ALPARGATAS S.A.
Corporate Taxpayer’s ID (CNPJ/MF): 61.079.117/0001-05
Company Registry (NIRE): 35 3000 25 270
Publicly-Held Company.
Extract from the Minutes of the Board of Directors' Meeting held on March 10, 2017,
at 09:00 a.m.
Minutes of the Board of Directors’ Meeting, held at the Company’s headquarters at
Avenida Doutor Cardoso de Melo, 1.336 - 14° andar, Vila Olímpia, in the City of São
Paulo, State of São Paulo, with the attendance of the following members: Vincent Trius,
Joesley Mendonça Batista, Wesley Mendonça Batista, Tarek Mohamed Noshy Nasr
Mohamed Farahat, Silvio Tini de Araújo and João José Oliveira de Araújo, and the
attendance of the members of the Fiscal Council: Demetrius Nichele Macei, Florisvaldo
Caetano de Oliveira, Carlos A. Reis de Athayde Fernandes and Fabio Gallo Garcia, to
discuss the following:
I – APPROVAL OF THE MANAGEMENT REPORT AND THE FINANCIAL
STATEMENTS FOR 2016: After a favorable opinion was expressed by the members of
the Fiscal Council, the members of the Board of Directors approved the Management
Report and the Financial Statements for the fiscal year ended December 31, 2016 and the
Independent Auditors’ Report referred to the same year was analyzed, as well as
documents to be submitted for approval at the Annual Shareholders’ Meeting.
II – APPROVAL OF ALLOCATION OF NET INCOME FOR THE 2016 FISCAL
YEAR: Net income for the fiscal year ended December 31, 2016 totaled
R$361,566,929.11 (three hundred and sixty-one million, five hundred and sixty-six
thousand, nine hundred and twenty-nine reais and eleven centavos). After a favorable
opinion was expressed by the members of the Fiscal Council, the members of the Board of
Director approved the following net income allocation, to be submitted for approval for
approval at the next Annual Shareholders’ Meeting:
(i) R$18,078,346.46 (eighteen million, seventy-eight thousand, three hundred and forty-six
reais and forty-six centavos) to be allocated to the legal reserve;
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(ii) R$181,734,149.67 (one hundred and eighty-one million, seven hundred and thirty-four
thousand, one hundred and forty-nine reais and sixty-seven centavos) to be allocated to the
tax incentive reserve;
(iii) R$132,600,000.00 (one hundred and thirty-two million and six hundred thousand
reais) to be allocated to the distribution of interest on equity, subject to approval by the
2017 Annual Shareholders’ Meeting, in the amount of R$0.2732905712 per common share
and R$0.3006196283 per preferred share. Said interest on equity arises from the net
income for the 2016 fiscal year, subject to Income Tax, in accordance with the current
legislation, and applies to all registered book-entry shares composing the Company’s
capital stock, excluding shares held in treasury. The first resolution, in the amount of
R$21,300,000.00 (twenty-one million and three hundred thousand reais) was paid on April
13, 2016 to shareholders registered on March 11, 2016; the second resolution, in the
amount of R$17,600,000.00 (seventeen million and six hundred thousand reais) was paid
on July 13, 2016 to shareholders registered on May 13, 2016; the third resolution, in the
amount of R$31,900,000.00 (thirty-one million and nine hundred thousand reais) was paid
on October 5, 2016 to shareholders registered on August 12, 2016; and the fourth
resolution, in the amount of R$61,800,000.00 (sixty-one million and eight hundred
thousand reais) was paid on December 14, 2016 to shareholders registered on November
11, 2016; and
(iv) R$29,154,432.98 (twenty-nine million, one hundred and fifty-four thousand, four
hundred and thirty-two reais and ninety-eight centavos) to be allocated to the investment
reserve in order to fund new investments and strengthen the Company’s working capital.
III – CAPITAL BUDGET FOR 2017: After a favorable opinion was expressed by
members of the Fiscal Council, the Board of Directors approved the Capital Budget for
2017, in the amount of R$168,868,513.69 (one hundred and sixty-eight million, eight
hundred and sixty-eight thousand, five hundred and thirteen reais and sixty-nine centavos)
for investments in the industrial area, purchase of machinery, information technology,
security, environment and other projects. It also approved the submission of the Capital
Budget for approval at the Annual Shareholders’ Meeting.
IV – BOARD OF DIRECTORS’ PROPOSAL TO BE SUBMITTED TO THE
ANNUAL SHAREHOLDERS’S MEETING: As a result of the resolutions taken, the
Board members decided to submit the following matters for approval at the Annual
Shareholders’ Meeting:
1. Examination, discussion and vote on the Management’s Report and the Financial
Statements accompanied by the Independent Auditors’ Report for the fiscal year ended
December 31, 2016;
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2. Approval of the proposals for the capital budget for 2017 and the net income allocation
for the fiscal year ended December 31, 2016, pursuant to the Management proposal
recorded in the Financial Statements, including the ratification of the distributions of
interest on equity, as resolved by the Board of Directors, subject to approval by the
Annual Shareholders’ Meeting;
3. Election of the Members of the Fiscal Council; and
4. Definition of the Board of Executive Officers’ overall annual compensation.
V – CALL NOTICE OF THE ANNUAL SHAREHOLDERS’ MEETINGS: The Board
members decided to convene the Annual Shareholders’ Meetings on April 19, 2017, at
10:00 a.m., at a venue to be indicated in the Call Notice. The Board members unanimously
decided to approve the matters put to vote, authorizing the Board of Directors’ proposal to
be published and presented to the Shareholders’ Meetings. All the Company’s departments
involved in these resolutions are hereby authorized to take any and all necessary measures
to implement them.
VI – PAYMENT OF INTEREST ON EQUITY SUBJECT TO APPROVAL AT THE
2018 ANNUAL SHAREHOLDERS’ MEETING: The Board of Directors approved the
distribution of interest on equity, as remuneration, pursuant to the applicable legal and
statutory provisions, subject to withholding Income Tax for individuals and legal entities,
in accordance with current legislation. The benefit covers all 470,449,777 book-entry
shares composing the Company’s capital stock, excluding shares held in treasury. The
gross amount is R$38,200,000.00 (thirty-eight million and two hundred thousand reais),
R$0.0787307679 per common share and R$0.0866038447 per preferred share. The
shareholders registered on March 17, 2017 are entitled to receive the interest on equity, and
the shares will be traded "ex-right" to interest on equity as of March 20, 2017. The
payment will be made on April 12, 2017 by Banco Itaú S.A. This amount shall be
attributed to the annual mandatory dividend to be approved at the 2018 Annual
Shareholders' Meeting.
This is a free English translation of the original minutes drawn up in the Company’s
records.
São Paulo, March 10, 2017.
Vincent Trius
Chairman of the Board of Directors
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