pending payment for that portion of services already performed until the date of suspension, ( ii) the reimbursement of costs resulting from this suspension or contract termination, (iii) the compensation for any burden caused by Vale to CPBS provided for herein. | ||
• For purposes of this item, CPBS may offset any debts they have with respect to the claims
that Vale might have, and use this contract as an extrajudicial execution order for the recovery
of any sums due, regarded now as certain net debt in the event of default by Vale. It will be
Vale’s responsibility to cover all costs that CPBS has to incur due to the collection, judicial
or extrajudicial, of the credits that might be owed in relation to the services. |
||
Nature and reasons for the operation / other relevant information |
Name of related party
|
Ferrovia Centro Atlântica S.A. | |
Date of transaction
|
01/01/2009 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
1,604,258.46 | |
Amount of related party
|
Not applicable | |
Duration
|
12/31/2011 | |
Loan or other type of debt
|
NO | |
Duration
|
12/31/2011 | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Leasing of BB-36 locomotives | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation /other
relevant information
|
— |
Name of related party
|
Ferrovia Centro Atlântica S.A. | |
Date of transaction
|
12/28/2007 | |
Amount (R $)
|
Not applicable | |
Current balance (R $) (12/31/2010)
|
4,235,512.27 |
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Amount of related party
|
Not applicable | |
Duration
|
12/28/2011 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Controlled | |
Purpose of the contract
|
Regulate cooperation between the parties for development of support processes by Vale and share costs. | |
| Compensate Vale for costs incurred in accordance with the terms of the Contract, to ensure the physical availability of shared infrastructure, provide clarification for Vale and take steps necessary for the development of support processes, including procurement and management of third parties | ||
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
This contract will be valid for twelve (12) months from 01/01/2008, or until the fulfillment of all obligations arising from the contract. Without prejudice to the possibility of termination, this Contract will be automatically extended to the end of its term for successive periods of twelve (12) months unless either party sends written notice to the other 90 (ninety) days in advance of the expected completion of the contract. The contract may be resolved by law in the event of default by either party of its obligations, provided that the party owed the obligation in arrears send written notice to the party in default and that the breach is not solved for a period of fifteen (15) days. Either party may terminate it by written notice, with a minimum advance warning of 180 (one hundred and eighty) days. In this case, neither of the parties will be due for indemnity or compensation on account of the termination, with all other obligations set forth in the instrument maintained until the termination of the original term of the contract. | |
Nature and reasons for the operation /other
relevant information
|
— |
Name of related party
|
Ferrovia Centro Atlântica S.A. | |
Date of transaction
|
07/18/2008 | |
Business amount (R$)
|
5,053,647.24 | |
Current balance (R$) (12/31/2010)
|
374,068.21 | |
Amount of related party
|
Not applicable | |
Duration
|
Until expiration of last installment, which will occur on 12/28/2012. | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Issuer
|
Subsidiary | |
Purpose of the contract
|
Sale of FCA locomotives and wagons to Vale | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information
|
— |
Name of related party
|
Ferrovia Centro Atlântica S.A. | |
Date of transaction
|
12/28/2007 | |
Business amount (R$)
|
50,160,697.43 | |
Current balance (R$) (12/31/2010)
|
32,574,859.73 | |
Amount of related party
|
Not applicable | |
Duration
|
Until expiration of last installment, to occur on 12/28/2011. | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Issuer
|
Subsidiary | |
Purpose of the contract
|
Sale of Vale locomotives and wagons to FCA. | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information
|
— |
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Name of related party
|
Ferrovia Centro Atlântica S.A. | |
Date of transaction
|
07/18/2008 | |
Business amount (R$)
|
38,093,560.34 | |
Current balance (R$) (12/31/2010)
|
28,648,642.43 | |
Amount of related party
|
Not applicable | |
Duration
|
Until expiration of last installment, to occur on 12/28/2012. | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Issuer
|
Subsidiary | |
Purpose of the contract
|
Sale of Vale locomotives and wagons to FCA. | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information
|
— |
Name of related party
|
Ferrovia Centro Atlântica S.A. | |
Date of transaction
|
04/07/2009 | |
Business amount (R$)
|
25,116,584.45 | |
Current balance (R$) (12/31/2010)
|
20,666,011.85 | |
Amount of related party
|
Not applicable | |
Duration
|
Until expiration of last installment, to occur on 01/31/2013. | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Issuer
|
Subsidiary | |
Purpose of the contract
|
Sale of Vale locomotives and wagons to FCA. | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information
|
— |
Name of related party
|
Ferrovia Centro Atlântica S.A. | |
Date of transaction
|
08/31/2005 | |
Business amount (R$)
|
N/A | |
Current balance (R$)
|
9,279,578.47 | |
Amount of related party
|
Not applicable | |
Duration
|
12/31/2010 | |
Loan or other type of debt
|
YES | |
Interest rate
|
94% of CDI | |
Relationship with the Issuer
|
Subsidiary | |
Purpose of the contract
|
Credit facility contract (financial aid) | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
The Contract may be terminated by complaint filed by any of the parties by giving notice 60 days in advance. On the date the contract is closed, any outstanding obligations must be fulfilled by the parties. In addition, regardless of the notice or communication, the parties may consider the contract automatically cancelled, and therefore, the debt expired, and payment of principal, interests, and obligations is required, in the case of (i) any plan of judicial or extrajudicial recovery existing against any party, or liquidation or bankruptcy; /(ii) contractual non-compliance not remedied within 60 days after receipt of notice; (iii) any party is overdue by at least 5 business days regarding payment of any amount owed. | |
Nature and reasons for the operation /other
relevant information
|
Financial Aid Contract. The seventh and last addition to the contract was signed on 15.01.10. Pursuant to the seventh addition, Vale understakes to supply FCA as a loan the amunt of up to R$ 130,000,000.00 as requested by FCA and approved by Vale. In addition, FCA will provide Vale as loan, the amount of up to R$ 39,000,000.00 as set forth by FCA and approved by Vale, All disbursements will be payable to variations of 94% of the CDI. This is a loan between Vale and FCA without intervention of a financial institution. |
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Name of related party
|
Ferrovia Centro Atlântica S.A. | |
Date of transaction
|
06/10/2004 | |
Business amount (R$)
|
Not applicable | |
Current balance (R$)
|
3,220,746.80 | |
Amount of related party
|
Not applicable | |
Duration
|
Undetermined | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
1.- By defining technical, operational, and administrative procedures, regulate and standardize performance of mutual carriage of goods in cargo trains, exchange of wagons and locomotives, and repairs of wagons, locomotive and permanent ways. | |
| 2.- Streamline the organization and procedures related to activities of mutual traffic and exchange of railway rolling stock | ||
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information
|
— |
Name of related party
|
Ferrovia Centro Atlântica S.A. e Vale Fertilizantes | |
Date of transaction
|
01/01/2010 | |
Business amount (R$)
|
R$ 48,213,580.86 | |
Current balance (R$) (12/31/2010)
|
R$ 1,491,930.69 | |
Amount of related party
|
Not applicable | |
Duration
|
One year | |
Loan or other type of debt
|
No | |
Interest rate
|
— | |
Relationship with the Issuer
|
Subsidiary | |
Purpose of the contract
|
Acquisition of transportation services by train. The existing balance refers to advancements made. | |
Duration
|
None | |
Conditions of termination or expiration
|
a) None |
|
Nature and reasons for the operation / other relevant information
|
— |
Name of related party
|
Ferrovia Centro Atlântica S.A. and Log-in Logística Intermodal S.A. | |
Date of transaction
|
03/01/2007 | |
Business amount (R$)
|
Undetermined | |
Current balance (R$) (12/31/2009)
|
0.00 | |
Amount of related party
|
Could not be assessed. | |
Duration
|
10 years | |
Loan or other type of debt
|
No | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Providing railway transportation services of various products in containers owned by the CONTRACTED PARTY and/or the CONTRACTING PARTY, by the CONTRACTED PARTY to the CONTRACTING PARTY, along pre-established routes, jointly agreed upon between the PARTIES (Annex 1), exclusively on railroad flatcars. | |
Guaranties and insurance
|
Contract specifies compensations for theft, loss, or damage of the goods that will be handled in a specific process and, in the case of any debt, they will be settled within 60 days after receipt of the compensation request. The price to be considered will be that declared in the fiscal note at the time of carriage. | |
Conditions of termination or expiration
|
Contract may be terminated by operation of law, regardless of notice, communication or judicial summons or extrajudicial communication, in the event of non-observance of its terms, bankruptcy or judicial or extrajudicial recovery of either PARTY. | |
Nature and reasons for the operation / other relevant information
|
— |
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Table of Contents
Name of related party
|
Ferrovia Centro Atlântica S.A. and Companhia Hispano-brasileira de Pelotização — HISPANOBRAS | |
Relationship with the Company
|
Subsdiaries and affiliates | |
Date of transaction
|
01/01/2010 | |
Purpose of the contract
|
Supply railroad transport service | |
Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
The contract foresees indemnization in the event of theft, loss or damage of goods and will be treated in specific process and if they are due, they will be paid up to 60 (sixty) days after receiving the request for compensation. The price to be considered will be the one declared in the RECEIPT at the time of the transportation. | |
Duration
|
5 (five) years. | |
Conditions of termination or expiration
|
This agreement may be terminated by any of the Partires, by means of a written notification to the other Party. The Party by reason of which the Resolution was requested, will have no right to any claim, indemnization or compensation in the following cases: | |
(i) If the other Party fails to fulfill any of the obligations foreseen by this Contract, except when the failure can be
corrected and if the defaulting party corrects it within 5 (five) days after receiving the correspoding written notification; |
||
(ii) Petition or declaration of insolvency, bankruptcy or judicial or extrajudicial recovery of the other Party |
||
(iii) In the event of an act of God or force majeure regularly proved, that comes to stop the execution of this
Contract for more than 30 (thirty) days. |
||
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— |
Name of related party
|
Ferrovia Centro Atlântica S.A. | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
01/01/2010 | |
Purpose of the contract
|
Supply railroad transport service | |
Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
The contract foresees indemnization in the event of theft, loss or damage of goods and will be treated in specific process and if they are due, they will be paid up to 60 (sixty) days after receiving the request for compensation. The price to be considered will be the one declared in the RECEIPT at the time of the transportation | |
Duration
|
5 (five) years. | |
Conditions of termination or expiration
|
This agreement may be terminated by any of the Partires, through written notification to the other Party. The Party by reason of which the Resolution was requested, will have no right to any claim, indemnization or compensation in the following cases: | |
(i) If the other Party fails to fulfill any of the obligations foreseen by this Contract, except when the failure can be
corrected and if the defaulting party corrects it within 5 (five) days after receiving the correspoding written notification; |
||
(ii) Petition or declaration of insolvency, bankruptcy or judicial or extrajudicial recovery of the other Party; |
||
(iii) In the event of an act of God or force majeure regularly proved, that comes to stop the execution of this Contract
for more than 30 (thirty) days. |
||
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
N/A | |
Rate of interest
|
N/A |
Name of related party
|
Ferrovia Centro Atlântica S.A. and Log-in Logística Intermodal S.A. | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
02/01/2009 | |
Purpose of the contract
|
Railroad transportation of miscellaneous goods arranged in containers and transportation of empty containers. | |
Business amount
|
Undetermined. | |
Current balance
|
None. |
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Amount of related party
|
Could not be assessed. | |
Guaranties and insurance
|
The contract foresees indemnization in the event of theft, loss or damage of goods and will be treated in specific process and if they are due, they will be paid up to 60 (sixty) days after receiving the request for compensation. The price to be considered will be the one declared in the RECEIPT at the time of the transportation. | |
Duration
|
12 (twelve) months | |
Conditions of termination or expiration
|
It can be terminated ipso jure in case of not complying with any of its conditions, as well as in the case of bankruptcy or judicial or extrajudicial recovery, under the provisions or Act 11.101, of 02.09.2005, of any of the contracting parties without need of any judicial or extrajudicial notification for this purpose. | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— |
Name of related party
|
Ferrovia Centro Atlântica S.A. and Log-in Logística Intermodal S.A. | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
08/13/2010 | |
Purpose of the contract
|
Railroad transportation of empty conteineres. | |
Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
The contract foresees indemnization in the event of theft, loss or damage of goods and will be treated in specific process and if they are due, they will be paid up to 60 (sixty) days after receiving the request for compensation. The price to be considered will be the one declared in the RECEIPT at the time of the transportation | |
Duration
|
1 (one) month | |
Conditions of termination or expiration
|
It can be terminated ipso jure in case of not complying with any of its conditions, as well as in the case of bankruptcy or judicial or extrajudicial recovery, under the provisions or Act 11.101, of 02.09.2005, of any of the contracting parties without need of any judicial or extrajudicial notification for this purpose. | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— |
Name of related party
|
Ferrovia Centro Atlântica S.A. and Log-in Logística Intermodal S.A. | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
07/28/2010 | |
Purpose of the contract
|
Railroad transportation of empty conteineres. | |
Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
The contract foresees indemnization in the event of theft, loss or damage of goods and will be treated in specific process and if they are due, they will be paid up to 60 (sixty) days after receiving the request for compensation. The price to be considered will be the one declared in the RECEIPT at the time of the transportation. | |
Duration
|
1 (one) month | |
Conditions of termination or expiration
|
It can be terminated ipso jure in case of not complying with any of its conditions, as well as in the case of bankruptcy or judicial or extrajudicial recovery, under the provisions or Act 11.101, of 02.09.2005, of any of the contracting parties without need of any judicial or extrajudicial notification for this purpose. | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— |
Name of related party
|
Ferrovia Centro Atlântica S.A. and Log-in Logística Intermodal S.A. | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
11/05/2009 | |
Purpose of the contract
|
Railroad transportation of empty conteineres. | |
Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed |
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Guaranties and insurance
|
The contract foresees indemnization in the event of theft, loss or damage of goods and will be treated in specific process and if they are due, they will be paid up to 60 (sixty) days after receiving the request for compensation. The price to be considered will be the one declared in the RECEIPT at the time of the transportation | |
Duration
|
3 (three) months | |
Conditions of termination or expiration
|
It can be terminated ipso jure in case of not complying with any of its conditions, as well as in the case of bankruptcy or judicial or extrajudicial recovery, under the provisions or Act 11.101, of 02.09.2005, of any of the contracting parties without need of any judicial or extrajudicial notification for this purpose. | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— | |
Name of related party
|
Ferrovia Centro Atlântica S.A. and Log-in Logística Intermodal S.A. | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
12/23/2009 | |
Purpose of the contract
|
Railroad transportation of miscellaneous goods arranged in containers. | |
Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
The contract foresees indemnization in the event of theft, loss or damage of goods and will be treated in specific process and if they are due, they will be paid up to 60 (sixty) days after receiving the request for compensation. The price to be considered will be the one declared in the RECEIPT at the time of the transportation | |
Duration
|
6 (six) months | |
Conditions of termination or expiration
|
It can be terminated ipso jure in case of not complying with any of its conditions, as well as in the case of bankruptcy or judicial or extrajudicial recovery, under the provisions or Act 11.101, of 02.09.2005, of any of the contracting parties without need of any judicial or extrajudicial notification for this purpose. | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— | |
Name of related party
|
Ferrovia Centro Atlântica S.A. and Log-in Logística Intermodal S.A. | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
12/23/2009 | |
Purpose of the contract
|
Railroad transportation of miscellaneous goods arranged in containers | |
Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
The contract foresees indemnization in the event of theft, loss or damage of goods and will be treated in specific process and if they are due, they will be paid up to 60 (sixty) days after receiving the request for compensation. The price to be considered will be the one declared in the RECEIPT at the time of the transportation | |
Duration
|
3 (three) months | |
Conditions of termination or expiration
|
It can be terminated ipso jure in case of not complying with any of its conditions, as well as in the case of bankruptcy or judicial or extrajudicial recovery, under the provisions or Act 11.101, of 02.09.2005, of any of the contracting parties without need of any judicial or extrajudicial notification for this purpose. | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— | |
Name of related party
|
Ferrovia Centro Atlântica S.A. and Log-in Logística Intermodal S.A. | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
02/02/2010 | |
Purpose of the contract
|
Railroad transportation of miscellaneous goods arranged in containers and trasportation of empty containers | |
Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
The contract foresees indemnization in the event of theft, loss or damage of goods and will be treated in specific process and if they are due, they will be paid up to 60 (sixty) days after receiving the request for compensation. The price to be considered will be the one declared in the RECEIPT at the time of the transportation |
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Duration
|
6 (seis) meses | |
Conditions of termination or expiration
|
It can be terminated ipso jure in case of not complying with any of its conditions, as well as in the case of bankruptcy or judicial or extrajudicial recovery, under the provisions or Act 11.101, of 02.09.2005, of any of the contracting parties without need of any judicial or extrajudicial notification for this purpose | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— | |
Name of related party
|
Ferrovia Centro Atlântica S.A. and Log-in Logística Intermodal S.A. | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
02/07/2010 | |
Purpose of the contract
|
Railroad transportation of miscellaneous goods arranged in containers and trasportation of empty containers | |
Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
The contract foresees indemnization in the event of theft, loss or damage of goods and will be treated in specific process and if they are due, they will be paid up to 60 (sixty) days after receiving the request for compensation. The price to be considered will be the one declared in the RECEIPT at the time of the transportation | |
Duration
|
3 (three) months | |
Conditions of termination or expiration
|
It can be terminated ipso jure in case of not complying with any of its conditions, as well as in the case of bankruptcy or judicial or extrajudicial recovery, under the provisions or Act 11.101, of 02.09.2005, of any of the contracting parties without need of any judicial or extrajudicial notification for this purpose. | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— | |
Name of related party
|
Ferrovia Centro Atlântica S.A. and Log-in Logística Intermodal S.A. | |
Relationship with the Company
|
Controlada | |
Date of transaction
|
02/24/2010 | |
Purpose of the contract
|
Railroad transportation of empty containers. | |
Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
The contract foresees indemnization in the event of theft, loss or damage of goods and will be treated in specific process and if they are due, they will be paid up to 60 (sixty) days after receiving the request for compensation. The price to be considered will be the one declared in the RECEIPT at the time of the transportation | |
Duration
|
1 (one) month | |
Conditions of termination or expiration
|
It can be terminated ipso jure in case of not complying with any of its conditions, as well as in the case of bankruptcy or judicial or extrajudicial recovery, under the provisions or Act 11.101, of 02.09.2005, of any of the contracting parties without need of any judicial or extrajudicial notification for this purpose | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— | |
Name of related party
|
Ferrovia Centro Atlântica S.A. and Log-in Logística Intermodal S.A. | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
02/10/2010 | |
Purpose of the contract
|
Railroad transportation of miscellaneous goods arranged in containers and trasportation of empty containers | |
Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
The contract foresees indemnization in the event of theft, loss or damage of goods and will be treated in specific process and if they are due, they will be paid up to 60 (sixty) days after receiving the request for compensation. The price to be considered will be the one declared in the RECEIPT at the time of the transportation |
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Duration
|
3 (three) months | |
Conditions of termination or expiration
|
It can be terminated ipso jure in case of not complying with any of its conditions, as well as in the case of bankruptcy or judicial or extrajudicial recovery, under the provisions or Act 11.101, of 02.09.2005, of any of the contracting parties without need of any judicial or extrajudicial notification for this purpose. | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— | |
Name of related party
|
Ferrovia Centro Atlântica S.A. and Fundação Vale do Rio Doce de Seguridade Social — VALIA | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
10/01/2009 | |
Purpose of the contract
|
Transfer of surveillance expenses of the premises where Valia is | |
Business amount
|
5,455.87 | |
Current balance
|
5,455.87 in 12/31/2010 | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
None | |
Duration
|
Undetermined | |
Conditions of termination or expiration
|
None | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— | |
Name of related party
|
Ferrovia Centro Atlântica S.A. and PASA — Plano de Assistência à Saúde do Aposentado da Vale (Healthcare plan for Vale’s retired personnel) | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
12/01/2009 | |
Purpose of the contract
|
Supply of Management of Supplementary Medical Assistance (“SMA”) | |
Business amount
|
N/A | |
Current balance
|
2,352,606.48 in 12/31/2010 | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
None | |
Duration
|
Undetermined | |
Conditions of termination or expiration
|
None | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— | |
Name of related party
|
Ferrovia Centro Atlântica S.A. and Fundação Vale do Rio Doce de Habitação e Desenvolvimento Social — FVRD (Vale Foundation of Rio Doce of Dwelling and Social Development) | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
09/01/2008 | |
Purpose of the contract
|
Supply of services — Turistic train | |
Business amount
|
N/A | |
Current balance
|
162,201.60 in 12/31/2010 | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
None | |
Duration
|
Undetermined | |
Conditions of termination or expiration
|
None | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— | |
Name of related party
|
Ferrovia Centro Atlântica S.A. | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
11/11/2010 | |
Purpose of the contract
|
Supply of railroad transport service |
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Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
None | |
Duration
|
2 (two) years | |
Conditions of termination or expiration
|
This agreement may be terminated by any of the Partires, through written notification to the other Party. The Party by reason of which the Resolution was requested, will have no right to any claim, indemnization or compensation in the following cases: | |
(i) Petition or declaration of insolvency, bankruptcy or judicial or extrajudicial recovery of the other party; |
||
(ii) with observance of the provisions set forth in clause 12, in the event of an act of God or force majeure regularly
proved, that comes to stop the execution of this Contract for more than 90 (ninety) days. |
||
| Without prejudice of its other rights, Vale S.A. can terminate this Contract at its exclusive judgement, through a previous and written notification of 30 (thirty) days given to the Company, without the Company having the right to any claim, indemnization or compensation whatsoever, in any of the following cases: | ||
(i) If the Company fails to fulfill any of the obligations foreseen by this Contract, that have to be corrected within
30 (thirty) days after receiving Vale’s written notification for this purpose; and |
||
(ii) assignment, outsourcing and/or partial or total transfer for third parties of assumed obligations, or of the
credits deriving from this contract, without previous and written authorization from Vale S.A. |
||
| Without prejudice of its other rights, Vale S.A. can terminate this Contract at its exclusive judgement, through a previous and written notification of 30 (thirty) days given to the Company, without the Company having the right to any claim, indemnization or compensation whatsoever, in any of the following cases: | ||
(i) delay in the payments for a period higher than 90 (ninety) days; |
||
(ii) dealy in the availability of information that compromises the regular fulfillment of the obligations assumed in the
contract, that have to be corrected within 30 (thirty) days after receiving the Company’s notification for this purpose;
and |
||
(iii) if Vale S.A. fails to fulfill any of the obligations of this contract and as a consequence the Company cannot
continue with the regular fulfillment of its contract obligations, and is not corrected within 30 (thirty) days after
receiving the Company’s notification for this purpose. |
||
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— | |
Name of related party
|
Ferrovia Centro Atlântica S.A. | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
01/01/2009 | |
Purpose of the contract
|
Supply of railroad transport service | |
Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
None | |
Duration
|
4 (four) years | |
Conditions of termination or expiration
|
None | |
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— | |
Name of related party
|
Ferrovia Centro Atlântica S.A. | |
Relationship with the Company
|
Subsidiary | |
Date of transaction
|
04/30/2010 | |
Purpose of the contract
|
Supply of railroad transport service | |
Business amount
|
Undetermined | |
Current balance
|
None | |
Amount of related party
|
Could not be assessed | |
Guaranties and insurance
|
None | |
Duration
|
9 (nine) months. |
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Conditions of termination or expiration
|
This agreement may be terminated by any of the Partires, through written notification to the other Party. The Party by reason of which the Resolution was requested, will have no right to any claim, indemnization or compensation in the following cases: | |
(i) Petition or declaration of insolvency, bankruptcy or judicial or extrajudicial recovery of the other party; |
||
(ii) with observance of the provisions set forth in clause 12, in the event of an act of God or force majeure regularly
proved, that comes to stop the execution of this Contract for more than 90 (ninety) days. |
||
| Without prejudice of its other rights, Vale S.A. can terminate this Contract at its exclusive judgement, through a previous and written notification of 30 (thirty) days given to the Company, without the Company having the right to any claim, indemnization or compensation whatsoever, in any of the following cases: | ||
(i) If the Company fails to fulfill any of the obligations foreseen by this Contract, that have to be corrected within
30 (thirty) days after receiving Vale’s written notification for this purpose; and |
||
(ii) assignment, outsourcing and/or partial or total transfer for third parties of assumed obligations, or of the
credits deriving from this contract, without previous and written authorization from Vale S.A |
||
| Without prejudice of its other rights, Vale S.A. can terminate this Contract at its exclusive judgement, through a previous and written notification of 30 (thirty) days given to the Company, without the Company having the right to any claim, indemnization or compensation whatsoever, in any of the following cases: | ||
(i) delay in the payments for a period higher than 90 (ninety) days; |
||
(ii) dealy in the availability of information that compromises the regular fulfillment of the obligations assumed in the
contract, that have to be corrected within 30 (thirty) days after receiving the Company’s notification for this purpose;
and |
||
(iii) if Vale S.A. fails to fulfill any of the obligations of this contract and as a consequence the Company cannot
continue with the regular fulfillment of its contract obligations, and is not corrected within 30 (thirty) days after
receiving the Company’s notification for this purpose. |
||
Loan or other type of debt
|
No | |
Nature and reasons for the operation / other relevant information
|
— | |
Rate of interest
|
— | |
Name of related party
|
Ferrovia Centro Atlântica S.A. and MRS Logística S.A. — MRS | |
Relationship with the Company
|
Subsidiary and affiliate | |
Date of transaction
|
02/26/2010 | |
Purpose of the contract
|
Assignment of 16 locomotives type GE U 23C, by MRS to FCA | |
Business amount
|
8,859.504.00 | |
Current balance
|
2,953,168.11 in 12/31/2010 | |
Amount of related party
|
N/A | |
Guaranties and insurance
|
FCA shall contract, keep and renew with a first line institution approved by MRS, na insurance coverage insuring a total financial coverage for indemnization to MRS, according to the terms set forth in this Sixth Clause, for any accident or disaster regarding the locomotives; the insurance coverage will be in agreement with the support conditions of FCA, which will be the only responsible for the expenses of contracting, keeping and renewing said insurance coverage. | |
Duration
|
As from the moment of receiving the first locomotive up to 02/28/2011 | |
Conditions of termination or expiration
|
Clause 4.3.1 — If MRS wishes to receive back before November 30, 2010, any of the locomotives granted, MRS has to give FCA a previous written notification, and has to pay FCA a compensation for an amount of R$37,687.50, for month or month fraction, for the term that is missing between the date of effective withdrawal and November 30, 2010 per locomotive withdrawn. The same value has to be paid by FCA to MRS in case it decides to return the locomotives before November 30, 2010. This payment has to be made by the party that anticipated the withdrawal or the return of the locomotives to the other party in up to 15 consecutive days after the date of effective delivery or return. | |
| Clause 4.5 — In addition to the hypothesis of the end of assign set forth in this instrument, MRS can request the return of the locomotives granted, before December 01, 2010, without indemnization due to FCA, by reason of judicial decision or formal decision of the Grantor, based and written pursuant to the law, whenever such decisions are written verified by MRS to FCA. | ||
Loan or other type of debt
|
No |
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Nature and reasons for the operation / other relevant information
|
N/A | |
Rate of interest
|
N/A | |
Name of related party
|
Ferrovia Centro Atlântica S.A. and MRS Logística S.A. — MRS | |
Relationship with the Company
|
Subsidiary and affiliate | |
Date of transaction
|
04/15/2008 | |
Date of transaction
|
Establishment of commercial and operative conditions for the interchange of load between FCA and MRS under the way of a Right of Way or Mutual Traffic pursuant to Resolution 433 of ANTT, of 02/17/2004. Use of courtyards of MRS by the Companhia and vice-versa for the circulation and crossing of loading trains | |
Purpose of the contract
|
Undetermined | |
Business amount
|
406,607,.24 in 12/31/2010 | |
Current balance
|
Could not be assessed | |
Amount of related party
|
None | |
Guaranties and insurance
|
60 (sixty) months | |
Duration
|
Without prejudice of the other termination hypothesis set forth in the contract, it can also be ended in the event of the following (either if the occur together or not): declaration of bankruptcy, assignment of judicial or extrajudicial recovery of anu of the parties, since the moment of the final sentence, extintion, suspension or interruption of the federal concession for exploitation of the service of railroad transport of loads or the hiring connected to the concession and the failure to comply with the clause or conditon of the contract, not solved within a maximum term of 30 (thirty) consecutive days, to be counted from the date when the infringing party received the written notification from the other party. In the event of an unilateral termination, without reason or due to the failure to comply with the clause or condition of the contract, not solved within a maximum term of 30 (thirty) consecutive days, to be counted from the date when the infringing party received the written notification from the other party, it can be demanded to the infringing party as indemnization the value corresponding to the annual volume, of the year of termination, as per the definition of item 14.1 and its sub-paragraphs, multiplied by the weighted mean of the tariff of the right of way in force at the time of termnation. | |
Conditions of termination or expiration
|
No | |
Loan or other type of debt
|
— | |
Nature and reasons for the operation / other relevant information
|
— | |
Name of related party
|
Docepar S.A. (DOCEPAR) | |
Date of transaction
|
01/02/2006 | |
Amount (R$)
|
49,030,201.87 | |
Current balance (R$) (12/31/2010)
|
376,227.91 | |
Amount of related party
|
Not applicable | |
Duration
|
06/30/2011 | |
Loan or other type of debt
|
YES | |
Interest rate
|
94% of the CDI | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Loan | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
PREPAYMENT | |
| DOCEPAR may prepay the amount, in whole or in part, including principal and interest calculated from January 2 (two), 2006 until the date of actual payment. | ||
| DOCEPAR should notify its intention to make the prepayment at least 3 (three) days in advance. | ||
| EARLY TERMINATION | ||
| If DOCEPAR fails to meet any of its obligations, Vale may automatically assume the debt for the total value (principal and interest) plus the contractual penalty provided for in the contract, the present serving as an extrajudicial execution order, in accordance with Article 585 of the Code of Civil Procedure. |
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Nature and reasons for the operation / other relevant information
|
Interest rate charged: 94% CDI Inter-company loan to cover cash needs. Vale is debtor in this transaction. |
|
Name of related party
|
Minas da Serra Geral SA (MSG) | |
Date of transaction
|
03/28/2008 | |
Amount (R$)
|
27,878,191.00 | |
Current balance (R$) (12/31/2010)
|
0.00 | |
Amount of related party
|
Not applicable | |
Duration
|
12/30/2010 | |
Loan or other type of debt
|
YES | |
Interest rate
|
94% CDI | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Loan | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
PREPAYMENT | |
| Vale may prepay the amount, in whole or in part, including principal and interest calculated from March 28 (twenty-eight), 2008 until the date of actual payment. VALE should notify its intention to make the prepayment at least 3 (three) days in advance. | ||
| EARLY TERMINATION | ||
| If Vale fails to meet any of its obligations, MSG may automatically assume the debt for the total value of the loan (principal and interest) plus the contractual penalty provided for in the contract, the present serving as an extrajudicial execution order, in accordance with Article 585 of the Code of Civil Procedure. | ||
Nature and Reasons for the operation / other relevant information
|
Interest rate charged: 94% of the CDI This is an inter-company loan. Cash centralization. The company is the creditor. | |
Name of related party
|
Florestas Rio Doce SA (FRDSA) | |
Date of transaction
|
10/30/2008 | |
Amount (R$)
|
3,848,783.00 | |
Current balance (R$) (12/31/2010)
|
0.00 | |
Amount of related party
|
Not applicable | |
Duration
|
12/30/2010 | |
Loan or other type of debt
|
YES | |
Interest rate
|
94% of the CDI | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Loan | |
Guaranties and insurance
|
None |
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Conditions of termination or expiration
|
PREPAYMENT | |
| Vale may prepay the amount, in whole or in part, including principal and interest calculated from October 30 (thirty), 2008 until the date of actual payment. Vale should notify its intention to make the prepayment at least 3 (three) days in advance. | ||
| EARLY TERMINATION | ||
| If Vale fails to meet any of its obligations, FRDSA may automatically assume the debt for the total value of the loan (principal and interest) plus the contractual penalty provided for in the contract, the present serving as an extrajudicial execution order, in accordance with Article 585 of the Code of Civil Procedure. | ||
Nature and reasons for the operation / other relevant information
|
Interest rate charged: 94% of the CDI. This is an inter-company loan for cash centralization. The company is the debtor. |
|
Name of related party
|
Instituto Ambiental Vale do Rio Doce (IAVRD) | |
Date of transaction
|
11/12/2007 | |
Amount (R$)
|
367,494.00 | |
Current balance (R$) (12/31/2010)
|
0.00 | |
Amount of related party
|
Not applicable | |
Duration
|
12/30/2010 | |
Loan or other type of debt
|
YES | |
Interest rate
|
94% of the CDI | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Loan | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
PREPAYMENT | |
| Vale may prepay the amount, in whole or in part, including principal and interest calculated from November 12 (twelve), 2007 until the date of actual payment. Vale should notify its intention to make the prepayment at least 3 (three) days in advance. | ||
| EARLY REDEMPTION | ||
| If Vale fails to meet any of its obligations, IAVRD may automatically assume the debt for the total value of the loan (principal and interest) plus the contractual penalty provided for in the contract, the present serving as an extrajudicial execution order, in accordance with Article 585 of the Code of Civil Procedure. | ||
Nature and reasons for the operation / other relevant information
|
Interest rate charged: 94% of the CDI. This is an inter-company loan for cash centralization. The Company is the debtor. |
|
Name of related party
|
Vale Operações Ferroviárias S/A (formerly, Mineração Tacumã Ltda.) | |
Date of transaction
|
01/02/2006 | |
Amount (R$)
|
5,162,101.00 | |
Current balance (R$) (12/31/2010)
|
13,536,715.10 | |
Amount of related party
|
Not applicable | |
Duration
|
06/30/2011 | |
Loan or other type of debt
|
YES | |
Interest rate
|
94% of the CDI | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Loan | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
PREPAYMENT | |
| TACUMÃ may prepay the amount, in whole or in part, including principal and interest calculated from January 2 (two), 2006 until the date of actual payment. TACUMÃ should notify its intention to make the prepayment at least 3 (three) days in advance. | ||
| EARLY REDEMPTION | ||
| If TACUMÃ fails to meet any of its obligations, Vale may automatically assume the debt for the total value of the loan (principal and interest) plus the contractual penalty provided for in the contract, the present serving as an extrajudicial execution order, in accordance with Article 585 of the Code of Civil Procedure. | ||
Nature and reasons for the operation / other relevant information
|
Interest rate charged: 94% of the CDI. This is an inter-company loan for cash centralization. The Company is the debtor. | |
Name of related party
|
CVRD Overseas Ltd. | |
Date of transaction
|
07/24/2003 | |
Amount (R$)
|
724,025,000.00 (equivalent to USD 250,000,000.00) | |
Current balance (R$) (12/31/2010)
|
0.00 | |
Amount of related party
|
Not applicable | |
Duration
|
01/15/2010 | |
Loan or other type of debt
|
YES | |
Interest rate
|
4.43% p.a. | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Export prepayment — Long term | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
Vale has the right to prepay the amount, without premium or penalty, in whole or in part, at any time and as of the date of the Contract, by prior written notification of up to 3 (three) business days to CVRD Overseas. | |
Nature and reasons for the operation / other relevant information
|
This is an export prepayment to cover cash needs. The Company is the debtor in this transaction. | |
Name of related party
|
CVRD Overseas Ltd. | |
Date of transaction
|
10/19/2000 | |
Amount (R$)
|
280,710,000.00 (equivalent to USD 150,000,000.00) | |
Current balance (R$) (12/31/2010)
|
0.00 |
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Amount of related party
|
Not applicable | |
Duration
|
01/15/2010 | |
Loan or other type of debt
|
YES | |
Interest rate
|
8.926% p.a. | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Export prepayment | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
Vale may prepay the amount, without premium or penalty, in whole or in part, at any time and as of the date hereof, by prior written notification of up to 3 (three) business days to CVRD Overseas. | |
Nature and reasons for the operation / other relevant information
|
This is an export prepayment to cover cash needs. The Company is the debtor in this transaction. | |
Name of related party
|
CVRD Overseas Ltd. | |
Date of transaction
|
08/15/2000 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
0.00 | |
Amount of related party
|
Not applicable | |
Duration
|
Undetermined | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Purchase of iron ore agglomerated and non-agglomerated products. In accordance with Vale securitization program started in 2000, it was established with the Trustee that sales for securitized customers over the term of the program would be made through CVRD Overseas. | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None. Vale securitization program, started in 2000, specifying that sales for securitized customers were to be made by CVRD Overseas, was finished in January 2010. | |
Nature and reasons for the operation / other relevant information |
||
Name of related party
|
Vale International S.A. | |
Date of transaction
|
01/13/2006 | |
Amount (R$)
|
28,014,166,800.00 (equivalent to USD 16,089,000,000.00) | |
Current balance (R$) (12/31/2010)
|
26,583,154,909.17 (equivalent to USD 15,954,360,166.35) | |
Amount of related party
|
Not applicable | |
Duration
|
12/21/2026 | |
Loan or other type of debt
|
YES | |
Interest rate
|
2.66% p.a. (average rate) | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Export prepayment | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
Prepayment — The exporter may, by notice in writing at least two (2) business days for the Importer, elect to prepay any amount, in whole or in part, with accrued interest. | |
Nature and reasons for the operation / other relevant information
|
This is an export prepayment to cover cash needs. The Company is the debtor in this transaction. | |
Name of related party
|
Vale International S.A. | |
Date of transaction
|
01/31/2005 | |
Amount (R$)
|
3,120,634,886.35 (equivalent to USD 1,792,232,303.21) | |
Existing balance (R$) (12/31/2010)
|
314,187,170.49 (equivalent to USD 1,809,018,827.57) | |
Amount of related party
|
Not applicable | |
Duration
|
04/29/2014 | |
Loan or other type of debt
|
YES | |
Interest rate
|
3.37% p.a. (average rate) | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Import financing | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other relevant information
|
This is an import financing for the optimization of the import area (streamlining import processes, with reduction of the number of exchange contracts). |
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Name of related party
|
Vale International S.A. | |
Date of transaction
|
03/01/2006 | |
Amount (R$)
|
Not applicable | |
Existing balance (R$) (12/31/2010)
|
1,553,000,000.00 | |
Amount of related party
|
Not applicable | |
Duration
|
12/31/2016 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Purchase of agglomerated and non-agglomerated iron ore, copper concentrate and copper cathode products. The “Termination” clause was prepared under English jurisdiction, and for this reason an analogy has been made with the wording of Brazilian legal institutions (which are different from English legal institutions). | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
The contract may be terminated immediately by written notification to the other party, if: (I) the other party commits a serious breach of any obligation under this contract if such breach is not remedied within 7 (seven) business days following the warning about the violation requesting its remedying; (II) an actual charge is made on the property of the other party or a judicial administrator or administrator is appointed to manage the property of the other party; (III) the other party enters into a contract with its creditors or has an administrator or other person who takes the decisions, including the decision to file documents in a Court of Justice declaring the intention to appoint an administrator to substitute the administrator in office; (IV) the other party declares liquidation (except in cases of mergers or restructurings, in which case the new company will assume the obligations imposed by the other party in relation to the current contract); (V) any occurrence of any event similar to events previously listed in accordance with the laws of any jurisdiction; or (VI) the other party stops or threatens to stop commercial/business transactions. | |
Nature and reasons for the operation / other
relevant information
|
— | |
Name of related party
|
Baovale Mineraçâo S.A. | |
Date of transaction
|
03/01/2002 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
3,000,000.00 | |
Amount of related party
|
Not applicable | |
Duration
|
2022 | |
Loan or other type of debt
|
No | |
Relationship with the Company
|
Subsidiary, joint control | |
Purpose of the contract
|
Purchase of agglomerated and non-agglomerated iron ore pellets | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
The contract may be terminated upon the occurrence of the following events by the: | |
| (I) Complaining party, if the other party commits a material breach of any of its obligations under the current contract and if such violation is not resolved within sixty (60) days after being given notice of the violation, requesting its solution; | ||
| (II) Vendor, if the Purchaser fails to pay the amount equivalent to 1,000,000 tons from the last fiscal through the next fiscal year; | ||
| (III) If Purchaser fails to meet the accumulated tonnage and exceeds 1,500,000 tons in any fiscal year; | ||
| (IV) Vendor or Purchaser, if applicable, in case of insolvency, bankruptcy or liquidation of the other party; | ||
| (V) Vendor or Purchaser after termination of the Shareholders Contract; | ||
| (VI) Vendor or Purchaser, after mutual consent; | ||
| (VII) Purchaser, if the Vendor fails to fulfill its obligations; | ||
| (VIII) Vendor or Purchaser, at the end of the term of the Contract. |
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Nature and reasons for the operation / other
relevant Information
|
— | |
Name of related party
|
Companhia Hispano Brasileira de Pelotização — Hispanobras | |
Date of transaction
|
05/13/1974 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
312,847,945.36 | |
Amount of related party
|
Not applicable | |
Duration
|
Current while the company exists | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Affiliate | |
Purpose of the contract
|
Supply of pellet feed (Vale for Hispanobras) Pellet acquisition contract (Hispanobras for Vale) Plant operation contract (Vale operates Hispanobras plant) In accordance with the shareholders’ contract between Vale and Arcelor Mittal Spain, Vale operates Hispanobras pellet plant, supplies pellet feed, and purchases part of the pellets produced in that plant. |
|
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation
/ other relevant Information |
||
Name of related party
|
Companhia Nipo-Brasileira de Pelotização — Nibrasco | |
Date of transaction
|
04/30/2008 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
263,773,811.82 | |
Amount of related party
|
Not applicable | |
Duration
|
Up to 2013 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Affiliate | |
Purpose of the contract
|
Contract for leasing assets. Vale leased the 2 pellet plant of Nibrasco, upon payment of a fixed portion and variable portion depending on the performance of the assets. The duration of the agreement is of 3 years, successively renewable for an equal period | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
Written notification to the other party, at least one year before its termination. | |
Nature and reasons for the operation
/ other relevant Information
|
— | |
Name of related party
|
Companhia Italo-Brasileira de Pelotização — Itabrasco | |
Date of transaction
|
09/30/2008 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
88,450,437.13 | |
Amount of related party
|
Not applicable | |
Duration
|
2018 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Affiliate | |
Purpose of the contract
|
Contract for leasing assets. Vale leased the pellet plant of Itabrasco, upon payment of a fixed portion and variable portion depending on the performance of the assets. | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
Either party will have the right to terminate the lease after the initial period of three years, provided that they send
to the other party written notice at least a year before the lease expires. The parties may also, during the eighth year, review the conditions agreed in this contract in order to decide whether or not this will be renewed. |
|
Nature and reasons for the operation /other
relevant Information
|
— | |
Name of related party
|
Companhia Coreano Brasileira de Pelotização — Kobrasco | |
Date of transaction
|
05/06/2008 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
206,825,246.19 | |
Amount of related party
|
Not applicable | |
Duration
|
2013 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— |
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Table of Contents
Relationship with the Company
|
Affiliate | |
Purpose of the contract
|
Contract for leasing assets. Vale leased the Kobrasco pellet plant of Kobrasco, upon payment of a fixed portion and variable portion depending on the performance of the assets. Term of the contract is five years, renewable successively for an equal period. | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
Written notice to the other party at least one year in advance of its termination | |
Nature and reasons for the operation / other
relevant Information |
||
Name of related party
|
Samarco Mineração S.A. | |
Date of transaction
|
04/12/2004 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
The balance of all transactions made with Samarco on 12/31/10 was 88 million, as stated in Vale’s financial statements. | |
Amount of related party
|
Not applicable | |
Duration
|
04/12/2024 (contracted). The first addition was signed on 05/25/2006; the second addition was signed on 008/07/2006 valid until 01/01/2027. | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Affiliate | |
Purpose of the contract
|
Regulate commercial relations between the parties regarding sale or iron ore produced by Vale for Samarco. | |
Guaranties and insurance
|
There is insurance against damages, in the area in control of the purchaser, related to the materials and/or equipment belonging to the vendor, as provided for by the PURCHASER. | |
Conditions of termination or expiration
|
The contract may be terminated by operation of law, by the innocent party, without prior notice, in any of the following cases: | |
| a) Default of any term, condition or provision of this contract or its exhibits, provided that the breach is not remedied within thirty (30) calendar days of the written notices provided for above. In such case, the party at fault must pay the innocent party a contractual fine of 10% of the annual amount in which the event occurs, which will be deducted from the losses and damages. The higher value holds, in any case, over the lower, at the risk of refund; | ||
| b) Bankruptcy, judicial or extrajudicial recovery, dissolution or, judicial or extrajudicial liquidation, declared or approved; | ||
| c) Suspension by the competent authorities of the implementation of the Services for more than thirty (30) days; | ||
| d) Suspension of service due to the occurrence of force majeure or unforeseeable circumstances as noted in the fourteenth clause for a period exceeding ninety (90) days, in which case the VENDOR has the right to receive from the PURCHASER the supplies already provided. | ||
Nature and Reasons for the operation / other
Relevant Information
|
— | |
Name of related party
|
Samarco Mineração S.A. | |
Date of transaction
|
05/01/2001 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
Not applicable. The balance of all transactions made with Samarco on 12/31/10 was 88 million, as stated in Vale’s financial statements. | |
Amount of related party
|
Not applicable | |
Duration
|
02/30/2006 (contracted). The first addition was entered into on 09/08/2005. The second addition was entered into on 07/04/2008 to 12/31/2010. | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Affiliate | |
Purpose of the contract
|
Regulate commercial relations between the parties regarding sale or iron ore concentrate produced by Vale for Samarco. | |
Guaranties and insurance
|
There is insurance against damages, in the area in control of the PURCHASER, related to the materials and/or equipment belonging to the VENDOR, as provided for by the PURCHASER. |
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Conditions of termination or expiration
|
The contract may be terminated by operation of law, by the innocent party, without prior notice or judicial or extrajudicial communication, in any of the following cases: | |
| a) Default of any term, condition or provision of this contract or its exhibits, provided that the breach is not remedied within thirty (30) calendar days of the written notices provided for above; | ||
| b) Bankruptcy, judicial or extrajudicial recovery, insolvency, or judicial or extrajudicial liquidation; | ||
| c) Suspension by the competent authorities of the supplies for more than thirty (30) days; | ||
| d) Suspension of service due to the occurrence of force majeure or unforeseeable circumstances as noted in the fourteenth clause for a period exceeding ninety (90) days, in which case the VENDOR has the right to receive from the purchaser the supplies already provided. | ||
Nature and reasons for the operation / other
relevant Information
|
— | |
Name of related party
|
MRS Logística S.A. | |
Date of transaction
|
09/30/2007 | |
Amount (R$)
|
7,200,000,000.00 | |
Current balance (R$) (12/31/2010)
|
3,697,520,470.00 | |
Amount of related party
|
Not applicable | |
Duration
|
10/01/2007 to 09/30/2012 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Affiliate | |
Purpose of the contract
|
Regulating the provision of rail transport services for iron ore, from iron ore loading terminals identified as Terminal Andaime, Terminal Sarzedo, Terminal Olhos D’Água, Terminal Água Santa, Terminal Sarzedo Novo — TCS (Terminal de Carga de Sarzedo), Terminal Córrego do Feijão, Terminal Alberto Flores and Terminal Souza Noscheses, located in the state of Minas Gerais, and certain other terminals for shipping from the ports of Guaíba and Sepetiba, in Rio de Janeiro. | |
Guaranties and insurance
|
Assuming that the annual volume to be transported, informed by Vale to MRS, is not observed, the party in default will compensate for any losses arising from this default. MRS must contract the Optional Liability Insurance for personal injury and damage caused to third parties, and is responsible for payment of the corresponding values of the policies. | |
Conditions of termination or expiration
|
The contract may be terminated by operation of law, by written notice to the other party, without prior notice, in any of the following cases: | |
| a) default, by either party of any term, condition or provision of this contract, provided that the breach is not remedied within sixty (60) calendar days of the notices provided for above. | ||
| b) bankruptcy, judicial or extrajudicial recovery, dissolution or, judicial or extrajudicial liquidation, declared or approved; | ||
| c) suspension by the competent authorities of the implementation of the Services; | ||
| d) When the fines provided for in Clause Ten reach 10% (Ten Percent) of the value of its cargo transported and delayed, even in a cumulative way; | ||
| e) If MRS suspends the Service, in whole or in part, without express prior notice or written consent by Vale, for more than ten (10) consecutive days or 30 (thirty) alternating days; | ||
| f) Suspension of service due to the occurrence of force majeure or unforeseeable circumstances for a period exceeding sixty (60) days; | ||
| g) If a party assigns this contract without prior knowledge and written consent of the other party. In the event of expiration or termination of the Contract, both parties should return to the other any documentation that is in their possession. This return must be made within 24 (twenty four) hours from the date of termination. In case of cancellation it will apply only until the date on which the termination takes place, with no effects for the remainder of the term originally established. |
||
Nature and reasons for the operation / other
relevant Information
|
— |
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Table of Contents
Name of related party
|
MRS Logística S.A. | |
Date of transaction
|
09/04/2008 | |
Amount (R$)
|
74,487,455.00 | |
Current balance (R$) (12/31/2010)
|
30,659,974.36 | |
Amount of related party
|
Not applicable | |
Duration
|
12/31/2011 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Affiliate | |
Purpose of the contract
|
Provision of rail transport services for iron ore, from iron ore loading terminals identified as Terminal de Olhos D’agua, Sarzedo, Sarzedo Novo, Córrego Feijão, Alberto Flores, Souza Noschese, Andaime, Juiz de Fora and Casa de Pedra, and certain other terminals which might be used up to the PATRAG transhipping terminal. | |
Guaranties and insurance
|
Vale will guarantee MRS the minimum payment based on volume, equivalent to 85% of the amount stipulated for 2008, and
the equivalent of 80% of the amounts stipulated for the years 2009, 2010 and 2011 of the planned shipments by Vale to
MRS. If MRS fails to meet the set volume, it should compensate for the difference six months as of the date of default. MRS must contract the Optional Liability Insurance for personal injury and damage caused to third parties, and is responsible for payment of the corresponding values of the policies. |
|
Conditions of termination or expiration
|
The contract may be terminated by operation of law, by written notice to the other party, without prior notice, in any
of the following cases: 1) default, by either party of any term, condition or provision of this contract, provided that the breach is not remedied within sixty (60) calendar days of the notices provided for above. 2) bankruptcy, judicial or extrajudicial recovery, dissolution or, judicial or extrajudicial liquidation, declared or approved; 3) suspension by the competent authorities of the implementation of the Services; 4) when the fines provided for in Clause Ten reach 10% (Ten Percent) of the value of its cargo transported and delayed, even in a cumulative way; 5) If the contracted party suspends the service, in whole or in part, without express prior notice or written consent by Vale, for more than ten (10) consecutive days or 30 (thirty) alternating days; 6) Occurrence of force majeure or unforeseeable circumstances regularly proven, which results in suspension of execution of this contract for more than 30 days. |
|
Nature and reasons for the operation / other relevant Information
|
— | |
Name of related party
|
Ferrovia Norte Sul S.A. | |
Date of transaction
|
12/19/2008 | |
Amount (R$)
|
None | |
Current balance (R $) (12/31/2010)
|
18,424,508.44 | |
Amount of related party
|
None | |
Duration
|
In effect for thirty (30) years or until the end of the subcontract.The current balance above corresponds to the total value paid for the fiscal year ended on 31.12.2010. There is no way to determine the global value of the contract, since it depends on the quantity and type of individual services required by FNS and provided by Vale over the period. Prices for each service are specified in the contract based on its characteristics, and are readjusted on an annual basis as per IGP-DI. | |
Loan or other type of debt
|
No | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Specific Contractual Transaction, with the objective (i) to carry out specific transactions relating to mutual traffic and/or the right of passage; (ii) to refine global operational efficiency for railroad transportation and better conditions in general for passengers, in order to allow for increased railroad transportation between parties; (iii) to maintain a heightened relationship between parties, in order to increase service of the demands of transportation of cargo in its areas of influence, producing economic development in the regions it attends, all in accordance with our contracts, as well as in observance of the applicable technical norms and regulations; and (iv) to consider the junction between the two railroads and the Açailândia station, in the state of Maranhão, operated by Vale S.A., where we will make the exchange between railroad stations with dispatched cargo in mutual traffic. |
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Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
Contract may be terminated by giving notice, communication or judicial summons or extrajudicial communication within 30 (thirty) days, only in the event of non-compliance by either party with any clause, provided it is not remedied within 90 (ninety) days by the non-complying party, after receiving prior written notice identifying the non-compliance, with acknowledgement of receipt. | |
Nature and reasons for the operation /other
relevant information
|
— | |
Name of related party
|
Minerações Brasileiras Reunidas S.A. — MBR | |
Date of transaction
|
06/01/2007 | |
Amount (R$)
|
Annual payments up to 320,000,000.00 | |
Current balance (R$) (12/31/2010)
|
320,000,000.00 | |
Amount of related party
|
Cannot be assessed | |
Duration
|
31.05.2037 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Lease of facilities | |
Guaranties and insurance
|
— | |
Conditions of termination or expiration
|
Through dissolution or if the contract of usufruct of shares of Empreendimentos Brasileiros de Minerações S.A. — EBM ends | |
Nature and reasons for the operation / other
relevant Information
|
— | |
Name of related party
|
Minerações Brasileiras Reunidas S.A. — MBR | |
Date of transaction
|
10/29/2007 | |
Amount (R$)
|
697,000,000.00 | |
Current balance (R$) (12/31/2010)
|
7,283,583.70 (Vale is creditor) | |
Amount of related party
|
None | |
Duration
|
12/31/2010. The fourth addition was entered into on 01/15/10, and may be renewed on an annual basis. | |
Loan or other type of debt
|
YES | |
Interest rate
|
94% of the CDI rate. | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Loan. In accordance with the fourth addition, Vale undertakes to provide as loan to MBR up to R$697,000,000.00, as requested by MBR, and approved by Vale, which may be changed. | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
The Contract may be terminated by complaint filed by any of the parties by giving notice 60 days in advance. On the date the contract is closed, any outstanding obligations must be fulfilled by the parties. In addition, regardless of the notice or communication, the parties may consider the contract automatically cancelled, and therefore, the debt expired, and payment of principal, interests, and obligations is required, in the case of (i) any plan of judicial or extrajudicial recovery existing against any party, or liquidation or bankruptcy; (ii) contractual non-compliance not remedied within 60 days after receipt of notice; (iii) any party overdue by at least 5 business days on payment of any amount owed. | |
Nature and reasons for the operation / other
relevant Information
|
All disbursements to be paid to variation of 94% of CDI. This is a loan to cover cash needs. | |
Name of related party
|
Teal Minerals (Barbados) Incorporated | |
Date of transaction
|
03/23/09 | |
Amount (R$)
|
153,290,400.00 (equivalent to USD 92,000,000.00) | |
Current balance (R$) (12/31/2010)
|
158,110,308.51 (equivalent to USD 94,892,755.08) (Vale International is creditor). | |
Amount of related party
|
50% | |
Duration
|
04/01/14 | |
Loan or other type of debt
|
YES |
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Table of Contents
Interest rate
|
Prime rate + 2% a.a. | |
Relationship with the Company
|
Affiliate | |
Purpose of the contract
|
Loan | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other
relevant Information
|
Prime rate + 2% a.a. This is an inter-company loan for provision of the necessary resources for continuation of ore exploration activities and maintenance of the company. | |
Name of related party
|
Vale Manganês S.A. | |
Date of transaction
|
01/01/2006 | |
Amount (R$)
|
2,901,223.99 | |
Current balance (R$) (12/31/2010)
|
1,739,853.79 | |
Amount of related party
|
None | |
Duration
|
12/31/2010 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Supply of hematite (HTFA), raw material necessary for industrial operation in manufacture of iron alloys. | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
None | |
Nature and reasons for the operation / other
relevant Information
|
— | |
Name of related party
|
Vale Manganês S.A. and Vale Energy | |
Date of transaction
|
01/01/2005 | |
Amount (R$)
|
1,283,486.40 | |
Current balance (R$) (12/31/2010)
|
916,776.00 | |
Amount of related party
|
None | |
Duration
|
2025 | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Agency services (power supply) | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
The contract may be terminated by either party, without cause, with thirty (30) days’ prior notice. If such is the case, no compensation may be owed by either party. The contract may also be terminated by either party upon notice given to the other in the event of bankruptcy, recovery, or judicial or extrajudicial liquidation of the other party, or non-compliance by the other party of any obligation arising from the contract. | |
Nature and reasons for the operation / other
relevant Information
|
— | |
Name of related party
|
Vale Manganês S.A. | |
Date of transaction
|
05/01/2010 | |
Amount (R$)
|
52,343,509.14 | |
Current balance (R$) (12/31/2010)
|
47,245,998.64 | |
Amount of related party
|
None | |
Duration
|
12/31/2014. The amount was estimated based on the volume scheduled for the term of the contract. | |
Loan or other type of debt
|
NO | |
Interest rate
|
— | |
Relationship with the Company
|
Subsidiary | |
Purpose of the contract
|
Handling of manganese ore carried by and for Vale Manganês by railway Estrada de Ferro Vitória a Minas and Ferrovia Centro-Atlântica. | |
Guaranties and insurance
|
None |
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Table of Contents
Conditions of termination or expiration
|
This contract may be terminated by either PARTY, without any charge, provided it is done in writing with at least 60 (sixty) days in advance, of the intended termination date. If that is the case, no indemnification or compensation for whatever reason may be paid, not even for loss or damage. | |||
Nature and reasons for the operation / other
relevant Information
|
. | |||
Name of related party
|
Vale Manganês S.A. | |||
Date of transaction
|
09/01/2008 | |||
Amount (R$)
|
179,236,548.75 | |||
Current balance (R$) (12/31/2010)
|
9,468,794.22 | |||
Amount of related party
|
None | |||
Duration
|
12/31/2011. The amount was estimated based on the volume scheduled for the term of the contract. | |||
Loan or other type of debt
|
NO | |||
Interest rate
|
— | |||
Relationship with the Company
|
Subsidiary | |||
Purpose of the contract
|
Handling of manganese ore dispatched from Carajás-PA to São Luis-MA for Vale Manganês, and shipping at Ponta da Madeira terminal. | |||
Guaranties and insurance
|
None | |||
Conditions of termination or expiration
|
This contract may be terminated by either PARTY, without any charge, provided it is done in writing with at least 60 (sixty) days in advance of the intended termination date. If that is the case, no indemnity or compensation whatsoever may be paid, not even for loss or damage. | |||
Nature and reasons for the operation / other
relevant Information
|
— | |||
Name of related party
|
Vale Manganês S.A. | |||
Amount (R$)
|
1,944,926.24 | |||
Current balance (R$) (12/31/2010)
|
Not applicable | |||
Amount of related party
|
Not applicable | |||
Duration
|
12/31/2008 | |||
Loan or other type of debt
|
NO | |||
Interest rate
|
— | |||
Relationship with the Company
|
Subsidiary | |||
Purpose of the contract
|
Power supply. Over the year 2008, short-term contracts were entered into at market prices to meet demand for RDM units. | |||
Date of transaction
|
01/01/2008 | |||
Guaranties and insurance
|
None | |||
Conditions of termination or expiration
|
None | |||
Nature and reasons for the operation / other
relevant Information |
||||
Name of related party
|
Vale Canada Ltd | |||
Relationship with the Company
|
Subsidiary | |||
Date of transaction
|
09/21/2010 | |||
Purpose of the contract
|
Regulate cooperation between the parties for development of support processes by Vale S.A. and share the costs relative to such processes with the companies of Vale Group. | |||
Amount (R$ thousand)
|
It could not be assessed. | |||
Current balance (R$ thousand)
|
19,292,883.30 | |||
Amount of related party
|
N/A | |||
Guaranties and insurance
|
None | |||
Duration
|
12/31/2011. The current balance reported above corresponds to the total value paid by the Company to Vale S.A. for the services rendered during the fiscal year ended on 31.12.2010. There is no way to determine the global value of the contract, since it depends on the quantity and type of individual services required by the Company and provided by Vale over the period. Prices for each service are individually specified in the contract based on its characteristics, and are readjusted on an annual basis as per IGP-DI. | |||
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Conditions of termination or expiration
|
This contract may be terminated by operation of law if either party fails to fulfill its obligations, provided that a written notice has been given by the non-defaulting party to the party in default, and provided that the non-compliance has not been remedied within 15 (fifteen) days. | |||
Loan or other type of debt
|
No | |||
Interest rate
|
— | |||
Other relevant Information
|
— | |||
Name of related party
|
Salobo Metais S.A. | |||
Date of transaction
|
07/01/2009 | |||
Amount (R$)
|
6,499,210.58 | |||
Current balance (R$) (12/31/2010)
|
6,499,210.58 | |||
Amount of related party
|
Not applicable | |||
Duration
|
03/01/2013. | |||
Loan or other type of debt
|
NO | |||
Interest rate
|
— | |||
Relationship with the Issuer
|
Subsidiary | |||
Purpose of the contract
|
Lease of equipment owned by Vale for Salobo. Mina do Sossego, Canaã dos Carajás/PA. | |||
Guaranties and insurance
|
None | |||
Conditions of termination or expiration
|
This contract may be terminated by either party by giving written notice 30 (thirty) days in advance to the other, there being no right for any claim, indemnity or compensation for whatever reason. | |||
Nature and reasons for the operation / other
relevant Information
|
. | |||
Name of related party
|
Salobo Metais S.A. | |||
Date of transaction
|
03/10/2010 | |||
Amount (R$)
|
6,870,933.60 | |||
Current balance (R$) (12/31/2010)
|
6,870,933.60 | |||
Amount of related party
|
Not applicable | |||
Duration
|
03/09/2015 | |||
Loan or other type of debt
|
NO | |||
Interest rate
|
— | |||
Relationship with the Company
|
Subsidiary | |||
Purpose of the contract
|
Lease of an offroad, Caterpillar 793D- truck for handling services internally, in Mina do Sossego, Canaã dos Carajás/PA. | |||
Guaranties and insurance
|
None | |||
Conditions of termination or expiration
|
The contract may be terminated by either Party by written notice to the other, without there
being any right of claim, indemnification or compensation for whatever reason, in following
cases: (i) petition or declaration of insolvency, bankruptcy or liquidation
agreement of the other Party; (ii) on accordance with para. 10.4, occurrence of unforeseeable
circumstances or force majeure, regularly proven, resulting in suspension of the LEASE for more
than 30 (thirty) days. (iii) suspension of the LEASE without written agreement of the parties;
and (iv) in the event the fines on the other Party reach 10% (ten percent)
of the value indicated in paragraph 7.4. Subject to the satisfaction of its other rights, Vale may, at its sole discretion, terminate this Contract upon prior written notice to the LESSOR with at least 30 (thirty) days in advance, said LESSOR forbearing any rights to claim, indemnification or compensation, for whatever the reason, in the following cases: (i) failure to fulfill any contractual obligations by the LESSOR,
provided that Vale has given written notice establishing a reasonable term for remedy;
(ii) occurrence of lawsuits brought by the LESSOR, shareholders, quota
holders, or companies forming part of the same group against Vale, its subsidiaries,
controlling companies and affiliate companies; and, (iii) assignment, sucontracting, and / or transfer of all or part of
their obligations to third parties, or of credits under this Contract without prior written
authorization of Vale.
|
|||
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| Subject to the satisfaction of its other rights, the LESSOR may, at its sole discretion,
terminate this Contract upon prior written notice to Vale with at least 30 (thirty) days in
advance, Vale forbearing any rights to claim, indemnification or compensation, for whatever the
reason, in the following cases: (i) arrears for a period of more than 30 (thirty) days; (ii) delays in releasing information that might endanger regular
fulfillment of the obligations undertaken pursuant to this Contract, after giving notice to
Vale, and such information was not provided within 30 (thirty) days; and, (iii) Failure to comply with any obligations arising from this Contract
by Vale, directly resulting in the LESSOR being unable to continue with regular fulfillment of
its contractual obligations, after notice given to Vale clearly identifying its violations and
establishing a reasonable term for remedy.
|
||||
Nature and reasons for the operation /other
relevant Information
|
. | |||
Name of related party
|
Salobo Metais S.A. | |||
Date of transaction
|
07/01/2010 | |||
Amount (R$)
|
3,933,206.29 | |||
Current balance (R$) (12/31/2010)
|
3,933,206.29 | |||
Amount of related party
|
Not applicable | |||
Duration
|
11/01/2010 | |||
Loan or other type of debt
|
NO | |||
Interest rate
|
— | |||
Relationship with the Company
|
Subsidiary | |||
Purpose of the contract
|
Stripping service by Vale to SALOBO for opening Mina do Salobo. | |||
Guaranties and insurance
|
None | |||
Conditions of termination or expiration
|
The contract may be terminated by either party by written notice to the other, there being no right to any claim, indemnification or compensation, for whatever the reason. | |||
Nature and reasons for the operation /other
relevant Information
|
. | |||
Name of related party
|
Salobo Metais S.A. | |||
Date of transaction
|
07/24/2009 | |||
Amount (R$)
|
256,560.45 | |||
Current balance (R$) (12/31/2010)
|
0.00 | |||
Amount of related party
|
Not applicable | |||
Duration
|
11/24/2009 | |||
Loan or other type of debt
|
NO | |||
Interest rate
|
— | |||
Relationship with the Company
|
Subsidiary | |||
Purpose of the contract
|
Lease to Salobo of equipment owned by Vale — Nickel mine Ourilândia do Norte/PA. | |||
Guaranties and insurance
|
None | |||
Conditions of termination or expiration
|
The contract may be terminated by either party by giving written notice to the other, there being no right to any claim, indemnification or compensation, for whatever the reason. | |||
Nature and reasons for the operation /other
relevant Information
|
. | |||
Name of related party
|
MRC Serviços Ferroviários CBRJ-AL Ltda. | |||
Date of transaction
|
02/24/2010 | |||
Amount (R$)
|
40,275,360.00 | |||
Current balance (R$) (12/31/2010)
|
Not applicable | |||
Amount of related party
|
Not applicable | |||
Duration
|
12/31/2016 | |||
Loan or other type of debt
|
NO | |||
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Interest rate
|
— | |||
Relationship with the Issuer
|
Company belonging to Mitsui, controlling group of Vale. | |||
Purpose of the contract
|
Lease of 300 new HPE type- wagons. | |||
Guarantees and insurances
|
None | |||
Conditions of termination or expiration
|
Provided that (i) no breach has occurred or persists at the time of the notice
foreseen in item (ii) below, and at the time of return of all wagons as
specified under para. (iii) below; (ii) written notice has been given to MRC by
the LESSEES 180 (one-hundred and eighty) days in advance to inform on their
intention to terminate the Contract; and (iii) all the wagons have been returned
by the LESSEES as provided for in Clause 20, the LESSEES will have the right,
upon payment of the consideration provided for in Clause 23.2 of the Contract,
to irrevocably terminate the Contract with respect to all (and not less than
all) wagons. If the LESSEES terminate the Contract pursuant to Clause 23.1, they will pay MRC: i) a fine per leased wagon for the LESSEES for a value in
Reais equivalent to the remaining balance in the Contract; and ii) a compensation for any other costs, fines, expenses,
damages or disbursement incurred as a result of termination of the contrat and
other operational documents. Above mentioned value, including that resulting from the established formula in Clause 23.2 of the contract, will be corrected based on the IGPM (General Market Price Index) within the least time slot allowed by the applicable law. Except in the event of non-compliance by MRC, the values mentioned in clause 23 of the Contract will be owed by the LESSEES to MRC, regardless of the reason which caused termination by the LESSEES. |
|||
Nature and reasons for the operation /other
relevant Information
|
. | |||
Name of related party
|
Mitsui & Co. Ltd. and Vale Fertilizers | |||
Date of transaction
|
01/01/2011 | |||
Amount (R$)
|
29,263,380.00 | |||
Current balance (R$) (12/31/2010)
|
Not applicable | |||
Amount of related party
|
Not applicable | |||
Duration
|
12/31/2011 | |||
Loan or other type of debt
|
NO | |||
Interest rate
|
— | |||
Relationship with the Issuer
|
Controlling group of Vale and subsidiary. | |||
Purpose of the contract
|
Guarantee the operational continuation of the manufacturing plants with supply of sulfur. | |||
Guarantees and insurances
|
Not applicable | |||
Conditions of termination or expiration
|
Not applicable | |||
Nature and reasons for the operation /other
relevant Information
|
. | |||
Name of related party
|
Ultrafértil S.A. and Vale Fertilizers | |||
Date of transaction
|
01/01/2010 | |||
Amount (R$)
|
22,764,553.72 | |||
Current balance (R$) (12/31/2010)
|
1,130,296.29 | |||
Amount of related party
|
Not applicable | |||
Duration
|
One year | |||
Loan or other type of debt
|
NO | |||
Interest rate
|
— | |||
Relationship with the Issuer
|
Subsidiary of Vale Fertilizers | |||
Purpose of the contract
|
Guarantee the supply of LOW DENSITY AMMONIUM NITRATE to Vale by ULTRAFERTIL, marketed under brand “ULTRAPRILL”, and HIGH DENSITY AMMONIUM NITRATE, marketed under brank “ULTRAPRILL PLUS”. | |||
Guarantees and insurances
|
None | |||
Conditions of termination or expiration
|
Not applicable | |||
Nature and reasons for the operation /other
relevant Information
|
.- | |||
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Name of related party
|
Ultrafertil S.A. and Vale Fertilizantes | |||
Date of transaction
|
01/01/2010 | |||
Amount (R$) (R$)
|
303,014,775.01 | |||
Current balance (R$) (12/31/2010)
|
37,387.475.57 | |||
Amount of related party
|
Not applicable | |||
Duration
|
One year | |||
Loan or other type of debt
|
NO | |||
Rate of interest
|
— | |||
Relationship with the Issuer
|
Subsidiary of Vale Fertilizantes | |||
Purpose of the contract
|
Sale of supplies for fertilizers | |||
Guarantees and insurances
|
None | |||
Conditions of termination or expiration
|
Not applicable | |||
Nature and reasons for the operation /other
relevant Information
|
— | |||
Name of related party
|
Ultrafertil S.A. and Vale Fertilizantes | |||
Date of transaction
|
01/01/2010 | |||
Amount (R$)
|
5,527.928.45 | |||
Current balance (R$) (12/31/2010)
|
5,527,928.45 | |||
Amount of related party
|
Not applicable | |||
Duration
|
One year | |||
Loan or other type of debt
|
Yes | |||
Rate of interest
|
0.00 | |||
Relationship with the Issuer
|
Subsidiary of Vale Fertilizantes | |||
Purpose of the contract
|
Loan of Ultrafertil of supplies for fertilizers (with incidental taxes) | |||
Guarantees and insurances
|
None | |||
Conditions of termination or expiration
|
Not applicable | |||
Nature and reasons for the operation /other
relevant Information
|
It is a loan of supplies for manufacturing of fertilizers. | |||
Name of related party
|
Ultrafertil S.A. and Vale Fertilizantes | |||
Date of transaction
|
01/01/2010 | |||
Amount (R$)
|
175,855.788.54 | |||
Current balance (R$) (12/31/2010)
|
21,740,622.61 | |||
Amount of related party
|
Not applicable | |||
Duration
|
1 year | |||
Loan or other type of debt
|
No | |||
Rate of interest
|
— | |||
Relationship with the Issuer
|
Subsidiary o Vale Fertilizantes | |||
Purpose of the contract
|
Acquisition of supplies for fertilizers | |||
Guarantees and insurances
|
None | |||
Conditions of termination or expiration
|
Not applicable | |||
Nature and reasons for the operation /other
relevant Information
|
— | |||
Name of related party
|
Ultrafertil S.A. and Vale Fertilizantes | |||
Date of transaction
|
01/01/2010 | |||
Amount (R$)
|
1,830,433.78 | |||
Current balance (R$) (12/31/2010)
|
1,830,433.78 | |||
Amount of related party
|
Not applicable | |||
Duration
|
1 year | |||
Loan or other type of debt
|
Yes | |||
Rate of interest
|
0.00 | |||
Relationship with the Issuer
|
Subsidiary of Vale Fertilizantes | |||
Purpose of the contract
|
Loan of Ultrafertil of supplies for fertilizers (with incidental taxes) | |||
Guarantees and insurances
|
None | |||
Conditions of termination or expiration
|
Not applicable | |||
Nature and reasons for the operation /other
relevant Information
|
It is a loan of supplies for manufacturing of fertilizers. | |||
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Name of related party
|
Vale Fosfatados S.A. and Vale Fertilizantes | |||
Date of transaction
|
01/01/2010 | |||
Amount (R$)
|
230,893,678.81 | |||
Current balance (R$) (12/31/2010)
|
1,242,654.65 | |||
Amount of related party
|
Not applicable | |||
Duration
|
1 year | |||
Loan or other type of debt
|
No | |||
Rate of interest
|
— | |||
Relationship with the Issuer
|
Parent company of Vale Fertilizantes at the moment | |||
Purpose of the contract
|
Sale of supplies for fertilizers, the current balance refers to advances made by Vale Fosfatados | |||
Guarantees and insurances
|
None | |||
Conditions of termination or expiration
|
Not applicable | |||
Nature and reasons for the operation /other
relevant Information
|
— | |||
Name of related party
|
Vale Fosfatados S.A. and Vale Fertilizantes | |||
Date of transaction
|
01/01/2010 | |||
Amount (R$)
|
33,479,048.76 | |||
Current balance (R$) (12/31/2010)
|
33,479,048.76 | |||
Amount of related party
|
Not applicable | |||
Duration
|
1 year | |||
Loan or other type of debt
|
Yes | |||
Rate of interest
|
— | |||
Relationship with the Issuer
|
Parent company of Vale Fertilizantes at the moment | |||
Purpose of the contract
|
Loan of supplies for de Vale Fosfatados | |||
Guarantees and insurances
|
None | |||
Conditions of termination or expiration
|
Not applicable | |||
Nature and reasons for the operation /other
relevant Information
|
It is a loan of supplies for manufacturing of fertilizers | |||
Name of related party
|
Vale Fosfatados S.A. and Vale Fertilizantes | |||
Date of transaction
|
01/01/2010 | |||
Amount (R$)
|
4,626,070.88 | |||
Current balance (R$) (12/31/2010)
|
2,971,124.29 | |||
Amount of related party
|
Not applicable | |||
Duration
|
1 year | |||
Loan or other type of debt
|
No | |||
Rate of interest
|
— | |||
Relationship with the Issuer
|
Parent company of Vale Fertilizantes at the moment | |||
Purpose of the contract
|
Acquisition of supplies for fertilizers | |||
Guarantees and insurances
|
None | |||
Conditions of termination or expiration
|
Not applicable | |||
Nature and reasons for the operation /other
relevant Information
|
— | |||
Name of related party
|
KOREA NICKEL CORPORATION (“KNC”) | |
Date of transaction
|
12/01/2006 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
R$ 280,784,280.00 (equivalent to US$ 159.6 million) | |
Amount of related party
|
It cannot be assessed | |
Duration
|
12/31/2013 (agreement added in 10/01/2007, 05/20/2008 and 02/01/2009) | |
Loan or other type of debt
|
No | |
Interest rate
|
— | |
Relationship with the Issuer
|
Affiliate | |
Purpose of the contract
|
Supply of inputs — contract for the purchase and sale of product for the refining of the nickel in an area with an important consumer market | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
The contract may be terminated by any of the parties through written notification in the following cases: (a) bankruptcy or insolvency of the other party; or (b) if the other party fails to comply any obligation assumed pursuant to the terms of the agreement, if such condition lasts more than 60 days after the reception of such notification. | |
Nature and reasons for the operation /other
relevant Information
|
— |
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Name of related party
|
KOREA NICKEL CORPORATION (“KNC”) | |
Date of transaction
|
08/01/2008 | |
Amount (R$)
|
Not applicable | |
Current balance (R$) (12/31/2010)
|
R$ 10,731,730.00 (equivalent to US$ 6.1 million) | |
Amount of related party
|
It cannot be assessed | |
Duration
|
12/31/2013 (agreement added in 01/01/2009, 03/31/2009 and 01/01/2010- the agreement was replaced by a new one entered into on 01/01/2011) | |
Loan or other type of debt
|
No | |
Interest rate
|
— | |
Relationship with the Issuer
|
Affiliate | |
Purpose of the contract
|
Refining of nickel sinter — contract for the provision of services for the refining of the nickel in an area with an important consumer market | |
Guaranties and insurance
|
None | |
Conditions of termination or expiration
|
The contract may be terminated by any of the parties through written notification in the following cases: (a) bankruptcy or insolvency of the other party; or (b) if the other party fails to comply any obligation assumed pursuant to the terms of the agreement, if such condition lasts more than 60 days after the reception of such notification. | |
Nature and reasons for the operation /other
relevant Information
|
— |
| 16.3 | Measures Taken to Address the Conflict of Interest |
As mentioned in item 16.1, the Company conducts transactions with related parties in order to
always best serve its interests and those of its shareholders.
Transactions concluded with related parties are supported by prior, careful evaluations of the
terms therein, so that they takes place under strictly equitable conditions, obeying the normal
market prices and conditions. Thus, transactions with related parties do not generate any undue
benefits or harm to the parties involved.
To check the equitable nature of operations with related parties, the Company reviews the financial
viability of each operation vis-à-vis similar market transactions between unrelated parties. The
Company uses comparative analysis methods.
Transactions with related parties of the Company may, in general, be divided into: (i) Operational
transactions, and (ii) Financial transactions.
Within the operational part of its activities, Vale performs a substantial volume of transactions
with its wholly owned subsidiaries, subsidiaries and companies under joint control with third
parties, in view of its policy of integration of its activities in the production and commercial
chain. Besides the extraction of minerals, Vale invests heavily in activities related to transport,
logistics, and energy services and supplies essential to achieving its corporate purpose. The
Company’s investments in the logistics segment are based on the transport needs for mining
operations and for other products sold to customers. Additionally, Vale invests in power generation
to meet its own internal needs, in order to reduce costs and minimize risks due to problems of
energy supply. In this context, several operational contracts have been signed between Vale and
members of companies in its group, always taking care to observe fair and balanced terms and avoid
discrepancies with market conditions, as required by Corporate and Tax laws.
With respect to transactions of a financial nature, Vale seeks continuously and energetically to
find the best options available in local and international markets, with a view to securing or
investing resources. Overall, investments are undertaken in order to maintain the liquidity of the
company available for its investments coupled with a conservative policy regarding the assuming of
credit risk of counterparties, with a focus on maintaining its assets in first-tier banks.
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17.1 Information about the share capital
| Date of | ||||||||||||||||
| authorization or | Deadline for | |||||||||||||||
| Number of shares | Amount (R$) | approval | payment | |||||||||||||
a) Issued capital |
||||||||||||||||
Common Shares |
3,256,724,482 | 45,524,788,827.91 | ||||||||||||||
Preferred Class A Shares |
2,108,579,606 | 29,475,211,004.35 | 05/18/11 | 05/18/11 | ||||||||||||
Golden Shares |
12 | 167.74 | ||||||||||||||
Total |
5,365,304.100 | 75,000,000,000.00 | ||||||||||||||
b) Subscribed capital |
||||||||||||||||
Common Shares |
3,256,724,482 | 45,524,788,827.91 | ||||||||||||||
Preferred Class A Shares |
2,108,579,606 | 29,475,211,004.35 | 05/18/11 | 05/18/11 | ||||||||||||
Golden Shares |
12 | 167.74 | ||||||||||||||
Total |
5,365,304,100 | 75,000,000,000.00 | ||||||||||||||
c) Paid-in capital |
||||||||||||||||
Common Shares |
3,256,724,482 | 45,524,788,827.91 | ||||||||||||||
Preferred Class A Shares |
2,108,579,606 | 29,475,211,004.35 | 05/18/11 | — | ||||||||||||
Golden Shares |
12 | 167.74 | ||||||||||||||
Total |
5,365,304,100 | 75,000,000,000.00 | ||||||||||||||
| Amount of shares | ||||
e) Authorized capital |
||||
Common Shares |
3,600,000,000 | |||
Preferred Class A Shares |
7,200,000,000 | |||
Total |
10,800,000,000 | |||
Value (R$ thousand) |
— | |||
Authorization date |
08/30/2007 | |||
f & g) Titles convertible in shares and conditions for the conversion
Mandatory convertible notes series VALE-2012: The notes in the amount of US$ 292,445,150 with
maturity in 2012 will yield interests of 6.75% per year, payable quarterly. At their maturity, on
June 15, 2012, or before, Notes of Series VALE-2012 will be mandatorily converted to American
Depositary Shares (ADS), each ADS representing one common share issued by Vale.
Mandatory convertible notes series VALE.P-2012: The notes in the amount of US$ 649,213,250 with maturity in 2012 will yield interests of 6.75% per year, payable quarterly. At their maturity, on June 15, 2012, or before, Notes of Series VALE.P-2012 will be mandatorily converted to ADS, each ADS representing one preferred share class A issued by Vale
Mandatory convertible notes series VALE.P-2012: The notes in the amount of US$ 649,213,250 with maturity in 2012 will yield interests of 6.75% per year, payable quarterly. At their maturity, on June 15, 2012, or before, Notes of Series VALE.P-2012 will be mandatorily converted to ADS, each ADS representing one preferred share class A issued by Vale
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17.2 Capital Increases for the last three fiscal years:
| l) % of | ||||||||||||||||||||||||||||||||||||||||||||||||
| increase | ||||||||||||||||||||||||||||||||||||||||||||||||
| b) Corporate | e) Number of shares | f) Issue price | h) Form of | i) Criteria for | j) | over the | ||||||||||||||||||||||||||||||||||||||||||
| a) | Body that | d) Total amount | issued | (R$) | payment (cash, | determining | Subscription | previous | ||||||||||||||||||||||||||||||||||||||||
| Resolution | ruled the | c) Issue | of the increase | Preferred | Preferred | g) Total of | property or | the issuance | (private or | share | ||||||||||||||||||||||||||||||||||||||
| date | increase | date | (R$) | Common | Class A | Common | Class A | shares (units) | rights) | price | public) | capital | ||||||||||||||||||||||||||||||||||||
07/16/2008 |
Board of Directors | 07/17/2008 | 18,450,242,410.58 | 256,926,766 | 164,402,799 | 46.28 | 39.90 | 421,329,565 | Cash upon subscription in legal tender | Bookbuilding | Public | 65.89 | % | |||||||||||||||||||||||||||||||||||
05/08/2008 |
Board of Directors | 08/05/2008 | 983,950,718.10 | — | 24,660,419 | — | 39.90 | 24,660,419 | Cash upon subscription in legal tender | Bookbuilding | Public | 2.12 | % | |||||||||||||||||||||||||||||||||||
05/19/2010 |
AGE | N/A | 2,565,806,871.32 | There was no issuance of new shares | N/A | N/A | 0 | Capitalization of part of the expansion / investments reserve | N/A | N/A | 5.41 | % | ||||||||||||||||||||||||||||||||||||
05/18/2011 |
AGE | N/A | 25,000,000,000.00 | There was no issuance of new shares | N/A | N/A | 0 | Capitalization of part of the expansion / investments reserve | N/A | N/A | 50 | % | ||||||||||||||||||||||||||||||||||||
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17.3 Stock splits, reverse splits and bonuses in the Company’s last three fiscal years:
There were not stock splits, reverse splits or bonuses in the Company’s last three fiscal years:
17.4 Regarding reductions in the Company’s share capital
There was no reduction in the Company’s capital in the last three fiscal years.
17.5 Other information that the Company considers relevant
Additional information about securities convertible to shares
1) Series VALE and Series VALE.P-2012: US$941,658,400 in mandatorily convertible notes with
maturity in 2012, issued on July 13, 2009, by Vale Capital II.
The notes in the amount of US$292,445,150 with maturity in 2012, Notes of Series VALE-2012, will
yield interests of 6.75% per year, payable quarterly. At their maturity, on June 15, 2012, or
before, the Series VALE-2012 notes will be mandatorily converted to American Depositary Shares
(ADS), each ADS representing one common share issued by Vale. Additional interest will be paid
based on the net amount of cash distributions paid to holders of ADS.
The notes in the amount of US$649,213,250 with maturity in 2012, Notes of Series VALE.P-2012, will
yield interests of 6.75% per year, payable quarterly. At their maturity, on June 15, 2012, or
before, the Series VALE.P-2012 notes will be mandatorily converted to ADS, each ADS representing
one preferred Class A shares issued by Vale. Additional interest will be paid based on the net
amount of cash distributions paid to holders of ADS
The ADS, will, jointly, represent the amount of up to 18,415,859 common shares and 47,284,800
preferred class A shares issued by Vale, currently held in the treasury.
The notes are unsecured and unsubordinated obligations of Vale Capital II, and shall be completely
and unconditionally guaranteed by Vale. The guarantee is an unsecured and unsubordinated obligation
of Vale.
Convertible notes 2012
| Average of Market Value of the last 20 days prior | ||||
| Notes | to the maturity | Conversion rate | ||
Vale P 2012
|
Less than or equal to US$13.73 | 3.64170 | ||
| Range between US$13.73 and US$16.13 | US$50.00 divided by the average market value | |||
| Equal to or higher than US$16.13 | 3.09930 | |||
Vale 2012
|
Less than or equal to US$15.88 | 3.14860 | ||
| Range between US$15.88 and US$18.66 | US$50.00 divided by the average market value | |||
| Equal to or higher than US$18.66 | 2.67970 |
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Additional information about the increase of the Company’s capital
There was no issuance of special class preferred shares during the increase of the Company’s
capital, over the last 3 fiscal years.
The deliberated increase of capital in 08/16/08 was approved within the scope of the offer of
primary public distribution for Common Shares and Class A Preferred Shares issued by the Company
registered in Brazil before the Securities Commission [Comissão de Valores Mobiliários — CVM] in
07/17/2008, and the offer of
distribution of Common Shares and Class A Preferred Shares as American Depositary Shares (“ADSs”),
represented by American Depositary Receipts (“ADRs”), registered abroad before the US Securities
and Exchange Commission (“Global OFfer”). A subscription within the scope of Global Offer has been
verified and the increase of capital has been approved during the meeting of the Board of Directors
of July 22, 2008.
The amount of 256,926,766 common shares foreseen in the resolution of capital increase of 08/16/08
considers the 80,079,223 common shares issued by the Company as ADSs represented by ADRs, at the
price of US$29.00 or €18.25 per common ADS.
The amount of 164,402,799 preferred shares foreseen in the resolution of capital increase of
08/16/08 considers the 63,506,751 class A preferred shares issued by the Company as ADSs
represented by ADRs, at the price of US$25.00 or €15.74 per common ADS
The decision made on 08/05/08 provides for capital increase due to the use of the additional lot
within the scope of the public offering described above.
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18. Securities
18.1 Description of the rights of each class and type of share issued
Common Shares
Tag Along : 80,000000
a. Dividend rights
Under the Company’s Bylaws and the applicable legislation, owners of common shares will have the
right to receive a dividend proportionate to their interest in the capital stock, after
distribution of dividends to holders of preferred shares.
According to Article 44 of the Company’s Bylaws, at least 25% (twenty-five percent) of the annual
net profits, adjusted under the law, will be assigned to the payment of the mandatory dividend to
all the company’s shareholders.
b. Voting rights
Full.
c. Convertibility to other class or type of share:
No.
d. Right to reimbursement of capital
Yes
Description of the characteristics of the reimbursement of capital
Shareholders who hold common shares will have the right to the reimbursement of the value of their
shares according to the provisions set forth in the applicable law, according to the terms and
conditions established.
e. Restrictions regarding outstanding shares
No.
f. Circumstances where guaranteed rights of said securities may be altered.
The rights guaranteed to the common shares that are not determined by the applicable law may be
altered by means of an amendment of the bylaws, and approved at the extraordinary General Meeting
that can only be held in the 1st instance, with the presence of the shareholders
representing at least 2/3 of the voting capital, and in a second instance with any number of
shareholders present.
Changes shall be approved based on quorums and conditions set forth by the Law of Joint Stock
Company. It is also stressed that in accordance with article 7 of the bylaws, special class
preferred shares shall have the right of veto over any modification of rights assigned to types and
classes of shares issued by the Company, as well as any modification of article 7, or any other
rights granted by the bylaws to special class preferred shares.
g. Other Relevant Characteristics
There are no restrictions regarding outstanding common shares issued by the Company. For
information about restrictions to the Company’s stock trading by the involved individuals, see
description of our Negotiation Policy in item 20 on this Reference Form. All the other
characteristics of the common shares issued by the Company that we believe are relevant were
described on Letters “a — g” above.
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Class “A” Preferred Shares
Tag Along : 0.00
a. Dividend rights
Class “A” preferred shares have the following rights: a) priority in receiving dividends, to be
calculated in the form of Vale bylaws, corresponding to (i) at least 3% of the net worth of the
share based on the financial statements that served as a reference for the payment of dividends or
(ii) 6% calculated on the part of the capital formed by each class of share, whichever of them is
greater; (b) the right to participate in profit sharing on equal terms with the common shares, once
these have been guaranteed a dividend equal to the minimum priority established in accordance with
letter “a” above; and (c) participation in any premiums, on equal terms with the common shares,
maintaining the priority for the distribution of dividends. According to the Company’s Bylaws, at
least 25% of the annual net profits, adjusted under the law, will be assigned to the payment of the
mandatory dividend to the company’s shareholders.
b. Voting Right
Restricted.
Description of restriction
The preferred class “A” shares will have the same political rights as the common shares, with the
exception of voting for the election of members of the Board of Directors, with the qualification
set forth in §§ 2 and 3 of article 11 of Vale bylaws, as well as the right to elect and dismiss a
member of the fiscal Council and his Deputy. Preferred shares will exercise full and unrestricted
right to vote if the Company no longer pays, for a period of three (03) consecutive financial
years, the minimum dividends assured to holders of preferred shares, to which they have a right
under the terms of letter “a” above.
c. Convertibility to other class or type of share:
No.
d. Right to reimbursement of capital
No.
e. Restrictions regarding outstanding shares
No.
f. Circumstances where guaranteed rights of said securities may be altered.
The rights guaranteed to the class “A” preferred shares that are not determined by the applicable
law may be altered by means of an amendment of the bylaws, and approved at the extraordinary
General Meeting. that can only be held in the 1st instance, with the presence of
shareholders representing at least 2/3 of the voting capital, and the 2nd instance with
any number of shareholders present. Changes shall be approved based on quorums and conditions set
forth by the Law of Joint Stock Company. The effectiveness of the decision will depend on the prior
approval or ratification within one year, without the possibility of extending this period, by
holders of more than half of each class of preferred shares whose rights would be impaired, It is
also stressed that in accordance with article 7 of the bylaws, special class preferred shares shall
have the right of veto over any modification of rights assigned to types and classes of shares
issued by the Company, as well as any modification of article 7.
g. Other Relevant Characteristics
There are no restrictions regarding outstanding common shares issued by the Company. For
information about restrictions to the Company’s stock negotiations by the involved individuals, see
description of our Negotiation Policy in item 20 on this Reference Form. All the characteristics of
the class “A” preferred shares that the Company believes are relevant were described on Letters “a
- g” above.
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Special Class Preferred Shares (Golden Shares)
Tag Along : 0,00
a. Dividend rights
Special class preferred shares have the following rights: a) priority in receiving dividends, to be
calculated in the form of the Company’s bylaws, corresponding to (i) at least 3% of the net worth
of the share based on the financial statements that served as a reference for the payment of
dividends or (ii) 6% calculated on the part of the capital formed by each class of share, whichever
of them is greater; (b) the participation in profit sharing on equal terms with the common shares,
once these have been guaranteed a dividend equal to the minimum priority established in accordance
with letter “a” above; and (c) participation in any premiums, on equal terms with the common
shares, maintaining the priority established for the distribution of dividends. According to the
Company’s Bylaws, at least 25% of the annual net profits, adjusted under the law, will be assigned
to the payment of the mandatory dividend to the company’s shareholders.
b. Voting Right
Restricted.
Description of the restrction
The special class preferred shares (golden shares) have the same political rights as common shares,
with the exception of voting for the election of members of the Board of Directors, with the
qualification set out in §§ 2 and 3 of article 11 of the Bylaws, as well as the right to elect and
dismiss a member of the fiscal Council and his Deputy. Golden shares also have a right to veto on
the following subjects: (I) change in corporate name; (ii) change of headquarters; (iii) change in
statutory purpose regarding mining activities; (iv) liquidation of the company; (v) transfer or
closing of the activities of any or all of the following stages of the company’s integrated systems
of iron ore; (vi) any modification of rights assigned to types and classes of shares set forth in
the bylaws; and (vii) any amendment to article 7, or any other rights granted to special class
shares in the Bylaws.
c. Convertibility to other class or type of share:
No.
d. Right to reimbursement of capital
No.
e. Restrictions regarding outstanding shares
Yes
Special class preferred shares belong exclusively to the Federal Government.
f. Circumstances where guaranteed rights of said securities may be altered.
The rights guaranteed to the special class preferred shares that are not determined by the
applicable law may be altered by means of an amendment of the bylaws, and approved at the
extraordinary General Meeting that can only be held in the first instance, with the presence of the
shareholders representing at least 2/3 of the voting capital, and in the 2nd instance
with any number of shareholders present. Changes shall be approved based on quorums and
conditions set forth by the Law of Joint Stock Company. The effectiveness of the decision will
depend on the prior approval or ratification within one year, without the possibility of extending
this period, by holders of more than half of each class of preferred shares whose rights would be
impaired,. It is also stressed that in accordance with article 7 of the bylaws, special class
preferred shares shall have the right of veto over any modification of rights assigned to types and
classes of shares issued by the Company, as well as any modification of article 7.
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g. Other Relevant Characteristics
All the other characteristics of the special class preferred shares that the Company believes are
relevant were described on Letters “a — g” above.
18.2 Statutory regulations which limit the right to vote of large shareholders or which cause them
to hold a public offering.
There are no statutory regulations which limit the right to vote of large shareholders or which
cause them to hold a public offering.
18.3 Description of exceptions and suspensive clauses relative to ownership or political rights set
forth in the bylaws
There are no exceptions or suspensive clauses relative to ownership or political rights set forth
in the Company’s bylaws
18.4 Volume of trading as well as minimum and maximum prices for securities traded
Fiscal Year
12/31/2010
12/31/2010
| Traded | Highest | Lowest | ||||||||||||||||||||||
| Administrative | Financial | Price Listed | Price Listed | List Price | ||||||||||||||||||||
| Quarter | Securities | Type | Class | Market | Entity | Volume(R$) | (R$) | (R$) | Factor | |||||||||||||||
03/31/2010 |
Shares | Common | Stock Exch. | BM&FBovespa S.A | 153,821,415 | 57.45 | 47.16 | R$ /unit | ||||||||||||||||
06/30/2010 |
Shares | Common | Stock Exch | BM&FBovespa S.A | 178,385,133 | 59.85 | 43.65 | R$ /unit | ||||||||||||||||
09/31/2010 |
Shares | Common | Stock Exch | BM&FBovespa S.A | 130,785,983 | 52.30 | 42.85 | R$ /unit | ||||||||||||||||
12/31/2010 |
Shares | Common | Stock Exch | BM&FBovespa S.A | 161,444,574 | 58.19 | 52.80 | R$ /unit | ||||||||||||||||
03/31/2010 |
Shares | Preferred | PNA | Stock Exch | BM&FBovespa S.A | 763,899,296 | 49.55 | 40.80 | R$ /unit | |||||||||||||||
06/30/2010 |
Shares | Preferred | PNA | Stock Exch | BM&FBovespa S.A | 900,334,068 | 51.34 | 37.50 | R$ /unit | |||||||||||||||
09/31/2010 |
Shares | Preferred | PNA | Stock Exch | BM&FBovespa S.A | 685,509,796 | 46.30 | 37.52 | R$ /unit | |||||||||||||||
12/31/2010 |
Shares | Preferred | PNA | Stock Exch | BM&FBovespa S.A | 674,544,688 | 50.92 | 46.75 | R$ /unit | |||||||||||||||
Fiscal Year
12/31/2009
12/31/2009
| Traded | Highest | Lowest | ||||||||||||||||||||||
| Administrative | Financial | Price Listed | Price Listed | List Price | ||||||||||||||||||||
| Quarter | Securities | Type | Class | Market | Entity | Volume(R$) | (R$) | (R$) | Factor | |||||||||||||||
03/31/2009 |
Shares | Common | Stock Exch. | BM&FBovespa S.A | 153,993,412 | 38.75 | 28.36 | R$ /unit | ||||||||||||||||
06/30/2009 |
Shares | Common | Stock Exch | BM&FBovespa S.A | 148,605,707 | 40.00 | 31.50 | R$ /unit | ||||||||||||||||
09/31/2009 |
Shares | Common | Stock Exch | BM&FBovespa S.A | 132,971,156 | 41.77 | 31.89 | R$ /unit | ||||||||||||||||
12/31/2009 |
Shares | Common | Stock Exch | BM&FBovespa S.A | 158,108,479 | 50.30 | 40.05 | R$ /unit | ||||||||||||||||
03/31/2009 |
Shares | Preferred | PNA | Stock Exch | BM&FBovespa S.A | 561,323,131 | 32.48 | 25.25 | R$ /unit | |||||||||||||||
06/30/2009 |
Shares | Preferred | PNA | Stock Exch | BM&FBovespa S.A | 596,092,582 | 33.79 | 27.05 | R$ /unit | |||||||||||||||
09/31/2009 |
Shares | Preferred | PNA | Stock Exch | BM&FBovespa S.A | 523,833,158 | 37.02 | 27.75 | R$ /unit | |||||||||||||||
12/31/2009 |
Shares | Preferred | PNA | Stock Exch | BM&FBovespa S.A | 663,912,411 | 43.37 | 35.67 | R$ /unit | |||||||||||||||
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Fiscal Year
12/31/2008
12/31/2008
| Traded | Highest | Lowest | ||||||||||||||||||||||
| Administrative | Financial | Price Listed | Price Listed | List Price | ||||||||||||||||||||
| Quarter | Securities | Type | Class | Market | Entity | Volume(R$) | (R$) | (R$) | Factor | |||||||||||||||
03/31/2008 |
Shares | Common | Stock Exch. | BM&FBovespa S.A | 178,156,759 | 62.50 | 45.00 | R$ /unit | ||||||||||||||||
06/30/2008 |
Shares | Common | Stock Exch | BM&FBovespa S.A | 148,394,923 | 72.09 | 55.44 | R$ /unit | ||||||||||||||||
09/31/2008 |
Shares | Common | Stock Exch | BM&FBovespa S.A | 165,017,065 | 55.01 | 33.80 | R$ /unit | ||||||||||||||||
12/31/2008 |
Shares | Common | Stock Exch | BM&FBovespa S.A | 146,834,909 | 36.39 | 22.10 | R$ /unit | ||||||||||||||||
03/31/2008 |
Shares | Preferred | PNA | Stock Exch | BM&FBovespa S.A | 657,284,815 | 52.50 | 40.61 | R$ /unit | |||||||||||||||
06/30/2008 |
Shares | Preferred | PNA | Stock Exch | BM&FBovespa S.A | 613,262,023 | 58.70 | 46.75 | R$ /unit | |||||||||||||||
09/31/2008 |
Shares | Preferred | PNA | Stock Exch | BM&FBovespa S.A | 663,960,212 | 46.04 | 30.30 | R$ /unit | |||||||||||||||
12/31/2008 |
Shares | Preferred | PNA | Stock Exch | BM&FBovespa S.A | 499,499,821 | 32.70 | 20.24 | R$ /unit | |||||||||||||||
18.5 Description of other securities which are not shares
ADS (American Depositary Shares) VALE
a) Securities Deposit Certificates
b) quantity: 783,013,959 (outstanding)
c) value: US$ 29.03 per ADR
d) date of issuance: 03/15/2002
e) total value (Reais) : 7,529,828,095.53
f) restrictions on outstanding shares: None
g) convertibility of shares or right to subscribe to or buy shares issued by the company: 1 to 1
h) possibility of redeeming: None
i) conditions for changing rights assured by such securities: None
j) other relevant characteristics: Each VALE ADS represents one common share issued by the Company.
VALE ADS are traded on the New York Stock Exchange under the tag VALE. The ADSs are represented by
ADRs (American depositary receipts) issued by the depositary, JPMorgan Chase Bank.
ADS (American Depositary Shares) VALE.P
a) Securities Deposit Certificates
b) quantity: 794,130,127 (outstanding)
c) value: US$ 24.82 per ADR
d) date of issue: 06/20/2000
e) total value (Reais) : 12,437,035,667.28
f) restrictions on outstanding shares: None
g) convertibility of shares or right to subscribe to or buy shares issued by the company: 1 to 1
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h) possibility of redeeming: None
i) conditions for changing rights assured by such securities: None
j) other relevant characteristics: Each VALE.P ADS represents one preferred share issued by the
Company. VALE.P ADS are traded on the New York Stock Exchange under the tag VALE.P. The Vale.P ADSs
are represented by ADRs (American depositary receipts) issued by the depositary, JPMorgan Chase
Bank.
HDS (Hong Kong Depositary Shares) 6210
a) Securities Deposit Certificates
b) quantity: 3,841,100 (outstanding)
c) total value R$: None
d) date of issue: 08/12/2010
e) restrictions on outstanding shares: None
f) convertibility of shares or right to subscribe to or buy shares issued by the company: 1 to 1
g) possibility of redeeming: None
h) conditions for changing rights assured by such securities: None
i) other relevant characteristics: Each HDS 6210 represents one common share issued by the
Company. VALE HDS are traded on the Hong Kong Stock Exchange (HKEx), under the tag 6210. The HDS
are represented by HDR (Hong Kong depositary receipts) issued by the depositary, JPMorgan Chase
Bank.
HDS (Hong Kong Depositary Shares) 6230
a) Securities Deposit Certificates
b) quantity: 1,509,900 (outstanding)
c) total value R$: None
d) date of issue: 08/12/2010
e) restrictions on outstanding shares: None
f) convertibility of shares or right to subscribe to or buy shares issued by the company: 1 to 1
g) possibility of redeeming: None
h) conditions for changing rights assured by such securities: None
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i) other relevant characteristics: Each HDS 6230 represents one preferred share issued by the
Company. HDS 6230 are traded on the Hong Kong Stock Exchange (HKEx), under the tag 6230. The HDS
are represented by HDR (Hong Kong depositary receipts) issued by the depositary, JPMorgan Chase
Bank.
CVRD27 Debentures (7th issue — 2nd series)
b) quantity: 400,000
c) value: R$ 4,000,000,000.00
d) date of issue: 11/20/2006
e) restrictions on outstanding shares: None
f) convertibility of shares or right to subscribe to or buy shares issued by the company: None
g) possibility of redeeming:
i. possibility of redemption: from 11/20/2010, it will be possible to effect acceleration of
all the debentures
ii. formula for calculating value of redemption: p = d/D*0.35% (p=premium; d=number of days
between redemption date and maturity date; D=number of days between 11/20/2010 and redemption
date)
h) if debt securities, indicate where applicable:
maturity, including conditions for acceleration:
(a) maturity date: 11/20/13
(b) all Company obligations may be declared overdue early, if the terms and conditions set
forth in the Deed of Issue are maintained, in the occurrence of any of the events summarized
below:
• bankruptcy, receivership order or out-of-court recovery or settlement, dissolution or
extinction of company;
• changing the company into a limited liability company, pursuant to articles 220 to 222 of law
No. 6,404/76;
• non-payment of the Nominal Value, of Remuneration, premium, or any other amounts owed to the
debenture holders;
• violation, by the Company, of any obligation for non-monetary compensation provided for in
the deed of issue, and if such breach is not dealt with within 60 (sixty) days from the date of
receipt of notice in writing, that is sent to the Company by the Fiduciary Agent for this
purpose;
• if any of the statements made in the deed of issue are proven to be false, incorrect or
misleading in any relevant aspect;
• occurrence of default or of default event by the Company or by any Relevant Subsidiary (any
subsidiary in which the proportional participation of Vale in the total assets of the
subsidiary exceeds 10% of the total consolidated assets of the company at the end of the last
financial year), which is not dealt with, for any contract, debt instrument or document showing
an open debt at a value equal to or exceeding R$ 125.000.000 (one hundred and twenty-five
million reais) updated monthly, from the date of issue, by IGMP, provided that such default or
default event results in an effective acceleration of said debt;
• reduction of the capital stock of the company, in accordance with article 174 of law No.
6,404/76, except if the operation has been previously approved by holders of at least the
majority of outstanding Debentures of the first series and at least the majority of outstanding
Debentures of the second series, as provided for in paragraph 3 of article 174 of law No.
6,404/76; or
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• approval of incorporation, merger or split of the company or sale, by the company, of all or
substantially all of its assets or its mining properties, with some exceptions. The provisions
of this section shall not apply to the operations of incorporation that have been previously
approved by holders of at least the majority of Debentures of the first series in circulation
or has been assured for the holders of Debentures who wish, during the period of at least six
months, to redeem the Debentures which they own.
| ii. | interest: DI + 0.25% |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral:
None |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: Secured Credit |
||
| v. | possible restrictions imposed on the issuer: None |
||
| vi. | the fiduciary agent, indicating the key terms of the contract: Pentagon SA DTVM. The
contract concluded with Pentagon has the usual market terms, among Vale’s obligations we
highlight: (i) maintaining proper functioning body to take care of Debenture holders’
interests; and (ii) contracting, at the beginning of the offer, at least one risk
classification agency to perform risk classification (rating) of the Debentures, also, with
respect to at least one agency risk classification, update it annually, until the expiration
date. Among the obligations of the fiduciary agent we highlight: (i) protecting the rights
and interests of debenture holders (ii) keeping in safe custody all deeds and titles (iii)
convening, when necessary, the General Meeting of debenture holders (iv) preparing an annual
report for debenture holders (v) maintaining an updated record of debenture holders. The
fiduciary agent receives annual remuneration of R$ 24,000.00, adjusted annually by IGMP. |
i) conditions for amendment of the rights conferred by such securities: during deliberations of the
General Meetings of debenture holders for each of the series, for each outstanding Debenture one
vote will be granted, permitting the establishment of proxy, whether Debenture holder or not.
Except for the provisions below, all deliberations to be taken in the General Meeting of debenture
holders will depend on approval of debenture holders representing at least the majority of
outstanding Debentures of the Second Series. Not included in the quorum above are: (I) the quorums
expressly provided for in other clauses of the deed of issue, such as the quorum for substitution
of fiduciary agent in case of absence, temporary impediments, renunciation, intervention, judicial
or extra-judicial settlement or bankruptcy of the same; and (ii) changes, which should be approved
by debenture holders representing at least 90% (ninety per cent) of outstanding Debentures of the
Second Series, as provided for in article 71, paragraph 5, of law No. 6,404/76: (a) of the quorums
for approval provided for in the Deed of issue; (b) the remuneration of Debentures, except in case
of replacement of the DI rate; (c) any dates for payment of any amounts provided for in the Deed of
issuance; (d) of the type of Debentures; (e) of the amendment of the provisions for optional early
redemption; or (f) creation of a repricing event.
j) other relevant characteristics: Debentures issued by Vale S.A.
Participative Debentures (CVRDA6, CVRDB6, CVRDC6, CVRDD6)
a) Debentures
b) quantity: 388,559,06
c) total value: R$ 3,885,590.56
d) date of issue: 07/08/1997
e) restrictions on outstanding shares: None
f) convertibility of shares or right to subscribe to or buy shares issued by the company: None
g) possibility of redeeming: None
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h) characteristics of securities: Single series. Registered. Not represented by certificate. Par
value updated pursuant to IGP-M variation. Participative debentures are traded in secondary market
together with the SND (National System of Debentures) under the management of ANDIMA (National
Association of Open Market Institutions) and the operation of CETIP since October 2002. CETIP codes
of the debentures are CVRDA6, CVRDB6, CVRDC6, CVRDD6. The ISIN number of the debentures is
BRVALEDBS028.
i) conditions for changing rights assured by such securities: Any change in the conditions of the
debentures shall depend on the approval of the debenture holders that represent the absolute
majority of the outstanding debentures. The maturity of the debentures shall take place in the
event of extinction of all the mining rights that are the purpose of the Deed, including also the
exhaustion of the discriminated mineral reserves or the reserves that replaced them. In that case,
the Issuer (Vale) binds itself to liquidate the outstanding Debentures at it par value updated
according to the provisions set forth in the Deed, without Premium.
j) other relevant characteristics: Premiums due to debenture holders shall be paid every six
months, on March 31 and September 30 of each year.
18.6 Description of the Brazilian markets where the company’s securities are admitted for trading
The main market for trading the Company’s common and preferred shares is the BM & F BOVESPA — Stock
Exchange in São Paulo.
The debentures of the Company were recorded for trading in the secondary market through (a) the SND
— National Debenture System, administered and operated by CETIP; and (b) the BOVESPAFIX, an
integrated environment for trading, settlement and custody of securities, administered and operated
by BM & F BOVESPA.
18.7 Description of the securities admitted to trading in foreign markets
The following bonds: VALE39, VALE19, CVRD36, CVRD34B, CVRD17, CVRD16, CVRD34, CVRD13, INCO2015,
INCO2012, INCO2032, CVRD20 and CVRD39 were accepted for trading in the United States of America, on
the New York Stock Exchange, on 11/10/2009, 09/15/2009, 11/21/2006, 11/02/2005, 11/21/2006,
01/10/2006, 01/15/2004, 08/08/2003, 09/26/2003, 05/13/2002, 09/23/2002, 09/15/2010 and 05/10/2010
respectively. The Securities Exchange Commission — SEC, is the body responsible for the
administration of the New York Stock Exchange and the Bank of New York is the depositary bank and
custodial institution for the Bonds.
The mandatory convertible notes Series Vale 2012 and Series Vale P 2012 (“Convertible Notes”) were
accepted for trading in the United States of America, on the New York Stock Exchange, on 07/13/2009
and 0/13/2009 respectively. The Securities Exchange Commission — SEC, is the body responsible for
the administration of the New York Stock Exchange and the Bank of New
York is the depositary bank and custodial institution for the Convertible Notes.
The American Depositary Shares (ADSs), represented by American Depositary Receipts (ADRs) Vale and
VALE. P, were admitted to trading in the United States of America, on the New York Stock Exchange
on 03/15/2002 and 06/20/2000 respectively. The ADSs, represented by ADRs, VALE3 and VALE5, have
also been admitted for trading in France, on the NYSE Euronext, both on 07/21/2008. The Securities
Exchange Commission — SEC, is the body responsible for the administration of the New York Stock
Exchange and the French Autorité des Marchés Financiers (AMF) is the entity responsible for the
NYSE Euronext. The depositary bank is the JPMorgan Chase Bank. Each ADS VALE or ADS VALE3,
represents a common share issued by the company, and 24% of the company’s common shares are linked
to the ADSs VALE and VALE3. Each ADS Vale.P or ADS VALE5, represents a Class A preferred share
issued by the Company, and 38% of Vale Class A preferred shares are linked to the ADSs VALE.P and
VALE5.
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Hong Kong Depositary Shares (HDSs), represented by Hong Kong Depositary Receipts (HDRs), 6210 and
6230 were admitted to trading in Hong Kong, on the Hong Kong Stock Exchange on 12/08/2010. The Hong
Kong Securities and Futures Commission (SFC) is the body responsible for the administration of the
Hong Kong Stock Exchange. The depositary bank is the JPMorgan Chase Bank. Each HDR 6210 represents
a common share issued by the company, and 0.1% of Vale’s common shares are linked to the HDRs 6210.
Each HDR 6230 represents a Class A preferred share issued by the Company and 0.1% Vale Class A
preferred shares are linked to the HDRs 6230.
The Eurobond CVRD18 with due date in 2018 was admitted to trading on the regulated market of the
Luxembourg Stock Exchange on 03/24/2010. The Commission de la Surveillance du Secteur Financier is
responsible for approval of the issue prospectus and the Bank of New York is the depositary bank
and custodial institution for Eurobond CVRD18.
Trading of Bonds, Convertible Notes, American Depositary Shares and Eurobonds last year was wholly
conducted abroad.
For more information about the securities admitted to trading in foreign markets, see items 18.5
and 18.10 of this Reference Form.
18.8 Description of the public offerings made by the Company or by third parties, including
controlling companies and subsidiaries, relating to the Company’s securities, during the last three
financial years
On 17 July 2008, Vale held a global public primary distribution offering of 256,926,766 common
shares and 189.063.218 Class A preferred shares, all registered, uncertificated and and no-par
value, represented by American Depositary Receipts (ADRs), at a price of US$ 46.28 per common share
and US$ 29.00 or 18.25 euros per common ADS, and R$ 39.90 per Class A preferred share and US$ 25.00
or 15.74 euros per preferred ADS, amounting to R$ 19,434 billion.
18.9 Description of takeover bids made by Company for shares issued by third parties during the
last three financial years
Not applicable.
18.10 Other information which the Company deems relevant
In Item 18.4 the shares financial volume pertains to the daily trading average in each quarter.
Below is information about the securities trading volume and the highest and lowest price traded in
the stock exchange in each of the quarters during the last three fiscal years, other than those
referred to in item 18.4 of this Reference Form.
| Daily Average Volume (US$ | Highest List Price | Lowest List Price | ||||||||||
| Vale ON — ADS VALE | Mil) | (US$)(1) | (US$)(1) | |||||||||
1º Quarter 2008 |
857,498 | 37.2 | 26.6 | |||||||||
2º Quarter 2008 |
924,709 | 43.9 | 34.4 | |||||||||
3º Quarter 2008 |
939,941 | 34.5 | 16.7 | |||||||||
4º Quarter 2008 |
535,042 | 18.6 | 8.8 | |||||||||
1º Quarter 2009 |
597,375 | 17.7 | 11.9 | |||||||||
2º Quarter 2009 |
545,433 | 20.8 | 13.8 | |||||||||
3º Quarter 2009 |
520,215 | 23.3 | 15.9 | |||||||||
4º Quarter 2009 |
631,128 | 29.5 | 22.3 | |||||||||
1º Quarter 2010 |
755,835 | 32.3 | 25.2 | |||||||||
2º Quarter 2010 |
950,663 | 34.6 | 24.0 | |||||||||
3º Quarter 2010 |
569,570 | 31.3 | 24.3 | |||||||||
4º Quarter 2010 |
632,066 | 34.7 | 31.5 | |||||||||
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| Vale PNA — ADS | Daily Average Volume (US$ | Highest List Price | Lowest List Price | |||||||||
| VALE.P | Mil) | (US$)(1) | (US$)(1) | |||||||||
1º Quarter 2008 |
233,515 | 31.2 | 23.9 | |||||||||
2º Quarter 2008 |
249,475 | 35.8 | 28.6 | |||||||||
3º Quarter 2008 |
240,564 | 28.6 | 15.3 | |||||||||
4º Quarter 2008 |
128,149 | 16.9 | 8.0 | |||||||||
1º Quarter 2009 |
114,610 | 14.7 | 10.4 | |||||||||
2º Quarter 2009 |
161,166 | 17.7 | 11.9 | |||||||||
3º Quarter 2009 |
157,321 | 20.7 | 13.7 | |||||||||
4º Quarter 2009 |
214,032 | 25.7 | 19.9 | |||||||||
1º Quarter 2010 |
243,184 | 27.8 | 21.9 | |||||||||
2º Quarter 2010 |
318,938 | 29.5 | 20.2 | |||||||||
3º Quarter 2010 |
214,045 | 27.8 | 21.1 | |||||||||
4º Quarter 2010 |
247,639 | 30.5 | 27.9 | |||||||||
| Source: | Bloomberg |
|
| (1) | Based on prices at closing |
Below is the description of other securities issued by the Company and its subsidiaries, other than
those referred to in item 18.5 of this Reference Form.
BNDESPAR Debentures — Ferrovia Norte Sul — 1st Issue
b) quantity: 66,510 debentures, at a nominal unit value of R$ 10,000.00
c) value: R$ 665,100,000.00
d) date of issue: 12/17/2007
e) restrictions on trading: None
f) convertibility of shares or right to subscribe to or buy shares issued by the company.
The DEBENTURES can be exchanged at any time from the first day of the 11th year from date of issue,
at the free discretion of their holder, for a quantity of common shares issued by FNS or Vale
Logística de Carga Geral S.A. (“Vale Logística”) that matches, in each Annual Exchange Period, the
application of the percentages that range from 0.74% to 9.62% (PERCENTAGE OF SHARES IN THE
EXCHANGE) on the number of common shares in which Ferrovia Norte Sul S.A. (FNS) capital stock is
divided, as long as this value is equal to or less than R$ 1,876,280,000.00. The debenture holders
may, at their sole discretion, exchange the entirety or only part of their DEBENTURES, and each
DEBENTURE can be exchanged for the amount of shares resulting from the division between (i) the
application of the Percentage of Shares in the Exchange to the number of common shares that make up
the capital of FNS, as long as this value is equal to or less than R$ 1,876,280,000.00 and (ii) the
amount of DEBENTURES fully paid.
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The PERCENTAGE of SHARES IN THE EXCHANGE was obtained on the basis of (i) projected economic value
of FNS forecast as from the 11th year after DATE OF ISSUE, as per cash flow projection and (ii)
projected value of NOMINAL UNIT VALUE as of the 11th year after DATE OF ISSUE.
Once the DEBENTURES are exchanged for FNS or Vale Logística controlling shares, there will be no
effects on Vale’s capital stock.
The number of shares issued by Vale Logística which the Debentures holders will have a right to
receive at the exchange regulated will be that resulting from the multiplication of Vale Logística
capital stock percentage, defined in the third clause of the fist annex, by the number of shares in
which Vale Logística capital stock is divided.
The debenture holders will have to choose between the exchange for FNS shares or for Vale Logística
shares, provided that (i) in neither case, will the Debenture holder be able to exchange part of
his debentures for FNS shares and part for Vale Logística shares; and (ii) at the time of the
exchange for FNS shares, the option to exchange for Vale Logística shares will immediately be void
and any blockage established may be released and vice-versa.
g) possibility of redemption:
| i. | Possibilities of redemption: |
Vale must effect the early redemption of all (and nothing less than the entirety) of
debentures outstanding within 30 (thirty) days of the occurrence of the following
events:
| a) | extinction of sub-concession contract concluded between VALEC Engenharia,
Construções e Ferrovias S.A. and the FNS for the administration and operation of public
rail cargo transport service on the Norte-Sul Railroad, due to expiry; buy-in;
termination; agreement between the parties; annulment of sub-concession or concession or
declaration of nullity of the administrative bidding procedure; and |
| b) | Intervention by the Licensing Authority in the sub-concession or in the concession
for the administration and operation of public rail cargo transport service on the
Norte-Sul Railroad conferred granted to FNS. |
| ii. | formula for calculating value of redemption |
On the payment date of the redemption, Vale will effect the settlement of the debentures
which are still outstanding, at their non-amortized nominal unit value, plus the amount
capitalized but not amortized, as well as the monetary interest capitalized semi-annually on
the 15th of June and December each year with a grace period of 4 years counted from the date
of issue and still not amortized, and remuneration in the amount of 0.8% p.a. above the TJLP
(long-term interest rate) liable until such date (the “redemption value”).
The Value of Redemption shall be increased by a percentage of 20% (twenty per cent) if
(i) the termination of letter “a” above is due to the expiry of the concession or even
sub-concession (ii) when the cancellation of the above-mentioned concession or
sub-concession is attributable, as determined in administrative proceedings, to Vale
Logística or the FNS.
h) if debt securities, indicate where applicable:
| i. | maturity, including conditions for acceleration: |
Maturity date: 12/17/2027
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Acceleration:
In addition to the assumptions referred to in articles 39, 40 and 47-A of the Provisions
Applicable, debenture holders may declare all debentures to be matured in advance and require
payment, by Vale, of the debt relative to the balance of debentures, plus the interest and other
charges which are liable up to the date of payment in the occurrence of the following events:
a) failure by Vale to fulfill any monetary obligation related to the debentures not dealt with
within 10 (ten) days counted from their respective maturity date;
b) failure to correct any default of any non-monetary obligation as provided in the DEED,
within a forty-five-day-term.
c) declaration of acceleration of any debt of Vale by reason of breach of contract which individual
amount equals or exceeds R$ 125,000,000.00 or which aggregate value, in a period of twelve (12)
consecutive months, is equal to or greater than R$ 1,000,000,000.00
d) the inclusion in the articles of incorporation or bylaws of Vale and FNS of any mechanism
whereby a special quorum is required for a decision or approval of matters which limit or restrict
control of Vale and FNS by their controlling companies or, further, the inclusion in those
documents, of mechanisms which lead to: restrictions on the growth capacity of Vale and FNS or
their technological development; restrictions on access by Vale and FNS to new markets; or
restrictions on or impairment of the ability to pay financial obligations provided for in this Deed
of Issue.
e) if the effective direct share control of Vale or FNS is changed by any means, unless approved in
advance by holders of debentures;
f) acquisition by FNS of controlling shareholding or shareholdings in other companies, joint
ventures or consortia consisting of activities which are not complementary to the normal
development of the corporate purpose of FNS, characterizing deviation from FNS’s corporate purpose,
unless approved in advance by holders of debentures;
g) in relation to FNS, the occurrence of any acquisition, merger, split, transformation or any
other corporate reorganization, whether this reorganization be strictly corporate or performed by
using relevant assets, and in relation to Vale, the occurrence of corporate re-organizations which
imply transferring to third parties that are not controlled by Vale, ownership of FNS shares which
will be the subject matter of an exchange in the terms of the deed, unless approved in advance by
holders of debentures representing at least 50% plus one of outstanding debentures;
h) non-compliance, by Vale, of any provision concerning the interchangeability of debentures
i) constitution, by Vale, of any collateralized guarantee with other creditors, without giving a
guarantee of the same quality and with equal priority of payment to this issue of debentures,
unless approved in advance by holders of debentures;
j) if Vale does not support and maintain the block for the exchange of common shares issued by FNS
corresponding to the percentage of share capital for the exchange;
k) if Vale does not use the proceeds generated by the issuance for capitalization of FNS, within 3
(three) days counted from the paying up of the debentures; and
| ii. | interest: TJLP + 0.8% a.a |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral:
None |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: Secured Credit |
||
| v. | possible restrictions imposed on the issuer: |
• for distribution of dividends: None
• disposal of certain assets: Vale may dispose of any goods, if at its discretion, this act
is desirable for the efficient running of its business and does not adversely affect Vale’s
capacity to honor its obligations in terms of the Deed of Issue.
• assumption of new debt: none
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• issuing new securities: none
| vi. | the fiduciary agent, indicating the key terms of the contract: none |
l) conditions for amendment of the rights conferred by such securities: Any changes to the terms
of this debenture issue will depend on the approval of debenture holders representing at least 50%
plus 1 debenture of outstanding debentures. For the purpose of setting up the quorum, debentures
possibly belonging to Vale shall be excluded.
m) other relevant characteristics:
Debentures issued by Vale S.A., privately, which were fully subscribed by BNDES Participações S.A.
Vale undertakes to maintain, for the duration of the Deed, the following indexes compiled annually
through the financial statements audited by external auditors registered with the CVM (Securities
Commission):
a) Ratio of Debt over Adjusted EBITDA less than or equal to 4.5 (four and five tenths); and
b) Ratio of Adjusted EBITDA over Interest Expenses greater than or equal to 2.0 (two).
In the event these levels are not observed, Vale should provide, within 60 (sixty) days counted
from the date of such communication, in writing to debenture holders, collateralized guarantees,
accepted by the debenture holders, at a value corresponding to at least 130% (one hundred and
thirty per cent) of the debt balance of debentures, unless within that period the levels above are
reestablished.
BNDESPAR Debentures — Ferrovia Norte Sul — 2nd Issue
b) quantity: 38,520 debentures, at a nominal unit value of R$ 10,000.00
c) value: R$ 385.200,000.00
d) date of issue: 10/15/2009
e) restrictions on trading: None
f) convertibility of shares or right to subscribe to or buy shares issued by the company: the
debentures are exchangeable against shares issued by Ferrovia Norte Sul S.A. (“FNS”), or Vale
Logística de Carga Geral S.A. (“Vale Logística”), held by Vale S.A.
The DEBENTURES can be exchanged at any time from the first day of the 11th year from date of issue,
at the free discretion of their holder, for a quantity of stock issued by FNS or Vale Logística
that matches, in each Annual Exchange Period, the application of the percentages that range from
0.74% to 9.62% (PERCENTAGE OF SHARES IN THE EXCHANGE) on the number of common shares in which
Ferrovia Norte Sul S.A. (FNS) capital stock is divided, as long as this value is equal to or less
than R$ 1,876,280,000.00. The debenture holders may, at their sole discretion, exchange the
entirety or only part of their DEBENTURES, and each DEBENTURE can be exchanged for the amount of
shares resulting from the division between (i) the application of the Percentage of Shares in the
Exchange to the number of common shares that make up the capital of FNS, as long as this value is
equal to or smaller than R$ 1,876,280,000.00, and (ii) the amount of DEBENTURES fully paid.
The PERCENTAGE of SHARES IN THE EXCHANGE was obtained on the basis of (i) projected economic value
of FNS forecast as from the 11th year after the DATE OF ISSUE, as per cash flow projection and (ii)
projected value of NOMINAL UNIT VALUE as from the 11th year after the DATE OF ISSUE.
Once the DEBENTURES are exchanged for FNS or Vale Logística controlling shares, there will be no
effects on Vale’s share capital.
The number of shares issued by Vale Logística which the Debentures holders will have a right to
receive at the exchange regulated will be that resulting from the multiplication of Vale Logística
capital stock percentage, defined in the third clause of the fist annex, by the number of shares in
which Vale Logística capital stock is divided.
The debenture holders will have to choose between the exchange for FNS shares or for Vale Logística
shares, provided that (i) in neither case, will the Debenture holder be able to exchange part of
his debentures for FNS shares and part for Vale Logística shares; and (ii) at the time of the
exchange for FNS shares, the option to exchange for Vale Logística shares will immediately be void
and any blockage established may be released and vice-versa.
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g) possibility of redemption:
| i. | Possibilities of redemption: |
Vale must effect the early redemption of all (and nothing less than the entirety) of
debentures outstanding within 30 (thirty) days of the occurrence of the following
events:
a) termination of sub-concession contract concluded between VALEC Engenharia, Construções e
Ferrovias S.A. and the FNS for the administration and operation of public rail cargo transport
service on the Norte-Sul Railroad, due to expiry, buy-in; termination; agreement between the
parties, annulment of sub-concession or concession or declaration of nullity of the
administrative bidding procedure; and
b) Intervention by the Licensing Authority, in the sub-concession or in the concession
for the administration and operation of public rail cargo transport service on the Norte-Sul
Railroad conferred granted to FNS.
| ii. | formula for calculating value of redemption |
On the date On the payment date of the redemption, Vale will effect the settlement of the
debentures which are still outstanding, at their non-amortized nominal unit value, plus the
amount capitalized but not amortized, as well as the remuneratory interest capitalized
semi-annually on the 15th of June and December each year with a grace period of 4 years
counted from the date of issue and still not amortized, and remuneration in the amount of 0.8%
p.a.
above the TJLP (long-term interest rate) liable until such date (the “redemption value”).
The Value of Redemption shall be increased by a percentage of 20% (twenty per cent) if
(i) the termination of this letter “a” above is due to the expiry of the concession or
even sub-concession (ii) when the cancellation of the above-mentioned concession or
sub-concession is attributable, as determined in administrative proceedings, to Vale
Logística or the FNS.
h) if debt securities, indicate where applicable:
| i. | maturity, including conditions for acceleration: |
Maturity date: 12/17/2027
Acceleration:
In addition to the assumptions referred to in articles 39, 40 and 47-A of the Provisions
Applicable, debenture holders may declare all debentures to be matured in advance and require
payment by Vale, of the debt relative to the balance of debentures, plus the interest and other
charges which are liable up to the date of payment in the occurrence of the following events:
a) failure by Vale to fulfill any monetary obligation related to debenture not dealt with within 10
(ten) days counted from their respective maturity date;
b) failure to correct any default of any non-monetary obligation as provided in the DEED,
within a forty-five-day-term.
c) declaration of acceleration of any debt of Vale by reason of breach of contract which individual
amount equals or exceeds R$ 125,000,000.00 or which aggregate value, in a period of twelve (12)
consecutive months, is equal to or greater than R$ 1,000,000,000.00
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d) the inclusion in the articles of incorporation or bylaws of Vale and FNS of any mechanism
whereby a special quorum is required for a decision or approval of matters which limit or restrict
control of Vale and FNS by their controlling companies or, further, the inclusion in those
documents, of mechanisms which lead to restrictions on the growth capacity of Vale and FNS or their
technological development; or on access to new markets or on the ability to pay financial
obligations provided for in this Deed of Issue.
e) if the effective direct share control of Vale or FNS is changed by any means, unless approved in
advance by holders of debentures;
f) acquisition by FNS of controlling shareholding or shareholdings in other companies, joint
ventures or consortia consisting of activities which are not complementary to the normal
development of the corporate purpose of FNS, characterizing deviation from FNS’s corporate purpose,
unless approved in advance by holders of debentures;
g) in relation to FNS, the occurrence of any acquisition, merger, split, transformation or any
other corporate reorganization, whether this reorganization be strictly corporate or performed by
using relevant assets, and in relation to Vale, the occurrence of corporate re-organizations which
imply transferring to third parties that are not controlled by Vale, ownership of FNS shares which
will be the subject matter of an exchange in the terms of the deed, unless approved in advance by
debenture holders representing at least 50% plus one of outstanding debentures;
h) non-compliance, by Vale, of any provision concerning the interchangeability of debentures
i) constitution, by Vale, of any collateralized guarantee with other creditors, without giving a
guarantee of the same quality and with equal priority payment to this issuance of debentures,
unless approved in advance by holders of debentures;
j) if Vale does not support and hold the block for the exchange of common shares issued by FNS
corresponding to the percentage of share capital for the exchange;
k) if Vale does not use the proceeds generated by the issuance for capitalization of FNS, within 3
(three) days counted from the paying up of the debentures;
| ii. | interest: TJLP + 0.8% pa |
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral:
None |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: Secured Credit |
||
| v. | possible restrictions imposed on the issuer: |
• for distribution of dividends: None
• disposal of determined assets: Vale may dispose of any goods, if at its discretion, this
act is desirable for the efficient running of its business and does not adversely affect
Vale’s capacity to honor its obligations in terms of the Deed of Issue.
• assumption of new debt: none
• issuing new securities: none
vi. the fiduciary agent, indicating the key terms of the contract: none
i) conditions for amendment of the rights conferred by such securities: Any changes to the terms
of this debenture issuance will depend on the approval of debenture holders representing at least
50% plus 1 debenture of outstanding debentures. For the purpose of setting up the quorum,
debentures possibly owned by Vale shall be excluded.
j) other relevant characteristics:
Debentures issued by Vale S.A., privately, which were fully subscribed by BNDES Participações S.A.
Vale undertakes to maintain, for the duration of the Deed, the following indexes compiled annually
through the financial statements audited by external auditors registered with the CVM (Securities
Commission):
a) Ratio of Debt over Adjusted EBITDA less than or equal to 4.5 (four and five tenths); and
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b) Ratio of Adjusted EBITDA over Interest Expenses greater than or equal to 2.0 (two).
If these levels are not observed, Vale should provide, within 60 (sixty) days counted from the date
of such communication, in writing to debenture holders, collateralized guarantees, accepted by the
debenture holders, at a value corresponding to at least 130% (one hundred and thirty per cent) of
the debt balance of debentures, unless within that period the levels above are reestablished.
Salobo1 Debentures
b) quantity: 5 debentures, with nominal unit value of R$ 15,250,399.93
c) value: R$ 76,251,999.65
d) date of issue: 01/06/97
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares issued by the company: The
debentures combine 5 subscription premiums (1 for each debenture) giving the holder the right to
subscribe to preferred shares of Salobo Metais S.A., in the amount equivalent to 50% of the shares
issued existing at the time the subscribed fully paid in capital 2 times the issue value of the
debentures.
g) possibility of redemption: None
h) if debt securities, indicate where applicable:
| i. | maturity, including conditions for acceleration: |
due date: 7 years as of the achievement of accumulated commercial invoicing of 200,000 tons of
copper by Salobo Metais S.A. (5 successive annual installments, formed of principal and
interest due after the first 2 years after the achievement of accumulated commercial invoicing
of 200,000 tons of LME grade A copper cathode)
possibility of early redemption: none
| ii. | interest: IGP-DI + 6.5% pa (capitalized) |
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral:
Vale S.A. guarantee |
| iv. | in the absence of any guarantee, if the credit is secured or subordinate: the debentures
will be subordinate to the other creditors of the issuer |
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: None
• disposal of determined assets: none
• contracting of new debt: none
• issuing new securities: none
vi. the fiduciary agent, indicating the key terms of the contract: none
i) conditions for amendment of the rights conferred by such securities: none
j) other relevant characteristics:
Debentures issued by Salobo Metais s.a., privately, which were fully subscribed by the Banco
Nacional de Desenvolvimento Econômico e Social (BNDES)
When issuing shares arising from the exercise of the right of subscription, a premium will be paid
corresponding to the dividends distributed to shareholders until that date, in the proportion of
shares subscribed by BNDES or its assignee.
VALE391 Bonds
b) quantity: bonds are issued at the minimum value of US$ 2,000, always in multiples of US$ 1,000.
| 1 | Bonds issued through Vale Overseas Ltd. subsidiary |
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c) value: US$ 1,000,000.000.00
d) date of issue: 11/10/09
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares issued by the company: None
g) possibility of redemption
i. Possibilities of redemption
(a) Redemption by means of payment of premium, at any time, at Vale Overseas criterion.
(b) Redemption due to changes in the tax law: if Vale or Vale Overseas are forced to maintain
values greater than 15%, in the event of payment of interest over note, due to changes in the
Brazilian or in Cayman tax law, Vale Overseas may redeem the entirety of the notes in advance.
ii. formula for calculating value of redemption:
(a) The redemption value will be 100% of the principal value or the sum of the current value of the
interest installments and the remaining principal, whichever is the greatest, deducted at the date
of redemption at the rate equivalent to Treasury + 0,40%
(b) Redemption due to changes in the tax law: The redemption value will be equal to 100% of the
principal value plus the interests accrued up to the date of redemption.
h) if debt securities, indicate where applicable:
| i. | maturity date: 11/10/39 |
Early maturity: if a default event occurs, which is not corrected or condoned, the trustee, as
instructed by at least 25% of the note holders for the value of the principal showing an open
debt, must declare the principal value, the interests accrued and any amount unpaid immediately
due. The default events are described in the deed of issuance, including, but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale, its Relevant Subsidiaries (any subsidiary which total assets are greater
than 10% of the total consolidated assets of the group at the end of each fiscal year), and in
regard to Vale Overseas, the occurrence of any default, in any transaction characterized as
debt, that exceeds, in total, US$ 50 million and this default results in the effective
acceleration of the debt.
• failure from Vale or Vale Overseas to comply with their covenants in relation to the
note and this failure persists 60 days after Vale or Vale Overseas have received communication
from the trustee or from at least 25% of the note holders reporting the non-compliance of the
obligations. These obligations include, but are not limited to: (a) obligation not to conduct
a merger or sale of the entirety of the assets or a significant part of the assets of Vale or
Vale Overseas, with some exceptions and (b) limitations to granting collateral in debt
transactions, with some permitted exceptions:.
• insolvency or bankruptcy.
• Vale Overseas notes become illegal, generating the acceleration of over US$ 50 million total.
• the collateral becomes invalid or unenforceable.
| ii. | interest: 6.875% a.a. |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
There is no granting of a collateral: Vale guarantees, irrevocably and unconditionally, the
full payment of the principal, interests and other amounts owed in relation to this note, in
the event Vale Overseas fails to pay. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
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Table of Contents
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale.
However, Vale Overseas may not declare or pay any dividends, without the trustee’s consent,
as instructed by at least 25% of the note holders for the value of the principal showing an
open debt.
• disposal of determined assets: Vale and Vale Overseas may not, without the consent from
the majority of the note holders, participate in a merger with another company or transfer
all or a significant part of its assets to a third party, except, however that: (a) the
company created by this consolidation or a third party that acquired said assets undertakes
to make timely payments of the principal and interests and other obligations from Vale and
Vale Overseas in the deed of issuance; (b) no default event occurs as a result of the
transaction; and (c) Vale or Vale Overseas, as applicable, provide their trustee with a
certification attesting that the consolidation or transfer of assets meet the requirements
set forth in item b.
• contracting of new debt: there are no restrictions to contracting new debts by Vale. Vale
Overseas may issue debts instruments within the scope of the deed of issuance, but Vale
Overseas may not contract any other type of loan or financing.
• issuing new securities: Vale Overseas may issue, without the consent from the note
holders, new notes according to the terms and conditions applicable to Bond VALE 2039. In
addition, Vale Overseas may issue new notes under other terms and conditions. Vale has the
right to guarantee, without the consent from the note holders, debts from its subsidiaries
and issue its own debt.
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance,
allows, at any time, with some exceptions, to amend the rights and obligations of Vale Overseas and
the investors’ in the note. Said amendments may only be executed by Vale Overseas and the trustee
with the consent from the majority of the note holders for the value of the principal showing an
open debt.
j) other relevant characteristics: none
VALE192 Bonds
b) quantity: bonds are issued at the minimum value of US$ 2,000, always in multiples of US$ 1,000.
c) value: US$ 1,000,000.000.00
d) date of issue: 09/15/09
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares issued by the company: None
| 2 | Bonds issued by Vale Overseas Ltd. subsidiary |
315
Table of Contents
g) possibility of redemption
i. Possibilities of redemption
(a) Redemption by means of payment of premium, at any time, at Vale Overseas criterion.
(b) Redemption due to changes in the tax law: if Vale or Vale Overseas are forced to maintain
values greater than 15%, in the event of payment of interest over note, due to changes in the
Brazilian or in Cayman tax law, Vale Overseas may redeem the entirety of the notes in advance.
ii. formula for calculating value of redemption:
(a) The redemption value will be 100% of the principal value or the sum of the current value of the
interest installments and the remaining principal, whichever is the greatest, deducted at the date
of redemption at the rate equivalent to Treasury + 0,30%
(b) Redemption due to changes in the tax law: The redemption value will be equal to 100% of the
principal value plus the interests accrued up to the date of redemption.
h) if debt securities, indicate where applicable:
| i. | maturity date: 09/15/19 |
Early maturity: if a default event occurs, which is not corrected or condoned, the trustee, as
instructed by at least 25% of the note holders for the value of the principal showing an open
debt, must declare the principal value, the interests accrued and any amount unpaid immediately
due. The default events are described in the deed of issuance, including, but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale, its Relevant Subsidiaries and Vale Overseas: the occurrence of any
default, in any transaction characterized as debt, that exceeds, in total, US$ 50 million and
this default results in the effective acceleration of the debt.
• failure from Vale or Vale Overseas to comply with their covenants in relation to the
note and this failure persists 60 days after Vale or Vale Overseas have received communication
from the trustee or from at least 25% of the note holders reporting the non-compliance of the
obligations. These obligations include, but are not limited to: (a) obligation not to conduct
a merger or sale of the entirety of the assets or a significant part of the assets of Vale or
Vale Overseas, with some exceptions and (b) limitations to granting collateral in debt
transactions, with some permitted exceptions:.
• insolvency or bankruptcy.
• Vale Overseas notes become illegal, generating the acceleration of over US$ 50 million total.
• the collateral becomes invalid or unenforceable.
| ii. | interest: 5.625% a.a. |
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
There is no granting of collateral. Vale guarantees, irrevocably and unconditionally, the
full payment of the principal, interests and other amounts owed in relation to this note, in
the event Vale Overseas fails to pay. |
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale.
However, Vale Overseas may not declare or pay any dividends, without the trustee’s consent,
as instructed by at least 25% of the note holders for the value of the principal showing an
open debt.
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Table of Contents
• disposal of determined assets: Vale and Vale Overseas may not, without the consent from
the majority of the note holders, participate in a merger with another company or transfer
all or a significant part of its assets to a third party, except, however that: (a) the
company created by this consolidation or a third party that acquired said assets undertakes
to make timely payments of the principal and interests and other obligations from Vale and
Vale Overseas in the deed of issuance; (b) no default event occurs as a result of the
transaction; and (c) Vale or Vale Overseas, as applicable, provide their trustee with a
certification attesting that the consolidation or transfer of assets meet the requirements
set forth in item b.
• contracting of new debt: there are no restrictions to contracting new debts by Vale. Vale
Overseas may issue debts instruments within the scope of the deed of issuance, but Vale
Overseas may not contract any other type of loan or financing, without the consent from the
trustee, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt
• issuing new securities: Vale Overseas may issue, without the consent from the note
holders, new notes according to the terms and conditions applicable to Bond VALE 2019. In
addition, Vale Overseas may issue new notes under other terms and conditions. Vale has the
right to guarantee, without the consent from the note holders, debts from its subsidiaries
and issue its own debt.
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance,
allows, at any time, with some exceptions, to amend the rights and obligations of Vale Overseas and
the investors’ in the note. Said amendments may only be executed by Vale Overseas and the trustee
with the consent from the majority of the note holders for the value of the principal showing an
open debt.
j) other relevant characteristics: none
CVRD363 Bonds
b) quantity: bonds are issued at the minimum value of US$ 2,000, always in multiples of US$ 1,000.
c) value: US$ 2,500,000,000.00
d) date of issue: 11/21/2006
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares issued by the company: None
| 3 | Bonds issued by Vale Overseas Ltd. subsidiary |
317
Table of Contents
g) possibility of redemption
i. Possibilities of redemption
(a) Redemption by means of payment of premium, at any time, at Vale Overseas criterion.
(b) Redemption due to changes in the tax law: if Vale or Vale Overseas are forced to maintain
values greater than 15%, in the event of payment of interest over note, due to changes in the
Brazilian or in Cayman tax law, Vale Overseas may redeem the entirety of the notes in advance.
ii. formula for calculating value of redemption:
(a) The redemption value will be 100% of the principal value or the sum of the current value of the
interest installments and the remaining principal, whichever is the greatest, deducted at the date
of redemption at the rate equivalent to Treasury + 0.35%
(b) Redemption due to changes in the tax law: The redemption value will be equal to 100% of the
principal value plus the interests accrued up to the date of redemption.
h) if debt securities, indicate where applicable:
| i. | maturity date: 11/21/36 |
Early maturity: if a default event occurs, which is not corrected or condoned, the trustee, as
instructed by at least 25% of the note holders for the value of the principal showing an open
debt, must declare the principal value, the interests accrued and any amount unpaid immediately
due. The default events are described in the deed of issuance, including, but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale, its Relevant Subsidiaries and Vale Overseas: the occurrence of any
default, in any transaction characterized as debt, that exceeds, in total, US$ 50 million and
this default results in the effective acceleration of the debt.
• failure from Vale or Vale Overseas to comply with their covenants in relation to the
note and this failure persists 60 days after Vale or Vale Overseas have received communication
from the trustee or from at least 25% of the note holders reporting the non-compliance of the
obligations. These obligations include, but are not limited to: (a) obligation not to conduct
a merger or sale of the entirety of the assets or a significant part of the assets of Vale or
Vale Overseas, with some exceptions and (b) limitations to granting collateral in debt
transactions, with some permitted exceptions:.
• insolvency or bankruptcy.
• Vale Overseas notes become illegal, generating the acceleration of over US$ 50 million total.
• the collateral becomes invalid or unenforceable.
| ii. | interest: 6.875% a.a. |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
There is no granting of collateral. Vale guarantees, irrevocably and unconditionally, the
full payment of the principal, interests and other amounts owed in relation to this note, in
the event Vale Overseas fails to pay. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale.
However, Vale Overseas may not declare or pay any dividends, without the trustee’s consent,
as instructed by at least 25% of the note holders for the value of the principal showing an
open debt.
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Table of Contents
• disposal of determined assets: Vale and Vale Overseas may not, without the consent from
the majority of the note holders, participate in a merger with another company or transfer
all or a significant part of its assets to a third party, except, however that: (a) the
company created by this consolidation or a third party that acquired said assets undertakes
to make timely payments of the principal and interests and other obligations from Vale and
Vale Overseas in the deed of issuance; (b) no default event occurs as a result of the
transaction; and (c) Vale or Vale Overseas, as applicable, provide their trustee with a
certification attesting that the consolidation or transfer of assets meet the requirements
set forth in item b.
• contracting of new debt: there are no restrictions to contracting new debts by Vale. Vale
Overseas may issue debts instruments within the scope of the deed of issuance, but Vale
Overseas may not contract any other type of loan or financing.
• issuing new securities: Vale Overseas may issue, without the consent from the note
holders, new notes according to the terms and conditions applicable to Bond VALE 2036. In
addition, Vale Overseas may issue new notes under other terms and conditions. Vale has the
right to guarantee, without the consent from the note holders, debts from its subsidiaries
and issue its own debt.
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance,
allows, at any time, with some exceptions, to amend the rights and obligations of Vale Overseas and
the investors’ in the note. Said amendments may only be executed by Vale Overseas and the trustee
with the consent from the majority of the note holders for the value of the principal
showing an open debt.
j) other relevant characteristics: none
CVRD34B4 Bonds
b) quantity: bonds are issued at the minimum value of US$ 2,000, always in multiples of US$ 1,000.
c) value: US$ 300,000,000.00
d) date of issue: 11/02/2005
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares issued by the company: None
g) possibility of redemption
i. Possibilities of redemption: Redemption due to changes in the tax law: Vale Overseas may only
redeem the entirety of the notes in advance if Vale or Vale Overseas are forced to maintain values
greater than 15%, in the event of payment of interest over note, due to changes in the Brazilian or
in Cayman tax law.
ii. formula for calculating value of redemption: The redemption value will be 100% of the principal
value plus interests accrued up to the time of redemption.
| 4 | Bonds issued by Vale Overseas Ltd. subsidiary |
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Table of Contents
h) if debt securities, indicate where applicable:
| i. | maturity date: 01/17/34 |
Early maturity: if a default event occurs, which is not corrected or condoned, the trustee, as
instructed by at least 25% of the note holders for the value of the principal showing an open
debt, must declare the principal value, the interests accrued and any amount unpaid immediately
due. The default events are described in the deed of issuance, including, but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale, its Relevant Subsidiaries and Vale Overseas: the occurrence of any
default, in any transaction characterized as debt, that exceeds, in total, US$ 50 million and
this default results in the effective acceleration of the debt.
• failure from Vale or Vale Overseas to comply with their covenants in relation to the
note and this failure persists 60 days after Vale or Vale Overseas have received communication
from the trustee or from at least 25% of the note holders reporting the non-compliance of the
obligations. These obligations include, but are not limited to: (a) obligation not to conduct
a merger or sale of the entirety of the assets or a significant part of the assets of Vale or
Vale Overseas, with some exceptions and (b) limitations to granting collateral in debt
transactions, with some permitted exceptions:.
• insolvency or bankruptcy.
• If an event occurs that turns Vale Overseas notes illegal, the trustee as instructed by at
least 25% of the note holders for the value of the principal showing an open debt, also
declares the value of the principal, the interests accrued and any amount unpaid due
immediately.
| ii. | interest: 8.25% a.a. |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
There
is no granting of collateral. Vale guarantees, irrevocably and unconditionally, the full
payment of the principal, interests and other amounts owed in relation to this note, in the
event Vale Overseas fails to pay. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale.
However, Vale Overseas may not declare or pay any dividends, without the trustee’s consent,
as instructed by at least 25% of the note holders for the value of the principal showing an
open debt.
• disposal of determined assets: Vale and Vale Overseas may not, without the consent from
the majority of the note holders, participate in a merger with another company or transfer
all or a significant part of its assets to a third party, except, however that: (a) the
company created by this consolidation or a third party that acquired said assets undertakes
to make timely payments of the principal and interests and other obligations from Vale and
Vale Overseas in the deed of issuance; (b) no default event occurs as a result of the
transaction; and (c) Vale or Vale Overseas, as applicable, provide their trustee with a
certification attesting that the consolidation or transfer of assets meet the requirements
set forth in item b.
• contracting of new debt: there are no restrictions to contracting new debts by Vale. Vale
Overseas may issue debts instruments within the scope of the deed of issuance, but Vale
Overseas may not contract any other type of loan or financing without the trustee’s
consent, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt. Moody’s must confirm in advance that the new issuance from Vale
Overseas will not result in a lower rating granted for other open notes.
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Table of Contents
• issuing new securities: Vale Overseas may issue, without the consent from the note
holders, new notes according to the terms and conditions applicable to Bond CVRD2034. In
addition, Vale Overseas may issue new notes under other terms and conditions. Vale has the
right to guarantee, without the consent from the note holders, debts from its subsidiaries
and issue its own debt.
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance,
allows, at any time, with some exceptions, to amend the rights and obligations of Vale Overseas and
the investors’ in the note. Said amendments may only be executed by Vale Overseas and the trustee
with the consent from the majority of the note holders for the value of the principal showing an
open debt.
j) other relevant characteristics: none
CVRD175 Bonds
b) quantity: bonds are issued at the minimum value of US$ 2,000, always in multiples of US$ 1,000.
c) value: US$ 1,250,000,000.00
d) date of issue: 11/21/2006
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares issued by the company: None
g) possibility of redemption
i. Possibilities of redemption
(a) Redemption by means of payment of premium, at any time, at Vale Overseas criterion.
(b) Redemption due to changes in the tax law: if Vale or Vale Overseas are forced to maintain
values greater than 15%, in the event of payment of interest over note, due to changes in the
Brazilian or in Cayman tax law, Vale Overseas may redeem the entirety of the notes in advance.
ii. formula for calculating value of redemption:
(a) Redemption by means of payment of premium: The redemption value will be 100% of the principal
value or the sum of the current value of the interest installments and the remaining principal,
whichever is the greatest, deducted at the date of redemption at the rate equivalent to Treasury +
0.25%
(b) Redemption due to changes in the tax law: The redemption value will be equal to 100% of the
principal value plus the interests accrued up to the date of redemption.
| 5 | Bonds issued by Vale Overseas Ltd. subsidiary |
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Table of Contents
h) if debt securities, indicate where applicable:
| i. | maturity date: 01/23/17 |
Early maturity: if a default event occurs, which is not corrected or condoned, the trustee, as
instructed by at least 25% of the note holders for the value of the principal showing an open
debt, must declare the principal value, the interests accrued and any amount unpaid immediately
due. The default events are described in the deed of issuance, including, but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale, its Relevant Subsidiaries and Vale Overseas: the occurrence of any
default, in any transaction characterized as debt, that exceeds, in total, US$ 50 million and
this default results in the effective acceleration of the debt.
• failure from Vale or Vale Overseas to comply with their covenants in relation to the
note and this failure persists 60 days after Vale or Vale Overseas have received communication
from the trustee or from at least 25% of the note holders reporting the non-compliance of the
obligations. These obligations include, but are not limited to: (a) obligation not to conduct
a merger or sale of the entirety of the assets or a significant part of the assets of Vale or
Vale Overseas, with some exceptions and (b) limitations to granting collateral in debt
transactions, with some permitted exceptions:.
• insolvency or bankruptcy.
• Vale Overseas notes become illegal, generating the acceleration of over US$ 50 million total.
• the collateral becomes invalid or unenforceable.
| ii. | interest: 6.25% a.a |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
There is no granting of collateral. Vale guarantees, irrevocably and unconditionally, the
full payment of the principal, interests and other amounts owed in relation to this note, in
the event Vale Overseas fails to pay. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale.
However, Vale Overseas may not declare or pay any dividends, without the trustee’s consent,
as instructed by at least 25% of the note holders for the value of the principal showing an
open debt.
• disposal of determined assets: Vale and Vale Overseas may not, without the consent from
the majority of the note holders, participate in a merger with another company or transfer
all or a significant part of its assets to a third party, except, however that: (a) the
company created by this consolidation or a third party that acquired said assets undertakes
to make timely payments of the principal and interests and other obligations from Vale and
Vale Overseas in the deed of issuance; (b) no default event occurs as a result of the
transaction; and (c) Vale or Vale Overseas, as applicable, provide their trustee with a
certification attesting that the consolidation or transfer of assets meet the requirements
set forth in item b.
• contracting of new debt: there are no restrictions to contracting new debts by Vale. Vale
Overseas may issue debts instruments within the scope of the deed of issuance, but Vale
Overseas may not contract any other type of loan or financing without the trustee’s
consent, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt.
• issuing new securities: Vale Overseas may issue, without the consent from the note
holders, new notes according to the terms and conditions applicable to Bond CVRD2017. In
addition, Vale Overseas may issue new notes under other terms and conditions. Vale has the
right to guarantee, without the consent from the note holders, debts from its subsidiaries
and issue its own debt.
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Table of Contents
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance,
allows, at any time, with some exceptions, to amend the rights and obligations of Vale Overseas and
the investors’ in the note. Said amendments may only be executed by Vale Overseas and the trustee
with the consent from the majority of the note holders for the value of the principal showing an
open debt.
j) other relevant characteristics: none
CVRD166 Bonds
b) quantity: bonds are issued at the minimum value of US$ 100,000, always in multiples of US$
1,000.
c) value: US$ 1,000,000,000.00
d) date of issue: 01/10/2006
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares issued by the company: None
g) possibility of redemption
i. possibilities of redemption: Redemption due to changes in the tax law: Vale Overseas may only
redeem the entirety of the notes in advance if Vale or Vale Overseas are forced to maintain values
greater than 15%, in the event of payment of interest over note, due to changes in the
Brazilian or in Cayman tax law.
ii. formula for calculating value of redemption: The redemption value will be 100% of the principal
value plus interests accrued up to the time of redemption.
h) if debt securities, indicate where applicable:
| i. | maturity date: 01/11/16 |
Early maturity: if a default event occurs, which is not corrected or condoned, the trustee, as
instructed by at least 25% of the note holders for the value of the principal showing an open
debt, must declare the principal value, the interests accrued and any amount unpaid immediately
due. The default events are described in the deed of issuance, including, but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale, its Relevant Subsidiaries and Vale Overseas: the occurrence of any
default, in any transaction characterized as debt, that exceeds, in total, US$ 50 million and
this default results in the effective acceleration of the debt.
• failure from Vale or Vale Overseas to comply with their covenants in relation to the
note and this failure persists 60 days after Vale or Vale Overseas have received communication
from the trustee or from at least 25% of the note holders reporting the non-compliance of the
obligations. These obligations include, but are not limited to: (a) obligation not to conduct
a merger or sale of the entirety of the assets or a significant part of the assets of Vale or
Vale Overseas, with some exceptions and (b) limitations to granting collateral in debt
transactions, with some permitted exceptions:.
• insolvency or bankruptcy.
• If an event occurs that turns Vale Overseas notes illegal, the trustee as instructed by at
least 25% of the note holders for the value of the principal showing an open debt, also
declares the value of the principal, the interests accrued and any amount unpaid due
immediately.
| ii. | interest: 6.25% a.a |
| 6 | Bonds issued by Vale Overseas Ltd. subsidiary |
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| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
There is no granting of collateral. Vale guarantees, irrevocably and unconditionally, the
full payment of the principal, interests and other amounts owed in relation to this note, in
the event Vale Overseas fails to pay. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale.
However, Vale Overseas may not declare or pay any dividends, without the trustee’s consent,
as instructed by at least 25% of the note holders for the value of the principal showing an
open debt.
• disposal of determined assets: Vale and Vale Overseas may not, without the consent from
the majority of the note holders, participate in a merger with another company or transfer
all or a significant part of its assets to a third party, except, however that: (a) the
company created by this consolidation or a third party that acquired said assets undertakes
to make timely payments of the principal and interests and other obligations from Vale and
Vale Overseas in the deed of issuance; (b) no default event occurs as a result of the
transaction; and (c) Vale or Vale Overseas, as applicable, provide their trustee with a
certification attesting that the consolidation or transfer of assets meet the
requirements set forth in item b.
• contracting of new debt: there are no restrictions to contracting new debts by Vale. Vale
Overseas may issue debts instruments within the scope of the deed of issuance, but Vale
Overseas may not contract any other type of loan or financing without the trustee’s
consent, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt.
• issuing new securities: Vale Overseas may issue, without the consent from the note
holders, new notes according to the terms and conditions applicable to Bond CVRD 2016. In
addition, Vale Overseas may issue new notes under other terms and conditions. Vale has the
right to guarantee, without the consent from the note holders, debts from its subsidiaries
and issue its own debt.
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance,
allows, at any time, with some exceptions, to amend the rights and obligations of Vale Overseas and
the investors’ in the note. Said amendments may only be executed by Vale Overseas and the trustee
with the consent from the majority of the note holders for the value of the principal showing an
open debt.
j) other relevant characteristics: none
CVRD347 Bonds
b) quantity: bonds are issued at the minimum value of US$ 2,000, always in multiples of US$ 1,000.
c) value: US$ 500,000,000.00
d) date of issue: 01/15/2004
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares issued by the company: None
| 7 | Bonds issued by Vale Overseas Ltd. subsidiary |
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g) possibility of redemption
i. possibilities of redemption: Redemption due to changes in the tax law: Vale Overseas may only
redeem the entirety of the notes in advance if Vale or Vale Overseas are forced to maintain values
greater than 15%, in the event of payment of interest over note, due to changes in the Brazilian or
in Cayman tax law.
ii. formula for calculating value of redemption: The redemption value will be 100% of the principal
value plus interests accrued up to the time of redemption.
h) if debt securities, indicate where applicable:
| i. | maturity date: 01/07/34 |
Early maturity: if a default event occurs, which is not corrected or condoned, the trustee, as
instructed by at least 25% of the note holders for the value of the principal showing an open
debt, must declare the principal value, the interests accrued and any amount unpaid immediately
due. The default events are described in the deed of issuance, including, but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale, its Relevant Subsidiaries and Vale Overseas: the occurrence of any
default, in any transaction characterized as debt, that exceeds, in total, US$ 50 million and
this default results in the effective acceleration of the debt.
• failure from Vale or Vale Overseas to comply with their covenants in relation to the
note and this failure persists 60 days after Vale or Vale Overseas have received communication
from the trustee or from at least 25% of the note holders reporting the non-compliance of the
obligations. These obligations include, but are not limited to: (a) obligation not to conduct
a merger or sale of the entirety of the assets or a significant part of the assets of Vale or
Vale Overseas, with some exceptions and (b) limitations to granting collateral in debt
transactions, with some permitted exceptions:.
• insolvency or bankruptcy.
• If an event occurs that turns Vale Overseas notes illegal, the trustee as instructed by at
least 25% of the note holders for the value of the principal showing an open debt, also
declares the value of the principal, the interests accrued and any amount unpaid due
immediately.
| ii. | interest: 8.25% a.a |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
There is no granting of collateral. Vale guarantees, irrevocably and unconditionally, the
full payment of the principal, interests and other amounts owed in relation to this note, in
the event Vale Overseas fails to pay. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale.
However, Vale Overseas may not declare or pay any dividends, without the trustee’s consent,
as instructed by at least 25% of the note holders for the value of the principal showing an
open debt.
• disposal of determined assets: Vale and Vale Overseas may not, without the consent from
the majority of the note holders, participate in a merger with another company or transfer
all or a significant part of its assets to a third party, except, however that: (a) the
company created by this consolidation or a third party that acquired said assets undertakes
to make timely payments of the principal and interests and other obligations from Vale and
Vale Overseas in the deed of issuance; (b) no default event occurs as a result of the
transaction; and (c) Vale or Vale Overseas, as applicable, provide their trustee with a
certification attesting that the consolidation or transfer of assets meet the requirements
set forth in item b.
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Table of Contents
• contracting of new debt: there are no restrictions to contracting new debts by Vale. Vale
Overseas may issue debts instruments within the scope of the deed of issuance, but Vale
Overseas may not contract any other type of loan or financing without the trustee’s
consent, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt. Moody’s must confirm in advance that the new issuance from Vale
Overseas will not result in a lower rating granted for other open notes.
• issuing new securities: Vale Overseas may issue, without the consent from the note
holders, new notes according to the terms and conditions applicable to Bond VALE 2034. In
addition, Vale Overseas may issue new notes under other terms and conditions. Vale has the
right to guarantee, without the consent from the note holders, debts from its subsidiaries
and issue its own debt.
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance,
allows, at any time, with some exceptions, to amend the rights and obligations of Vale Overseas and
the investors’ in the note. Said amendments may only be executed by Vale Overseas and the trustee
with the consent from the majority of the note holders for the value of the principal showing an
open debt.
j) other relevant characteristics: none
CVRD138 Bonds
b) quantity: bonds are issued at the minimum value of US$ 100,000 always in multiples of US$ 1,000.
c) value: US$ 124,415,000.00
d) date of issue: 08/08/2003
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares issued by the company: None
g) possibility of redemption
i. possibilities of redemption: Redemption due to changes in the tax law: Vale Overseas may only
redeem the entirety of the notes in advance if Vale or Vale Overseas are forced to maintain values
greater than 15%, in the event of payment of interest over note, due to changes in the Brazilian or
in Cayman tax law.
ii. formula for calculating value of redemption: The redemption value will be 100% of the principal
value plus interests accrued up to the time of redemption.
| 8 | Bonds issued by Vale Overseas Ltd. subsidiary |
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Table of Contents
h) if debt securities, indicate where applicable:
| i. | maturity date: 08/15/13 |
Early maturity: if a default event occurs, which is not corrected or condoned, the trustee, as
instructed by at least 25% of the note holders for the value of the principal showing an open
debt, must declare the principal value, the interests accrued and any amount unpaid immediately
due. The default events are described in the deed of issuance, including, but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale, its Relevant Subsidiaries and Vale Overseas: the occurrence of any
default, in any transaction characterized as debt, that exceeds, in total, US$ 50 million and
this default results in the effective acceleration of the debt.
• failure from Vale or Vale Overseas to comply with their covenants in relation to the
note and this failure persists 60 days after Vale or Vale Overseas have received communication
from the trustee or from at least 25% of the note holders reporting the non-compliance of the
obligations. These obligations include, but are not limited to: (a) obligation not to conduct
a merger or sale of the entirety of the assets or a significant part of the assets of Vale or
Vale Overseas, with some exceptions and (b) limitations to granting collateral in debt
transactions, with some permitted exceptions:.
• insolvency or bankruptcy.
• If an event occurs that turns Vale Overseas notes illegal, the trustee as instructed by at
least 25% of the note holders for the value of the principal showing an open debt, also
declares the value of the principal, the interests accrued and any amount unpaid due
immediately.
| ii. | interest: 9% a.a |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
There is no granting of collateral. Vale guarantees, irrevocably and unconditionally, the
full payment of the principal, interests and other amounts owed in relation to this note, in
the event Vale Overseas fails to pay. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale.
However, Vale Overseas may not declare or pay any dividends, without the trustee’s consent,
as instructed by at least 25% of the note holders for the value of the principal showing an
open debt.
• disposal of determined assets: Vale and Vale Overseas may not, without the consent from
the majority of the note holders, participate in a merger with another company or transfer
all or a significant part of its assets to a third party, except, however that: (a) the
company created by this consolidation or a third party that acquired said assets undertakes
to make timely payments of the principal and interests and other obligations from Vale and
Vale Overseas in the deed of issuance; (b) no default event occurs as a result of the
transaction; and (c) Vale or Vale Overseas, as applicable, provide their trustee with a
certification attesting that the consolidation or transfer of assets meet the requirements
set forth in item b.
• contracting of new debt: there are no restrictions to contracting new debts by Vale. Vale
Overseas may issue debts instruments within the scope of the deed of issuance, but Vale
Overseas may not contract any other type of loan or financing without the trustee’s
consent, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt. Moody’s must confirm in advance that the new issuance from Vale
Overseas will not result in a lower rating granted for other open notes.
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Table of Contents
• issuing new securities: Vale Overseas may issue, without the consent from the note
holders, new notes according to the terms and conditions applicable to Bond VALE 2013. In
addition, Vale Overseas may issue new notes under other terms and conditions. Vale has the
right to guarantee, without the consent from the note holders, debts from its subsidiaries
and issue its own debt.
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance,
allows, at any time, with some exceptions, to amend the rights and obligations of Vale Overseas and
the investors’ in the note. Said amendments may only be executed by Vale Overseas and the trustee
with the consent from the majority of the note holders for the value of the principal showing an
open debt. Some non-material clarifications or amendments may be made without the consent from the
note holders.
j) other relevant characteristics:
In January 2006, Vale Overseas reacquired through a public offering part of its outstanding debt
instruments (VALE13). The holders of approximately US$ 176 million principal, out of an outstanding
total US$ 300 million adhered to the offering. Vale Overseas reacquired and subsequently paid off
all the instruments offered.
CVRD18 Eurobonds
b) quantity: bonds are issued at the minimum value of EUR 50,000, always in multiples of EUR 1,000.
c) value: EUR 750,000,000
d) date of issue: 03/24/2010
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares issued by the company: None
g) possibility of redemption
i. possibilities of redemption:
(a) Redemption by means of payment of premium, at any time, at the issuer’s criterion.
(b) Redemption due to changes in the tax law: Vale may redeem the entirety of the notes in advance
if Vale is forced to maintain values greater than 15%, in the event of payment of interest over
note, due to changes in the Brazilian tax law.
ii. formula for calculating value of redemption:
(a) Redemption by means of payment of premium: The redemption value will be 100% of the principal
value or the sum of the current value of the interest installments and the remaining principal,
whichever is the greatest, deducted at the date of redemption at the rate equivalent to Bund Rate
(“German Bund” instruments) + 0.25%.
(b) Redemption due to changes in the tax law: The redemption value will be equal to 100% of the
principal value plus the interests accrued up to the date of redemption.
h) if debt securities, indicate where applicable:
| i. | maturity date: 03/24/2018 |
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Table of Contents
Early maturity: if a default event occurs, which is not corrected or condoned, the trustee, as
instructed by at least 25% of the note holders for the value of the principal showing an open
debt, must declare the principal value, the interests accrued and any amount unpaid immediately
due. The default events are described in the deed of issuance, including, but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale and its Relevant Subsidiaries: the occurrence of any default, in any
transaction characterized as debt, that exceeds, in total, US$50 million and this default
results in the effective acceleration of the debt.
• failure from Vale to comply with its covenants in relation to the note and this failure
persists 60 days after Vale has received communication from the trustee or from at least 25% of
the note holders reporting the non-compliance of the obligations. These obligations include,
but are not limited to: (a) obligation not to conduct a merger or sale of the entirety of the
assets or a significant part of the assets of Vale or Vale Overseas, with some exceptions and
(b) limitations to granting collateral in debt transactions, with some permitted exceptions:.
• insolvency or bankruptcy.
• Vale notes become illegal, generating the acceleration of over US$50 million total.
• the collateral becomes invalid or unenforceable.
| ii. | interest: 4.375% a.a |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
The notes are obligations unsecured by Vale and do not hold privileges over other Vale
unsecured debts. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale.
• disposal of determined assets: Vale and Vale Overseas may not, without the consent from
the majority of the note holders, participate in a merger with another company or transfer
all or a significant part of its assets to a third party, except, however that: (a) the
company created by this consolidation or a third party that acquired said assets undertakes
to make timely payments of the principal and interests and other obligations from Vale and
Vale Overseas in the deed of issuance; (b) no default event occurs as a result of the
transaction; and (c) Vale or Vale Overseas, as applicable, provide their
trustee with a certification attesting that the consolidation or transfer of assets meet
the requirements set forth in item b.
• contracting of new debt: there are no restrictions to contracting new debts by Vale. Vale
Overseas may issue debts instruments within the scope of the deed of issuance, but Vale
Overseas may not contract any other type of loan or financing without the trustee’s
consent, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt.
• issuing new securities: Vale may issue, without the consent from the note holders, new
notes according to the terms and conditions applicable to Eurobonds CVRD18. In addition,
Vale may issue new notes under other terms and conditions.
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights |
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Table of Contents
i) conditions for amendment of the rights conferred by such securities: The deed of issuance allows
to amend the rights and obligations of Vale Overseas and the investors’ in the note. Said
amendments may only be executed by Vale Overseas and the trustee with the consent from 100% or the
majority of the note holders for the value of the principal showing an open debt, pursuant to the
type of amendment. Some non-material clarifications or amendments may be made without the consent
from the note holders.
j) other relevant characteristics: Bond issued by Vale S.A.
CVRD209 Bonds
b) quantity: bonds are issued at the minimum value of US$2,000, always in multiples of US$1,000.
c) value: US$1,000,000,000.00
d) date of issue: 09/15/2010
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares issued by the company: None
g) possibility of redemption
i. possibilities of redemption:
(a) Redemption by means of payment of premium, at any time, at Vale Overseas’ criterion.
(b) Redemption due to changes in the tax law: Vale Overseas may redeem the entirety of the notes in
advance if Vale or Vale Overseas are forced to maintain values greater than 15%, in the event of
payment of interest over note, due to changes in the Brazilian or Cayman tax law.
ii. formula for calculating value of redemption:
(a) The redemption value will be 100% of the principal value or the sum of the current value of the
interest installments and the remaining principal, whichever is the greatest, deducted at the date
of redemption at the rate equivalent to Treasury + 0.30%.
(b) Redemption due to changes in the tax law: The redemption value will be equal to 100% of the
principal value plus the interests accrued up to the date of redemption.
h) if debt securities, indicate where applicable:
| i. | maturity date: 09/15/2020 |
| 9 | Bonds issued by Vale Overseas Ltd. subsidiary |
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Table of Contents
Possibility of Early maturity: if a default event occurs, which is not corrected or condoned,
the trustee, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt, must declare the principal value, the interests accrued and any amount
unpaid immediately due. The default events are described in the deed of issuance, including,
but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale, its Relevant Subsidiaries (any subsidiary in which the proportional
participation of Vale in the total assets of the subsidiary exceeds 10% of the total
consolidated assets of the company at the end of the last financial year), and Vale Overseas:
the occurrence of any default, in any transaction characterized as debt, that exceeds, in
total, US$50 million and this default results in the effective acceleration of the debt.
• failure from Vale or Vale Overseas to comply with its covenants in relation to the note
and this failure persists 60 days after Vale or Vale Overseas have received communication from
the trustee or from at least 25% of the note holders reporting the non-compliance of the
obligations. These obligations include, but are not limited to: (a) obligation not to conduct
a merger or sale of the entirety of the assets or a significant part of the assets of Vale or
Vale Overseas, with some exceptions and (b) limitations to granting collateral in debt
transactions, with some permitted exceptions:.
• insolvency or bankruptcy.
• Vale notes become illegal, generating the acceleration of over US$50 million total.
• the collateral becomes invalid or unenforceable.
| ii. | interest: 4.625% a.a |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
There is no granting of collateral. Vale guarantees, irrevocably and unconditionally, the
full payment of the principal, interests and other amounts owed in relation to this note, in
the event Vale Overseas fails to pay. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale.
However, Vale Overseas may not declare or pay any dividends, without the trustee’s consent,
as instructed by at least 25% of the note holders for the value of the principal showing an
open debt.
• disposal of determined assets: Vale and Vale Overseas may not, without the consent from
the majority of the note holders, participate in a merger with another company or transfer
all or a significant part of its assets to a third party, except, however that: (a) the
company created by this consolidation or a third party that acquired said assets undertakes
to make timely payments of the principal and interests and other obligations from Vale and
Vale Overseas in the deed of issuance; (b) no default event occurs as a result of the
transaction; and (c) Vale or Vale Overseas, as applicable, provide their trustee with a
certification attesting that the consolidation or transfer of assets meet the requirements
set forth in item b.
• contracting of new debt: there are no restrictions to contracting new debts by Vale. Vale
Overseas may issue debts instruments within the scope of the deed of issuance, but Vale
Overseas may not contract any other type of loan or financing.
• issuing new securities: Vale Overseas may issue, without the consent from the note
holders, new notes according to the terms and conditions applicable to Bond VALE 2020. In
addition, Vale Overseas may issue new notes under other terms and conditions. Vale has the
right to guarantee, without the consent from the note holders, its subsidiaries’ debts and
issue its own debt.
331
Table of Contents
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance
allows, at any time, with certain exceptions, to amend the rights and obligations of Vale Overseas
and the investors’ in the note. Said amendments may only be executed by Vale Overseas and the
trustee with the consent from the majority of the note holders for the value of the principal
showing an open debt.
j) other relevant characteristics: None
CVRD3910 Bonds
b) quantity: bonds are issued at the minimum value of US$2,000, always in multiples of US$1,000.
c) value: US$750,000,000.00
d) date of issue: 05/10/2010
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares issued by the company: None
g) possibility of redemption
i. possibilities of redemption:
(a) Redemption by means of payment of premium, at any time, at Vale Overseas’ criterion.
(b) Redemption due to changes in the tax law: Vale Overseas may redeem the entirety of the notes in
advance if Vale or Vale Overseas are forced to maintain values greater than 15%, in the event of
payment of interest over note, due to changes in the Brazilian or Cayman tax law.
ii. formula for calculating value of redemption:
(a) The redemption value will be 100% of the principal value or the sum of the current value of the
interest installments and the remaining principal, whichever is the greatest, deducted at the date
of redemption at the rate equivalent to Treasury + 0.40%.
(b) Redemption due to changes in the tax law: The redemption value will be equal to 100% of the
principal value plus the interests accrued up to the date of redemption.
h) if debt securities, indicate where applicable:
| i. | maturity date: 11/10/2039 |
| 10 | Bonds issued by Vale Overseas Ltd. subsidiary |
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Possibility of Early maturity: if a default event occurs, which is not corrected or condoned,
the trustee, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt, must declare the principal value, the interests accrued and any amount
unpaid immediately due. The default events are described in the deed of issuance, including,
but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale, its Relevant Subsidiaries: the occurrence of any default, in any
transaction characterized as debt, that exceeds, in total, US$50 million and this default
results in the effective acceleration of the debt.
• failure from Vale to comply with its covenants in relation to the note and this failure
persists 60 days after Vale has received communication from the trustee or from at least 25% of
the note holders reporting the non-compliance of the obligations. These obligations include,
but are not limited to: (a) obligation not to conduct a merger or sale of the entirety of the
assets or a significant part of the assets of Vale or Vale Overseas, with some exceptions and
(b) limitations to granting collateral in debt transactions, with some permitted exceptions:.
• insolvency or bankruptcy.
• Vale notes become illegal, generating the acceleration of over US$50 million total.
• the collateral becomes invalid or unenforceable.
| ii. | interest: 6.875% a.a |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
There is no granting of collateral. Vale guarantees, irrevocably and unconditionally, the
full payment of the principal, interests and other amounts owed in relation to this note, in
the event Vale Overseas fails to pay. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale.
However, Vale Overseas may not declare or pay any dividends, without the trustee’s consent,
as instructed by at least 25% of the note holders for the value of the principal showing an
open debt.
• disposal of determined assets: Vale and Vale Overseas may not, without the consent from
the majority of the note holders, participate in a merger with another company or transfer
all or a significant part of its assets to a third party, except, however that: (a) the
company created by this consolidation or a third party that acquired said assets undertakes
to make timely payments of the principal and interests and other obligations from Vale and
Vale Overseas in the deed of issuance; (b) no default event occurs as a result of the
transaction; and (c) Vale or Vale Overseas, as applicable, provide their trustee with a
certification attesting that the consolidation or transfer of assets meet the requirements
set forth in item b.
• contracting of new debt: there are no restrictions to contracting new debts by Vale. Vale
Overseas may issue debts instruments within the scope of the deed of issuance, but Vale
Overseas may not contract any other type of loan or financing.
• issuing new securities: Vale Overseas may issue, without the consent from the note
holders, new notes according to the terms and conditions applicable to Bond VALE 2039. In
addition, Vale Overseas may issue new notes under other terms and conditions. Vale has the
right to guarantee, without the consent from the note holders, its subsidiaries’ debts and
issue its own debt.
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Table of Contents
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance
allows, at any time, with certain exceptions, to amend the rights and obligations of Vale Overseas
and the investors’ in the note. Said amendments may only be executed by Vale Overseas and the
trustee with the consent from the majority of the note holders for the value of the principal
showing an open debt.
j) other relevant characteristics: None
Mandatorily Convertible Notes II —Vale 201211 Series
b) quantity: 5,848,903 notes
c) value: US$292,445,150.00
d) date of issue: 07/13/2009
e) restrictions on outstanding shares: none
f) Convertibility of shares or right to subscribe to or buy shares from the issuer. Convertible to
ADSs in relation to Vale common shares. Conversion into shares may also be made, at the note
holder’s criterion, at any time, prior to expiration, using the 2.6797 ADS/Note conversion rate.
Note unit face value is US$50.00
g) possibility of redemption
i. possibilities of redemption: Notes may be redeemed or converted into ADSs by Vale Capital II
prior to expiration, except in the cases where, due to changes in the Brazilian or Cayman tax law,
Vale
or Vale Capital II are forced to maintain values greater than 15%, in the event of payment of
interest over note.
ii. formula for calculating value of redemption: Notes are converted as VALE US ADSs, as per the
rate described below.
| VALE US Price | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Date | US$ 10,00 | US$ 12,00 | US$ 14,00 | US$ 15,88 | US$ 17,00 | US$ 18,66 | US$ 20,00 | US$ 22,00 | US$ 24,00 | US$ 28,00 | US$ 30,00 | US$ 35,00 | US$ 40,00 | US$ 45,00 | US$ 50,00 | |||||||||||||||||||||||||||||||||||||||||||||
07/13/2009 |
2,7326 | 2,6713 | 2,6311 | 2,6073 | 2,5978 | 2,5888 | 2,5847 | 2,5825 | 2,5835 | 2,5907 | 2,5956 | 2,6088 | 2,6213 | 2,6321 | 2,6412 | |||||||||||||||||||||||||||||||||||||||||||||
06/15/2010 |
2,8071 | 2,7345 | 2,6833 | 2,6511 | 2,6378 | 2,6240 | 2,6171 | 2,6119 | 2,6108 | 2,6158 | 2,6199 | 2,6317 | 2,6427 | 2,6518 | 2,659 | |||||||||||||||||||||||||||||||||||||||||||||
06/15/2011 |
2,9461 | 2,8569 | 2,7831 | 2,7314 | 2,7084 | 2,6834 | 2,6698 | 2,6576 | 2,6522 | 2,6523 | 2,655 | 2,663 | 2,6698 | 2,6746 | 2,6776 | |||||||||||||||||||||||||||||||||||||||||||||
07/15/2012 |
3,1486 | 3,1486 | 3,1486 | 3,1486 | 2,9412 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | |||||||||||||||||||||||||||||||||||||||||||||
h) if debt securities, indicate where applicable:
| i. | maturity date: 06/15/12 |
| 11 | Bonds issued by Vale Capital II subsidiary. |
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Possibility of Early maturity: if a default event occurs, which is not corrected or condoned,
the trustee, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt, must declare the principal value, the interests accrued and any amount
unpaid immediately due. The default events are described in the deed of issuance, including,
but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale, its Relevant Subsidiaries and Vale Capital II: the occurrence of any
default, in any transaction characterized as debt, that exceeds, in total, US$50 million and
this default results in the effective acceleration of the debt.
• failure from Vale or Vale Capital II to comply with their covenants in relation to the
note and this failure persists 60 days after Vale or Vale Capital II have received
communication from the trustee or from at least 25% of the note holders reporting the
non-compliance of the obligations. These obligations include, but are not limited to: (a)
obligation not to conduct a
merger or sale of the entirety of the assets or a significant part of the assets of Vale or
Vale Capital II, with some exceptions and (b) limitations to granting collateral in debt
transactions, with some permitted exceptions:.
• insolvency or bankruptcy.
• the collateral becomes invalid or unenforceable.
| ii. | interest: 6.75% a.a |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
Vale guarantees, irrevocably and unconditionally, all the payments in relation to the note,
in the event Vale Capital II fails to pay. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale.
However, if there were a distribution of dividends or interests over principal by Vale,
Vale Capital II will pay to the note holders additional interests based on this
distribution. The value of the additional interests will be the amount in dollars
equivalent to the cash distribution paid by the depository for a VALE US ADS multiplied by
the number of VALE US ADSs that the note holder would receive in the mandatory conversion
at the maximum conversion rate of 3.1486 ADS/Note.
• disposal of determined assets: Vale and Vale Capital II may not, without the consent from
the majority of the note holders, participate in a merger with another company or transfer
all or a significant part of its assets to a third party, except, however that: (a) the
company created by this consolidation or a third party that acquired said assets undertakes
to make timely payments of the principal and interests and other obligations from Vale and
Vale Capital II in the deed of issuance; (b) no default event occurs as a result of the
transaction; and (c) Vale or Vale Capital II, as applicable, provide their trustee with a
certification attesting that the consolidation or transfer of assets meet the requirements
set forth in item b.
• contracting of new debt: there are no restrictions to contracting new debts by Vale. Vale
Capital II may issue debts instruments within the scope of the deed of issuance.
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Table of Contents
• issuing new securities: Vale Capital II may issue, without the consent from the note
holders, new notes according to the terms and conditions applicable to Mandatory
Convertible Notes II — Vale 2012 Series, provided it has a sufficient number of common
shares in the treasury to support the conversion obligations of the new issuance. In
addition, Vale Capital II may issue new notes under other terms and conditions. Vale has
the right to guarantee, without the consent from the note holders, its subsidiaries’ debts
and issue its own debt.
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance allows
to amend the rights and obligations of the company and the investors’ in the note. Said amendments
may only be executed by the company and the trustee with the consent from 100% or the majority of
the note holders for the value of the principal showing an open debt, pursuant to the type of
amendment. Some non-material clarifications and changes may be made without the consent from the
note holders.
j) other relevant characteristics:
(a) Upon expiration, notes will be mandatorily converted to VALE US ADS. The conversion rate may
not be greater than 3.1486 VALE US ADSs per note and may not be lower than 2.6797 VALE US ADSs per
note, depending on the market value applicable to VALE US ADS at the conversion date. Vale
maintains in the treasury 18,415,859 common shares reserved for the conversion of notes.
(b) Vale Capital II, under certain circumstances as defined in the deed of issuance, may defer
payment of interests.
(c) Note holders have the right to convert them prior to expiration at the minimum conversion rate
(2.6797 VALE US ADSs per note) at any time, provided it is not a Cash Acquisition period.
(d) “Cash Acquisition” — notes will be converted prior to expiration in the event of a “Cash
Acquisition”, as defined below, pursuant to the conversion rates described in the table, plus a
conversion premium over the interests
| VALE US Price | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Date | US$ 10,00 | US$ 12,00 | US$ 14,00 | US$ 15,88 | US$ 17,00 | US$ 18,66 | US$ 20,00 | US$ 22,00 | US$ 24,00 | US$ 28,00 | US$ 30,00 | US$ 35,00 | US$ 40,00 | US$ 45,00 | US$ 50,00 | |||||||||||||||||||||||||||||||||||||||||||||
07/13/2009 |
2,7326 | 2,6713 | 2,6311 | 2,6073 | 2,5978 | 2,5888 | 2,5847 | 2,5825 | 2,5835 | 2,5907 | 2,5956 | 2,6088 | 2,6213 | 2,6321 | 2,6412 | |||||||||||||||||||||||||||||||||||||||||||||
06/15/2010 |
2,8071 | 2,7345 | 2,6833 | 2,6511 | 2,6378 | 2,6240 | 2,6171 | 2,6119 | 2,6108 | 2,6158 | 2,6199 | 2,6317 | 2,6427 | 2,6518 | 2,659 | |||||||||||||||||||||||||||||||||||||||||||||
06/15/2011 |
2,9461 | 2,8569 | 2,7831 | 2,7314 | 2,7084 | 2,6834 | 2,6698 | 2,6576 | 2,6522 | 2,6523 | 2,655 | 2,663 | 2,6698 | 2,6746 | 2,6776 | |||||||||||||||||||||||||||||||||||||||||||||
07/15/2012 |
3,1486 | 3,1486 | 3,1486 | 3,1486 | 2,9412 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | 2,6797 | |||||||||||||||||||||||||||||||||||||||||||||
“Cash Acquisition” — means the consolidation of any acquisition (liquidation, change of shares,
public offering, consolidation, reclassification, merger or sale of assets of Vale or its
subsidiaries) by means of which 75% of Vale common shares are changed or converted into other
instruments, in such a manner that no more than 10% trade in the New York Stock Exchange or
Nasdaq.
Mandatorily Convertible Notes II — Vale P 201212 Series
b) quantity: 12,984,265 notes
c) value: US$649,213,250.00
d) date of issue: 07/13/2009
e) restrictions on outstanding shares: none
| 12 | Bonds issued by Vale Capital II subsidiary. |
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Table of Contents
f) Convertibility of shares or right to subscribe to or buy shares from the issuer. Convertible to
ADSs in relation to Vale class A preferred shares. Conversion into shares may also be made, at the
note holder’s criterion, at any time, prior to expiration, using the 3.0993 ADS Note conversion
rate. Note unit face value is US$50.00
g) possibility of redemption
i. possibilities of redemption: Notes may be redeemed or converted into ADSs by Vale Capital II
prior to expiration, except in the cases where, due to changes in the Brazilian or Cayman tax law,
Vale
or Vale Capital II are forced to maintain values greater than 15%, in the event of payment of
interest over note.
ii. formula for calculating value of redemption: Notes are converted as VALE/P US ADSs, as per the
rate described below.
| VALE/P US Price | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Date | US$ 10,00 | US$ 12,00 | US$ 13,73 | US$ 15,00 | US$ 16,13 | US$ 18,00 | US$ 20,00 | US$ 22,00 | US$ 24,00 | US$ 28,00 | US$ 30,00 | US$ 35,00 | US$ 40,00 | US$ 45,00 | US$ 50,00 | |||||||||||||||||||||||||||||||||||||||||||||
07/13/2009 |
3,1175 | 3,0574 | 3,0256 | 3,0107 | 3,0020 | 2,9945 | 2,9928 | 2,9952 | 3,0000 | 3,0127 | 3,0195 | 3,0356 | 3,0494 | 3,0605 | 3,0694 | |||||||||||||||||||||||||||||||||||||||||||||
06/15/2010 |
3,1892 | 3,1151 | 3,0735 | 3,0531 | 3,0406 | 3,0284 | 3,0236 | 3,0241 | 3,0277 | 3,0389 | 3,0451 | 3,0594 | 3,0709 | 3,0797 | 3,0861 | |||||||||||||||||||||||||||||||||||||||||||||
06/15/2011 |
3,3309 | 3,2283 | 3,1632 | 3,129 | 3,1068 | 3,0834 | 3,0714 | 3,0678 | 3,0688 | 3,0762 | 3,0805 | 3,0894 | 3,0953 | 3,0987 | 3,1006 | |||||||||||||||||||||||||||||||||||||||||||||
07/15/2012 |
3,6417 | 3,6417 | 3,6417 | 3,3333 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | |||||||||||||||||||||||||||||||||||||||||||||
h) if debt securities, indicate where applicable:
| i. | maturity date: 06/15/12 |
Possibility of Early maturity: if a default event occurs, which is not corrected or condoned,
the trustee, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt, must declare the principal value, the interests accrued and any amount
unpaid immediately due. The default events are described in the deed of issuance, including,
but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale, its Relevant Subsidiaries and Vale Capital II: the occurrence of any
default, in any transaction characterized as debt, that exceeds, in total, US$50 million and
this default results in the effective acceleration of the debt.
• failure from Vale or Vale Capital II to comply with their covenants in relation to the
note and this failure persists 60 days after Vale or Vale Capital II have received
communication from the trustee or from at least 25% of the note holders reporting the
non-compliance of the obligations. These obligations include, but are not limited to: (a)
obligation not to conduct a merger or sale of the entirety of the assets or a significant part
of the assets of Vale or Vale Capital II, with some exceptions and (b) limitations to granting
collateral in debt transactions, with some permitted exceptions:.
• insolvency or bankruptcy.
• the collateral becomes invalid or unenforceable.
| ii. | interest: 6.75% a.a |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
Vale guarantees, irrevocably and unconditionally, all the payments in relation to the note,
in the event Vale Capital II fails to pay. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
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Table of Contents
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale.
However, if there were a distribution of dividends or interests over principal by Vale,
Vale Capital II will pay to the note holders additional interests based on this
distribution. The value of the additional interests will be the amount in dollars
equivalent to the cash distribution paid by the depository for a VALE US ADS multiplied by
the number of VALE US ADSs that the note holder would receive in the mandatory conversion
at the maximum conversion rate of 3.1486 ADS/Note.
• disposal of determined assets: Vale and Vale Capital II may not, without the consent from
the majority of the note holders, participate in a merger with another company or transfer
all or a significant part of its assets to a third party, except, however that: (a) the
company created by this consolidation or a third party that acquired said assets undertakes
to make timely payments of the principal and interests and other obligations from Vale and
Vale Capital II in the deed of issuance; (b) no default event occurs as a result of the
transaction; and (c) Vale or Vale Capital II, as applicable, provide their trustee with a
certification attesting that the consolidation or transfer of assets meet the
requirements set forth in item b.
• contracting of new debt: there are no restrictions to contracting new debts by Vale. Vale
Capital II may issue debts instruments within the scope of the deed of issuance.
• issuing new securities: Vale Capital II may issue, without the consent from the note
holders, new notes according to the terms and conditions applicable to Mandatory
Convertible Notes II — Vale P 2012 Series, provided it has a sufficient number of common
shares in the treasury to support the conversion obligations of the new issuance. In
addition, Vale Capital II may issue new notes under other terms and conditions. Vale has
the right to guarantee, without the consent from the note holders, its subsidiaries’ debts
and issue its own debt.
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance allows
to amend the rights and obligations of the company and the investors’ in the note. Said amendments
may only be executed by the company and the trustee with the consent from 100% or the majority of
the note holders for the value of the principal showing an open debt, pursuant to the type of
amendment. Some non-material clarifications and changes may be made without the consent from the
note holders.
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Table of Contents
j) other relevant characteristics:
(a) Upon expiration, notes will be mandatorily converted to VALE US ADS. The conversion rate may
not be greater than 3.6417 VALE US ADSs per note and may not be lower than 3.0993 VALE US ADSs per
note, depending on the market value applicable to VALE US ADS at the conversion date. Vale
maintains in the treasury 47,284,800 common shares reserved for the conversion of notes.
(b) Vale Capital II, under certain circumstances as defined in the deed of issuance, may defer
payment of interests.
(c) Note holders have the right to convert them prior to expiration at the minimum conversion rate
(3.0993 VALE US ADSs per note) at any time, provided it is not a Cash Acquisition period.
(d) “Cash Acquisition” — notes will be converted prior to expiration in the event of a “Cash
Acquisition”, as defined below, pursuant to the conversion rates described in the table, plus a
conversion premium over the interests
| VALE/P US Price | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Date | US$ 10,00 | US$ 12,00 | US$ 13,73 | US$ 15,00 | US$ 16,13 | US$ 18,00 | US$ 20,00 | US$ 22,00 | US$ 24,00 | US$ 28,00 | US$ 30,00 | US$ 35,00 | US$ 40,00 | US$ 45,00 | US$ 50,00 | |||||||||||||||||||||||||||||||||||||||||||||
07/13/2009 |
3,1175 | 3,0574 | 3,0256 | 3,0107 | 3,0020 | 2,9945 | 2,9928 | 2,9952 | 3,0000 | 3,0127 | 3,0195 | 3,0356 | 3,0494 | 3,0605 | 3,0694 | |||||||||||||||||||||||||||||||||||||||||||||
06/15/2010 |
3,1892 | 3,1151 | 3,0735 | 3,0531 | 3,0406 | 3,0284 | 3,0236 | 3,0241 | 3,0277 | 3,0389 | 3,0451 | 3,0594 | 3,0709 | 3,0797 | 3,0861 | |||||||||||||||||||||||||||||||||||||||||||||
06/15/2011 |
3,3309 | 3,2283 | 3,1632 | 3,129 | 3,1068 | 3,0834 | 3,0714 | 3,0678 | 3,0688 | 3,0762 | 3,0805 | 3,0894 | 3,0953 | 3,0987 | 3,1006 | |||||||||||||||||||||||||||||||||||||||||||||
07/15/2012 |
3,6417 | 3,6417 | 3,6417 | 3,3333 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | 3,0993 | |||||||||||||||||||||||||||||||||||||||||||||
“Cash Acquisition” — means the consolidation of any acquisition (liquidation, change of shares,
public offering, consolidation, reclassification, merger or sale of assets of Vale or its
subsidiaries) by means of which 50% of Vale class A preferred shares are changed or converted into
other instruments, in such a manner that no more than 10% trade in the New York Stock Exchange or
Nasdaq.
Inco 201513 Bonds
b) quantity: bonds are issued at the minimum value of US$1,000.
c) value: US$300,000,000.00
d) date of issue: 09/26/2003
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares from issuer: None
g) possibility of redemption
i. possibilities of redemption:
(a) Redemption by means of payment of premium, at any time, at Vale Inco’s criterion.
(b) Redemption due to changes in the tax law: if Vale Inco is forced to maintain additional values
to note holders, due to changes in the Canadian tax law.
ii. formula for calculating value of redemption:
a) The redemption value will be 100% of the principal value or the sum of the current value of the
interest installments and the remaining principal, whichever is the greatest, deducted at the date
of redemption at the rate equivalent to Treasury + 0.35%
(b) Redemption due to changes in the tax law: The redemption value will be equal to 100% of the
principal value plus the interests to any additional values established by the Canadian tax law up
to the date of redemption.
| 13 | Bonds issued by Vale Inco Ltd. subsidiary (Vale Inco). |
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Table of Contents
h) if debt securities, indicate where applicable:
| i. | maturity date: 10/15/2015 |
Possibility of Early maturity: if a default event occurs, which is not corrected or condoned,
the trustee, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt, must declare the principal value, the interests accrued and any amount
unpaid immediately due. The default events are described in the deed of issuance, including,
but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale Inco: the occurrence of any default, in any transaction characterized as
debt, that results in the effective acceleration of the debt.
• insolvency or bankruptcy by Vale Inco in Canada.
• failure from Vale Inco to comply with its covenants in relation to the notes. These
obligations include, but are not limited to: (a) obligation not to conduct a merger or sale of
the entirety of the assets or a significant part of the assets of Vale Inco, with some
exceptions and (b) limitations to granting collateral in debt transactions, with some permitted
exceptions:
| ii. | interest: 5.7% a.a |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
There is no granting of collateral by Vale Inco or its Relevant subsidiaries. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale
Inco.
• disposal of determined assets: Vale Inco may not participate in a merger with another
company or transfer all or a significant part of its assets to a third party, except,
however that: (a) the company created by this consolidation or a third party that acquired
said assets undertakes to make timely payments of the principal and interests and other
obligations from Vale Inco in the deed of issuance; (b) no default event occurs as a result
of the transaction; (c) Vale Inco provides its trustee with a certification attesting to
the consolidation or transfer of assets; and (d) if the company created by means of this
consolidation or a third party acquisition of said assets were outside Canada, the Canadian
tax law requirements must be met.
• contracting of new debt: there are no restrictions to contracting new debts by Vale Inco.
• issuing new securities: Vale Inco may issue, without the consent from the note holders,
new notes according to the deed of issuance terms and conditions. In addition, Vale Inco
may issue new notes under other terms and conditions. Vale has the right to guarantee,
without the consent from the note holders, its subsidiaries’ debts and issue its own debt.
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights. |
340
Table of Contents
i) conditions for amendment of the rights conferred by such securities: The deed of issuance
allows, with certain exceptions, to amend the rights and obligations of Vale Inco and the
investors’ in the note. Depending on the type of changes, said amendments may be executed by Vale
Inco and the trustee with the consent from the note holders. In most cases, the note holders may
approve changes to the note with the consent from 66.67% of the note holders for the value of the
principal showing an open debt. Some non-material clarifications and changes may be made without
the note holders’ consent.
j) other relevant characteristics: None
Inco 201214 Bonds
b) quantity: bonds are issued at the minimum value of US$1,000.
c) value: US$400,000,000.00
d) date of issue: 05/13/2002
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares from issuer: None
g) possibility of redemption
i. possibilities of redemption:
(a) Redemption by means of payment of premium, at any time, at Vale Inco’s criterion.
(b) Redemption due to changes in the tax law: if Vale Inco is forced to maintain additional values
to note holders, due to changes in the Canadian tax law.
ii. formula for calculating value of redemption:
a) The redemption value will be 100% of the principal value or the sum of the current value of the
interest installments and the remaining principal, whichever is the greatest, deducted at the date
of redemption at the rate equivalent to Treasury + 0.35%
(b) Redemption due to changes in the tax law: The redemption value will be equal to 100% of the
principal value plus the interests to any additional values established by the Canadian tax law up
to the date of redemption.
h) if debt securities, indicate where applicable:
| i. | maturity date: 05/15/12 |
Possibility of Early maturity: if a default event occurs, which is not corrected or condoned,
the trustee, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt, must declare the principal value, the interests accrued and any amount
unpaid immediately due. The default events are described in the deed of issuance, including,
but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale Inco: the occurrence of any default, in any transaction characterized as
debt, that results in the effective acceleration of the debt.
• insolvency or bankruptcy by Vale Inco in Canada.
• failure from Vale Inco to comply with its covenants in relation to the notes. These
obligations include, but are not limited to: (a) obligation not to conduct a merger or sale of
the entirety of the assets or a significant part of the assets of Vale Inco, with some
exceptions and (b) limitations to granting collateral in debt transactions, with some permitted
exceptions:
| ii. | interest: 7.75% a.a |
| 14 | Bonds issued by Vale Inco subsidiary. |
341
Table of Contents
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
There is no granting of collateral by Vale Inco or its Relevant subsidiaries. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale
Inco.
• disposal of determined assets: Vale Inco may not participate in a merger with another
company or transfer all or a significant part of its assets to a third party, except,
however that: (a) the company created by this consolidation or a third party that acquired
said assets undertakes to make timely payments of the principal and interests and other
obligations from Vale Inco in the deed of issuance; (b) no default event occurs as a result
of the transaction; (c) Vale Inco provides its trustee with a certification attesting to
the consolidation or transfer of assets; and (d) if the company created by means of this
consolidation or a third party acquisition of said assets were outside Canada, the Canadian
tax law requirements must be met.
• contracting of new debt: there are no restrictions to contracting new debts by Vale Inco.
• issuing new securities: Vale Inco may issue, without the consent from the note holders,
new notes according to the deed of issuance terms and conditions. In addition, Vale Inco
may issue new notes under other terms and conditions. Vale has the right to guarantee,
without the consent from the note holders, its subsidiaries’ debts and issue its own debt.
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights. |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance
allows, with certain exceptions, to amend the rights and obligations of Vale Inco and the
investors’ in the note. Depending on the type of changes, said amendments may be executed by Vale
Inco and the trustee with the consent from the note holders. In most cases, the note holders may
approve changes to the note with the consent from 66.67% of the note holders for the value of the
principal showing an open debt. Some non-material clarifications and changes may be made without
the note holders’ consent.
j) other relevant characteristics: None
Inco 203215 Bonds
b) quantity: bonds are issued at the minimum value of US$1,000.
c) value: US$400,000,000.00
d) date of issue: 09/23/2002
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares from issuer: None
| 15 | Bonds issued by Vale Inco. subsidiary. |
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Table of Contents
g) possibility of redemption
i. possibilities of redemption:
(a) Redemption by means of payment of premium, at any time, at Vale Inco’s criterion.
(b) Redemption due to changes in the tax law: if Vale Inco is forced to maintain additional values
to note holders, due to changes in the Canadian tax law.
ii. formula for calculating value of redemption:
a) The redemption value will be 100% of the principal value or the sum of the current value of the
interest installments and the remaining principal, whichever is the greatest, deducted at the date
of redemption at the rate equivalent to Treasury + 0.40%
(b) Redemption due to changes in the tax law: The redemption value will be equal to 100% of the
principal value plus the interests to any additional values established by the Canadian tax law up
to the date of redemption.
h) if debt securities, indicate where applicable:
| i. | maturity date: 09/15/32 |
Possibility of Early maturity: if a default event occurs, which is not corrected or condoned,
the trustee, as instructed by at least 25% of the note holders for the value of the principal
showing an open debt, must declare the principal value, the interests accrued and any amount
unpaid immediately due. The default events are described in the deed of issuance, including,
but not limited to:
• failure to pay interests, principal or premium, if any.
• in relation to Vale Inco: the occurrence of any default, in any transaction characterized as
debt, that results in the effective acceleration of the debt.
• insolvency or bankruptcy by Vale Inco in Canada.
• failure from Vale Inco to comply with its covenants in relation to the notes. These
obligations include, but are not limited to: (a) obligation not to conduct a merger or sale of
the
entirety of the assets or a significant part of the assets of Vale Inco, with some exceptions
and (b) limitations to granting collateral in debt transactions, with some permitted
exceptions:
| ii. | interest: 7.2% a.a |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral.
There is no granting of collateral by Vale Inco or its Relevant subsidiaries. |
||
| iv. | in the absence of a guarantee, if the credit is secured or subordinate: N/A |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: There are no restrictions on dividend distribution by Vale
Inco.
• disposal of determined assets: Vale Inco may not participate in a merger with another
company or transfer all or a significant part of its assets to a third party, except,
however that: (a) the company created by this consolidation or a third party that acquired
said assets undertakes to make timely payments of the principal and interests and other
obligations from Vale Inco in the deed of issuance; (b) no default event occurs as a result
of the transaction; (c) Vale Inco provides its trustee with a certification attesting to
the consolidation or transfer of assets; and (d) if the company created by means of this
consolidation or a third party acquisition of said assets were outside Canada, the Canadian
tax law requirements must be met.
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• contracting of new debt: there are no restrictions to contracting new debts by Vale Inco.
• issuing new securities: Vale Inco may issue, without the consent from the note holders,
new notes according to the deed of issuance terms and conditions. In addition, Vale Inco
may issue new notes under other terms and conditions. Vale has the right to guarantee,
without the consent from the note holders, its subsidiaries’ debts and issue its own debt.
| vi. | the fiduciary agent, indicating the key terms of the contract: The Bank of New York acts
as a trustee of the notes within the scope of the deed of issuance and its main role is to
secure investors’ rights. |
i) conditions for amendment of the rights conferred by such securities: The deed of issuance
allows, with certain exceptions, to amend the rights and obligations of Vale Inco and the
investors’ in the note. Depending on the type of changes, said amendments may be executed by Vale
Inco and the trustee with the consent from the note holders. In most cases, the note holders may
approve changes to the note with the consent from 66.67% of the note holders for the value of the
principal showing an open debt. Some non-material clarifications and changes may be made without
the note holders’ consent.
j) other relevant characteristics: None
Perpetual Notes
b) quantity: notes are issued at the minimum value of US$1,000,000.00, always in multiples of
US$1,000,000.00
c) value: US$120,000.000.00
d) date of issue: 14/01/2000
e) restrictions on outstanding shares: none
f) convertibility of shares or right to subscribe to or buy shares from issuer: These notes may be
exchanged for 48 billion preferred shares of Mineração Rio do Norte S.A. (MRN) — initially
equivalent to 8% of MRN total shares, under the following circumstances: (a) Mandatory
redemption (b) Redemption at the note holder’s discretion (c) Redemption at issuer Vale
International S.A.’s discretion.
g) possibility of redemption
i. cases of redemption
(a) Mandatory redemption: in the event of (i) dissolution of MRN (ii) all or substantially all MRN
assets and liabilities will be transferred to a consortium constituted by MRN shareholders to
undertake MRN or (iii) MRN sustains a merger or consolidation with another company.
(b) Redemption at Note holder’s discretion: the note holder must provide a 30-day-advance notice to
issuer.
(c) Redemption at Issuer’s discretion: the note issuer must provide a 30-day-advance notice to the
note holders.
ii. formula for calculating value of redemption
a) Mandatory redemption: Issuer must obtain transfer to note holders (i) in the event of
dissolution: the percentage of liquid assets (if any) distributed among preferred shareholders (ii)
in the event of transfer to a consortium: the percentage of liquid assets and liabilities
transferred to this consortium (iii) In the event of merger or consolidation with another company:
the percentage of the number of shares received by the shareholders in relation to this operation,
in this case the percentage represented by 48 billion preferred shares in relation to the total
number of MRN preferred shares.
(b) Optional redemption: (i) in the event of total redemption: by transfer to note holders of
48,000,000,000 preferred shares (ii) in the event of partial redemption: by transfer to note
holders of the number of proportionate preferred shares.
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h) if debt securities, indicate where applicable:
| i. | expiration, including early expiration conditions: |
||
Date of expiration: None |
|||
Early expiration: (a) In the case of liquidation or dissolution of issuer or Vale do Rio
Doce Alumínio S.A. Aluvale or (b) issuer fails to execute its note obligations. |
|||
In the event of early expiration, issuer must deliver 48,000,000,000 MRN preferred shares or, in
the event of default, at the note holder’s criterion, issuer must deliver Alunorte preferred
shares or US$48 million incremented from the average of the last three dividends paid by MRN
multiplied by 20 years and a 10%/year deducted rate. |
|||
| ii. | interests: payments simultaneously to the payment of MRN dividends, in the amount
equivalent to 8% of MRN share, as of FY 2000, over the dividends paid. |
||
| iii. | guarantee and, if in the form of collateral, description of the goods used as collateral:
None |
||
| iv. | the absence of a guarantee, if the credit is secured or subordinate: secured |
||
| v. | possible restrictions imposed on the issuer, in relation to: |
• distribution of dividends: None
• disposal of determined assets: sale of all or a significant part of MRN assets and
liabilities is the condition for early redemption.
• contracting of new debt: None
• issuing new securities: None
| vi. | the fiduciary agent, indicating the key terms of the contract: None |
i) conditions for amendment of the rights conferred by such securities: changes to the note
holders’ rights and obligations are permitted, at any time. Said amendments may only be executed by
MRN with the consent from the majority of the note holders for the value of the principal showing
an open debt; however, any changes to the date of payment of principal and interests or reduction
to the value of principal and interests may only be authorized by 75% of the note holders for the
value of the principal showing an open debt.
j) other relevant characteristics: Perpetual notes were issued by Vale International S.A. and paid
in full by Norsk Hydro Aluminium Brasil Investment B.V.
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19. BUY-BACK PLANS AND SECURITIES HELD IN TREASURY
19.1 Share buyback plans carried out over the last 3 financial years
Financial year as of 12/31/2010
| a. | Dates of meetings where buy-back plans were approved: |
09/23/2010
| b. | description of each plan: |
1. Share Buyback Plan approved on 09/23/2010
I. quantity of shares envisaged, divided by class
and type :
|
Common Shares: 64,810,513 Preferred Class “A” Shares: 98,367,748 |
|
ii. percentage in relation to total outstanding
shares, divided by class and type :
|
Common Shares: 5% Preferred Class “A” Shares: 5% |
|
iii. buyback period:
|
09/24/2010 to 03/22/2011 | |
iv. reserves and profits available for the buy-back:
|
R$62,121,595,000,(June 2010) | |
v. other important characteristics :
|
Pursuant to CVM Instruction No. 10/80, according to amendment and article 14, XXXII of Vale’s bylaws, on October 23, 2010, the Board approved the acquisition by Vale and/or any of its subsidiaries of common shares and class “A” preferred shares issued by Vale to stay in the Treasury and for later cancellation or disposal for a value of up to US$2 billion, comprising up to 64,810,513 common shares and up to 98,367,748 preferred shares corresponding to 5% of the total amount of outstanding shares of each type..The deadline for completion of operations was 180 days from the date of authorization, taking into account the blackout period for trading. This program was executed in full up to October 11, 2010. 21,682,700 common shares were acquired at an average price of US$31.31 per share, and 48,197,700 preferred shares at an average price of US$27.40 per share, totaling US$2.0 billion, and corresponding, respectively, to 1.67% and 2.45% of the outstanding (“free float”) common and preferred shares, based on the equity position at the inception date of the program. | |
| Purpose of the program: use of the excess of the resources held in cash for optimizing the assignment of capital and maximizing the value for shareholders. The program followed strictly the Brazilian law in force, and the acquisition of shares was made in stock market at market value. The institutions that took part as intermediary parties in the buy-back were: Bradesco S.A. CTVM — Avenida Paulista, 1450 — 7th floor, São Paulo/SP; Itaú CV S.A. - Avenida Brigadeiro Faria Lima, 3400 - 10th floor,- São Paulo/SP; Ágora CTVM S.A. — Praia de Botafogo, 300 — 6th floor, Rio de Janeiro/RJ; Fator S.A. CV — Rua Doutor Renato Paes de Barros, 1017 - 11th and 12th floors, São Paulo/SP; Credit Suisse Hedging-Griffo CV S.A. — Avenida Presidente Juscelino Kubitschek, 1830 - 6th and 7th floors — Torre IV, São Paulo/SP; Magliano S.A. CCVM — Rua Bela Cintra, 986 — 2nd floors, São Paulo/SP, CEP: 01415-000; Credit Suisse Brasil S.A. CTVM — Avenida Brigadeiro Faria Lima 3064, 13th floor, São Paulo/SP; Santander CCVM S.A. — Avenida Presidente Juscelino Kubitschek, 2041, 2235 — 24th floor, São Paulo/SP; J.P.Morgan CCVM S.A. - Avenida Brigadeiro Faria Lima 3729, 13th floor, São Paulo/SP | ||
vi. quantity of shares purchased, divided by class
and type :
|
Common Shares: 21,682,700 Preferred Class “A” Shares: 48,197,700 |
|
vii. weighted average price of acquisition, divided
by class and type:
|
Common Shares: R$53.09 Preferred Class “A” Shares: R$46.44 |
|
viii. percentage of shares purchased in relation to
the total approved :
|
Common Shares: 33.45553% Preferred Class “A” Shares: 48.99746% |
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Financial year as of 12/31/2008
| a. | Dates of meetings where buy-back plans were approved: |
10/16/2008
| b. | description of each plan: |
1. Share Buyback Plan approved on 10/16/2008
I. quantity of shares envisaged, divided by class
and type :
|
Common Shares: 69,944,380 Preferred Class “A” Shares: 169,210,249 |
|
ii. percentage in relation to total outstanding
shares, divided by class and type :
|
Ordinary Shares: 5.5% Preferred Class “A” Shares: 8.5% |
|
iii. buyback period:
|
10/16/2008 to 10/10/2009 | |
iv. reserves and profits available for the buy-back:
|
R$45,224,907,000 (Sept. 2008) | |
v. other important characteristics :
|
Pursuant to CVM Instruction No. 10/80, according to amendment and article 14, XXXII of Vale’s bylaws, on October 16, 2008, the Board approved the acquisition by Vale and/or any of its subsidiaries of common shares and class “A” preferred shares issued by Vale to stay in the Treasury and for later cancellation or disposal. The deadline for completion of operations was 360 days from the date of authorization, beginning on October 27, 2008, after the blackout period for trading. On May 27, 2009, the Board of Directors approved the ending of the program, therefore, as of October 27, 2008, it has acquired 18,415,859 common shares and 47,284,800 class “A” preferred shares issued by Vale. | |
| Purpose of the program: to maximize the value for shareholders, taking into account market multiples observed at that moment. The program followed strictly the Brazilian law in force, and the acquisition of shares was made in stock market at market value. The institutions that took part as intermediary parties in the buy-back were: Bradesco S.A. CTVM — Avenida Ipiranga 282, 13th, 14th and 15th floors — São Paulo (SP); Itaú CV — Av. Doutor Hugo Beolchi 900, 15th floor, Torre Eudoro Vilella — São Paulo (SP); Agora-Senior CTVM S.A. — Praia de Botafogo 300, 6th floor — Rio de Janeiro (RJ); Fator S.A. CV — Rua Doutor Renato Paes de Barros 1.017 — 11th and 12th floors — São Paulo (SP); Credit Suisse Hedging-Griffo CV S.A. — Av. Presidente Juscelino Kubitschek 1.830, 6th and 7th floors — Torres III e IV — São Paulo (SP); Magliano S.A. CCVM — Rua Bela Cintra 986, 2nd floor — São Paulo (SP); Credit Suisse (Brasil) S.A. CTVM — Av. Brigadeiro Faria Lima 3064, 13th floor — São Paulo (SP); Santander S.A. CCT — Rua Hungria 1400, 4th floor — São Paulo (SP). | ||
vi. quantity of shares purchased, divided by class
and type :
|
Common Shares: 18,415,859 Preferred Class “A” Shares: 47,284,800 |
|
vii. weighted average price of acquisition, divided
by class and type:
|
Common Shares: R$27.37 Preferred Class “A” Shares: R$24.91 |
|
viii. percentage of shares purchased in relation to
the total approved :
|
Common Shares: 26.33% Preferred Class “A” Shares: 27.94% |
19.2 Movement of the securities held in the Treasury
Fiscal year ended 12/31/2008
| Type of share | ||||||||||||
| Common | Class of common share | Description of securities | ||||||||||
| Movement | Amount | Total value | Weighted average price | |||||||||
| (units) | (reais) | (reais) | ||||||||||
Initial balance |
56,582,040 | 131,102,767.00 | 2.32 | |||||||||
Acquisition |
18,355,859 | 502,051,138.00 | 27.35 | |||||||||
Disposal |
0 | 0.00 | 0.00 | |||||||||
Cancellation |
0 | 0.00 | 0.00 | |||||||||
Final balance |
74,937,899 | 633,153,905.00 | 8.45 | |||||||||
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| Type of share | Class of preferred share | |||||||||||
| Preferred | “A” | Description of securities | ||||||||||
| Movement | Amount | Total value | Weighted average price | |||||||||
| (units) | (reais) | (reais) | ||||||||||
Initial balance |
30,341,144 | 659,118,475.00 | 21.72 | |||||||||
Acquisition |
46,513,400 | 1,156,225,082.00 | 24.86 | |||||||||
Disposal |
240 | 10,427.00 | 43.45 | |||||||||
Cancellation |
0 | 0.00 | 0.00 | |||||||||
Final balance |
76,854,304 | 1,815,333,130.00 | 23.62 | |||||||||
Fiscal year ended 12/31/2009
| Type of share | ||||||||||||
| Common | Class of common share | Description of securities | ||||||||||
| Movement | Amount | Total value | Weighted average price | |||||||||
| (units) | (reais) | (reais) | ||||||||||
Initial balance |
74,937,899 | 633,153,905.00 | 8.45 | |||||||||
Acquisition |
60,000 | 1,962,183.00 | 32.70 | |||||||||
Disposal |
0 | 0.00 | 0.00 | |||||||||
Cancellation |
0 | 0.00 | 0.00 | |||||||||
Final balance |
74,997,899 | 635,116,088.00 | 8.47 | |||||||||
| Type of share | Class of preferred share | |||||||||||
| Preferred | “A” | Description of securities | ||||||||||
| Movement | Amount | Total value | Weighted average price | |||||||||
| (units) | (reais) | (reais) | ||||||||||
Initial balance |
76,854,304 | 1,815,333,130.00 | 23.62 | |||||||||
Acquisition |
771,400 | 21,679,777.00 | 32.74 | |||||||||
Disposal |
43,800 | 1,434,012.00 | 32.74 | |||||||||
Cancellation |
0 | 0.00 | 0.00 | |||||||||
Final balance |
77,581,904 | 1,835,578,895.00 | 23.66 | |||||||||
Fiscal year ended 12/31/2010
| Type of share | ||||||||||||
| Common | Class of common share | Description of securities | ||||||||||
| Movement | Amount | Total value | Weighted average price | |||||||||
| (units) | (reais) | (reais) | ||||||||||
Initial balance |
74,997,899 | 635,116,088.00 | 8.47 | |||||||||
Acquisition |
21,682,700 | 1,151,602,061.00 | 53.11 | |||||||||
Disposal |
49,305,205 | 417,615,086.00 | 8.47 | |||||||||
Cancellation |
0 | 0.00 | 0.00 | |||||||||
Final balance |
47,375,394 | 1,369,103,063.00 | 28.90 | |||||||||
| Type of share | Class of preferred share | |||||||||||
| Preferred | “A” | Description of securities | ||||||||||
| Movement | Amount | Total value | Weighted average price | |||||||||
| (units) | (reais) | (reais) | ||||||||||
Initial balance |
77,581,904 | 1,835,578,895.00 | 23.66 | |||||||||
Acquisition |
48,197,700 | 2,239,681,438.00 | 46.47 | |||||||||
Disposal |
26,130,033 | 618,236,581.00 | 23.66 | |||||||||
Cancellation |
0 | 0.00 | 0.00 | |||||||||
Final balance |
99,649,571 | 3,457,023,752.00 | 34.69 | |||||||||
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19.3 Securities held in the Treasury at the end of the last financial year
| On December 31, 201 | ||||||||||||||||
| Weighted average | ||||||||||||||||
| price of acquisition | Date of | % in relation to securities in circulation of the same | ||||||||||||||
| Type | Quantity | (in R$) | acquisition | class and type: | ||||||||||||
Shares |
||||||||||||||||
PN Shares |
1,385,471 | 21.49 | 07/13/06 | 0.049793261 | ||||||||||||
PN Shares |
60,000 | 21.45 | 07/13/06 | 0.001477107 | ||||||||||||
PN Shares |
60,000 | 21.45 | 07/13/06 | 0.001477107 | ||||||||||||
PN Shares |
960,600 | 21.29 | 07/14/06 | 0.023648476 | ||||||||||||
PN Shares |
1,012,400 | 21.26 | 07/14/06 | 0.024923711 | ||||||||||||
PN Shares |
161,200 | 21.20 | 07/14/06 | 0.003968493 | ||||||||||||
PN Shares |
527,400 | 20.87 | 07/07/06 | 0.012983766 | ||||||||||||
PN Shares |
1,819,500 | 21.06 | 10/28/08 | 0.089586511 | ||||||||||||
PN Shares |
722,000 | 23.88 | 10/29/08 | 0.035549031 | ||||||||||||
PN Shares |
4,755,600 | 25.00 | 10/30/08 | 0.234150928 | ||||||||||||
PN Shares |
5,608,600 | 25.30 | 10/31/08 | 0.276149991 | ||||||||||||
PN Shares |
6,340,600 | 26.09 | 11/03/08 | 0.312191390 | ||||||||||||
PN Shares |
1,139,400 | 27.65 | 11/04/08 | 0.056100506 | ||||||||||||
PN Shares |
3,943,700 | 27.11 | 11/05/08 | 0.194175502 | ||||||||||||
PN Shares |
5,048,400 | 24.54 | 11/06/08 | 0.248567488 | ||||||||||||
PN Shares |
2,579,200 | 24.95 | 11/07/08 | 0.126991773 | ||||||||||||
PN Shares |
348,000 | 24.79 | 11/07/08 | 0.017134436 | ||||||||||||
PN Shares |
2,351,900 | 25.89 | 11/10/08 | 0.115800229 | ||||||||||||
PN Shares |
662,000 | 25.89 | 11/10/08 | 0.032594818 | ||||||||||||
PN Shares |
1,442,000 | 24.66 | 11/11/08 | 0.070999588 | ||||||||||||
PN Shares |
1,362,200 | 24.21 | 11/12/08 | 0.067070484 | ||||||||||||
PN Shares |
1,291,600 | 23.27 | 11/12/08 | 0.063594360 | ||||||||||||
PN Shares |
795,700 | 23.66 | 11/13/08 | 0.039177789 | ||||||||||||
PN Shares |
481,600 | 24.47 | 11/17/08 | 0.023712484 | ||||||||||||
PN Shares |
94,500 | 24.49 | 11/17/08 | 0.004652886 | ||||||||||||
PN Shares |
741,300 | 22.76 | 11/19/08 | 0.036499303 | ||||||||||||
PN Shares |
370,100 | 22.87 | 11/19/08 | 0.018222571 | ||||||||||||
PN Shares |
2,216,900 | 21.04 | 11/21/08 | 0.109153249 | ||||||||||||
PN Shares |
989,100 | 23.37 | 11/24/08 | 0.048700203 | ||||||||||||
PN Shares |
1,409,500 | 25.03 | 11/28/08 | 0.069399389 | ||||||||||||
PN Shares |
412,000 | 4.78 | 01/30/09 | 0.020285596 | ||||||||||||
PN Shares |
359,400 | 32.12 | 01/30/09 | 0.017695736 | ||||||||||||
PN Shares |
4,780,300 | 44.68 | 09/24/10 | 0.237952536 | ||||||||||||
PN Shares |
4,521,400 | 45.33 | 09/27/10 | 0.225065079 | ||||||||||||
PN Shares |
3,900,000 | 45.78 | 09/28/10 | 0.194133191 | ||||||||||||
PN Shares |
3,990,000 | 45.96 | 09/29/10 | 0.198613187 | ||||||||||||
PN Shares |
183,600 | 46.50 | 09/29/10 | 0.009139193 | ||||||||||||
PN Shares |
3,750,000 | 46.19 | 09/30/10 | 0.186666530 | ||||||||||||
PN Shares |
3,169,000 | 46.53 | 10/01/10 | 0.157745662 | ||||||||||||
PN Shares |
1,050,000 | 47.53 | 01/01/10 | 0.052266628 | ||||||||||||
PN Shares |
3,030,000 | 46.56 | 10/04/10 | 0.150826556 | ||||||||||||
PN Shares |
1,079,800 | 46.82 | 10/04/10 | 0.053750005 | ||||||||||||
PN Shares |
3,950,000 | 47.06 | 10/05/10 | 0.196622078 | ||||||||||||
PN Shares |
177,800 | 47.77 | 10/05/10 | 0.008850482 | ||||||||||||
PN Shares |
4,090,000 | 47.65 | 10/06/10 | 0.203590962 | ||||||||||||
PN Shares |
4,290,300 | 47.31 | 10/07/10 | 0.213561443 | ||||||||||||
PN Shares |
352,500 | 47.60 | 10/07/10 | 0.017546654 | ||||||||||||
PN Shares |
4,290,000 | 47.46 | 10/08/10 | 0.213546510 | ||||||||||||
PN Shares |
1,593,000 | 47.61 | 10/11/10 | 0.079295942 | ||||||||||||
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| On December 31, 201 | ||||||||||||||||
| Weighted average | ||||||||||||||||
| price of acquisition | Date of | % in relation to securities in circulation of the same | ||||||||||||||
| Type | Quantity | (in R$) | acquisition | class and type: | ||||||||||||
ON Shares |
182,435 | 4.31 | 09/27/01 | 0.002118347 | ||||||||||||
ON Shares |
1,512,000 | 4.26 | 09/28/01 | 0.003960114 | ||||||||||||
ON Shares |
78,000 | 4.22 | 10/01/01 | 0.000204292 | ||||||||||||
ON Shares |
170,400 | 4.29 | 10/02/01 | 0.000446299 | ||||||||||||
ON Shares |
1,784,400 | 4.28 | 10/03/01 | 0.004673563 | ||||||||||||
ON Shares |
109,200 | 4.25 | 10/03/01 | 0.000286008 | ||||||||||||
ON Shares |
60,000 | 4.28 | 10/04/01 | 0.000157147 | ||||||||||||
ON Shares |
1,038,000 | 4.28 | 10/04/01 | 0.002718650 | ||||||||||||
ON Shares |
60,000 | 4.28 | 10/05/01 | 0.000157147 | ||||||||||||
ON Shares |
600,000 | 4.27 | 10/05/01 | 0.001571474 | ||||||||||||
ON Shares |
248,400 | 4.30 | 10/05/01 | 0.000650590 | ||||||||||||
ON Shares |
600,000 | 4.30 | 10/09/01 | 0.001571474 | ||||||||||||
ON Shares |
546,000 | 4.31 | 1011//01 | 0.001430041 | ||||||||||||
ON Shares |
284,400 | 4.20 | 11/08/01 | 0.000744879 | ||||||||||||
ON Shares |
3,600 | 4.18 | 11/12/01 | 0.000009429 | ||||||||||||
ON Shares |
988,900 | 23.35 | 10/28/08 | 0.031080609 | ||||||||||||
ON Shares |
249,000 | 26.50 | 10/29/08 | 0.007825940 | ||||||||||||
ON Shares |
249,600 | 28.01 | 10/30/08 | 0.007844797 | ||||||||||||
ON Shares |
1,873,900 | 28.15 | 10/31/08 | 0.058895696 | ||||||||||||
ON Shares |
1,810,000 | 28.84 | 11/03/08 | 0.056887352 | ||||||||||||
ON Shares |
354,800 | 31.02 | 11/04/08 | 0.011151178 | ||||||||||||
ON Shares |
1,754,400 | 30.21 | 11/05/08 | 0.055139873 | ||||||||||||
ON Shares |
1,909,959 | 27.06 | 11/06/08 | 0.060029011 | ||||||||||||
ON Shares |
1,182,800 | 27.36 | 11/07/08 | 0.037174784 | ||||||||||||
ON Shares |
502,000 | 27.15 | 11/07/08 | 0.015777597 | ||||||||||||
ON Shares |
855,000 | 28.65 | 11/10/08 | 0.026872202 | ||||||||||||
ON Shares |
561,000 | 28.49 | 11/10/08 | 0.017631936 | ||||||||||||
ON Shares |
926,000 | 27.22 | 11/11/08 | 0.029103695 | ||||||||||||
ON Shares |
158,600 | 27.93 | 11/12/08 | 0.004984715 | ||||||||||||
ON Shares |
965,100 | 26.73 | 11/12/08 | 0.030332588 | ||||||||||||
ON Shares |
1,038,000 | 25.72 | 11/13/08 | 0.032623796 | ||||||||||||
ON Shares |
283,700 | 26.15 | 11/17/08 | 0.008916542 | ||||||||||||
ON Shares |
219,500 | 27.00 | 11/17/08 | 0.006898770 | ||||||||||||
ON Shares |
145,500 | 26.97 | 11/19/08 | 0.004572989 | ||||||||||||
ON Shares |
322,700 | 25.07 | 11/19/08 | 0.010142292 | ||||||||||||
ON Shares |
580,800 | 24.93 | 11/21/08 | 0.018254240 | ||||||||||||
ON Shares |
651,400 | 23.41 | 11/24/08 | 0.020473161 | ||||||||||||
ON Shares |
425,800 | 27.36 | 11/27/08 | 0.013382671 | ||||||||||||
ON Shares |
347,400 | 27.98 | 11/28/08 | 0.010918600 | ||||||||||||
ON Shares |
60,000 | 32.72 | 01/30/09 | 0.001885769 | ||||||||||||
ON Shares |
1,021,100 | 50.67 | 09/24/10 | 0.048425964 | ||||||||||||
ON Shares |
660,000 | 51.57 | 09/24/10 | 0.031300691 | ||||||||||||
ON Shares |
572,600 | 51.50 | 09/27/10 | 0.027155721 | ||||||||||||
ON Shares |
980,000 | 52.56 | 09/27/10 | 0.046476784 | ||||||||||||
ON Shares |
520,000 | 51.83 | 09/28/10 | 0.024661151 | ||||||||||||
ON Shares |
1,640,000 | 52.70 | 09/28/10 | 0.077777476 | ||||||||||||
ON Shares |
680,000 | 52.07 | 09/29/10 | 0.032249197 | ||||||||||||
ON Shares |
1,933,000 | 52.88 | 09/29/10 | 0.091673086 | ||||||||||||
ON Shares |
420,000 | 52.19 | 09/30/10 | 0.019918622 | ||||||||||||
ON Shares |
1,603,000 | 52.96 | 09/30/10 | 0.076022740 | ||||||||||||
ON Shares |
400,000 | 52.51 | 10/01/10 | 0.018970116 | ||||||||||||
ON Shares |
1,900,000 | 53.67 | 10/01/10 | 0.090108051 | ||||||||||||
ON Shares |
1,748,000 | 52.92 | 10/04/10 | 0.082899407 | ||||||||||||
ON Shares |
1,700,000 | 54.38 | 10/05/10 | 0.080622993 | ||||||||||||
ON Shares |
647,000 | 53.86 | 10/06/10 | 0.030684163 | ||||||||||||
ON Shares |
1,685,500 | 54.83 | 10/06/10 | 0.079935326 | ||||||||||||
ON Shares |
630,000 | 53.44 | 10/07/10 | 0.029877933 | ||||||||||||
ON Shares |
2,182,500 | 53.81 | 10/07/10 | 0.103505696 | ||||||||||||
ON Shares |
640,000 | 53.55 | 10/08/10 | 0.030352186 | ||||||||||||
ON Shares |
120,000 | 53.60 | 10/11/10 | 0.005691035 | ||||||||||||
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19.4. Other information that the Company considers relevant
On February 19, 2001, there was an approval at the Extraordinary General Meeting, for the
incorporation of shares held by minority shareholders in subsidiary Mineração da Trindade S.A
(“Samitri”), without an increase in capital and without issuing new shares in Vale by using shares
held in the Treasury, in accordance with the authorization by the CVM (Brazilian SEC) on December
13, 2000, pursuant to article 23 of the CVM Instruction No. 10 of February 14, 1980. As a result of
the incorporation of Samitri shares into Vale’s equity, the minority shareholders of Samitri
received class A Vale preferred shares (PNA), maintained in the Treasury by the Company, at a rate
of 1 (one) share issued by Vale per lot of 628 (six hundred and twenty-eight) Samitri shares.
With this operation Samitri became a wholly owned subsidiary of Vale. Those holding Samitri shares,
who contact Vale, will have their shares updated and converted into Vale PNA shares, in the
proportion informed above. In this way, the Treasury shares have been disposed of in the periods
2007-2009 (3,888 PNA shares in 2007, 240 PNA shares in 2008 and 43,800 PNA shares in 2009) on
account of the upgrade of bearer bonds for the minority shareholders of Samitri.
The mandatorily convertible notes due June 15, 2010 of its wholly-owned subsidiary Vale Capital
Limited (“Vale Capital”), series RIO and RIO P, were converted into common and preferred American
Depositary Shares (ADSs), respectively. The conversion rate, which is the number of ADSs
deliverable upon conversion of each note on the applicable date, was 1.9026 common ADSs per Series
RIO and 2.2351 preferred ADSs per Series RIO P. The American Depositary Shares, into which the
Series RIO Notes were converted, represented an aggregate of 49,305,205 common shares, and the
Series RIO P Notes represented an aggregate of 26,130,033 preferred class A shares. Those shares
were held in the treasury and were sold to be used in the conversion of the notes.
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20. SECURITIES TRADING POLICY
20.1 Description of the Company’s policy for trading of securities by major shareholders, direct or
indirect, directors, members of the Board of Directors, or of any body with consultative or
technical functions, created by legal statute.
a. Date of approval
The policy for trading of securities issued by Vale S.A. (“Trading Policy”) was approved by the
Board on 01.19.2011, which replaced the one that was previously current, approved on 11/13/2002 and
reviewed on 07/29/2004.
b. Related parties
Vale’s Trading Policy applies to the following individuals (all together the “Related Parties”):
| • | The Company; |
| • | Its subsidiary, Valepar S.A. (“Valepar”); |
| • | representatives of shareholders of Valepar S.A., controlling entity of Vale; |
| • | members of the Board of Directors of Valepar; |
| • | members of the Board of Directors of Vale ; |
| • | members of the Advisory Committee of Vale; |
| • | members of the supporting committees for the Board of Directors of Vale ; |
| • | Vale’s Board of Directors; and |
| • | Global directors, department directors, general managers, executive coordinators,
coordinators, managers and other employees who, because of their role, function or position
in the company, and its subsidiaries, has knowledge of inside information. |
c. Main characteristics
Vale’s Trading Policy, formulated in accordance with the CVM Instruction No. 358/02 and Vale’s Code
of Ethical Conduct, aims to contribute to the orderly trading of securities issued by Vale, or its
related companies, removing any suspected misuse of information concerning material events or facts
about Vale (“inside information”).
The Trading Policy also aims to contribute to compliance with laws and regulations of the United
States and Hong Kong, where Vale shares are traded in the stock exchanges in the form of ADRs and
HDRs, respectively, that prohibit Insider trading / dealing (using inside information for their own
benefit), including the practice of tipping (providing privileged information to third parties to
benefit from it).
For purposes of the laws and regulations of the United States, a person engages in practices of (i)
insider trading to buy or sell securities using relevant information and not publicly disclosed
(material non-public information) that has been obtained or used in breach of a duty of trust and
confidentiality (duty of trust and confidence), and (ii) tipping if you provide the same type of
information to third parties who end up taking advantage of this information to commit insider
trading.
For purposes of the laws and regulations of Hong Kong, a person engages in practices of (i) insider
trading when having material non-public information, buys or convinces third parties to negotiate
Vale’s securities, or provides the same type of information to third parties knowing, or expecting
that they will negotiate with Vale’s securities
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The prohibitions contained in this Trading Policy cover any acquisition, sale or transfer of
securities issued or guaranteed by Vale.
Companies opened under the control of Vale should adopt the Company’s Trading Policy, applying,
where appropriate, the same prohibitions and/or restrictions disciplined by the Company’s Trading
Policy.
Any violation to the provisions of the Company’s Trading Policy shall be deemed a breach of the
Code of Ethical Conduct of Vale and may be subject to the penalties provided by law and damages
caused to Vale and to third partiers, in addition to any proceedings and penalties established in
the Code of Ethical Conduct of Vale.
d. Forecast of blackout periods for trading
Related Persons cannot, in addition to what is already provided for in the CVM Instruction n °
358/02, trade securities issued by Vale and publicly quoted companies controlled by it:
| • | Fifteen (15) days prior and 2 (two) days after the dissemination or publication of the
quarterly and annual financial statements of Vale; |
||
| • | In the period between the decision taken by the shareholders of Valepar, controller of
Vale to: (i) modify Vale capital of by share subscription; (ii) approve a program of
acquisition or disposal of Vale shares issued by Vale itself; and (iii) distribute
dividends or interest on equity, bonuses in shares or their derivatives or splits, and the
publication of the respective public notices and/or advertisements or newsletters; and |
||
| • | During any other period designated by the Executive Director responsible for Vale
investor relations, with the prior authorization of the Chairman of the Board of Directors
at the request of the CEO |
Related Persons may trade securities issued by Vale, as long as they observe the blackout periods
mentioned above, with the goal of long-term investment, it being recommended they maintain
ownership of securities issued by the Company for a minimum period of 6 (six) months.
20.2 Other information that the Company considers relevant
The provisions of Vale’s Trading Policy are also applied when the trading of Related Persons is
carried out for their own direct and/or indirect benefit using, for example:
| • | A partnership directly or indirectly controlled by Related Persons; |
| • | Third parties who have a management, a trust or financial asset investment portfolio
management agreement with Related Persons; |
| • | Proxies or agents of Related Individuals; and |
| • | Spouses who are not legally separated, partners and any other dependant included in the
annual tax return of Related Persons. |
Related Persons must guarantee, whenever possible and if they are forbidden from trading, that the
above-mentioned natural and legal persons will also refrain themselves from trading securities
issued by the Company.
Besides the Related Parties, the Company’s Trading Policy also applies to any director who leaves
before the public disclosure of business or event initiated during his administration, and will
extend for six months thereafter.
The restrictions contained above shall not apply to transactions made by investment funds where the
Related Persons are shareholders provided that the (a) investment funds are not exclusive, and (b)
trading decisions of the administrator of the fund may not be influenced by the shareholders.
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Members of the Board, its advisory committees, the Executive Board and the Supervisory Board of
Vale must communicate in writing pursuant to Article 11 of CVM Instruction 358/02, to the Executive
Director of Investor Relations and through him to the CVM and the stock exchanges where Vale shares
are listed for trading (a) the amount of securities issued by Vale and subsidiaries or their
parent-held companies, as well as the property of his spouse,
unless it is actually or legally separated, of a partner, any dependent included in the annual
income tax and partnerships directly or indirectly controlled by them, and (b) changes in the
above-mentioned positions.
The announcement referred to in the above paragraph above shall be made (a) on the first business
day after taking office, and (b) within 5 (five) days after each trading and must contain at least
the following information (i) name and identification of the sender, indicating the registration
number in the National Registry of Legal Entities or the Roll of Individual Taxpayers if they are
domiciled for tax purposes in Brazil, (ii) quantity of each type and class, in case of shares, and
the other characteristics for other securities, as well as the identification of the issuer and the
balance of the position held before and after the negotiation, and (iii) form, price and date of
the transactions.
The Executive Director of Investor Relations, in turn, shall submit to the CVM and the stock
exchanges the information received, on an individual and consolidated basis, as the case may be,
within 10 (ten) days after the end of the month when the changes to the positions held take place,
or on the month when the taking of office takes place.
The Related Persons must sign their Declaration of Compliance, pursuant to article 16, § 1 of the
CVM Instruction 358/02, in accordance with the model contained in Annex I to the Company’s Trading
Policy, which will remain filed at Vale’s headquarters while they continue their relationship with
Vale, and at least for five years after their departure.
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21. DISCLOSURE POLICY
21.1 Rules, bylaws or procedures adopted to ensure that information to be disclosed publicly is
collected, processed and reported accurately and in a timely manner
On 07/24/2002, the Board of the Company approved the adoption of the Policy on Disclosure of
Information (“Disclosure Policy”), which applies to Vale and public companies under its control,
subject to the provisions of the Securities and Exchange Commission (“CVM”) Instruction 358/02. The
policy governs the disclosure of information which by its nature, may generate relevant events or
facts and is based on the following basic principles: (i) obedience to specific laws and the
regulations of the CVM and the U.S. Securities and Exchange Commission — SEC (“SEC”) (regulatory
agency of the United States stock market), (ii) consistency with best practices in investor
relations, and (iii) transparency and fair treatment.
The Policy applies mandatorily to Directors, members of the Board of Directors, Advisory Board and
of any bodies with technical or advisory functions for the Company and any person who, by virtue of
his office, function or position in Vale and its subsidiaries, has knowledge of information of
relevant events or facts. The Policy will be made known to the directors of the subsidiaries of
Vale.
The company has, still, an Information Disclosure Board, chaired by the Director-Chairman and
comprised of the following members: (a) Executive Director, responsible for Investor Relations; (b)
Legal Department Director; and (c) Investor Relations General Manager. The main functions of the
Information Disclosure Board are to evaluate the relevance of facts or events that have taken place
or are related to the company’s business activities and to supervise the dissemination of
information in this regard to the capital market.
21.2 Disclosure policy for relevant events or facts adopted by the issuer, indicating the
procedures for maintaining secrecy about relevant information not disclosed
In accordance with the Policy, Vale will make public, fairly and simultaneously, events or facts of
strategic, administrative, technical, business or economic nature that might affect prices of its
securities and influence investors’ decisions to keep them, buy them or sell them, or to exercise
any rights inherent to the holders of securities.
The Officers, members of the Board and the Advisory Board and any bodies with technical or advisory
capacity in Vale and all employees who have personal knowledge of relevant events or facts shall
notify the Executive Director responsible for Investor Relations.
All relevant information that is not yet public knowledge, and is disclosed, intentionally or not,
in meetings with analysts, investor seminars, interviews with journalists or any other incidental
party, should be immediately made public.
The disclosure of the event or fact must be made before or after the close of the trading sessions
of the Stock Exchanges where the shares of Vale are traded. If disclosure is mandatory during the
trading period, the Executive Director responsible for Investor Relations office will ask the Stock
Exchange to suspend trading until the complete disclosure of the information.
Access to information in Vale about events or facts, before their public disclosure, is limited to
professionals directly involved with the subject matter, until their release is timely.
The Directors, members of the Board of Directors, Advisory Board and any bodies with technical or
advisory functions in the organization and any person who, by virtue of his office, function or
position has access to information about relevant events or facts, shall maintain secrecy on that
information until public disclosure and ensure that subordinates and other people in a position of
trust to do the same, being jointly responsible with those that fail to comply. The professionals
mentioned above are also subject to the Confidentiality Agreement entered into with Vale.
Events or facts may, exceptionally, not be disclosed if the controlling shareholders or the
directors of Vale view that disclosure endangers legitimate company interests. In this case, the
administrators can refer their decision to the CVM, to keep confidential, on an exception basis,
material facts or events which the company understands presents a risk, if disclosed, to the
legitimate interests of the organization.
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Wherever management decides to maintain secrecy about information on an event or fact and this then
escapes its control, the Executive Director responsible for Investor Relations office should
disclose publicly, immediately, that information.
Also, under pertinent laws and regulations of the CVM and SEC, Vale will make its disclosures to
the capital market using the following communication channels:
| • | Publication of notices in newspapers of general circulation used by the Company; |
||
| • | Circulation of press releases, simultaneously in Portuguese and English, for the CVM
and SEC, stock exchanges, in Brazil and abroad, where Vale stocks are traded, custodian
agents, escrow agents for American Depositary Receipts ( ADRs), capital market
participants, news agencies and “wire” services, by electronic means; |
||
| • | Telephone conferences and “webcasts” held regularly every quarter for the
dissemination of results and in exceptional cases, if they become necessary. The
realization of these events will be announced in advance publicly to capital markets,
indicating the date, time and telephone numbers for connection. Such conferences and
“webcasts” will be recorded and available on the website of Vale (www.vale.com)
in the Investor Relations section, within sixty days of their completion; |
||
| • | A minimum of four (4) public meetings per year with the Brazilian Association of
Capital Market Analysts (ABAMEC), one each quarter. Vale will publicly announce in
advance the date, time and place of such events; |
||
| • | Intensive use of the Investor Relations section of the Vale site, with versions in
Portuguese and English, for the immediate availability of press releases, presentations
at meetings and conferences, operational information, corporate events, dividend payments
and securities debt issued, annual reports, quarterly and annual financial statements and
documents filed with the CVM and SEC, quotes for Vale stock traded on the Stock Exchange
of Sao Paulo and the New York Stock Exchange and answers to frequently asked questions
compiled by participants in the capital market; |
||
| • | Active participation in investor conferences held in Brazil and abroad. |
21.3 Administrators responsible for implementation, maintenance, evaluation and supervision
of the information disclosure policy
The Executive Director of Investor Relations is responsible for the dissemination of information
regarding material facts or events, although the other administrators respond jointly in cases of
non-compliance with the rules on disclosure.
21.4 Disclose other information that the issuer may deem significant
Vale’s Disclosure Committee whose main tasks are to assess the significance of events or facts
related to the Company’s business and oversee the process of disseminating information about them
to the capital market. The Disclosure Committee may eventually approve the disclosure of forecasts
for the behavior of the markets where it operates or about its own future performance, presenting
with clarity, the assumptions that support such estimates, together with the following note:
“This press release may contain statements that express management’s expectations about future
events or results. All declarations, when based on future expectations rather than on historical
facts involve various risks and uncertainties. Vale cannot guarantee that such statements will
prove correct. Such risks and uncertainties include factors: relating to the Brazilian economy and
securities markets, which exhibit volatility and can be affected by developments in other
countries; iron ore business and its dependence on the steel industry, which is cyclical in nature;
and the highly competitive industries in which Vale operates. For additional information about
factors that could cause results to differ from those predicted by the company, please consult the
reports filed with the Securities and Exchange Commission — CVM and the
U.S. Securities and Exchange Commission — SEC, including the most recent Annual Report — Form 20F —
Vale.”
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If the forecasts are not confirmed, Vale will inform the reasons for the difference in results.
Due to the listing of securities that represent shares of Vale (“HDR”) at the Hong Kong (“HKEx”),
Vale also agrees to abide by the laws of Hong Kong and to comply with the rules and regulations of
the HKEx regarding disclosure of information, including distributing “press releases” or any other
relevant information in Chinese language and to post on HKEx’s site reports or other relevant
information.
Vale shall not be held responsible for the disclosure of information about acquisition or sale, by
any unrelated parties, of the participation corresponding to five percent or more in kind or shares
of stock representing its capital or rights over those shares and any other securities issued by
Vale, under the terms of Article 12 of Instruction CVM 358.
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22. EXTRAORDINARY BUSINESS
22.1 Acquisition or disposal of any significant assets that do not belong to the normal operations
of the Company during the last 3 financial years
There was no acquisitions or disposals of any significant assets that do not belong to the normal
operations of the Company during the last 3 financial years
22.2 Significant changes in the running of the Company’s business during the last three financial
years
There were no significant changes in the running of the Company’s business during the last three
financial years
22.3 Identification of significant contracts concluded by the Company and its subsidiaries which are
not directly connected to its operations and that took place in the last three financial years.
There were no significant contracts executed by the Company and/or its subsidiaries with third
parties, nor directly connected to its operations in the last three financial years.
22.4 Other information that the Company deems relevant
There is no other relevant information for this item “22”
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Vale S.A. (Registrant) |
||||||
| By: | /s/ Roberto Castello Branco
|
|||||
Date: May 31, 2011
|
Roberto Castello Branco | |||||
| Director of Investor Relations | ||||||
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