WEG S.A.
Reference Form 2011
(A free translation of the original issued in Portuguese)
Reference Form - 2011 - WEG SA
Version : 1
Contents
1. Person in charge of the form
1.1
Statement and identification of people responsible for the form ....................... 1
2. Independent Auditors
2.1/2.2 Identification and Remuneration of Auditors ...................................................... 2
2.3
Other relevant information .................................................................................... 3
3. Selected financial information
3.1
Financial information - Consolidated ................................................................... 4
3.2
Non-GAAP financial measures ............................................................................ 5
3.3
Event subsequent to the latest year-end financial statements .......................... 6
3.4
Policy on allocation of net income........................................................................ 7
3.5
Distribution of dividends and retention of net income ........................................ 8
3.6
Declaration of dividends in the account of retained earnings or reserves........ 9
3.7
Level of indebtedness ...........................................................................................10
3.8
Obligations according to the nature and maturity date ......................................11
3.9
Other relevant information ....................................................................................12
4. Risk Factors
4.1
Description of risk factors .....................................................................................13
4.2
Comments on the expectations in changes in the exposure to risk factors .....21
4.3
Relevant Non-confidential judicial, administrative or arbitral proceedings ....22
4.4
Legal, administrative or arbitral proceedings not subject to confidentiality to
which the opposing parties are the issuer’s or its subsidiaries’ officers
or former officers, controllers or former controllers or investors........................25
4.5
Relevant confidential suits ....................................................................................26
4.6
Legal, administrative or arbitration proceedings, based on similar facts and
legal grounds, which are not subject to confidentiality and relevant jointly .....27
4.7
Other relevant contingencies................................................................................28
4.8
Regulations in country of origin and of the custodian country of the
securities ................................................................................................................29
Reference Form - 2011 - WEG SA
Version : 1
Contents
5. Market risk
5.1
Description of main market risks ..........................................................................30
5.2
Description of market risk management policy ...................................................31
5.3
Significant changes in the main market risks ......................................................33
5.4
Other relevant information ....................................................................................34
6. History of the Issuer
6.1/6.2/6.4 Establishment of the issuer, period of duration and date of CVM
registration .............................................................................................................35
6.3
Brief history of the Company ................................................................................36
6.5
Major corporate events in the issuer, controller or affiliates ..............................38
6.6
Filings for bankruptcy based on significant amounts and filings for
in-court or out-of-court reorganizations ...............................................................41
6.7
Other relevant information ....................................................................................42
7. Issuer’s Activities
7.1
Description of the activities of the issuer and its subsidiaries ...........................43
7.2
Information on operational segments ..................................................................47
7.3
Information over products and services relative to the operational
segments ................................................................................................................52
7.4
Clients responsible for more than 10% of total net revenue ..............................61
7.5
Relevant effects on the statutory regulation of activities....................................62
7.6
Relevant Foreign Revenues .................................................................................65
7.7
Effects of foreign regulations on the Company’s activities ................................66
7.8
Relevant long-term relations ................................................................................67
7.9
Other relevant information ....................................................................................68
8. Economic Group
8.1
Economic Groups - Description ...........................................................................69
8.2
Organizational Chart .............................................................................................71
8.3
Restructuring operations.......................................................................................72
8.4
Other relevant information ....................................................................................75
Reference Form - 2011 - WEG SA
Version : 1
Contents
9. Relevant Assets
9.1
Relevant Non-Current assets - Others ................................................................76
9.1
Relevant Non-Current Assets / 9.1.a – Fixed Assets.........................................77
9.1
Relevant non-current assets / 9.1.b – Patents, brands, licenses, grants,
franchises and technology transfer contracts .....................................................78
9.1
Relevant non-current assets / 9.1.c - 9.1.c - Shareholdings .............................79
9.2
Other relevant information ....................................................................................86
10. Management’s Comments
10.1
General financial and equity conditions...............................................................87
10.2
Financial and Operating Results ..........................................................................95
10.3
Events with relevant effects, which occurred and were expected in the
financial statements ..............................................................................................98
10.4
Significant effects from changes in accounting practices – Qualifications
and emphasis of matter paragraphs in the auditor’s report ........................... 101
10.5
Critical accounting policies ................................................................................ 104
10.6
Internal controls over preparation of financial statements - Degree of
effectiveness and deficiencies and recommendations included in the
independent auditor’s report.............................................................................. 112
10.7
Allocation of funds from public offerings of securities and diversion
thereof, if any ...................................................................................................... 113
10.8
Relevant items not disclosed in the financial statements ............................... 114
10.9
Comments on items not disclosed in the financial statements ....................... 115
10.10 Business plan ..................................................................................................... 116
10.11 Other factors having a material influence......................................................... 119
11. Forecasts
11.1
Forecasts and assumptions disclosed.............................................................. 120
11.2
Follow-up and changes to the forecasts disclosed.......................................... 121
12. General Meetings and Management
12.1
Follow-up and changes to the forecasts disclosed.......................................... 122
12.2
Rules, policies and practices relating to general meetings............................. 127
12.3
Dates and newspapers of publication of information required by
Law No. 6404/76 ................................................................................................ 129
12.4
Rules, policies and practices relating to the Board of Directors..................... 130
12.5
Description of arbitration clause for resolution of conflicts ............................. 131
Reference Form - 2011 - WEG SA
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Contents
12.6
/8 - Composition and professional experience of the issuer’s
management and supervisory board ................................................................ 132
12.7
Composition of corporate committees and audit, financial and
remuneration committees ................................................................................. 148
12.9
Existence of any marital relationship, common law marriage or kinship
up to the second degree related to the officers of the issuer, subsidiaries
and controlling shareholder ............................................................................... 149
12.10 Relationships involving subordination, service delivery or control between
officers and subsidiaries, controlling shareholders and others ...................... 150
12.11 Any agreements, including insurance policies, which provide for the
payment or reimbursement of expenses incurred by the officers .................. 151
12.12 Other relevant information ................................................................................. 152
13. Management’s Compensation
13.1
Description of compensation policies and practices, including non-statutory
board members .................................................................................................. 161
13.2
Total Compensation of the board of directors, officers and fiscal council .... 163
13.3
Variable compensation of the Board of Directors, Executive Board and
Supervisory Board .............................................................................................. 166
13.4
Stock-based compensation plan of the Board of Directors and Executive
13.5
Board ................................................................................................................... 167
Stakes in shares, units of interest and other convertible securities held by
members of the Board of Directors, Executive Board and Supervisory
Board - by body .................................................................................................. 168
13.6
Stock-based compensation of board of directors and executive board......... 169
13.7
Information on options outstanding held by the Board of Directors and
Executive Board ................................................................................................. 170
13.8
Options exercised and options granted related to stock-based
compensation of the Board of Directors and Executive Board ....................... 171
13.9
Information required to understand the data disclosed in items
13.6 to 13.8 - Stock and option pricing method ............................................... 172
13.10 Existing pension plans offered to members of the Board of Directors and
Executive Board ................................................................................................. 173
13.11 Highest, lowest and average individual compensation paid to the Board of
Directors, Executive Board and Supervisory Board ........................................ 174
13.12 Mechanisms involving compensation or termination benefits for directors
or officers in case of removal from office or retirement ................................... 175
13.13 Percentage rate of total compensation held by members of the Board of
Directors, the Executive Board or the Supervisory Board who are related
parties to controlling shareholders .................................................................... 176
Reference Form - 2011 - WEG SA
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Contents
13.14 Compensation paid to the members of the Board of Directors, the
Executive Board and the Supervisory Board grouped per body, for any
reason other than the office held by them ........................................................ 177
13.15 Compensation paid to the members of the Company’s Board of Directors,
the Executive Board and the Supervisory Board recognized in the
statement of income of direct or indirect controlling shareholders, of
companies under common control, and of the issuer’s subsidiaries ............. 178
13.16 Other relevant information ................................................................................. 182
14. Human resources
14.1
Human Resources.............................................................................................. 183
14.2
Comments on material changes - Human resources...................................... 184
14.3
Description of the issuer’s employee compensation policies ......................... 185
14.4
Description of the relationships between the issuer and unions .................... 186
15. Control
15.1/15.2 - Shareholding structure ............................................................................... 188
15.3
Capital distribution .............................................................................................. 238
15.4
Shareholders organization chart ....................................................................... 239
15.5
Shareholders’ agreements, duly filed at registered office of the issuer or
to which the controlling shareholder is a party................................................. 240
15.6
Significant changes to interests held by the members of the group of
controlling shareholders and by the issuer’s directors and officers ............... 241
15.7
Other relevant information ................................................................................. 242
16. Transactions with Related Parties
16.1
Description of the issuer’s rules, policies and practices regarding
transactions with related parties........................................................................ 243
16.2
Information about transactions with related parties ......................................... 244
16.3
Identification of the measures adopted to address conflicts of interest
and that the transaction was carried out at arm’s length or was adequately
compensated ...................................................................................................... 246
Reference Form - 2011 - WEG SA
Version : 1
Contents
17. Capital stock
17.1
Information on Capital Stock ............................................................................. 247
17.2
Capital Stock Increases ..................................................................................... 248
17.3
Information on share split, grouping and dividends ......................................... 249
17.4
Information on reduction of capital stock.......................................................... 250
17.5
Other relevant information ................................................................................. 251
18. Securities
18.1
Share rights......................................................................................................... 252
18.2
Description of possible statutory regulations which significantly limit the
shareholders’ right to vote or which forces them to carry out a public
offering................................................................................................................. 253
18.3
Description of exceptions and conditional clauses relative to equity or
political rights provided for in the bylaws .......................................................... 254
18.4
Trade volume and higher and lower quotes of the negotiated securities ...... 255
18.5
Description of other securities issued ............................................................... 256
18.6
Brazilian markets in which securities are accepted for negotiation ............... 257
18.7
Information on the class and species of security admitted for trade in
foreign markets ................................................................................................... 258
18.8
Public offerings carried out by issuer or third parties, including controlling
shareholders affiliated companies and subsidiaries, regarding securities
of the issuer ........................................................................................................ 259
18.9
Description of public acquisition offers made by the issuer regarding
shares issued by third parties............................................................................ 260
18.10 Other relevant information ................................................................................. 261
19. Buyback Programs/ Treasury
19.1
Information on repurchase plans for shares of the issuer............................... 262
19.2
Transactions of securities held in treasury ....................................................... 263
19.3
Information regarding securities held in treasury on the closing date of
the last fiscal year social .................................................................................... 264
19.4
Other relevant information ................................................................................. 265
20. Negotiation Policy
20.1
Information on the negotiation policy of securities .......................................... 266
20.2
Other relevant information ................................................................................. 267
Reference Form - 2011 - WEG SA
Version : 1
Contents
21. Disclosure Policy
21.1
Description of norms, by-laws or internal procedures regarding the
disclosure of information .................................................................................... 268
21.2
Description of disclosure policy of material fact or event and of the
procedures relative to the maintenance of secrecy regarding the relevant
information which has not been disclosed ....................................................... 282
21.3
Administrators responsible for implementing, maintaining, evaluating and
overseeing disclosure of information ................................................................ 283
21.4
Other relevant information ................................................................................. 284
22. Extraordinary Negotiations
22.1
Purchase or sale of any relevant asset which does not fit the normal
operations of the issuer...................................................................................... 285
22.2
Significant changes in the issuer’s manner of conducting business .............. 286
22.3
Relevant contracts signed by the issuer and its subsidiaries, not directly
connected to its operational activities ............................................................... 287
22.4
Other relevant information ................................................................................. 288
Reference Form - 2011 - WEG SA
1.1
Version : 1
IDENTIFICATION OF THE PERSONS RESPONSIBLE FOR THE
CONTENT OF THIS FORM
Name of person in charge for the content of this form
Harry Schmelze r Junior
Position of person in charge
Chief Executive Officer - CEO
Name of person in charge for the conte nt of this form
Laurence Beltrão Gomes
Position of responsible pe rson
Investor Relations Officer - IRO
The officers qualified above, declare that:
1
•
they have reviewed this Reference Form;
•
all the information included herein complies with the terms of CVM
Instruction No. 480, of December 7, 2009, especially its articles 14 to 19;
and
•
this set of information represents a true, accurate and complete view of the
Company’s economic and financial condition, the risks underlying its
activities and the securities issued thereby.
Reference Form - 2011 - WEG SA
Version : 1
2.1/2.2 Identification and remuneration of the Auditors
Does the Company have an auditor?
YES
CVM Code
Type of auditor
Nome/Corporate Name
CPF/CNPJ
Pe riod in which the services were provided
Description of engaged services
Total amount of fees of the independent auditors,
separated per services
471-5
National
Ernst & Young Terco Auditores Independentes S.S
61.366.936/0010-16
March 30, 2010
Audit of the Financial Statements
The total fees paid to Ernst & Young Terco Auditores Independentes S.S. was R$ 794,363.39, Relative to the following
Services rendered in 2010:
1. Audit of the 2010 Financial Statements - R$ 392,500.00;
2. Consulting service in the definition project and review of the profiles in the ERP system – R$ 269,183.72;
3. Due diligence over company acquisitions - R$ 96,079.67;
4. Tax consulting regarding windpower - R$ 22,000.00.
5. Free translation into English of the standard financial statement forms (SFS) and quarterly information (ITR) 2010 –
R$ 14,600.00
None
Substitution justification
Reason presented by the auditor in case of
disagreement with the justification of the issuer
None
Name of technician in charge
Period of
se rv ice rendering
CPF
MARCOS ANTONIO QUINTANILHA
March 30, 2010
006.840.298-80
2
Address
R. Dr. Amadeu da Luz, 100, Centro, Blumenau, SC, Brasil, CEP
89010-160, Phone (047) 21237300
Reference Form - 2011 - WEG SA
2.3
Version : 1
Other relevant information
When engaging external audit services, the Company seeks to maintain the
independence of the external auditors. Thus we seek to eliminate any possible conflict
of real or inferred interests.
3
Reference Form - 2011 - WEG SA
3.1
Version : 1
Financial information - Consolidated
Fiscal year (31/12/2010)
Fiscal year (31/12/2009)
Fiscal Year (31/12/2008)
Net equity
3,454,607,000.00
3,299,739,000.00
0.00
Total assets
7,511,164,000.00
6,583,066,000.00
0.00
Net rev./Fin. Interm.
4,391,973,000.00
4,210,620,000.00
0.00
1,386,952,000.00
1,356,401,000.00
0.00
519,782,000.00
550,543,000.00
0.00
620,905,029
620,905,029
0
5.560000
5.310000
0.000000
0.840000
0.890000
0,000000
(Brazilian re ais)
Rev./Insurance premium profit
Gross results
Net results
Number of shares, Ex-Treasury
(Units)
Share equity value (Reais
Unit)
Net result per share
4
Reference Form - 2011 - WEG SA
3.2
Version : 1
Non-GAAP financial measures
In case the issuer disclosed in the last fiscal year or wishes to disclose in
this form non-GAAP financial measures, such as Ebitda (earnings before
income tax, depreciation and amortization) or Ebit (earnings before
interest and income tax), the issuer must:
a) Inform the value of non-GAAP financial measures
The company presents calculated EBITDA according to that established by
the Official Letter CVM/SNC/SEP No. 01/2007. The values are stated in the
following table:
b) To reconcile disclosed values and values registered in the audited
financial statements.
(=) Gross Operational Income
(-) Selling Expenses
(-) General and Administrative Expenses
(-) Profit sharing
(+) Depreciation/Amortization
(=)EBITDA
Dec. 31, 2010
1,386,952
(434,249)
(262,724)
(84,859)
183,990
789,110
In R$ Thousands
Dec. 31, 2009
1,356,401
(408.179)
(225.288)
(76.640)
191,130
837,424
c) Explain why this measurement is more appropriate for a correct
understanding of the Company’s financial position and results of
operations.
The Company believes that EBITDA represents supplementary information
that may, in some cases, help more thoroughly understand its financial and
economic condition. EBITDA is traditionally used by financial analysts as a
rough measure, yet imperfect, of an entity’s ability to generate cash. The
Company does not recommend that EBITDA be used separately from other
information included in its financial statements, nor does it believe that
EBITDA is, in itself the most appropriate measure to understand its financial
position and the results of its operations.
5
Reference Form - 2011 - WEG SA
3.3
Version : 1
Event subsequent to the latest year-end financial statements
Authorization to prepare the individual and consolidated financial statements
was given at the Board Meeting held on February 1, 2011, and no event
subsequent to this date was identified that should have been informed.
6
Reference Form - 2011 - WEG SA
3.4
Version : 1
Policy on allocation of net income
a) Rules on retained earnings.
According to the Company’s bylaws, after the deductions established in
article 189 of the Brazilian Corporate Law and after the deduction, limited to
10% (ten percent) of net income, of management profit sharing (article 190
of Corporate Law), net income for the year will be allocated as follows:
(i) 5% (five percent) to the legal reserve, not exceeding 20% (twenty
percent) of total capital;
(ii) an amount, when necessary and properly justified by management, to
the provision for contingencies and to the unrealized earnings reserve,
as legally determined;
(iii) Retained earnings, when properly justified by management, to finance
the capital budget approved by the General Meeting and reviewed
annually;
(iv) any balance remaining after the above deductions shall be distributed to
the shareholders in the form of dividends.
b) Rules on dividend distribution
In accordance with article 38 of the Company’s bylaws, a minimum 25%
(twenty five percent) of net income adjusted pursuant to article 202 of the
Corporate Law will be distributed as dividends and / or interest on equity, in
compliance with Law No. 9249/95, allocated to dividends.
c) Periodicity of dividend distribution.
It is Company policy to declare interest on equity on a quarterly basis and
dividends on a half-yearly basis, with half year payments.
d) Any dividend distribution limitations imposed by law or special
regulations applying to the issuer, or otherwise prescribed by contract
or by administrative, judicial or arbitral decisions
Not Applicable.
7
Reference Form - 2011 - WEG SA
3.5
Version : 1
Distribution of dividends and retention of net income
(Reais)
Fiscal Year 31/12/2010
Fiscal Year 31/12/2009
Adjusted net income
Dividends distributed regarding adjusted
ne t income
519,782,000.00
548,392,000.00
58.950000
54.710000
Re turn rate regarding issuers ne t equity
Total distributed dividends
15.050000
306,434,894.00
16.680000
300,039,361.36
Re tained earnings
Date of approval of withholding
239,967,000.00
26/04/2011
223,412,000.00
27/04/2010
Withheld Net Profit
Amount
Payment of
Dividends
Amount
Payment of
Dividends
Mandatory Dividends
Common
66,436,838.11
Common
Common
101,207,520.00
11/08/2010 127,285,531.00
10/03/2010
16/03/2011
71,027,075.00
12/08/2009
12/08/2009
Interest on Equity
Common
31,410,489.70
11/08/2010 29,064,787.25
Common
36,523,825.23
Common
36,523,825.23
11/08/2010
16/03/2011
Common
34,332,395.73
16/03/2011
Common
10,899,295.21
10/03/2010
Common
32,697,885.65
12/08/2009
Common
29,064,787.25
10/03/2010
8
Fiscal Year 31/12/2008
Amount
Payment of Dividends
Reference Form - 2011 - WEG SA
3.6
Declaration of dividends in the account of retained earnings or
reserves
N/A
9
Version : 1
Reference Form - 2011 - WEG SA
3.7
10
Version : 1
Level of Indebtedness
Fiscal Year
Amount of debt, of any nature
Type of index
31/12/2010
3,967,328,000.00
Level of indebtedness
Index of debt Description and reason for the use of another índex
1,12000000
Reference Form - 2011 - WEG SA
3.8
Version : 1
Obligations according to the nature and maturity date
Fiscal Year (31/12/2010)
Type of debt
Actual guarantee
Documented
guarantees
Total
Observation
Less than one year
One to three years
Over Five years
Total
5,340,000.00
16,204,000.00
1,496,000.00
0.00
23,040,000.00
1,933,463,000.00
1,838,399,000.00
138,043,000.00
34,383,000.00
3,944,288,000.00
1,938,803,000.00
1,854,603,000.00
139,539,000.00
34,383,000.00
3,967,328,000.00
The information herein is relative to the consolidated financial statements
11
Three to Five years
Reference Form - 2011 - WEG SA
3.9
Version : 1
Other relevant information
In 2010, the Company adopted the international financial reporting Standards in
the preparation of its financial statements, according to the norms issued by
CVM.
Therefore, the Company chose to use the exceptional possibility provided for
2011 Reference form of not filling out the columns regarding fiscal 2008 of item
3.1 above, as the information cannot be compared.
12
Reference Form - 2011 - WEG SA
4.1
Version : 1
Description of Risk Factors
a) To the Issuer
Being a holding company may limit our dividend paying ability.
Being purely a holding company, our assets are represented only by the
shares issued by our subsidiaries, as well as by funds invested in shortterm investments. We do not perform operating activities, and all of our
revenues virtually derive from our subsidiaries. Consequently, our dividend
paying ability depends primarily on receiving dividends and other cash
flows from our subsidiaries. Our corporate structure and our subsidiaries’
consistent history record of income generation contribute to mitigating this
risk.
We may not be able to implement our growth strategy, including
organic growth or through acquisitions.
Throughout our history, WEG has consistently increased revenues and
other operating results. This growth is based both on the geographic
expansion of our operations and on the continuous introduction of new
products to our existing lines. We intend to continue expanding our
activities not only in the segments and industries where we operate but also
by tapping into market growth opportunities not yet exploited.
However, we may not be able to achieve future growth rates similar to
those obtained in the past. The operational results in recent years or
periods are not a guarantee or an indication of our future performance.
Moreover, deploying our business strategies and achieving of our goals
depend on circumstances that may or may not exist regardless, in part, of
our efforts. If we are unable to grow at a satisfactory pace, our financial
results could be adversely impacted.
The growth of our business has required in the past and will continue to
require in the future substantial investments in internal control systems and
in the expansion and adjustment of our administrative, technical,
operational and financial resources. This continuous business growth and
expansion into new markets will require new investments, as well as
adjustments to our resources, and, thus, depend substantially on our ability
to implement and manage the expansion of these resources. If we are
unable to manage the expansion of these resources or fail to succeed in
developing new projects and ventures and in our management, our
operating results may be adversely impacted.
Our exposure to the Brazilian market of electrical and electronic
equipment may limit our future growth.
We believe we are leaders in the Brazilian industry of electric motors, with
our market share exceeding 80% in some segments. This leading position
makes it difficult for us to increase our sales by increasing our market share
and makes the increase of our sales in the Brazilian market to depend on:
13
Reference Form - 2011 - WEG SA
4.1
Version : 1
Description of Risk Factors
•
•
•
The growth of national economy, which increases the market demand
for our products and services;
Entering new segments of similar businesses;
Developing new products, which largely depends on the success of our
research and development program.
One or several of these factors may evolve to adversely impact our future
growth and, consequently, adversely affect our ability to generate revenues
and operating results.
Our expansion strategy in the international market depends on the
infrastructure and environment for the development of foreign trade.
To continue growing, we must win markets with product lines for segments
where our share is low, which requires:
• Exchange rates to be at levels that favor exports;
• Governments to invest in infrastructure, enabling Brazilian exports to
grow and flow;
• Ability to face competition in international markets and to win new
clients in these markets; and
The absence of non-tariff barriers and import restrictions in countries to
which we export or will export our products
One or several of these factors may evolve to adversely impact our future
growth and, consequently, adversely affect our ability to generate revenues
and operating results.
Our future results may be impacted by changes in the world’s
economic scenario.
For the years ended December 31, 2008, 2009 and 2010, 35%, 34% and
34%, respectively, of our gross operating revenues derived from
international sales. Because of this, and considering our internationalization
strategy, our revenues depend not only on the performance of the Brazilian
economy but also on the economic performance of other countries where
we operate and which represent important markets for our products. Thus,
for instance, any economic downturn in North America or Europe, markets
that accounted for 35% and 24% of our gross operating revenues for the
year ended December 31, 2010, may cause the demand for our products to
drop in these markets and adversely affect us.
14
Reference Form - 2011 - WEG SA
4.1
Version : 1
Description of Risk Factors
Current operations and expansion of our international subsidiaries
involve special challenges that we may not overcome. Our failure to
meet these challenges could adversely affect us.
We have international subsidiaries and intend to continue expanding our
international operations. We face certain risks related to business in
international markets, as follows:
•
•
•
•
•
•
Extensive regulations and oversight, tariffs and other trade barriers;
Reduced intellectual property protection;
Difficulties in implementing controls and procedures for preparing
financial reports and statements;
Hiring employees and managers from our foreign operations;
Potential adverse tax consequences; and
Limitations on foreign remittances of funds, including remittance of
dividends.
Additionally, we must adapt to and comply with laws and regulations of
foreign governments and regulatory authorities in each country where we
may wish to do business. We cannot ensure that we will succeed in
marketing our products in international markets. We may also face
difficulties in managing our international operations due to, among other
things, adverse competitive conditions, foreign risk management,
emergence of new competitors in a domestic market, cultural and language
differences, and political and economic instability. Any of these factors may
adversely affect us.
We are subject to risks arising from our concentrated activities in
Jaraguá do Sul (Santa Catarina state, or SC).
Our operating activities are concentrated in the city of Jaraguá do Sul (SC),
which hosts our principal manufacturing facilities and research and product
development labs. Should any natural disaster, operational errors, strikes,
damage to property and equipment or environmental damages occur in
Jaraguá do Sul, our production lines could be interrupted. We have other
plants both in Brazil and abroad that could, if necessary, partially and
temporarily meet production requirements to meet the demand for products.
The interruption of production in Jaraguá do Sul may adversely affect us,
even if it is offset by other units.
Losses or other liabilities not covered by our insurance policies may
result in additional costs in our operations.
We have insurance policies of different types, whether or not required by
law, such as insurance covering third party liability and property damage.
The occurrence of losses or other liabilities that may not be covered by
such policies or that exceed the sums insured therein may result in
unexpected additional costs, and this could adversely affect us.
15
Reference Form - 2011 - WEG SA
4.1
Version : 1
Description of Risk Factors
We are subject to risks related to the use of our products.
Our business exposes us to potential liability risks related to damage to
third parties (civil liability for personal injury and property damage) and
indirect damages (loss of profits) arising from any failures in our products.
For illustration purposes, our high-voltage electric motors are used on
offshore oil rigs and in the production lines of large steel companies. Our
low-voltage electric motors, in turn, are used by major manufacturers of
consumer durables as components for the manufacture of household
appliances in general. A failure in the operation of any of these motors may
result in losses to our clients or to those acquiring the appliances, and
trigger the corresponding obligation to pay for the damages caused, if it is
determined that we are responsible for the original malfunction.
In addition to incurring expenses normally arising from damages, settlement
agreements or defense costs, we may also be exposed to damages to our
image as a result of civil liability claims.
We have a Product Liability insurance policy that covers direct damages
(personal injury and property damage) caused to third parties. We cannot
guarantee that this insurance coverage will be sufficient to protect us from
losses arising from civil liability, replacement of products and other
complaints.
Additionally, we established a provision for product warranty arising from
manufacturing defects for a definite period of time (warranty period), based
on historical occurrences, but it may not be sufficient to cover all expenses
incurred with these events.
We cannot ensure that civil liability claims or losses caused by faulty
products or that a number of complaints brought against us will not have an
adverse indirect impact on us, such as for example, loss of market share.
Our operating segment is subject to risks related to logistics and
transportation structure in Brazil.
The Brazilian transportation infrastructure has been facing several
problems, including, but not limited to, saturation, lack of investments in the
expansion and modernization of port and airport infrastructure, high cost of
specialized workforce, high tax burden on such operations, and the poor
state of repair of roads and vehicle fleets. In addition, the constant strikes
and lockouts of civil servants and private entities linked to the transportation
segment represent obstacles to be overcome by national producers and
exporters.
16
Reference Form - 2011 - WEG SA
4.1
Version : 1
Description of Risk Factors
Most of our clients are located far from our production and distribution
centers. In order to get our products delivered to our national and
international clients, we use Brazilian highways and ports. We export our
products through such ports as São Francisco do Sul and Itajaí (both in
Santa Catarina state, or SC), which are located respectively 60 km and 90
km away from our main manufacturing plant in Jaraguá do Sul (SC).
These and other factors related to the Brazilian transport infrastructure may
impact our ability to distribute our production, and adversely affect our
operating results and financial position.
b) The issuer’s direct or indirect controlling persons or group
We are indirectly controlled by a group of persons linked to the
Company’s founders, whose interests may prevail over the interests
of other shareholders.
At December 31, 2010, 51% of our capital was owned by WEG
Participações e Serviços S.A., which, in turn, is controlled by the founders
of the WEG Group and their families. Thus, these people have sufficient
powers to approve or reject matters that, whether required by law or our
bylaws, must be submitted for the shareholders’ consideration, including:
•
•
•
•
election and removal of most members of the board;
policy on dividend distribution;
establishment of business guidelines and strategies; and
approval of mergers, spin-offs, acquisitions and divestitures or carveouts.
In June 2007, the Company joined the “Novo Mercado” (New Market), a
special market segment of BM&F Bovespa (São Paulo Stock Exchange)
that sets standards and procedures for corporate governance and
protection of minority shareholders. As part of the Novo Mercado, the
controlling shareholders have limited capacity to approve certain matters.
Nonetheless, we cannot ensure that the interests of the controlling
shareholders will converge with those of the minority shareholders.
c) The issuer’s shareholders
Our shares have low liquidity in the secondary market, which may
hinder their sale and reduce their price.
Currently, the market for trading the shares issued by WEG has limited
liquidity. We cannot ensure that this market will develop to be sufficiently
active and liquid in the future. Thus, investors may face difficulties in trading
these shares or be forced to trade them for different prices than those that
could be obtained in more liquid markets.
17
Reference Form - 2011 - WEG SA
4.1
Version : 1
Description of Risk Factors
The somewhat volatile and illiquid Brazilian securities market may
substantially limit investors’ ability to trade shares for the price and at
the time they want.
Investing in securities traded in emerging markets such as Brazil often
involves higher risks as compared to other global markets, and these
investments are generally considered more speculative in nature. The
Brazilian securities market is substantially smaller, less liquid, more
concentrated and can be more volatile than major securities markets
worldwide. There is also a significantly greater concentration in the
Brazilian securities market as compared to the major securities markets in
the United States, for example. These factors may limit the ability of
investors to trade shares for the price and at the time they want.
d) The issuer’s subsidiaries and affiliates
The risks relating to our subsidiaries are the same as those relating to the
Company
e) The issuer’s suppliers
The change in the price of commodities used by the machinery and
equipment industry in international markets may affect the sales of
the industry as a whole as well as our sales in particular.
The main raw materials used by the machinery and equipment industry are
international commodities such as copper and steel plate, with the price of
many of these commodities being pegged to the U.S. dollar and thus
subject to price fluctuations in international markets, even indirectly. These
commodities may represent as much as 40% of the final cost of some of
our products. If the price of these commodities substantially increases in
the future, we may not be able to pass such cost increases on to our
customers at competitive prices, and a passed-on price increase may
reduce our sales volume and therefore our profit margin, which may
adversely affect us.
f)
The issuer’s clients
We do not envisage risks relating to the Company’s clients
g) The economic segments in which the issuer operates
Increased competition in the sector in which we operate may
adversely affect us.
We operate in highly competitive markets. Our main competitors are
international groups with global presence, technological capacity,
recognized brands in Brazil and abroad, and access to financial markets
and capital markets at competitive costs. In addition, we may face fiercer
competition with new entities being incorporated or existing companies
being consolidated and with our competitors gaining increased market
share, which may adversely affect us.
18
Reference Form - 2011 - WEG SA
4.1
Version : 1
Description of Risk Factors
The market for our products is characterized by evolving technologies and
developing industries. The ability to successfully overcome the sector’s
consolidation, to enhance and develop our existing products, to
continuously develop innovative products, to continuously shorten our
delivery time, to cut our costs and tailor our products to customers’ needs,
and to outgrow our competitors, either by acquiring new businesses or
through our organic growth, all this impacts the demand for our products.
Moreover, competitors may develop technologies or products that turn our
products obsolete or less marketable, or even operate more efficiently than
us. Increased competition, including by foreign companies and/or
companies with more investment capital than us, increased output capacity
of our competitors, and increased competition may adversely affect us.
The performance of the capital goods sector is strongly influenced by
the level of investments.
The performance of the capital goods sector in general, and of machinery
and heavy equipment in particular, is significantly influenced by the level of
investments made by both the private sector and the public sector. For
involving high value-added goods, the capital goods sector also depends
on having access to long-term credit granted by national and international
private and public financial institutions, and by multilateral agencies. The
capital goods industry is usually one of the first to be affected by economic
crises and one of the last to react after an economic upturn.
The performance of the capital goods sector is strongly influenced by
the level of investments.
The performance of the capital goods sector in general and of machinery
and heavy equipment in particular, is significantly influenced by the level of
investments made by both the private sector and the public sector. For
involving high value-added goods, the capital goods sector also depends
on having access to long-term credit granted by national and international
private and public financial institutions, and by multilateral agencies. The
capital goods industry is usually one of the first to be affected by economic
crises and one of the last to react after an economic upturn.
The decrease in investments carried out in the Country and non-existence
of long term credit may adversely affect the national economy and affect
our operational results and financial condition.
Industrial automation activities depend on high technology to develop
and perform high complexity projects.
The industrial automation segment is subject to rapid and continuous
technological breakthroughs. Our performance in this segment depends on
our ability to continue enhancing our products and offering our customers
innovative solutions that respond to rapid changes in technological
standards and market expectations in general. If we are unable to
anticipate and develop breakthroughs, or to suit our products to new
technological standards, we may be adversely affected.
19
Reference Form - 2011 - WEG SA
4.1
Version : 1
Description of Risk Factors
We may not be able to develop or acquire new technologies on a timely
and sufficient basis to remain competitive in this market in the future, which
could adversely affect us. Furthermore, the development of new products
and technologies involves the risk of delay in introducing new products to
the market, thus generating significant costs.
h) The regulation applicable to the sectors in which the issuer operates
We are subject to strict environmental requirements and limitations.
We are subject to stringent environmental protection laws and regulations
in the various countries in which we operate. In addition, the waste
generated by our factories is subject to strict pollutant waste disposal rules
and procedures. Failure to comply with environmental laws and regulations
of various countries in which we operate may lead to the imposition of
remedial requirements and trigger a variety of administrative, civil and
criminal enforcement measures, also on a retrospective basis. The violation
of any environmental law or regulation or of any contractual obligation may
adversely affect us.
Moreover, changes in environmental laws or regulations may increase the
related costs of compliance, reducing the amount of resources available for
the payment of expenses, investments and development of other activities.
Any such reduction in resources may also adversely affect us.
i)
The foreign countries where the issuer operates
The economic and political conditions in the countries where we
operate may adversely affect us.
We operate and we intend to expand our operations outside Brazil. As a
result, we are subject to risks concerning the countries where we operate or
we may come to operate, especially emerging countries like India, China
and Latin American countries. These risks include, among others, the
economic, political, social, judicial and legal condition in these countries,
which may be highly unstable and/or. For the year ended December 31,
2010, 34% of our consolidated gross revenues derived from our businesses
outside Brazil, including the operations of foreign manufacturing
subsidiaries. We expect the rate of our foreign revenues to increase
substantially in the future, which may increase the risk of negative impacts
on our operations and results.
20
Reference Form - 2011 - WEG SA
4.2
Version : 1
Comments on the expectations in changes in the exposure to
risk factors
The Company continuously reviews the risks to which it is exposed and which
may adversely affect its business, financial position and results of operations.
We continuously monitor changes in the political and business scenarios that
may influence our activities, by monitoring key performance indicators
21
Reference Form - 2011 - WEG SA
4.3
Version : 1
Relevant Non-confidential judicial, administrative or arbitral proceedings
SUMMARY REPORT OF LEGAL AND ADMINISTRATIVE PROCEEDINGS
Claim
a) Court
b) Level
c) Filing date
d) Parties in the suit Defendant
Plaintiff
Cláudio Vogel Filho & Cia. Ltda.
1 Claim for pain and
suffering and property
damage
2 Tax Notification
2 nd Civil District Court of São
Sebastião do Caí/RS
1st Instance
30/10/2007
WEG Indústrias S/A - Química
Administrative
2nd Instance
20/12/2007
3 Claim for pain and
suffering, property
damage and aesthetic
damage
4 Ordinary claim for
damages filed together
with a motion for
interim relief
5 Labor Claim
36th Civil District Court of
Rio de Janeiro/RJ
2nd Instance
18/09/2006
5 Civil District Court of
Divinópolis/MG
1st Instance
30/10/2007
WEG Exportadora S.A. Merged by National Social Security (INSS)
WEG Equipamentos Elétrico S.A. e
WEG Indústrias S.A. WEG
Indústrias S/A - Química
Valdir Rosa de Oliveira, Marco Aurélio
Almeida de Oliveira, Antonio Gomes de
Oliveira, Vaudelino Sampaio e José
Roberto da Costa
WEG Equipamentos Elétricos S/A, Divigusa Indústria e Comércio Ltda.
Biochamm Cald. e Equip.Ind. Ltda.
e TGM Turbinas Ind.e Com. Ltda.
37th Labor Court of Belo
Horizonte/MG
Administrative
2nd Instance
14/02/2008
WEG Industrias S.A - Química
1st Instance
25/10/2010
Trafo Equipamentos Elétricos S.A., Receita Federal do Brasil (RFB)
incorporada pela WEG Equip.
Elétricos S.A.
6 Tax Notification
22
th
Francisco Ambrósio da Silva
Reference Form - 2011 - WEG SA
4.3
Version : 1
Relevant Non-confidential judicial, administrative orarbitral proceedings
SUMMARY REPORT OF LEGAL AND ADMINISTRATIVE PROCEEDINGS (cont.)
Suit
e) amounts, assets or rights involved
f) key facts
1
pending an arbitration award
2
approximately R$ 12 million
3
pending an arbitration award
4
approximately R$ 5 million
5
approximately R$ 6 million
6
R$ 3,100 thousand
Civil suit where the Plaintiff claims loss of profits from polyester coating manufactured
by WEG to be applied on roofs - claim for compensation for pain and suffering,
property damage, and loss of profits, plus court costs and attorneys’ fees. No value
was assigned to the claim.
The tax inspectors demand the payment of social security contributions on
compensation/salary amounts on which the company believes no such taxes are
levied.
Civil suit where the Plaintiffs claim for compensation for pain and suffering, property
damage and aesthetic damage resulting from their work as ship painters using WEG
products. Their employer (Brasfels S/A shipyard) was impleaded into the suit by WEG.
Civil suit where the Plaintiff claims property damage and loss of profits as a result of
alleged loss of earnings from an energy generator set comprising turbines, boiler and
generator acquired from the defendants.
Labor suit where a former agent claims an employment relationship and the right to
commission difference payments - there are procedural incidents and civil proceedings
related thereto.
The Federal Revenue Office demands the payment of import taxes which have not
been paid due to the Draw Back regime.
23
g) Possibility of Loss:
likely
likely
unlikely
likely
likely
Reference Form - 2011 - WEG SA
4.3
Version : 1
Relevant Non-confidential judicial, administrative orarbitral proceedings
SUMMARY REPORT ON LEGAL AND ADMINISTRATIVE PROCEEDINGS (cont.)
Suit h) analysis of impact of an unfavorable outcome
1
2
3
4
5
6
24
i) provisioned value, if
there is a provision
Low impact, given that the coating application technology has evolved considerably from the time of the alleged events, and this would not
N/A
significantly impact WEG’s operation in this segment, as it has little relevance to the business.
Low impact, given that many of the amounts under dispute, with respect to future periods, have been covered by a judicial order and / or
R$ 10,900,261.00
court deposit
Low impact, given that the problems clearly resulted from the lack of use of Individual Protection Equipment by the Plaintiffs, i.e. even if
R$ 1,500,000.00
WEG is to be condemned, this would not require changes to our products or business strategy
Low impact, given that the problems resulted from failures in the equipment linked to WEG’s generator, with no contractual joint labiality
N/A
among the defendants; thus in spite of a remote unsuccessful outcome of the case for WEG, this would not represent a significant business
impact
Low impact - we believe that the most likely scenario is the recalculation of commissions, which would amount only to part of the quantum
sought. No impact on the business
Low impact – considering that the tax demand is limited to the focused on the investigated acts.
R$ 3,100,00.00
Reference Form - 2011 - WEG SA
4.4
25
Version : 1
Legal, administrative or arbitral proceedings not subject to
confidentiality to which the opposing parties are the issuer’s
or its subsidiaries’ officers or former officers, controllers or
former controllers or investors
a – court:
N/A
b – level:
N/A
c –filing date:
N/A
d - parties to the suit:
N/A
e - amounts, assets or rights involved:
N/A
f - key facts:
N/A
g - an unfavorable outcome is:
N/A
i – probable:
N/A
i – probable:
N/A
ii – possible:
N/A
iii – remote:
N/A
h - analysis of impact of an unfavorable outcome:
N/A
i - accrued amount, if any:
N/A
Reference Form - 2011 - WEG SA
4.5
Relevant confidential suits
N/A
26
Version : 1
Reference Form - 2011 - WEG SA
4.6
Version : 1
Legal, administrative or arbitration proceedings, based on
similar facts and legal grounds, which are not subject to
confidentiality and relevant jointly
Civil suits due to Employment relationship:
On December 31, 2010, the Company was a party to 257 labor-related suits,
mostly referring to indemnification for labor accidents, involving the amount of
R$ 168,803,549.24. In some cases, we are backed by an EMPLOYER’S
LIABILITY INSURANCE POLICY. None of the claims is considered relevant to
the Company’s activities or to negatively and significantly impact its results. The
suits with possibility of unfavorable outcome are provisioned for in the amount
of R$38,956,330.00 on December 31, 2010.
Labor:
At December 31, 2010, the Company was a party to 409 labor-related suits filed
with the Labor Court, mostly referring to overtime, health hazard premium and
invalidation of two compensation systems used concurrently, involving the
amount of R$ 52,485,945.78. In some cases, we are backed by an
EMPLOYER’S LIABILITY INSURANCE POLICY. None of the claims is
considered relevant to the Company’s activities or to negatively and significantly
impact its results. On December 31, 2010 a provision of R$ 29,203.00was
established for those claims with a likely unfavorable outcome.
On December 31, 2010, there were also 91 other administrative suits against
the Company, of which the value of the fines were paid upon filing of suits,
therefore a provision was unnecessary. Generally speaking, the filings claim
lack of compliance with Regulatory Norm No.31 (NR 31) of the Ministry of Labor
for a subsidiary. In two bookings the Ministry of Labor Authorities alleged that
there was degrading conditions of work. However said claims relate to
employees from service providers and said conditions had been reported off the
grounds of the subsidiary. Therefore, with the closure of the administrative suit,
the subsidiary is discussing this matter in court.
27
Reference Form - 2011 - WEG SA
4.7
Other relevant contingencies
N/A
28
Version : 1
Reference Form - 2011 - WEG SA
4.8
Regulations in country of origin and of the custodian country
of the securities
a - limitations on the exercise of political and economic rights:
b - limitations on the circulation and transfer of securities:
c - events for cancellation of registration:
d - other issues of interest to investors:
29
Version : 1
N/A
N/A
N/A
N/A
Reference Form - 2011 - WEG SA
5.1
Version : 1
Description of Main Market Risks
In the normal course of its business, the Company is exposed to various
financial risks underlying its activities. These risks refer mainly to adverse
changes in interest and foreign currency rates, and commodity prices, such as
copper and steel. Within these financial risks, we highlight:
Credit Risk
Credit risk is a financial risk relating to the possibility of not receiving from our
customers amounts or credits due from the sale of our products, or of not
receiving the payment of such amounts in a timely fashion.
Liquidity Risk
Liquidity risk represents potential mismatched maturities of assets and
liabilities. Our general policy is to maintain adequate liquidity levels to ensure
our ability to meet our present and future obligations and to capitalize on
business opportunities as they arise.
Market Risk
Market risk is related to the negative impact on the value of our assets and
liabilities as a result of such factors as fluctuations in interest rates or foreign
exchange rates. Most of our activities are subject to market risks.
Interest Rate Risk
Interest rate risk arises from the timing difference in the pricing of assets and
liabilities. An increase in interest rates could raise the cost of our borrowings,
reduce the demand for our products or have a negative impact on our financial
expenses and operating results. Similarly, any increase in interest rates could
also impact the yield on our investments, with positive effects on financial
income.
On December 31, 2010, 73.8% of our loans and financings were in Brazilian
reais and subject to the fluctuation of Long Term Interest Rates – TJLP.
Foreign Exchange Rate Risk
Foreign exchange risk arises from owning assets, liabilities and items
denominated in or indexed to foreign currencies. For the year ended December
31, 2010, approximately 39% of our gross operating revenue was obtained in
markets other than Brazil and in other currencies than the Brazilian real.
At December 31, 2010, our debt denominated in or otherwise linked to the U.S.
dollar, comprising short- and long-term financing in foreign currency, was
equivalent to R$ 732,7 million, or 30% of our total debt.
30
Reference Form - 2011 - WEG SA
5.2
Version : 1
Description of market risk management policy
Financial Risk Management Policy
Our risk management practices and procedures seek to protect against the
volatility of interest rates and foreign exchange rates and to mitigate the
negative impacts brought by this volatility on the Company’s cash flows. The
Company constituted a Committee for Financial Risk Management, a body of
the Executive Board which approved a Policy for Managing the Financial Risks.
Hedging strategy
The strategies adopted by the Company seek to minimize the net position of
assets and liabilities exposed to changes in foreign exchange rates and interest
rates. The Company does not carry out operations with financial instruments for
speculative reasons, nor does it contract financial instrument with other
purposes except for hedging.
As mentioned, the Company seeks protection against Exchange and interest
rate variation. The main instruments and guidelines used by the company are:
Foreign exchange risk
Approximately 39% of the Company’s Net Revenues take place in the foreign
market and the main currencies are the US Dollar and Euro. Therefore an
appreciation of the Brazilian real (R$) in comparison with these currencies will
reduce our revenues in reais. The risk of exchange variation over loans and
financings in foreign currency are due to the possibility of devaluation of the
Brazilian real, when the principal and interest of these financings would suffer
negative impacts.
The active exchange rate (revenues) or liabilities (debts) are mitigated by the
management of net exchange exposure, which could use financial instruments
without cash (NDFs), financial investments in foreign currencies and/or through
financial debt in foreign currencies.
Interest rate risk
The Company’s cash and cash equivalents are currently invested in BDCs or
debentures connected to the interest rate of interbank depository certificates
(CDI), issued by first-tier banks and with a reduced credit risk. Therefore a
reduction of CDI would cause a reduction in financial revenues from said
financial investments.
Approximately35% of the financings which compose the total bank debt are
linked to the long term interest rate. Consequently, an increase in TJLP would
cause an increase in our bank indebtedness as well as in our debt service.
The interest rate over financial investments, loans and financings is constantly
monitored. We can use financial instruments without cash to mitigate the risks
of referral interest rates for the financial investments and financings of the
Company.
31
Reference Form - 2011 - WEG SA
5.2
Version : 1
Description of market risk management policy
Parameters used for risk management
The management of these risks is carried out by the Financial Risk
Management Committee, through the Financial Risk Management Policy, which
defined the risk factors and level of exposure and strategy definition.
The Financial Risk Management Committee holds weekly meetings to monitor
market risks with the participation of members of various areas and
departments, continuously, and the monitoring of the general limits established
by the Financial Risk Management Policy.
Adequacy of operational structure and internal controls to verify
effectiveness of adopted policy
The Company constantly monitors its activities and internal controls, seeking to
identify possible risks. It also applies verification tests to said controls. The tests
are carried out by each department and by the internal audit team.
32
Reference Form - 2011 - WEG SA
5.3
Version : 1
Significant changes in the main market risks
The Company believes that its currently decentralized practices and procedures
satisfactorily meet its requirements for monitoring major exposures. These
practices and procedures are in line with the Company’s organizational culture
of conducting business with caution.
Moreover, and mindful of the higher volatility in global financial markets, the
Company has been developing a formal financial risk management policy,
consolidating the various practices, policies and procedures that are specific to
the different areas. This effort seeks to provide the Company with a wider and
more general perspective of risk exposure, especially of financial risks.
33
Reference Form - 2011 - WEG SA
5.4
Version : 1
Other relevant information
In the last fiscal year, there have been significant changes in the major market
risks or in the risk monitoring policy adopted by the Company.
34
Reference Form - 2011 - WEG SA
Version : 1
6.1 / 6.2 / 6.4 Establishment of the issuer, period of duration and
date of CVM registration
Date of Establishment of Issuer
16/09/1961
Constitution Form of Issuer
The company was constituted as a limited liability and
transformed into a anonymous privately held partnership on
June 7, 1965. In 1971 the company’s shares were accepted
for trading in the stock exchange.
Country of Establishment
Brasil
Statutory Te rm
Undetermined statutory term
Date of CVM Registration
February 09, 1982
35
Reference Form - 2011 - WEG SA
6.3
Version : 1
Brief history of the Company
We started our activities in 1961 in the city of Jaraguá do Sul, Santa Catarina
State, as an electric motor manufacturer doing business as Eletromotores
Jaraguá Ltda. Our founders, electrician Werner Ricardo Voigt, business
administrator Eggon João da Silva and mechanic Geraldo Werninghaus,
created the WEG brand based on their first name initials. Coincidentally, WEG
means way in German. In the first quarter of activities, 146 electric motors were
assembled.
Ever since our foundation, we embraced the business strategy of building a
highly qualified technical assistance network to develop customer reliance and
to promote our products, with the first technical assistants being accredited still
in the 1960s.
In 1968, keeping up with the rapid growth in motor productions and lack of
qualified labor in the region, the Company created CentroWEG, a technical
school that to this day teaches production processes to high school students,
offering access to technical education and the opportunity of employment after
conclusion of the course.
The 1970s were made famous by the expansion of the national market and by
the first steps of the company in the international market. In addition to the
acquisition to install a second factory and beginning of trading of WEG stocks in
the stock market, the Company began to export its motors to countries in Latin
America. In September 1975, we reached the milestone of 1 million electric
motors produced, consolidating the WEG brand.
In the 1980s we began to diversify our activities, with the incorporation of WEG
Máquinas to manufacture large-sized rotating electrical machines and WEG
Acionamentos to manufacture electric and electronic components and WEG
Transformadores to manufacture distribution equipment. In 1983, with the
creation of WEG Química, currently named WEG Tintas, the company entered
into the industrial paint and electric insulation market. Lastly in 1986 WEG
Automação was created to develop, produce and sale of products for industrial
automation and electrical packages.
In the 1990s we continued to consolidate our brand in the international market
with the launching of the distribution branch in the United States and the
acquisition of a company in Belgium. In 1996 WEG reached the brand of 100
million CVs produced, making it the largest manufacturer of electric equipment
in Latin America.
To improve the competition conditions in the international market, as of the year
2000 the company began to implement factories abroad, acquiring in the same
year two factories in Argentina, one in Mexico, one in Portugal in 2002 and one
in China in 2004. With the acquisition of capital of
36
Reference Form - 2011 - WEG SA
6.3
Version : 1
Brief History
Voltran, a Mexican transformer manufacturer in 2006, WEG Transformadores
Mexico was created, the first branch abroad to manufacture products other
than electric motors.
In 2007 WEG acquired the controlling capital of Trafo Equipamentos Eléctrico
S.A., manufacturer of transformers with factories in Rio Grande do Sul and São
Paulo, and HISA Hidráulica Industrial S.A., a manufacturer of hydraulic turbines
headquartered in Santa Catarina, therefore the Company added new products
to its portfolio.
In 2010 the company acquired the controlling capital of ZEST, a South-African
company which leads the distribution, system integration and electric and
electronic products for industrial use market. Mexican company Voltran was
also acquired as well as Instrutech, a Brazilian manufacturer of products and
systems related to industrial automation man/machine safety.
In 2011 WEG grewand conquered new markets with the company’s debut in the
wind power segment, with the manufacturing of aerogenerators with the most
modern technology available in the market, and the acquisition of three new
units to manufacture paint, two in Brazil and one in Argentina.
Currently the WEG Group has 22 factories, of which 13 are in Brazil and 9
abroad, with operations in the five business units which follow: Motors,
Automation, Energy, Transmission and Distribution and Paints. With more than
22 thousand employees, the company has consolidated itself as one of the
largest global manufacturers of electric motors.
37
Reference Form - 2011 - WEG SA
6.5
Version : 1
Major corporate events in the issuer, controller or affiliates
a) In 2011
(i) Agreement with M.Torres Olvega Industrial Group/ MTOI (Spain)
On March 3, we announced the signature of the Understanding
Memorandum and Technology Transfer Agreement with Group M.
Torres Olvega Industrial (MTOI). The group was funded in 1975 to
project, develop and manufacture systems for industrial automation
processes and solutions for the aeronautics, paper and energy
segments.
The technological agreement between MTOI and WEG will result in the
creation of a joint venture, with the equal participation, to manufacture,
assemble, install and sell aerogenerators and supply of operation and
maintenance services in Brazil.
The manufacturing of aerogenerators will take place initially in the
factory in Jaraguá do Sul, State of Santa Catarina.
b) In 2010
(i) Acquisition of control of ZEST (South Africa)
On May 25, we published a Notice of Material Fact informing that we
were entering into an agreement to acquire control of ZEST Group, a
South African-based company formed by the leading distributor of
electric motors in that market and by companies specializing in
assembling industrial electrical panels, in integrating products for the
assembly of generator sets and in providing electrical commissioning
services.
The ZEST Group has been a partner to WEG for more than 30 years,
importing and distributing its products.
It was informed that the parties expected to complete the transaction by
the end of June 2010, once the due diligence process had been
completed.
(ii) Acquisition of additional stake in Voltran S.A. de C.V. (Mexico)
On May 25, we announced our agreement with the Jimenez family for
the acquisition of control of Voltran S.A. de C.V., increasing our stake in
the company to 60%.
In May 2006, WEG acquired 30% of the capital of Voltran, one of the
largest transformermanufacturers in Mexico.
(iii) Acquisition of Instrutech S.A.
On June 9, we informed that subsidiary WEG Equipamentos Elétricos
S.A. entered into an agreement to acquire Instrutech Ltda.
(“Instrutech”), a Brazilian manufacturer of industrial, commercial and
man/machine safety automation systems and products.
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Reference Form - 2011 - WEG SA
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Major corporate events in the issuer, controller or affiliates
(IV) Acquisition of Equisul Ltda.
On December 6, we announced that subsidiary WEG Equipamentos
Elétricos S.A. signed a deal to acquire company Equisul Indústria e
Comércio Ltda., which specializes in the development and
manufacturing of uninterruptible power supply or UPS, including nobreaks, inverters, rectifiers, chargers and battery banks. Equisul only
has consolidated financial statements as of 2011.
c) In 2009
(i) Construction of a new Manufacturing Unit – City of Linhares (ES)
On August 13, we published a Notice of Material Fact informing that we
were discussing the construction of a new manufacturing unit with the
state government of Espírito Santo and the city government of
Linhares. The completion of negotiations was announced on August 21,
confirming the construction of a new manufacturing unit to expand our
electric motor manufacturing activities.
For the construction of the future industrial site, WEG adopted a
modular concept that allows for the gradual and continuous increase of
output capacity, thus meeting the Company’s expansion requirements
over several years. The first of these manufacturing modules in
Linhares should become operational in 2011. This modular concept has
been used by WEG in its other plants in Brazil and abroad.
(ii) Integration of TRAFO shares by WEG
The Extraordinary General Meetings held by WEG S.A. and by
subsidiary Trafo Equipamentos Elétricos S.A. on December 28, 2009
approved the integration of shares issued by TRAFO into WEG.
As a result of this integration, TRAFO became a wholly-owned
subsidiary of WEG, which, in turn, became the sole shareholder of
TRAFO directly or indirectly holding all of its shares, and continued to
hold all the rights and obligations it held before the operation was
approved. TRAFO shareholders, in turn, became holders of WEG
shares, based on the approved share exchange ratio. Subsequently, on
December 30, 2009, the merger of Trafo Equipamentos Elétricos S.A.
into subsidiary WEG Equipamentos Elétricos S.A. was approved.
d) In 2008
(i) New sales and distribution subsidiary – Russia
On March 13, we announced the establishment of a new sales and
distribution subsidiary abroad, WEG Russia, incorporated in Nizhny
Novgorod (formerly Gorki), capital of the province with the same name.
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Major corporate events in the issuer, controller or affiliates
WEG Russia will sell, distribute and provide technical assistance
services for products and systems in Russia and the former Soviet
Union countries. This market represents a great business potential in
such areas as oil and gas exploration, production and transportation.
Our presence in this region is still small and our experience in the oil &
gas industry in other regions will be important for us to win new
businesses in Eastern Europe.
(ii) Expansion of activities in India
On May 26, we announced our plans on expanding our activities in
India, with the construction of a new electrical motor plant in the city of
Hosur, Tamil Nadu state, near Bangalore. The new plant will require
estimated investments totaling US$ 50 million for the first stage of the
project, with operational start-up being expected for late 2009.
India has proven to be an extremely attractive market since we started
our sales activities through our own subsidiary in 2004, when important
deliveries were made for projects involving irrigation and electrical,
hydraulic and thermal power generation.
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Reference Form - 2011 - WEG SA
6.6
Filings for bankruptcy based on significant amounts and
filings for in-court or out-of-court reorganizations
N/A
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Reference Form - 2011 - WEG SA
6.7
Other relevant information
N/A
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Reference Form - 2011 - WEG SA
7.1
Version : 1
Description of the activities of the issuer and its subsidiaries
Activities performed by the issuer:
We believe the WEG Group to be the largest manufacturer of electrical and
electronic equipment for industrial use in Brazil and Latin America today. We
also believe that we are one of the major manufacturers of low-voltage electric
motors worldwide. We estimate that our share in the domestic market of electric
motors ranges from 75% to 95%, depending on the type of motor and market
segment. We manufacture some 40,000 electric motors per day and
approximately 25,000 different types of electric motors per year, on average.
The division traditionally used by WEG in its communications with the market
considers the criteria of market dynamics. Our operations are organized into
four segments:
•
Industrial Electrical and Electronic Equipment – This segment
includes those products classified as capital goods, such as low- and
medium-voltage industrial electric motors, drivers and controls, industrial
automation equipment and services, maintenance components and
services; The electric motors and other pieces of equipment can be
applied in any industrial segment, in equipment such as compressors,
pumps and fans, for example;
•
Power Generation, Transmission and Distribution – The products and
services included in this area are the generators for hydraulic
powerplants, hydraulic turbines, transformers, substations, control panels
and system integration services. We have carried out the investments in
our productive capacity, as well as in our new transformer units in Mexico
and high voltage motors in India, to expand our reach in markets other
than the Brazilian one where we are already strongly present;
•
Household Motors – This segment focuses on the Brazilian market,
where we hold a significant share of the single-phase motor market,
mainly used in home appliances (the so-called white goods), i.e.
consumer durables, such as washing machines, air conditioners, water
pumps and others; and
•
Paints and Varnishes – These include liquid paints and powder coatings
and electrical insulating varnishes, focusing on industrial and marine use
and coatings for hazardous environments. These products can be used
both in capital goods and in consumer durables and semi-durables.
This segment is not the same used in WEG’s internal organization, which only
considers industrial processes and divides the Company in five business units:
motors, automation, energy, transmission & distribution and paints & varnishes.
The reconciliation of both types of information can be seen as follows:
Business Area
Business Unit
43
Generation
Industrial Electric and Transmission and
Electronic Equipment
Distribution
Motors + Automation
Energy + T&D+
Automation
Motors for
Household use
Paints and
Varnishes
MotorS
Paints & varnishes
Reference Form - 2011 - WEG SA
7.1
Version : 1
Description of the activities of the issuer and subsidiaries
In Brazil our factory operations are located as follows:
•
Jaraguá do Sul (Santa Catarina) – Factories I and II –production of
electric, automation and energy Motors, as well as corporate and
administration functions.
•
Guaramirin (Santa Catarina) – Factory III – production of liquid and
powdered paints and metal works and welding
•
Blumenau (Santa Catarina) – Factory IV – production of transformers
•
Itajaí (Santa Catarina) – production of dry transformers and automation
•
Joaçaba (Santa Catarina) – HISA –production of hydraulic turbines
•
São José (Santa Catarina) – Equisul – production of no breaks and UPS
•
Gravataí (Rio Grande do Sul )– production of transformers
•
Hortolândia (São Paulo) – production of transformers
•
São Bernardo do Campo (São Paulo) –production of high voltage motors
and generators
•
São Paulo (São Paulo) – Instrutech – production of electronic sensors for
industrial automation
•
Manaus (Amazonas) – production of commercial electric motors
•
Linhares (Espirito Santo) –production of commercial electric motors
Subsidiaries that develop Production Activities – The corporate purpose of
our production units abroad is to research, develop, produce, industrialize, sell,
export, import, promote and represent our products abroad, as well as to
provide services involving the assembly, installation, maintenance and technical
assistance related to our products abroad.
44
•
WEG Equipamientos Electricos S/A (Argentina) - Promotes and sells,
through a local sales team, self-manufactured products and products from
our business segments located in Brazil, such as high- and low-voltage
electric motors, transformers and generators.
•
WEG México S.A. de C.V. (Mexico) - Operates through a local sales team
that promotes and sells its products as well as all other product lines
manufactured in Brazil. Products imported from our Brazilian units are
mainly electric motors for use in home appliances and for industrial facilities
in general.
•
WEG Transformadores de Mexico S.A de C.V. (Mexico) e Voltran S.A.
de C.V. - They operate through a local Sales team which promotes and
sells its products, as well as products manufactured in Brazil to be applied
in electrical facilities such as power substations.
•
WEG Euro - Indústria Elétrica S.A. (Portugal) –Operates through a local
sales team that promotes and sells its products as well as all other product
lines manufactured in Brazil. Products imported from our Brazilian units are
mainly electric motors.
Reference Form - 2011 - WEG SA
7.1
Version : 1
Description of the activities of the issuer and subsidiaries
•
WEG Nantong Electric Motors Manufacturing CO., Ltd (China) Acquired in November 2004, it focuses on the production of three-phase
high- and low-voltage electric motors primarily for consumers in the
segments of steel, mining, petrochemical and OEM (use in pumps,
compressors and general purpose machinery and equipment).
•
WEG Industries (India) Private Ltd. (India) – The unit whose Project was
announced on May 2008 and which began production in February 2011.
The Company produces high voltage electric motors, which are specifically
designed for use in infra-structure, such as irrigation pumps and energy
generation.
•
ZEST Electric Motors (Pty) Ltd. (South Africa) – The control was
acquired in May 2010. ZEST operates through a local sales team which
promotes and sells its products, as well as all other product lines
manufactured in Brazil, in addition to third party products added in full
electric systems, for general industrial use, such as: mining, oil, gas and
generation and distribution of power.
Subsidiaries that develop Distribution and Sales Activities – The corporate
purpose of our distribution and sales units abroad is to sell, export, import,
promote and represent products from our various business segments in Brazil,
as well as to provide services involving the assembly, installation, maintenance
and technical assistance related to these products.
45
•
WEG Electric Corp. (United States of America)
•
WEG Benelux S.A. (Belgium)
•
WEG France S.A. (France)
•
WEG Germany Gmbh (Germany)
•
WEG Electric Motors (UK) Ltd. (England)
•
WEG Australia Pty Ltd. (Australia)
•
WEG Iberia S.L. (Spain)
•
WEG Scandinavia AB (Sweeden)
•
WEG Italia S.R.L. (Italy)
•
WEG Indústrias Venezuela C.A. (Venezuela)
•
WEG Chile S.A. (Chile)
•
WEG Colômbia Ltda (Colombia)
•
WEG Electric (India) PVT. LTD. (India)
•
WEG Electric Motors Japan CO., LTD. (Japan)
•
Description of the activities of the issuer and subsidiaries
Reference Form - 2011 - WEG SA
7.1
Version : 1
Description of the activities of the issuer and subsidiaries
•
WEG Singapore (Singapore)
•
WEG Middle East (United Arab Emirates)
•
WEG Germany NN (Russia)
Partnership - In countries where we have no subsidiaries developing industrial
or distribution and sales activities, we operate through partnerships with local
distributors and agents. Our most significant partnership abroad is with V. J.
Pamensky Canada INC. (Canada). Having been our partner for over 25 years,
V. J. Pamensky Canada INC. operates as a distributor of and agent for our
products in the Canadian market. The company buys our products, especially
electric motors, drives, contactors, relays and starters, and distributes them
locally.
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Reference Form - 2011 - WEG SA
7.2
Version : 1
Information on Operation Segments
a) Products and Services Sold
The Picture below presents the products within our areas of operations:
Services
Electronic
Components
Generation of
Energy
Motor
Energy
Substations
Transformer
Distribution
Panel
Electric
Components
Generator
Au to ma tion of Indu stria l
Pro cesse s
Paints an d Va rnish es
Fo r ind ustrial a pp lication .
Electric and electronic Industrial equipment
Included are products such as low, medium and high voltage electric
motors, drivers, equipment and industrial automation services, electric
components, in addition to maintenance services. We believe we are one of
the world leaders in low-voltage industrial motors and we have increased
our market share in integrated industrial solutions.
The demand for this type of product is due primarily to the growing
industrial production and investments in fixed capital formation, both in
Brazil and worldwide.
The consumer markets are diversified, both geographically and in terms of
customer type. We have global presence in this segment, focusing most of
our sales in foreign markets. Our main customers in this business segment
are equipment manufacturers, commonly referred to as OEM (Original
Equipment Manufacturers), of capital goods and large industrial enterprises
that invest in capacity expansion.
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Reference Form - 2011 - WEG SA
7.2
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Information on Operation Segments
Products
We develop and manufacture a wide variety of electric motors, which can
be divided into the following groups:
General Purpose Motors
Our general purpose electric motors include three-phase, single-phase,
high performance, aluminum frame, fractional and multispeed motors.
These motors are used, for example, in general industrial machinery,
pumping systems, ventilation systems, and low power devices for various
purposes, crushers, conveyors and machine tools.
Special Purpose Motors
Our special purpose electric motors include motors for compressors, closecoupled pumps, oil wells, chainsaws, inverter duty motors (with different
speeds), farm duty motors (rural use), “IEEE 841” motors (use in the
petrochemical sector), motors for centrifugal pumps, brake motors and fuel
pumps.
Motors for Hazardous Environments
Our electric motors for hazardous environments are used in explosive
areas (oil rigs, fuel pumps and chemical industry in general) and include
explosion proof motors, increased safety motors and non-sparking motors.
High-Voltage Motors.
These high value added electric motors are custom developed and
manufactured, and are designed for industries that require specific
solutions, such as those operating in mining, petrochemical, steel and
paper and pulp segments.
In addition to electric motors, we also produce a number of electronic and
electro-mechanical components that protect and control these electric
motors in electrical installations in general. These components include
frequency inverters, drivers, thermal magnetic molded case switches,
circuit breakers, starters, pushbuttons for control and signaling, mini circuit
breakers, contactors and overload relays, timers and electronic protectors,
capacitors for power factor correction, permanent metal polypropylene
capacitors for motors and lighting and fuses.
These components may be sold separately or in simple ‘motor plus
component’ sets. However, they are usually supplied within integrated
packages in the form of electrical panels, motor control centers and
oversight and control systems, including computer network interfaces and
software supervisor.
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Reference Form - 2011 - WEG SA
7.2
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Information on Operation Segments
Power Generation, Transmission and Distribution
This area includes several products such as generators for hydroelectric
plants, thermal power plants of various types and wind power plants,
transformers and substations, as well as control panels and power
automation services.
These products and systems are also considered capital goods. The
difference here is that the demand for this type of product depends
primarily on the growth of diversified investments in energy in the three
sub-segments of electric power generation, transmission and distribution,
rather than on the industrial production and investments in fixed capital
formation, as the case is with the segment of industrial electrical and
electronic equipment.
Within this business segment, we focus on the Americas, using our large
presence in Brazil, which is still our most important market, as a basis for
operating in the other American countries.
Our main customers in this area are the power generation, transmission
and distribution companies, small hydroelectric power plants (PCH) and
large industrial companies that adopt electric power co-generation.
Products
We develop and manufacture high-voltage generators that use many
different types of fuel and the following energy sources: water, thermal and
wind power.
We operate individually or in joint ventures with other companies in the
supply of equipment and complete systems for power generation. In
addition, we develop and manufacture power transformers, which can be
high-voltage, industrial (or medium-voltage) and distribution transformers.
These transformers are used to turn high-voltage electric power into
consumable levels. We also supply electric power substations (up to 100
MVA) on a turn-key basis, covering project design and implementation
through installation and ‘go-live’.
Household Motors
This line of business includes all single-phase motors developed and
manufactured for use by manufacturers of household appliances and
equipment, which includes motors for automatic and semi-automatic
washing machines, dryers, air movement motors, air conditioning motors,
inverter duty type motors for washing machines, and a wide range of small
motors for use in water pumps, lawn mowers, among others.
The consumer market is also diversified, although the market
characteristics lead to a greater concentration in large OEM (Original
Equipment
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Reference Form - 2011 - WEG SA
7.2
Version : 1
Information on the operational segments
Manufacturers) of white goods in general. In this segment, our operations
mainly focus on Brazil or, alternatively, in Latin America. The demand for
these products depends on the increase in the consumers’ purchasing
power, credit supply and interest rates.
Paints and Varnishes
The focus of activity in this segment is only the Brazilian market and
products for industrial use. In addition, all our paint and varnish
requirements for the manufacture of our products are met by this area.
The main products are liquid paints and powder coatings, electrical
insulating varnishes and resins. We believe we are one of the largest
Brazilian manufacturers of powder coatings and marine use paints. These
products are used by the consumer durables industry and capital goods in
general, for coating and protecting components and products.
Our major customers in the paints and varnishes segment are metallurgical
companies, shipyards, equipment and tools manufacturers and the furniture
sector. These customers usually acquire products from our other lines of
business, which clearly indicates the great synergy between this and other
segments.
Given the great diversity of products, the demand in this area depends on
increased industrial output and GDP.
b) revenues from this segment and their share in the issuer’s net
revenues
The table below shows the share of each business segment in our gross
operating revenues for the periods:
Industrial Electrical and Electronic Equipment
Power Generation, Transmission and Distribution
Household Motors
Paints and Varnishes
2010
54.3%
25.6%
15.0%
7.1%
2009
48.4%
33.5%
12.2%
5.9%
2008
55.4%
27.1%
12.3%
5.2%
c) Income or loss from the segment and its participation in the issuer’s
net income
We do not disclose operating results per business area.
In order to meet the IFRS norms regarding information per segment, the
Maagement has defined the operational and geographical segments of the
Company based on the reports used internally for its business decisionmaking strategy. The Company’s management is structured and
systemized with information of the operations, considering the industry
segments, energy, abroad and consolidated.
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Reference Form - 2011 - WEG SA
7.2
Version : 1
Information on the operational segments
Brazil
Net Operating Revenue
Profit Before Taxes and Equity
Depreciation/ Amortization/ Exhaustion
Identifiable Assets
Identifiable Liabilities
Industry
31/12/10
31/12/09
2,616,471
2,314,717
691,955
508,468
116,495
124,108
2,514,308
2,346,940
515,647
366,433
Energy
31/12/10
31/12/09
1,277,789
1,685,479
359,176
651,253
43,225
51,158
1,210,811
1,214,459
324,043
396,359
Abroad
31/12/10
1,425,015
42,257
24,270
1,171,664
275,180
31/12/09
1,193,867
36,873
15,864
806,526
220,306
Exclusions and
adjustments
31/12/10
(927,302)
(363,423)
(184,664)
(171,627)
31/12/09
(983,443)
(458,069)
(142,924)
(139,066)
Consolidated
31/12/10
4,391,973
729,965
183,990
4,712,119
943,243
31/12/09
4,210,620
738,525
191,130
4,225,001
844,032
Industry: single and triple phase motors, electric and electronic industrial equipment, such as industrial electric motors for low and
medium voltage, paints and varnishes.
Energy: generators for hydraulic, Wind and thermal powerplants, substations, control panels and energy automation services.
Abroad: it is composed by operations carried out through subsidiaries located in various countries.
The elimination and adjustments column includes eliminations applicable to the Company in the context of the IFRS consolidated
financial statements.
All operating assets and liabilities are presented as identifiable assets and liabilities.
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Reference Form - 2011 - WEG SA
7.3
Version : 1
Information on products and services relative to the operating
segments
a)
Characteristics of the production process
We adopt a highly integrated business model, internally producing various
goods and services that are used for the development of our core activities.
The main consequence of vertical integration is that we develop
customized products and manufacture them in large scale at lower costs.
The vertical integration of the production process allows:
Flexible production, reducing delivery times for customized products at the
lowest cost;
Flexible supply, which allows to quickly change product mix offerings to
meet seasonal market demands;
Control over our plant’s supply, which implies more flexibility in increasing
production;
Continuous learning from all stages of our production process, with quality
gains in the final product.
Please find below a brief description of our vertically integrated production
structure.
Steel Plates Center - responsible for the production of rotors and stators
used in our electric motors, including the processes of steel cutting,
stamping and heat treatment.
Foundry- our foundries supply cast iron covers and frames for use in
electric motors and generators.
Machining Center - comprises the cast items machining department and
the shaft machining department. The cast items machining department
performs operations involving cutting, drilling and final preparation of
frames and covers for motors and generators. The shaft machining
department produces shafts for motors and generators from long steel bars
Wire Manufacturing Plant - manufactures the various types of copper and
aluminum wiring used in the several motors and transformers we produce;
copper and aluminum are received in rods that are extruded and electrically
insulated with varnishes and, in some cases, paper and special plastic
films.
Packaging Factory - our packaging factory produces all wood packaging
used in our various lines of products. Many of these lines require special
packaging that can store heavy goods and transport them for long
distances. We have our own reforestation areas that guarantee the
continuous supply of timber.
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Information on products and services relative to the operating
segments
Tooling - this unit produces some of the machines and tools (molds and
devices) that assist in increasing the productivity of our industrial plants,
allowing high flexibility and streamlining the development of new products
and/or applications. Moreover, this department also manufactures and
customizes some machines used in our production process
Production Process
Our products are manufactured according to specifications and standards
of the Brazilian Institute of Metrology, Standardization and Industrial Quality
(INMETRO) and quality certification agencies and bodies in the countries
where we operate, among which: Underwriters Laboratories Inc. (U.S.A.),
Bureau Veritas Quality International (U.K.), CSA International (Canada),
Asociación de Normalización y Certificación, AC. (Mexico), Instituto
Argentino de Normalización (Argentina), South African Bureau of
Standards (South Africa), Physikalisch-Technische Bundesanstalt
(Germany).
Electric Motors and Generators
Industrial electric motors are basically made up of the frame, stator, rotor,
shaft, ring, front and rear covers, baffle, fan and terminal box. Because we
have a vertical production structure, each of these components is produced
internally. Thus, we have total control over our factories’ supplies and
process parameters, obtaining specialized products at competitive
manufacturing costs.
The production process of high-voltage electric motors for industrial use
and generators for small- and medium-sized power plants basically
involves the same stages comprising the manufacture of low-voltage
electric motors and is divided into: processing of steel plates, aluminum
injection, foundry, cast items machining, shaft machining, wire
manufacturing, packaging plant and final assembly.
Transformers
Transformers may be classified according to their power and voltage, into
high-voltage, medium-voltage or distribution transformers. These products
are used to turn high-voltage electric power into consumable levels. We
also build electric power substations on a turn-key basis, covering project
design and implementation through installation and ‘go-live’.
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Information on products and services relative to the operating
segments
Not considering their power and voltage, our transformers can be “oil” or
“dry” type transformers according to the type of insulation used. Oil type
transformers are made up of the core, coils, connections, tanks and
accessories. Dry type transformers are made up of the core, coils,
connections and accessories. In a nutshell, the manufacturing process is
divided into the following steps: (i) cutting the sheets for the core; (ii)
assembling the core; (iii) manufacturing the coils; (iv) assembling the active
part; (v) drying and tightening the active part (for oil type transformers only);
(vi) manufacturing the tank and components; (vii) closing the transformer
(for oil type transformers only); and (viii) conducting electrical tests.
Command, Control and Protection Components
We produce a wide range of electrical and electronic components for the
protection, command and control of industrial electrical machinery. These
components are then integrated in the form of panels that form industrial
automation systems, power generation systems or power substations.
The electronic products manufacturing unit is responsible for the
manufacture of frequency inverters and soft-starters. This area currently
has machines for automatic placement of components (SMD) and manual
insertion lines, as well as machines for varnishing plates and complete
systems for products load testing.
Electromechanical drive components basically include thermoplastic and
thermofixed injected elements, stamped parts and silver contacts. Again,
because of our vertical structure, each of these components is produced
internally. The electromechanical drive processes and components include
various stamped parts and silver contacts, plastic injection parts and
assembly.
The electrical panels manufacturing unit is responsible for stamping,
painting and assembly activities. This area includes CNC punching
machines, press brakes and phosphate and painting lines (powder coatings
and liquid paints). Moreover, it also has specific areas for assembly and
testing of the panels, thus ensuring final product quality.
Paints and Varnishes
We produce liquid paints and powder coatings, electrical insulating
varnishes and resins. These products are used by the consumer durables
industry and capital goods in general, to paint and protect components and
products.
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Information on products and services relative to the operating
segments
Powder coatings. These are 100% solid paints formed by a balanced blend
of elements designed to protect and decorate surfaces, such as polymers,
pigments, additives and mineral fillers; after being processed, these are
presented as a single substance in the form of fine powder. This powder is
applied at high temperatures. The end result is a protective film with high
chemical and physical resistance offered in various colors, sparkles and
types of finishing.
Liquid Paints. These are basically made up of fillers, resins, solvents,
pigments and reagents. These elements are added to the formula
according to the customers’ need, which is defined by the intended
application, i.e. exposure to weather, bad weather and hazardous
conditions, among other factors. The production process consists of the
following steps: (i) weighing; (ii) dispersing; (iii) milling; (iv) completing; (v)
adjustment of product characteristics (color, viscosity, gloss, etc.) to the
customers’ requirements; (vi) the quality center reviews all of the paint’s
characteristics (viscosity, solids, drying, gloss, among others) and gives
final approval; and (vii) packaging and identification with the product code,
lot number and validity term, and sending of reports as requested by the
customer
b)
Characteristics of the distribution process
Most of our clients are located far from our production and distribution
centers. In order to get our products delivered to our national and
international clients, we use Brazilian highways and ports. Our export
products are delivered mainly through São Francisco do Sul and Itajaí ports
Santa Catarina state, which are located respectively 60 km and 90 km
away from our main manufacturing plant in Jaraguá do Sul (SC).
c)
Characteristics of the activity markets, especially:
(1) Share in each such markets
Industrial Electrical and Electronic Equipment
The consumer markets are diversified, both geographically and in terms of
customer type. We have global presence in this segment, focusing most of
our sales in foreign markets. Our main customers in this business segment
are equipment manufacturers, commonly referred to as OEM (Original
Equipment Manufacturers), of capital goods and large industrial enterprises
that invest in capacity expansion.
55
Reference Form - 2011 - WEG SA
7.3
Version : 1
Information on products and services relative to the operating
segments
Power Generation, Transmission and Distribution
These products and systems are also considered capital goods. The
difference here is that the demand for this type of product depends primarily
on the growth of diversified investments in energy in the three subsegments of electric power generation, transmission and distribution, rather
than on the industrial production and investments in fixed capital formation,
as the case is with the segment of industrial electrical and electronic
equipment. Within this business segment, we focus on the Americas, using
our large presence in Brazil, which is still our most important market, as a
basis for operating in the other American countries. Our main customers in
this area are the power generation, transmission and distribution
companies, small hydroelectric power plants (PCH) and large industrial
companies that adopt electric power co-generation.
Household Motors
The consumer market is also diversified, although the market
characteristics lead to a greater concentration in large OEM (Original
Equipment Manufacturers) of white goods in general. In this segment, our
operations mainly focus on Brazil or, alternatively, in Latin America. The
demand for these products depends on the increase in the consumers’
purchasing power, credit supply and interest rates.
Paints and Varnishes
The focus of activity in this segment is only the Brazilian market and
products for industrial use. In addition, all our paint and varnish
requirements for the manufacture of our products are met by this area
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Reference Form - 2011 - WEG SA
7.3
Version : 1
Information on products and services relative to the operating
segments
Gross Operating Results per Market - 2010
Foreign
market
34%
Domestic
market
66%
Domestic Market
In 2010, Gross Operating Revenues in the domestic market totaled
R$3,503.9 million, or 66% of our total Gross Operating Revenues, up 3,9%
from the previous year, reflecting an economic upturn and, consequently,
an increase in the demand for capital goods. We remain leaders in the
Brazilian electric motor market and continue to gain significant positions in
all business segments we operate in the domestic market. Our operations
are distinguished by continuously expanding and enhancing the technology
content of our line of products and services over time, keeping to our
strategy of offering complete and integrated industrial solutions
Reference Form - 2011 - WEG SA
7.3
Version : 1
Information on products and services relative to the operating
segments
Foreign Market
Gross Operating Revenues in the foreign market totaled R$1,778.9 million,
or 34% of total Gross Operating Revenues. The year-on-year comparison
measured in Brazilian reais shows an increase of 2.3%. In U.S. dollars,
Gross Revenues in the foreign market reached US$1,015.6 million, as
compared to the US$ 877.3 million recorded in the previous year.
Over the years we have expanded our operations to the various global
markets, having eventually become a global company with product
distribution to more than 100 countries across five continents and direct
operations in more than 20 of the major global markets. We have industrial
operations in Brazil, Argentina, Mexico, Portugal, China and India, and we
will begin to manufacture high-voltage electric motors and generators in
India in mid-2010. Our mindset has been to diversify our business by
expanding our geographic presence, allowing us to maintain consistent
growth rates in the foreign market, minimizing the impacts of economic
changes in each country or region. We believe there are growth
opportunities in the various global markets and we expect to recover our
level of increase in revenues and results in the future.
(2) Market competition
Since its foundation in 1961, WEG has competed with multinational
companies that had been operating with a significant presence in Brazil.
This competition was established in the international scenario after 1970,
when electric motors started to be exported to Latin American countries.
With its vertical integration strategy, the company began to grow rapidly to
promptly meet the changing demands of the markets where it operates.
We operate in an open market and we have many different types of
competitors in Brazil and abroad. We comply with regulations applicable in
the countries where we manufacture and sell our products
d) Seasonality event
N/A
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Version : 1
Information on products and services relative to the operating
segments
e)
Major inputs and raw materials, indicating
(1) a description of relations with suppliers and whether they are
subject to governmental regulation or control, indicating the
respective bodies and applicable legislation
We seek to optimize our costs by choosing to partner with some suppliers
in Brazil and abroad without any exclusivity commitments or agreements.
Accordingly, we have contracts with major suppliers of copper, steel plates
and silicon sheets and steel round bars. We do not have significant
inventory of raw material.
We select our suppliers based on the quality and price of products,
suppliers’ reputation and financial status, delivery times and product
availability. Our quality control ensures that purchased items meet the
company’s specifications and the regulatory standards of the Brazilian
Association of Technical Standards (ABNT).
Major Suppliers:
Copper:
•
Paranapanema (Brazil)
•
Ibrame (Brazil))
Steel Plates
•
Sistema Usiminas (Brazil)
•
Companhia Siderúrgica Nacional (Brazil)
Silicon Steel Plates
•
Aperam (Brazil)
•
Baosteel (China)
•
Chinasteel (Taiwan)
Long Steel
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Reference Form - 2011 - WEG SA
7.3
Version : 1
Information on products and services relative to the operating
segments
•
Grupo Gerdau (Brazil)
•
Schougang ( China)
•
Citic (China)
(2) any dependence on a few suppliers
There is no significant dependence on a few suppliers. We actively seek to
diversify our suppliers, avoiding concentration. Our main raw materials are
commodity products, for which there is a wide range of suppliers in the
international market.
(3) any price volatility
The Company operates in a competitive industry. The sales prices are
largely determined in this competitive process, which considers the
fluctuations in raw material price levels.
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Reference Form - 2011 - WEG SA
7.4
Clients responsible for more than 10 % of total net revenue
a)
total amount of revenue deriving from the client
N/A
b)
operating segments impacted by revenue deriving from the client
N/A
61
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Reference Form - 2011 - WEG SA
7.5
Version : 1
Relevant effects on the statutory regulation of activities
a) need for government permits to engage in activities and a
background information on the relations with government authorities
in obtaining such permits
The Company does not engage activities within regulated segments or
which require permits from government agencies or specific regulators.
Required permits are limited to those of a legal and general nature.
b) the issuer’s environmental policy and related compliance costs, and,
as applicable, the costs of compliance with other environmental
practices, including adherence to international environmental
protection standards
Based on WEG Principles, we actively seek to minimize the impact of our
operations on the environment, making continuous investments in this
area. This concern with adopting effective actions with a view to obtaining
a self-sustainable development is part of our culture since the
establishment of our Group, more than 45 years ago.
We also benefit from these investments in environmental efforts as we can
reduce the marginal costs of production through increased efficiency in the
use of raw materials. Moreover, we develop educational efforts relating to
our operations and the environment among the people living in the
communities around our major units.
Environmental Legislation
The Brazilian Constitution establishes that the federal government and the
state governments have the power to concurrently promulgate laws and
regulations on environmental matters. The environmental legislation of the
Brazilian states in which we perform industrial activities entails, in addition
to general purpose rules, some specific characteristics applicable to our
activities.
The operating standards are established in the environmental licenses
(preliminary, installation and operating licenses) issued for each of our
production units. Operating licenses are subject to renewal and may be
modified from one year to another. We comply with the limits of our current
operating licenses and we do not expect to be significantly impacted by
stricter environmental requirements, if any, although there are no
guarantees in this regard.
Liquid effluents, solid waste and air emissions resulting from our operations
comply with all applicable laws and regulations of the states in which we
perform industrial activities. We do not anticipate significant expenditures
to continue to obey existing or proposed environmental laws and
regulations. However, there is no guarantee that the approval of more
stringent environmental legislation in the future will not require
extraordinary expenditures on our part.
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Version : 1
Relevant effects on the statutory regulation of activities
Air Emission Loads
We made significant investments over the past five years in bag filters,
scrubbers, catalytic burners for solvents and in the development of new
operating procedures designed to minimize environmental impacts
associated with air emissions from our manufacturing processes. New
technologies such as the removal of volatile organic compounds by
activated carbon are being tested for future implementation.
Liquid Effluents
Water is an important element in our overall manufacturing processes. We
use water from the rivers flowing close to our plants. Our manufacturing
facilities II, III and IV, located in Jaraguá do Sul, Guaramirim and
Blumenau, respectively, are equipped with effluent treatment systems. The
processes used for treating these effluents are physical, chemical and
biological. After being treated, the wastewater returns to the rivers, based
on the parameters established by legislation. The effluents generated by
the manufacturing process from our industrial facility # I and from part our
industrial facility # II are treated in the effluent treatment system of
industrial facility # III. The characteristics of the effluents are constantly
monitored by means of chemical, physical and biological analyses.
Solid Waste
Our industrial waste recycling rate reached 80%. Scrap from processed
plates and machined cast iron parts, for instance, is reused in our
manufacturing process. Waste paper, cardboard, plastic and other metals
are also collected for recycling. Waste materials that are not recycled are
disposed of in landfills or shipped to co-processing in cement kilns. WEG
has an industrial landfill that is specific for our foundry waste. This landfill
has a leachate treatment station and is monitored through piezometers,
whose water is subjected to physical, chemical and biological tests
including ecotoxicological assumptions
Preservation of native forests
All the timber used for manufacturing or packaging our products come from
planted trees. We do not use wood from native forests. We currently own
4,966 hectares of legal reserves and 6,968 hectares of planted forests to
supply wood for packaging. The quality of the land we generally use is not
good enough for other forms of farming. Each year we plant more trees for
our own future use than we cut down. Our cultivation techniques aim at
keeping our forests healthy. On occupying farming and forestry areas, we
always preserve more than 20% of native vegetation.
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Relevant effects on the statutory regulation of activities
Environmental Certification
Our industrial plants I, II and III, located in Jaraguá do Sul and Guaramirim,
are certified in accordance with the requirements of ISO 14001. The
environmental certification requirements include (i) the establishment of an
environmental management policy, (ii) identification of environmental
aspects and impacts, (iii) legal compliance and (iv) establishment of
procedures for operational control, emergency response, communication
with stakeholders, internal audits by the Environmental Management
System, critical analyses by senior management, monitoring and
measurement, addressing non-compliant issues and corrective and
preventive measures.
c) dependence on relevant patents, trademarks, licenses, permits,
franchises, or royalty contracts de royalties for the development of
activities
Our Group’s policy is to protect our trademarks and patents in the several
countries where we operate or intend to operate
We renew our trademark registrations based on the related dates of
expiration (every 10 years). As for patents, we maintain them for their
maximum periods (15 or 20 years depending on the type of patent).
Our “WEG” flagship trademark is registered in Brazil under several specific
classes at the National Institute of Industrial Property (INPI), and is valid for
use until May 2, 2019. This term is renewable, at our request, for equal
successive periods of 10 years. The WEG trademark and other trademarks
owned by the Company are under continuous legal and administrative
control, both in Brazil and abroad, where we currently have a related
authorized registration in 80 countries.
We currently own 47 patents issued or being considered in Brazil (INPI)
and abroad. Over the past three years, we filed 27 new patent applications
with the INPI and equivalent agencies abroad. Our principal patents relate
to improvements in electric motors. Patent applications abroad are mainly
filed in the United States, Canada, Mexico, China and the European Union.
64
Reference Form - 2011 - WEG SA
7.6
Version : 1
Relevant revenues from foreign countries
a) customer revenues attributed to the country of issuer’s main office
and their share in the issuer’s total net revenues
- Gross Operating Revenue
- Domestic Market
- Foreign Market
2010
5,282.7
3,503.9
1,778.9
2009
5,110.6
3,371.6
1,739.0
2008
5,471.2
3,570.1
1,901.1
b) customer revenues attributed to each foreign country and their share
in the issuer’s total net revenues
Region
North America
South and Central America
Europe
Africa
Australasia
65
2010
35%
17%
24%
14%
10%
2009
29%
15%
31%
8%
16%
2008
30%
17%
31%
10%
12%
Reference Form - 2011 - WEG SA
7.7
Version : 1
Effects of foreign regulations on the Company’s activities
WEG is subject to specific legislation in each country where it operates.
According to item 4.1.i, the company is exposed to risks relating to international
operations, including regulations.
66
Reference Form - 2011 - WEG SA
7.8
Relevant long-term relations
N/A
67
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Reference Form - 2011 - WEG SA
7.9
Version : 1
Other relevant information
Engagement of BTG Pactual as market-maker
On September 21, 2010, we informed the market and our shareholders about
the engagement of BTG PACTUAL CORRETORA DE TÍTULOS E VALORES
MOBILIÁRIOS S.A. to act as market maker for the common shares ON
(WEGE3) in BM&FBOVESPA –Futures and Commodities Exchange. The
contract included an initial duration period of 6 (six) months, eligible for
automatic renovation.
The market formation is regulated by BM&F Bovespa. It is responsible for daily
offering in the market consistent purchase and sale offers, seeking to increase
liquidity of shares.
BTG Pactual began its activities as a market maker for WEGE3 as of
September 22, 2010.
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Reference Form - 2011 - WEG SA
8.1
Version : 1
Economic Groups - Description
a) Direct and indirect controlling shareholders
The company’s direct controlling shareholder is WEG Participações e
Serviços S.A., which holds a 50.79% stake in capital on December 31, 2010.
b) Subsidiaries
Percentage(%) of the Company
on 31/12/10
Direct
Indirect
(i) Subsidiaries
WEG Equipamentos Elétricos S.A.
WEG T intas Ltda
WEG Amazônia S.A.
WEG Linhares Equipamentos Elétricos Ltda
WEG Administradora de Bens Ltda
WEG Logística Ltda.
Hidráulica Industrial S.A. Ind. Com. - HISA
RF Reflorestadora S.A.
Agro Trafo S.A.
Instrutech Ltda
Logotech Ltda
WEG Chile S.A.
WEG Colômbia Ltda.
WEG Equipamientos Electricos S.A.
WEG Indústrias Venezuela C.A.
WEG Mé.ico S.A. de C.V.
WEG T ransformadores Mé.ico S.A. de CV
WEG Electric Corp.
WEG Service CO.
WEG Overseas S.A.
WEG Benelu. S.A.
WEG France S.A.S
WEG Germany GmbH
WEG Ibéria S.L.
WEG Electric Motors (UK) Ltd.
WEG Itália S.R.L
WEGeuro Ind. Electricas S.A.
WEG Scandinávia AB
WEG Austrália PTY
WEG Electric (Índia) Private Limited
WEG Electric Motors Japan CO Ltd.
WEG Nantong Electric Motors Manufacturing
WEG Singapore Pte Ltd.
WEG Germany NN
WEG Middle East FZE
WEG Industries (Índia) Private Ltd.
Voltran S.A. de C.V.
Zest Electric Motors (Pty) Ltd.
69
99.95
99.91
0.02
99.95
0.01
0.10
8.00
0.99
10.44
0.79
100.00
0.07
5.74
4.99
-
0.04
99.98
99.99
100.00
100.00
60.94
99.99
99.99
99.90
92.00
99.00
89.55
99.99
99.99
60.00
99.21
100.00
99.99
100.00
100.00
100.00
100.00
99.93
94.26
100.00
100.00
94.99
100.00
100.00
100.00
100.00
100.00
99.99
60.00
50.68
Reference Form - 2011 - WEG SA
8.1
Description of economic group
c) Issuer’s stake in companies of the group
Information offered in item 8.1 (b)
d) Stake of group companies in the issuer
N/A
e) Companies under common control
N/A.
70
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Reference Form - 2011 - WEG SA
8.2
71
Organizational chart of the economical group
Version : 1
Reference Form - 2011 - WEG SA
8.3
Version : 1
Restructuring operations
Date of Operation
December 6, 2010
Corporate Event
Sale and Acquisition of equity control
Description of Operation (i) Acquisition of Equisul
On December 6, we announced the signing of an agreement for the acquisition of
company Equisul Indústria e Comércio Ltda, specialized in the development and
manufacturing of uninterruptible power supply or UPS systems, including: no-breaks,
inverters, rectifiers, loaders and battery banks.
Equisul has a factory in São José (SC), with around 50 employees and must maintain
operating revenues of approximately R$ 15 million in 2010. The Company was
established in 1995 and acted as manufacturer of medium and small sized systems up
to 2004, when it expanded its product line for large triple phase systems with the
merger of GPL Eletroeletronica S.A., a traditional company in this segment.
With the acquisition of Equisul, WEG increased its complete product and solutions
portfolio for Power systems, adding solutions known as Critical Power, pieces of
equipment with broad use in it, finances and in critical industrial processes, such as in
the platforms of gas and oil exploration, in which An uninterrupted production is
potentially costly. With the ever growing industrial automation, the Commercial and
technological synergies for the UPS area are gaining importance day-to-day.
The consolidation of Equisul took place as of January 2011.
Date of Operation
June 9, 2010
Corporate Event
Sale and Acquisition of Equity Control
Description of Operation Acquisition of Instrutech- On June 9, announcing the agreement for the acquisition by
our subsidiary WEG Electrical S.A., Instrutech Ltda., company
which develops and manufactures electronic sensors for industrial automation,
commercial and human protection. The acquisition expanded the product line and
integrated solutions WEG in the automation area, adding products with high added
value and that were previously offered. Instrutech was the only Brazilian company to
produce specific equipment for automation of man/machine security.
Products and integrated electronic sensing systems are used largely on extreme
working conditions, in applications like machines tool, plastic injection molding,
machinery for working wood, packaging lines carriers, etc.
Date of Operation
May 25, 2010
Corporate Event
Sale and Acquisition of Equity Control
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Version : 1
Restructuring operations
Operation Description
(i)Acquisition of control of the ZEST Group - On May 25, we announced the acquisition
of controlling interest (51%) of the ZEST Group, a company based in South Africa.
Partner of WEG in South Africa for over 30 years, the ZEST Group won expressive
participation in all lines of business, particularly in Electric motors, in which it became
leader of the South African market. The Group also includes companies specialized in
assembling electric panels, industrial Assembly Group generators and providing
electrical commissioning services. The ZEST Group became the twenty-fourth
subsidiary of WEG abroad and its operations now, from the third quarter of 2010, to be
consolidated by WEG. As of this acquisition, South Africa, which was already an
important market with prospective of growth above the world average, has been
converted into and expansion base and WEG throughout the African continent.
Expansion has occurred both at leveraging extensive knowledge of markets by ZEST
Group, as for the development of large and WEG leader networking experience
leading in energy, mining and oil & gas.(ii)Control of the capital of Voltran-on May 25,
we also acquisition of additional stake in the capital of Voltran S.A. de C.V., a Mexican
company whichmanufactures transformers, raising our stake to 60% of the capital.
Date of Operation
The partnership between the WEG family Jimenez, controller of Voltran, began in
2006, when they were acquired 30% of the capital of the Mexican company. The
Voltran brand is strong in the Mexican market, partnered with WEG, generated good
results, with expansion of product line and improve deliverability. The evolution the
partnership was a natural consequence of these results, seeking to leverage the
synergies with other operations of WEG in Mexico. Also in this case, Voltran revenues
began to have an impact on WEG’s consolidated revenues from the third quarter of
2010.
01/08/2009
Corporate Event
Merger
Description of Operation On August 1, 2009, subsidiary Weg Equipamentos Elétricos S/A merged companies
Weg Automação S/A and Weg Itajaí Equipamentos Elétricos Ltda. seeking the
reduction of operating costs and expenses, especially those Due to the implementation
of the ERP (SAP System), which enables the integration and synergy of the activities
related to the production process and flow of materials, as well as activities of
strengthening in industrial solutions which involve products of the merged companies,
making negotiations easier and generating more competiveness.
On August 13, 2009 we announced through a Material Fact Notice that we were in
negotiation with the Governments of Espírito Santo and of the municipality of Linhares
for the installation of a new Industrial Unit. The conclusion of these negotiations was
informed on August 21, with the confirmation of the construction of a new factory to
support the expansion of the production of electric motors. In the future construction of
the factory, WEG adopted a modular concept, which allows for a gradual and
continuous expansion of the production capacity throughout various years meeting the
company’s expansion demands. The first production unit in Linhares is expected to
begin operations in 2011. This modular concept is used by WEG in its other factories
in Brazil and abroad.
Date of Operation
73
In the General Shareholders’ Meeting carried out on December 28, 2009 both in WEG
S.A. as in subsidiary T rafo Equipamentos Elétricos S.A., the operation with the merger
of TRAFO shares by WEG was approved. With the merger, TRAFO became a full
subsidiary of WEG, which became the sole shareholder of TRAFO issued shares
(direct or indirectly), in addition to continue holding the rights and liabilities held by the
company immediately before the approval of the operation. The shareholders of
TRAFO, held WEG shares, according to the substitution relation approved. Later on
December 31, 2009, the merger of TRAFO Equipamentos Elétricos S.A. by subsidiary
WEG Equipamentos Elétricos S.A. was approved.
13/03/2008
Reference Form - 2011 - WEG SA
8.3
Version : 1
Restructuring Events
Corporate Event
Other
Description of Corporate Event
Constitution of new Subsidiary
"Other"
Description of Operation
On March 13, we announced the establishment of a new subsidiary of
sale and distribution in the external market, WEG Russia, constituted
in the city of Nizhny Novgorod (previously Gorki), capital of the
province with the same name. WEG Russia will sell, distribute and
offer technical assistance of products and systems in Russia and in the
other Eastern-European countries. This market has large potential for
business in areas such as exploration, production and transport of oil
and gas. Our presence in the region is still modest, and our experience
in the oil and gas markets in other regions will be important so that we
can conquer our space in Easter Europe.
On May 26 we announced our expansion plan for India, with the
construction of a factory for the manufacturing of electrical motors, to
be constructed in the city of Hosur, state of Tamil Nadu, close to
Bangalore. The new factory will demand total estimated investments of
US$ 50 million for the first phase of the project and should begin the
production of electric motors by the end of 2009. India has proven to
be an extremely attractive market since 2004 when we began our
sales through own subsidiaries and important projects for irrigation,
electricity, hydraulics and thermal industry.
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Reference Form - 2011 - WEG SA
8.4
Other relevant information
N/A
75
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Reference Form - 2011 - WEG SA
9.1
Relevant Non-Current assets - Others
See items 9.1a) – b) – c)
76
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Reference Form - 2011 - WEG SA
9.1
Relevant Non-Current Assets / 9.1.a – Fixed Assets
Description of the fixed asse ts
Factory in Portugal
Factory II
Factory III
Factory IV
Gravataí Unit
Hortolândia Unit
Itajaí Unit
Linhares Unit
São Bernardo do Campo
Factory in Mexico
Factory in Índia
Factory in China
Factory in Argentina
Factory I
Joaçaba Unit
Manaus Unit
77
Version : 1
Location Country
Portugal
Brazil
Brazil
Brazil
Brazil
Brazil
Brazil
Brazil
Brazil
Mexico
India
China
Argentina
Brazil
Brazil
Brazil
Location State
SC
SC
SC
RS
SP
SC
ES
SP
SC
SC
AM
Location Municipality
Maia
Jaraguá do Sul
Guaramirim
Blumenau
Gravataí
Hortolândia
Itajaí
Linhares
São Bernardo Campo
Município de Huehuetoca
Cidade de Hosur
Jiangsu Provence
Córdoba Provence
Jaraguá do Sul
Joaçaba
Manaus
Type of Property
Own
Own
Own
Own
Own
Own
Own
Own
Own
Own
Own
Own
Own
Own
Own
Own
Reference Form - 2011 - WEG SA
9.1
Version : 1
Relevant non-current assets / 9.1.b –Patents, brands, licenses, grants, franchises and technology transfer
contracts
Type of asset
Description of asset
Territory
Brands
Registration of WEG
Brand in various
Classes
80 countries in which Renewable for 10
the company has
years
business
Brands
Registration of Various 30 countries in which Renewable for 10
brands Regarding the The company has
years
Determined Product
business
classes
78
Duration
Events which may cause loss of rights
Consequence for loss of rights
Failure in renovation of registrations of third Commercial losses due to loss of
parties or cancelation by the local authorities brand recall and marketing costs for
strategic alternative
Failure in renovation of registrations, of third
parties or cancelation by local authorities
Reference Form - 2011 - WEG SA
9.1
Version : 1
Relevant non-current assets/ 9.1.c - Shareholdings
Company
Name
CNPJ (Corporate
Taxpayer’s ID)
Fiscal year
Book Value – Variation % Market Value – Amount of dividends
Variation %
received (Re ais)
Ins trutech Ltda 01.422.798/0001-22
CVM Code
-
T ype of Company
Subsidiary
31/12/2010
0,000000
0,000000
31/12/2009
0,000000
0,000000
31/12/2008
0,000000
0,000000
Re asons for acquisition and maintenance of shareholdings
Integrating part o f business
Logotech Ltda 96.570.148/0001-30
Subsidiary
31/12/2010
0,000000
0,000000
31/12/2009
0,000000
0,000000
31/12/2008
0,000000
0,000000
Re asons for acquisition and maintenance of shareholdings
Integrating part o f business
RF
79.670.501/0001-35
Subsidiary
Reflorestadora
S.A.
79
He adquarte ring He adquarte ring He adquarte ring
Country
State
Municipality
Brazil
Market Value
0,00 Book Value
0,00
0,00
Brazil
Book Value
0,00 Book Value
0,00
0,00
Brazil
Date
Value (Reais)
SP
São Paulo
31/12/2010
SP
Shareholdings
the Issuer (%)
Sale of equipm ent and elec tronic implements destined 0,010000
for automation and control of industrial processes.
Rendering of servic es and projection and consulting in
implemented equipment destined for automation and
the c ontrol of indus trial processes . Installation and
maintenance of electronic equipment and implements
for automation and control of industrial processes.
0,00
São Paulo
31/10/2010
SC
De scription of Activitie s develope d
Sale of equipm ent and elec tronic implements destined 0,100000
for automation and control of industrial processes
Rendering of servic es and projection and consulting in
implemented equipment destined for automation and
the c ontrol of indus trial processes . Installation and
maintenance of electronic equipment and implements
for automation and control of industrial processes.
0,00
Jaraguá do Sul
99,950000
Produc tion of res ins in general, painting materials,
subs tance and produc ts from vegetable and c hemical
origin for indus try and sc ienc e.
of
Reference Form - 2011 - WEG SA
9.1
Company Name
Fiscal ye ar
31/12/2010
31/12/2009
31/12/2008
Version : 1
Relevant non-current assets/ 9.1.c - Shareholdings
CNPJ (Corporate
CVM Code
Taxpaye r’s ID)
Book Value – Variation % Market Value –
Variation %
-10,980000
1,960000
0,000000
Type of Company
Amount of dividends
rece ived (Reais)
Market Value
5.893.000,00 Book value
5.325.000,00
0,00
0,000000
0,000000
0,000000
Reasons for acquisition and mainte nance of shareholdings
Integrating part of business
WEG Am azônia S.A. 06.303.603/0001-49
-
Subsidiary
31/12/2010
50,000000
0,000000
31/12/2009
0,000000
0,000000
31/12/2008
0,000000
0,000000
Reasons for acquisition and mainte nance of shareholdings
Integrating part of business
WEG Chile S.A.
00.000.000/0000-00
- Subsidiary
31/12/2010
31/12/2009
31/12/2008
80
47,920000
40,800000
0,000000
0,000000
0,000000
0,000000
He adquarte ring Headquarteri He adquarte ring
Country
ng State
Municipality
Date
Value (Reais)
Brazil
Market Value
0,00 Book Value
0,00
0,00
31/12/2010
247.730.000,00
AM
Manaus
31/12/2010
Shareholdings of the
Issuer
Produc tion, manufac turing, s ale, export and import of 0,020000
industrial systems, elec tromechanical and electronic
machines , girating elec trical machines , machinery and
equipment in general, equipment for producing,
distributing and convers ion of electricity, elec tric al
material, programmable c ontrollers, parts and
components for machinery, devic es and equipm ents
in general.
6.000,00
Produc tion, manufac turing, s ale, export and import of 8,000000
industrial systems, elec tromechanical and electronic
machines , girating electrical machines , machinery and
equipment in general, equipment for producing,
distributing and convers ion of electricity, elec tric al
material, programmable c ontrollers, parts and
components for machinery, devic es and equipm ents
in general.
Chile
Market Value
0,00 Book Value
0,00
0,00
Description of Activ ities developed
31/12/2010
1.562.000,00
Reference Form - 2011 - WEG SA
9.1
Version : 1
Relevant non-current assets/ 9.1.c - Shareholdings
Company Name
CNPJ (Corporate
Taxpayer’s ID)
CVM COde
Fiscal year
Book Value – Variation % Market Value –
Variation %
Reasons for acquisition and maintenance of shareholdings
Integrating part of business
WEG Colômbia
00.000.000/0000-00Ltda.
Type of Company
Amount of dividends
received (Reais)
Affiliate
31/12/2010
32,650000
0,000000
31/12/2009
0,000000
0,000000
31/12/2008
0,000000
0,000000
Reasons for acquisition and maintenance of shareholdings
Integrating part of business
Subsidiary
WEG Electric (Índia) 00.000.000/0000-00
31/12/2010
16,670000
0,000000
31/12/2009
-14,290000
0,000000
31/12/2008
0,000000
0,000000
Reasons for acquisition and maintenance of shareholdings
Integrating part of business
81
Headquartering Headquartering Headquartering
Country
State
Municipality
Date
Production, manufacturing, sale, export and 0,990000
import of industrial systems,
electromechanical and electronic machines,
girating electrical machines, machinery and
equipment in general, equipment for
producing, distributing and conversion of
electricity, electrical material, programmable
controllers, parts and components for
machinery, devices and equipments in
general
31/10/2010
65.000,00
India
Market Value
0,00Book Value
0,00
0,00
Shareholdings
of the Issuer
Value (Reais)
Colombia
Market Value
0,00Book Value
0,00
0,00
Description of Activities developed
Sale, export and import of industrial
4,990000
systems, electromechanical and electronic
machines, gyrating electrical machines,
machinery and equipment in general,
equipment for producing, distributing and
conversion of electricity, electrical material,
programmable controllers, parts and
components for machinery, devices and
equipments in general
31/12/2010
21.000,00
Reference Form - 2011 - WEG SA
9.1
Version : 1
Relevant non-current assets/ 9.1.c - Shareholdings
Corporate Name
CNPJ(Corporate
Taxpayer’s ID)
Fiscal year
Book Value – Variation % Market Value –
Variation %
WEG Electric Corp. 00.000.000/0000-00
CVM Code
-
Type of Company
Amount of dividends
Received (reais)
Subsidiary
31/12/2010
8,240000
0,000000
31/12/2009
-13,020000
0,000000
31/12/2008
0,000000
0,000000
Reasons for acquisition and maintenance of shareholdings
Integrating part of business.
WEG
07.175.725/0001-60
Affiliate
Equipamentos
31/12/2010
-8,040000
0,000000
31/12/2009
1,740000
0,000000
31/12/2008
0,000000
0,000000
Reasons for acquisition and maintenance of shareholdings
Integrating part of business.
82
Headquartering Headquartering Headquartering
Country
State
Municipality
Date
Brazil
Market Value
653.973.000,00Book Value
392.947.000,00
0,00
Shareholdings of the
Issuer(% )
Value (Reais)
United States
Market Value
0,00 Book Value
0,00
0,00
Description of Activities developed
Sale, export and import of industrial
0,790000
systems, electromechanical and electronic
machines, gyrating electrical machines,
machinery and equipment in general,
equipment for producing, distributing and
conversion of electricity, electrical material,
programmable controllers, parts and
components for machinery, devices and
equipments in general
31/12/2010
SC
31/12/2010
499.000,00
Jaraguá do Sul
2.459.328.000,00
Production, manufacturing, sale, export
0,000000
and import of industrial s ystems,
electromechanical and electronic
machines, gyrating electrical machines,
machinery and equipment in general,
equipment for producing, distributing and
conversion of electricity, electrical material,
programmable controllers, parts and
components for machinery, devices and
equipments in general
Reference Form - 2011 - WEG SA
9.1
Version : 1
Relevant non-current assets/ 9.1.c - Shareholdings
Corporate Name
CNPJ(Corporate
Taxpayer’s ID)
Fiscal year
Book
Value
Variation %
WEG
Equipamientos
CVM Code
Type of Company
– Market Value – Amount of dividends
Variation %
Received (Reais)
00.000.000/0000-00 Subsidiary
Argentina
31/12/2010
8,980000
0,000000
31/12/2009
-57,640000
0,000000
31/12/2008
0,000000
0,000000
Reasons for acquisition and maintenance of shareholdings
Integrating part of business.
WEG Itália S.R.L
00.000.000/0000-00 Subsidiary
31/12/2010
0,000000
0,000000
31/12/2009
0,000000
0,000000
31/12/2008
0,000000
0,000000
Reasons for acquisition and maintenance of shareholdings
Integrating part of business.
83
Headquartering Headquartering Headquartering
Country
State
Municipality
Market Value
581.000,00Book Value
0,00
0,00
Date
31/12/2010
31/12/2010
Shareholdings
of the Issuer (% )
Value (Reais)
Production, manufacturing, sale, export and
import of industrial s ystems, electromechanical
and electronic machines, gyrating electrical
machines, machinery and equipment in general,
equipment for producing, distributing and
conversion of electricity, electrical material,
programmable controllers, parts and
components for machinery, devices and
equipments in general
10,440000
Sale, export and import of industrial systems,
electromechanical and electronic machines,
gyrating electrical machines, machinery and
equipment in general, equipment for producing,
distributing and conversion of electricity,
electrical material, programmable controllers,
parts and components for machinery, devices
and equipments in general
0,070000
3.324.000,00
Italy
Market Value
0,00Book Value
0,00
0,00
Description of Activities developed
5.000,00
Reference Form - 2011 - WEG SA
9.1
Version : 1
Relevant non-current assets/ 9.1.c - Shareholdings
Corporate Name
Fiscal year
CNPJ(Corporate
Taxpayer’s ID)
Book Value –
Variation %
CVM Code
Type of Company
Market Value –
Variation %
Amount of
dividends
Received (Reais)
Subsidiary
WEG Overseas S.A.00.000.000/0000-00-
31/12/2010
-16,440000
0,000000
31/12/2009
96,640000
0,000000
31/12/2008
0,000000
0,000000
Reasons for acquisition and maintenance of shareholdings
Integrating part of business.
Subsidiary
WEG Tintas Ltda. 12.006.058/0001-21-
Headquartering Headquartering Headquartering
Country
State
Municipality
Date
Value (Reais)
Description of Activities developed
Virgen
(USA)
Sale, export and import of industrial systems,
electromechanical and electronic machines,
gyrating electrical machines, machinery and
equipment in general, equipment for producing,
distributing and conversion of electricity, electrical
material, programmable controllers, parts and
components for machinery, devices and equipments
in general
100,000000
Production of resins in general, painting materials,
substance and products from vegetable and
chemical origin for industry and science.
99,910000
Isles
Market Value
0,00 Book Balue
0,00
0,00
Brazil
Market Value
31/12/2010
0,000000
0,000000
2.360.000,00 Book Value
31/12/2009
0,000000
0,000000
0,00
31/12/2008
0,000000
0,000000
0,00
Reasons for acquisition and maintenance of shareholdings
Integrating part of business.
WEGeuro Ind.
00.000.000/0000-00Subsidiary
Portugal
Market Value
84
31/12/2010
SC
31/12/2010
Shareholdings of
the Issuer (% )
61.000,00
Guaramirim
56.062.000,00
Production, manufacturing, sale, export and import of 5,740000
industrial systems, electromechanical and electronic
machines, girating electrical machines, machinery
and equipment in general, equipment for producing,
distributing and conversion of electricity, electrical
material, programmable controllers, parts and
components for machinery, devices and equipments
in general
Reference Form - 2011 - WEG SA
9.1
Version : 1
Relevant non-current assets/ 9.1.c - Shareholdings
Corporate
Name
CNPJ(Corporate
Taxpayer’s ID)
CVM Code
Fiscal year
Book Value – Variation Market Value – Amount of dividends
%
Variation %
Received (Reais)
31/12/2010
-1,040000
0,000000
31/12/2009
2,380000
0,000000
31/12/2008
0,000000
0,000000
Reasons for acquisition and maintenance of
shareholdings
Integrating part of business.
85
Type of Company
Headquartering Headquartering Headquartering
Country
State
Municipality
0,00 Book Value
0,00
0,00
Date
Value (Reais)
31/12/2010
1.622.000,00
Description of
Activ ities
developed
Corporate Name (%)
Reference Form - 2011 - WEG SA
9.2
Other relevant information
N/A
86
Version : 1
Reference Form - 2011 - WEG SA
Version : 1
10.1 General financial and equity conditions
(Amounts in thousands of Brazilian reais, except where otherwise indicated)
a) General financial and equity position – WEG Group
WEG is a Brazilian corporation with global operations, being thus exposed to
global economic conditions in the ordinary course of its business. Over the
past few years the world economic situation large favored the expansion of
our business, which witnessed one of the longest periods of continuous
economic expansion in modern history. However, from mid 2008, the
imbalances accumulated during the long period of expansion, originating
from the expansion of consumer credit, especially in the U.S. housing sector,
led to instability in global financial markets and started up a synchronized
movement of global economic downturn.
This slowdown in economic activity, even with its distinct effects and
intensity, hit all segments of the market and practically all regions of the
globe, forcing the hasty and decisive governmental intervention, with actions
that stimulated the economy such as expansion tax policies and monetary
policies which increased liquidity. The results of these measures could be felt
in the second half of 2009, with the decrease and, in the case of the said
emerging economies, such as that of Brazil, the beginning of a recovery in
growth, which gained force in 2010.
The industrial segment managed to recover from the crisis, with the
reversion of the decrease reported in 2009. According to the IBGE (Brazilian
Institute of Geography and Technology) industrial production grew by 10.5%
in 2010 versus 2009. The production of capital goods increased even faster,
growing by 20.8% versus the previous year.
b) Capital structure and possible redemption of shares or interest units,
indicating:
At December 31, 2010, the capital structure is made up of 29% debt (Total
Liabilities minus Cash and Cash Equivalents) and 71% equity (Net Equity).
Management believes that the capital structure of the Company today is
adequate for the market’s current timing.
i.
Possible redemption
Management does not anticipate possible redemption of issued shares.
ii. Calculation method for redemption price
N/A.
c) Ability to pay financial commitments undertaken
The Company seeks to maintain resources and sources of liquidity to pursue
investment opportunities to maintain its growth rate without increasing its
exposure to financial risks.
The Company invests cash and cash equivalents in liquid financial
instruments of first-tier banks, based on financial soundness, credit quality
and profitability criteria. Over the past years, most of the financial
instruments are denominated in Brazilian currency.
87
Reference Form - 2011 - WEG SA
Version : 1
10.1 General financial and equity conditions
At December 31, 2010, cash, cash equivalents and short-term investments,
all classified under current assets, totaled R$ 2,552,996 (R$ 2,127,117 at
December 31, 2009) as shown below:
a)Cash and Banks
b)Financial Investments
-In Local Currency
Bank Deposit Certificates (CDB)
-In Foreign Currency
Foreign Deposit Certificates
Other foreign balances
TOT AL
CONSOLIDATED
31/12/10
31/12/09
53,971
30,948
2,499,025
2,096,169
2,454,302
2,024,651
2,454,302
2,024,651
44,723
71,518
29,685
70,285
15,038
1,233
2,552,996
2,127,117
Investments in Brazil
• At December 31, 2010, Bank Deposit Certificates (CDB) were subject to
interest between 99.6% and 106.0% of CDI (100.0% and 106.5% of CDI
at December 31, 2009).
Investments Abroad:
• In Euro, with a rate of 0.1% to 1.3% p.a. in depository certificates issued
by financial institutions abroad, in the amount of EUR 9,266, whose
balance on December 31, 2010 was R$ 20,645.
• In US Dollars, plus interest of 0.05% to 2.00% p.a., in depository
certificates issued by financial institutions abroad, in the original value of
US$ 5,434 whose balance on December 31, 2010 was R$ 9,040.
• In local currency with interest ranging between 1.92% to 11.75% p.a.
whose balance on December 31, 2010 was R$ 15,037.
In all cases, the investments have immediate liquidity.
d) Sources of funds used for working capital and capital expenditures
The Company uses the following sources of funds:
• To finance the acquisition and construction of fixed assets in Brazil, we
use loans from the National Bank for Economic and Social Development
(BNDES) and other development agencies, mostly in national currency;
• To finance foreign subsidiaries’ working capital, we use funds in the
respective currencies of each country.
• To finance foreign trade operations, we use advance on exchange
contracts (ACC), financing in foreign currency type, taking advantage of
the natural hedge and continuously monitoring the financial exposure to
foreign exchange.
• For investments in research and development activities, we use specific
lines of credit from the Financing Agency for Studies and Projects
(FINEP).
88
Reference Form - 2011 - WEG SA
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10.1 General financial and equity conditions
e) Sources of funds for working capital and capital expenditures intended
to be used as a means of covering liquidity shortfalls
The Company controls its future working capital requirements, avoiding the
need to enter into emergency financing agreements to cover unexpected
liquidity shortfalls, which always implies higher costs. Moreover, the
Company has access to pre-approved standby lines of credit from the main
banks with which it does business, and these lines may be used at any time.
f) Levels of debt and characteristics of such debts, also describing:
i. Relevant loan and financing agreements:
At December 31, 2010, gross financial debt totaled R$ 2,418,943, as
follows:
• Short-term operations totaled R$ 1,018,995 million (42% of total),
represented by transactions associated with operating activities (trade
finance) in foreign currency and by the current amount of loans
obtained from BNDES and other development agencies, mostly in local
currency.
• Long-term operations totaled R$ 1,399,948 million (58% of total),
mainly represented by financing obtained from BNDES and other
development agencies, mostly in local currency, and by the noncurrent
amount of working capital financing for foreign subsidiaries in the
respective currencies of each country.
89
Reference Form - 2011 - WEG SA
Version : 1
10.1 General financial and equity conditions
The following table describes the debt characteristics:
Type
IN BRAZIL
SHORT TERM
Working Capital (ACC)
Working Capital
Working Capital
Working Capital
Working Capital
Working Capital
Fixed Assets
LONG TERM
Working Capital
Fixed Assets
Working Capital
Working Capital
Fixed Assets
Working Capital
Working Capital
ABROAD
SHORT TERM
Working Capital
Working Capital
Working Capital
Working Capital
Working Capital
Working Capital
LONG TERM
Working Capital
Working Capital
Working Capital
Working Capital
TOTAL SHORT TERM
TOTAL LONG TERM
90
Annual Charges
Interest 0,8% to 2,3% p.a. (+) exchange variation
TJLP (+) 1,4% to 5,0% p.a.
Basket of Currencies (+) 0,8% to 2,5% p.a.
Interest 4,5% to 7,0% p.a.
US Dollar (+) 1,4% to 1,8% p.a.
US$ (+) Libor (+) 3,25% p.a.
TJLP (+) 1,2% to 8,8% p.a.
TJLP (+) 1,5% to 5,3% p.a.
UFIR (+) 1,2% to 5,0% p.a.
Basket of Currencies (+) 0,8% to 2,5% p.a.
Interest 4,5% to 7,0% p.a.
TJLP (+) 1,2% to 5,0% p.a.
US Dollar (+) 1,4% to 1,8% p.a.
US$ (+) Libor (+) 3,25% p.a.
EURIBOR (+) 0,8% to 3,4% p.a.
LIBOR (+) 2,1% to 3,3% p.a.
90% of PBOC (4,5% to 5,0%) p.a.
BBSY (+) 2,3% p.a.
JIBAR (+) 3,5% p.a.
Interest 0,8% to 16,5% p.a.
90% of PBOC (4,5% to 5,0%) p.a.
BBSY (+) 2,3% p.a.
JIBAR (+) 3,5% p.a.
Interest 5,0% to 11,7% p.a.
CONSOLIDATED
31/12/10
31/12/09
760,349
276,411
388,700
2,470
82,560
4,801
67
5,340
1,311,643
488,272
41,500
424
662,216
17,700
59,876
41,655
729,256
229,577
479,431
7.242
6,932
1.,059
5,015
906,253
483.569
22,832
2,906
365,002
19,921
12,023
-
258,646
40,524
72,358
8,059
18,277
14,058
105,370
88,305
51,079
302
32,338
4,586
1.018.995
1.399.948
166,629
45,818
45.513
7,989
67,309
70,395
70,395
895,885
976,648
Reference Form - 2011 - WEG SA
Version : 1
10. 1 General financial and equity conditions
ii. (cont.) other long term relations with financial institutions
N/A
iii. (cont.) debt subordination levels,
All of the financing agreements have the same seniority levels
iv. (cont.) any restrictions regarding:
• indebtedness ratios and limitations on new indebtedness:- Some of the
Company’s agreements with BNDES impose minimum requirements
on:
• capitalization (net equity/total assets)
• relation between net debt/EBITDA
• current liquidity (current assets/liabilities) - The financing agreementin
place with IFC include clauses that impose limits on the distribution of
dividends by the Company in case of default regarding the installments
of the contract.
• sale of assets –the financing contract with IFC stipulates that the
Company cannot sell assets (i) which represent more than 10% of the
assets which were consolidated in the year prior to the event or (ii) the
value of consolidated assets is lower than 50% of the consolidated
assets on March 31, 2010.
• Issuance of new securities - The financing agreements in place do not
include clauses that impose limits on the issuance of securities by the
Company
• Disposal of Corporate control - The financing agreements in place do
not include clauses that impose limits on the disposal of the Company’s
corporate control.
v. Limitations on the use of current financing arrangements
The Company has access to pre-approved standby lines of credit from the
main banks with which it does business, and these lines may be used at
any time.
vi. Significant changes in each line item of the financial statements.
Review of balance sheet accounts
Position at December 31, 2010 as compared to December 31, 2009
91
Reference Form - 2011 - WEG SA
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10.1 General financial and equity conditions
I. Current Assets
At December 31, 2010, current assets amounted to R$ 4,794,009,
representing a decrease of R$ 820,851, or 21%, over the R$ R$ 3,973,158
figure for December 31, 2009. In relation to total assets, current assets
decreased from 60% at December 31, 2009 to 64% at December 31, 2010.
The major changes in current assets were as follows:
Cash and cash equivalents
The line item “Cash and cash equivalents”, amounting to R$ 2,552,996 at
December 31, 2010, increased R$ 425,879, or 20%, over the R$ 2,127,117
figure for December 31, 2009. This positive change results from the
substantial cash generated for the period, together with a decrease in
investments in working capital. In relation to total assets, cash and cash
equivalents accounted for 34% at December 31, 2010, as compared to 32%
for December 31, 2009.
Accounts receivable
The line item “Accounts receivable” amounted to R$ 1,044,712 at December
31, 2010, representing an increase of R$ 134,576, or 15%, over the R$
910,136 figure for December 31, 2009. This change results from the increase
in customer financing requirements for the period, with the increase of
business. In relation to total assets, trade accounts receivable represented
14% at December 31, 2010, as compared to the same percentage for
December 31, 2009.
Inventories
The line item “Inventories” amounted to R$ 1,008,952 at December 31, 2010,
representing an increase of R$ 250,836, or 33%, over the R$ 758,116 figure
for December 31, 2009. This change results from the natural increase in
need for investment observed in the period, with the increase in business. In
relation to total assets, inventories represented 13% at December 31, 2010,
as compared to 12% for December 31, 2009.
II. Noncurrent assets
At December 31, 2010, “Noncurrent assets”amounted to R$ 2,717,155,
representing 36% of total assets, with a positive variation of R$ 107,247 or
4% in relation to the total R$ 2.609.908 on December 2009. Regarding total
assets, noncurrent assets increased from 36% on December 31, 2009 to
40% on December 31, 2010. The main variations in Current Assets were:
Fixed Assets
The account “Fixed Assets” presented the balance of R$ 2,395,575 on
December 31, 2010, with an increase of R$ 124,382 or 5% in comparison
with the 2,271,193 registered on December 31, 2009. The variation is due to
the investment in expansion of capacity, net of effects of write-offs and
depreciation and exhaustion registered in the period. In comparison with the
total assets, fixed assets represented 32% on December 31, 2019,
compared to 35% registered on December 31, 2009.
92
Reference Form - 2011 - WEG SA
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10.1 General financial and equity conditions
Intangible Assets
Intangible assets presented the balance of R$ 183,995 on December 31,
2010, with a R$ 55,135 or 43% increase in comparison with the R$ 128,860
registered on December 31, 2009. The variation results from the goodwill
registered in acquisitions. Regarding total assets, intangible assets
represented 2% on December 31, 2010, the same percentage registered on
December 31, 2009.
III. Current Liabilities
Current Liabilities totaled R$ 1,938,803 on December 31, 2010, with an
increase of R$ 240,242 or 14% compared to the total of R$ 1,698,561 on
December 31, 2009. Regarding total liabilities, current liabilities on
December 31, 2010 maintained the same 26% registered on December 31,
2009. The main variations in Current Liabilities were:
Suppliers
The line “Suppliers” amounted to R$ 242.300 at December 31, 2010,
representing an increase of R$ 53,521, or 28%, over the R$ 188,779 figure
for December 31, 2009. This change naturally results from an increase in
operations for the period. In relation to total liabilities, suppliers represented
3% at December 31, 2010, as compared to the same percentage on
December 31, 2009.
Short-term debt
The line item “Short-term debt” amounted to R$ 1,018,995 at December 31,
2010, representing an increase of R$ 123.110, or 14%, over the R$ 895,885
figure for December 31, 2009. This change results from an increase in shorttermloans to support the increase in the need for investments in working
capital. In relation to total liabilities, short-term debt represented 14% at
December 31, 2010, as compared to 14% for December 31, 2009.
Dividendos e juros sobre capital próprio a pagar
The account “Dividends and interest on equity payable” presented the
balance of R$ 63,440 on December 31, 2010, the increase of R$ 26,591 or
72% regarding the R$ 36,849 registered on December 31, 2009. This
variation takes place due to the change in accounting of declared dividends,
but which have still not been effectively paid over the minimum legal limit of
25% of adjusted net income. Regarding total liabilities the account
represented 1% on December 31, 2010, in comparison to 1% registered on
December 31, 2009.
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10.1 General financial and equity conditions
IV. Noncurrent liabilities
Noncurrent liabilities totaled R$ 2,028,525 on December 31, 2010, with a R$
471,306 or 30% increase in comparison with the total of R$ 1,557,219 on
December 31, 2009. Regarding total liabilities, noncurrent liabilities
increased from 24% on December 31, 2009 to 27% on December 31, 2010.
The main variations in noncurrent liabilities were:
Long T erm Financings and Loans
The account "financing and long-term loans, with a balance of R$ 1,399,948
on December 31, 2010, showed a growth of R$ 423,300 or 43% compared to
R$ 976,648 registered on December 31, 2009. This variation is caused by
the increase of the company's debt profile and engagement of new funding.
In relation to the total liabilities, account funding and long-term loans
accounted for 19% in December 31, 2010 compared to 15% registered
onDecember 31, 2009.
V. Net Equity
Equity reached R$ 3,543,836 at December 31, 2010, an increase of R$
216,550 or 7% over the R$ 3,327,286 registered on December 31, 2009.
This growth was mainly caused by the net profit generated in the fiscal year,
net of result distributions.
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10.2 Financial and Operating Results
(Amounts in thousands of Brazilian reais, except where otherwise indicated)
Position on December 31, 2009 compared to December 31, 2008.
Gross Operating Revenue
In 2010, the Consolidated Gross Operating Revenue (GOR) totaled
R$4.391.973, a 4,3% year on year decrease. The revenue performance,
however, was different for each of our business segments, having showed
healthy
growth
in
the
Industrial
Electrical
and
Electronic
Equipment,Household Motors area and in the Paints & Varnishes area.
However, the GTD area (equipment for the energy industry) suffered from the
low performance in incoming requests in 2009.
The following aspects are to be highlighted in each of these areas:
Industrial electrical and electronic equipment – with the recovery in the industrial
production rhythm, in Brazil and in the rest of the world, and the consequent
expansion of investment in the industrial production capacity, observing a 12%
increase in GOR, when compared to 2009. This business area concentrates
most of our business abroad, which is conducted in other curries. Therefore,
despite the performance and appreciation of the Brazilian currency affects
comparisons, which explains the modest increase.
Equipment for the generation, transmission and distribution of energy (GTD) –
we observed a decrease of 24% in GOR compared to 2009. This is a segment
characterized as a "long cycle", in which the effects of the changes in the basis
of demand are slowly transferred to sales and revenue, and our performance in
this segment focuses on a few market niches. Regarding power generation we
have clear focus on the sources that provide renewable and distributed
generation of power, such as small hydro and biomass thermal energy. As
mentioned, the negative GTD performance in 2010 is the result of decrease in
volume of new orders in 2009, when the international crisis caused a decrease
in investments. The performance of sales, measured by the placement of new
orders, showed an improvementthroughout the year, mainly in the transmission
and distribution products. The impacts of this improvement should be most
evident throughout 2011.
Household motors - This business area maintained good performance
throughout the year with growth of 24% in GOR compared to 2009, even with
the gradual withdrawal of consumer incentives in the form of tax reductions.
This business area, however, is characterized as "short cycle", i.e., changes in
market conditions are quickly transferred to sales and revenue. Still, the market
remained positive, with the expansion of employment, income and credit
boosting the market.
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10.2 Financial and Operating Results
Paints and varnishes - the positive conditions of Brazilian industry allowed for a
20% increase compared to the previous year in this business area. This positive
reactin is within the expectations, as we seek to cater to the same customers
that we conquered in other business areas with our line of paints and varnishes.
Domestic Market
Net Operating Revenue in the internal market reached R$ 2,670,443
representing 61% of our GOR with growth of 5.7% compared to the previous
year. This increase was due to the recovery of economical activity, with positive
reflections over the demand of durable consumer products and capital goods for
investments in expansion of the production capacity.
Throughout the last 50 years, we built a leading position in all operating areas in
the Brazilian market, continuously expanding our lines of products and services.
We are the leaders in the production of electric equipment such as electric
motors, transformers, generators and, throughout the years, we have evolved in
the sense of creating full integrated industrial solutions.
Foreign Market
In our foreign markets Net Operating Revenue reached R$ 1,721,530,
corresponding to 39% of GOR. The comparison of the GOR values in reais
shows a 2.2% increase in comparison with the previous year. Considering the
amounts in US Dollars, Net Operating Revenue in the foreign market reached
USD 892,9million, with growth of 15.7% in comparison with 2009. In 2010 we
continued to advance in our international operations. We increased our
participation in the Mexican transformer market, acquiring additional interest of
the capital of our affiliate Voltran, one of the market leaders. In addition, we
acquired control of ZEST, the leading company in the electric and electronic
industrial market in South Africa. In addition to these acquisitions, we continue
to expand our factory operations beyond Brazil. In 2010 we built a factory in
India, which is added to our factories in Argentina, Mexico, Portugal and China.
We currently distribute our products in over 100 countries in the five different
continents and we are directly present in the main global markets. We seek to
diversify our geographical presence, maintaining consistant growth rates in the
foreign market and avoiding the effects of the variations in the economic cycle
of each country.
Cost of Products Sold
Cost of Products Sold (CPS) reached R$ 3,005,021 in 2010 representing 68.4%
in comparison with GOR (67.8% in 2009). Therefore there was a decrease of
0.6 percentage point in comparison with the previous year in gross margin,
which reached 31.6%.
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10.2 Financial and Operating Results
The main impacts over CPS have been:
•
Changes in the mix of sold products, with the addition of more products
which have a lower added value, with an increase in transformation cost
and lower dilution of fixed costs. This is an expected effect, as the
recovery of the demand which normally takes place faster in the market
and in the less elaborate products. We have noticed a gradual expansion
of recovery in the demand of products and elaborated markets.
•
Appreciation of the Brazilian currency has put pressure on our margins in
the increase of costs in reais relative to the margins in other currencies.
We work to minimize these pressures by combining our global process for
purchase of inputs with the currency hedging policy.
Selling, General and Administrative Expenses
Consolidated Selling, General and Administrative Expenses totaled R$ 696,973,
representing 15.9% of GOR in 2010. There was an increase of about 10% over
R$ 633.467 accrued in 2009, however despite the relative growth has been only
0.9 percentage points compared to GOR. Similarly, as previously described, in
the case of CPS, the effects of the changes in the production mix explain the
negative variations in operating expenses.
EBITDA
As a result of the effects discussed above, EBITDA, calculated according to the
methodology defined by CVM in Official Letter 01/07, reached the amount of R$
789,110 in 2010, with a 5.8% over the results obtained in 2009. The EBITDA
margin was 18%, 1.9 percentage points below the EBITDA margin in the
previous year.
Financial Expenses and Revenues
Financial Revenues added R$ 348,471 (R$ 383,468 in 2009) and Financial
Expenses totaled R$ 225,356 (R$ 272,149 in 2009). Therefore, the financial
results were positive by R$ 123,115 (R$ 111,319 in 2009).
Net Income
As a result of the effects mentioned previously, Consolidated Net Income
attributable to the shareholders of WEG S.A. reached R$ 519,782, 5.6% lower
than the R$ 550,543 registered in 2009. Return on Net Income was 15.8% in
2010 (17.9% in 2009).
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10.3 Events with relevant effects, which occurred and were
expected in the financial statements
(Amounts in thousands of Brazilian reais, except where otherwise indicated)
a) Introduction or sale of operational segment.
N/A
b) Constitution, acquisition or sale of shareholdings
New Manufacturing Unit in India.
The company built, including during 2010, a new manufacturing unit in the
city of Husur, Tamil state, India. This facility will manufacture high-voltage
electric motors and electric power generators and will start operations in the
beginning of 2011.
This is a pioneering venture for the Company to manufacture high-voltage
equipment abroad, seeking to leverage the opportunity offered by the rapidly
expanding Indian market.
Another unique aspect of this project is that it is a greenfield project,
designed and implemented to meet WEG’s standard requirements since the
start-up of operations.
New Manufacturing Unit in Linhares (ES)
In August 2009, the completion of negotiations with the state government of
Espírito Santo and the city government of Linhares for the construction of a
new electric motors manufacturing unit was announced.
For the construction of the future industrial site, the Company will adopt the
same modular concept used by WEG in its other plants in Brazil and abroad,
which allows for the gradual and continuous increase of output capacity, thus
meeting the Company’s expansion requirements over several years. The first
of these manufacturing modules in Linhares should become operational in
2011. The expected investment for this phase of the project is R$ 160 million
over the next 4-6 years.
The project is being implemented in a SUDENE tax incentive region
Acquisition of control of ZEST Group
On May 25, we announced the acquisition of the shareholding control (51%)
of ZEST Group, a company with headquarters in South Africa. ZEST Group
has been WEG’s partner in South Africa for over 30 years, it conquered and
expressive share in all lines of business, especially the electric motors, in
which it became the leader in the South African market. The group also
includes companies which specialize in the assembly of electric industrial
panels, in the assembly of generator groups and in the rendering of electric
commissioning services. ZEST Group became the fourth subsidiary of WEG
abroad, and, as of the third quarter in 2010 they started being consolidated
by WEG.
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10.3 Events with relevant effects, which occurred and were
expected in the financial statements
As of this acquisition, South Africa, which already was an important market,
with perspective of growth above the global average, must be converted in
WEG’s expansion base in the entire African continent. The expansion has
taken place both through The use of ZEST Group’s vast knowlege of the
markets, as well as due to the potencialization through WEG’s experience in
energy, mining, oil and gas.
Control of Voltran’s Capital
On May 25, we announced the acquisition of additional participation in
Voltran S.A. de C.V., a Mexican manufacturer of transformers, raising our
shareholdings to 60% of the capital stock. The partnership between WEG
and the Jimenez family, controlling shareholders of Voltran, began in 2006,
when 30% of the capital stock of the Mexican company were acquired.
The Voltran brand is recognized in the Mexican market, and the partnership
with WEG generated good results, with the broadening of the line of products
and improved delivery capacity. The evolution of the partnership was a
natural consequence of these positive results, seeking to make use of the
synergies with WEG’s other operations in Mexico. Also, Voltran’s revenues
began impacting WEG’s consolidated revenues as of the third quarter of
2010.
Acquisition of Instrutech
On June 9, we informed that subsidiary WEG Equipamentos Elétricos S.A.
entered into an agreement to acquire Instrutech Ltda. (“Instrutech”), a
Brazilian manufacturer of industrial, commercial and man/machine safety
automation systems and products.
The acquisition broadened the line of products and integrated WEG solutions
in the automation area, adding products with high added value which weren’t
offered previously. Instrutech was the only Brazilian company to produce
specific equipment for man/machine security automation.
The integrated electronic sensor products and systems are widely used in
extreme work conditions, with application in tool machines, plastic injectors,
woodwork machinery, packaging, transportation lines, etc.
Acquisition of Equisul
On December 6, we announced the agreement to acquire company Equisul
Indústria e Comércio Ltda, which specializes in the development and
manufacturing of uninterruptible power supply or UPS systems, including nobreaks, invertors, rectifiers, chargers and battery banks. Equisul has a
factory in São José (SC) with around 50 employees and should have
operating revenues of around R$ 15 million in 2010. The company was
established in 1995 and acted as manufacturer of small and medium sized
systems up to 2004, when it expanded its products tolarge three phase
systems with the merger of GPL Eletroeletrônica S.A., a traditional company
in this segment.
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10.3 Events with relevant effects, which occurred and were
expected in the financial statements
With the acquisition of Equisul, WEG increased its product and complete
solution portfolio for energy systems, merging known solutions such as
critical power, equipments with broad uses in segments such as IT, finances,
and critical processes in the industry, such as in the platforms of gas and oil
exploration, in which an uninterrupted production is potentially costly. With a
growing automation of industrial processes, technological and commercial
synergies in the UPS area with our other revenues becoming more
important.
The consolidation of Equisul took place as of January 2011.
c) Unusual events or operations
N/A
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10.4 Significant effects from changes in accounting practices Qualifications and emphasis of matter paragraphs in the
auditor’s report
• Significant changes in accounting practices
• Significant effects in the alterations of accounting practices..
• Transition basis to IFRS
In all previous periods, including fiscal year ended December 31, 2009,
the Company prepared its financial systems according to Brazilian
accounting regulations (BRGAAP) in force at that time. The financial
statements for the year ended December 31, 2010 were the first ones to
be prepared in accordance with the norms established by the Accounting
Pronouncements Committee and IFRS.
Therefore the Company prepared its financial statements complying with
the norms of the CPCs for the periods initiated on or as of January 1,
2010, as described in its accounting policies. For the 2010 financial
statements, the initial balance considered was that of January 1, 2009,
the transition date for the CPCs. This item explains the main adjustments
made by the Company to present again the initial equity balance sheet,
after the adoption of said accounting norms on January 1, 2009 and also
for the originally published balance sheet, prepared according to the
regulations in force at that time, for the fiscal year ended December 31,
2009.
• Exemptions Adopted
The Company applied the exemption of business combination described
in IFRS 1 and in CVM Decision 647/10 (CPC 37) and, therefore, did not
represent the combination of business which took place before January 1,
2009, date of the transition.
• Deemed Cost
The Company calculated the market value of its fixed assets and used
this value as the attributed cost of these assets on the date of transition.
Consequently, the Company revised the estimates of usable life for these
fixed assets and changed their annual depreciation rates.
• Conciliation of net equity December 31, 2008
Net Equity
Consolidated Balance on December 31, 2008 in BRGAAP
Adjustments due to transition to IFRS:
- Share of non-controlling shareholders
- Deemed net cost
- Financial depreciation for comparison purposes (Adjustments from initial adoption)
- Proposed additional dividends
Consolidated balance on January 1, 2009 adjusted according to IFRS
101
In R$
Thousands
2,178,580
42,341
865,125
(54,016)
87,085
3,119,115
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10.4 Significant effects from changes in accounting practices Qualifications and emphasis of matter paragraphs in the
auditor’s report
• Transition balance to IFRS
31/12/08 in
BRGAAP
Assets
Current Assets
Non-Current Assets
Long-term realizable
Other non-current assets
Investments
Fixed Assets
Intangible Assets
Total Assets
Liabilities
Current Liabilities
Dividends and Interest on
Equity
Other current liabilities
Non-current liabilities
Deferred taxes
Other non-current liabilities
Total liabilities
Net Equity
Of controlling shareholders
Capital stock
Capital Reserve
Adjustment of equity appraisal
Profit Reserve
Of non-controlling
shareholders
Total liabilities and Net Equity
•
Proposed
Div idends
Financial
Depreciation
4,386,420
1,386,354
-
(81,841)
1,286,542
4,386,420
2,591,055
197,616
13,342
1,047,333
128,063
5,772,774
-
(81,841)
(81,841)
1,286,542
1,286,542
197,616
13,342
2,252,034
128,063
6,977,475
-
2,433,786
2,520,871
(87,085)
140,167
2,380,704
1,030,982
7,505
1,023,477
3,551,853
2,220,921
(87,085)
(87,085)
87,085
(27,825)
(27,825)
(27,825)
(54,016)
421,417
421,417
421,417
865,125
53,082
2,380,704
1,424,574
401,097
1,023,477
3,858,360
3,119,115
1,360,500
6,071
89,829
722,180
87,085
(54,037)
861,466
-
1,360,500
6,071
951,295
755,228
42,341
5,772,774
-
21
(81,841)
3,659
1,286,542
46,021
6,977,475
-
Conciliation of net equity and net income as at December 31, 2009
Consolidated Balance as at 31/12/2009 in BRGAAP
Economic Depreciation for comparison purposes (initial adoption
adjustments)
Attributed cost, net of taxes
Realization of attributed cost – net of taxes
Deferred taxes over depreciation of deemed cost
Depreciation over deemed cost
Interest of non-controlling shareholders
Excess of proposed dividends
Consolidated Balance on 31/12/2009, adjusted in IFRS
102
Em R$ Mil
Consolidated
Deemed
01/01/09
Cost
em IFRS
In R$ Thousands
Ne t
Net
Equity
Income
2,362,787
548,392
865,125
(52,128)
24,217
127,285
3,327,286
54,014
24,956
(77.082)
9.657
559,937
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10.4 Significant effects from changes in accounting practices Qualifications and emphasis of matter paragraphs in the
auditor’s report
In the reconciliations above, the CPCs approved by CVM, effective on and after
December 2010 and for the FY 2009 financial statements for comparison
purposes.
c) Qualifications and emphasis of matter paragraphs in the auditor’s
report.
The independent auditor’s report contained the following emphasis and other
matters:
Emphasis
As mentioned in Note 2, the individual financial statements (Company) were
prepared in accordance with accounting practices adopted in Brazil, issued
by the Brazilian FASB (CPC) and are published jointly with the consolidated
financial statements.
In the preparation of these individual financial statements, WEG S/A
measured its investments in subsidiaries and affiliates under the equity
method, while such investments would be measured at cost or fair value for
IFRS purposes.
Other matters
Statements of value added
We have also audited the individual and consolidated statements of value
added (SVA) for the year ended December 31, 2010, the presentation of
which is required by Brazilian corporation law for publicly-held companies,
and as supplementary information under the IFRS, whereby no statement of
value added presentation is required. These statements have been subject
to the same auditing procedures previously described and, in our opinion,
are presented fairly, in all material respects, in relation to the overall financial
statements.
Audit of prior year corresponding figures
The corresponding figures for the year ended December 31, 2009, presented
for comparison purposes, were previously audited by us in accordance with
the standards on auditing prevailing upon issuance of our unmodified opinion
report thereon dated February 5, 2010. The standards on auditing then
prevailing allowed for division of responsibilities, accordingly, the financial
statements of certain subsidiaries and affiliates for the year ended December
31, 2009 were audited by other independent auditors and our opinion, as
regards amounts of investments and results deriving from referred to
subsidiary, is based on that auditor’s report.
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10.5 Critical accounting policies
The financial statements were prepared on a historical cost basis, unless stated
otherwise, and adjusted to reflect the deemed cost at the date of transition to
IFRS.
The preparation of financial statements requires the use of certain critical
accounting estimates as well as the exercise of professional judgment by
Company management. The determination of these estimates takes into
consideration experiences from past and current events, assumptions in respect
of future events, and other objective and subjective factors. Significant items
subject to such estimates and assumptions include:
• review of the useful life of property, plant and equipment and its recovery in
operations;
• credit risk analysis to determine the allowance for doubtful accounts;
• fair value measurement of financial instruments;
• commitments to post-employment benefits; and ecognition of deferred
income tax assets on income and social contribution tax losses, as well as
the analysis of other risks to determine other provisions, including the
provision for contingencies resulting from administrative and judicial
proceedings and other assets and liabilities as of the balance sheet date.
The settlement of transactions involving these estimates may result in amounts
different from those recorded in the financial statements due to uncertainties
inherent in the estimate process. The Company reviews its estimates and
assumptions periodically.
The authorization to conclude preparation of the accompanying financial
statements was granted in the Board meeting held on February 1, 2011.
In relation to the consolidated and individual financial statements, significant
accounting practices adopted are as under:
i. Consolidated financial statements under IFRS
The consolidated financial statements under IFRS were prepared and are
presented in accordance with accounting practices adopted in Brazil, which
comprise Brazilian Securities and Exchange Commission (CVM) rules and
pronouncements of Brazilian FASB (CPC), which are in conformity with
International Financial Reporting Standards (IFRS) issued by the
International Accounting Standards Board (IASB).
These are the first financial statements presented by the Company in
accordance with CPCs and IFRS. Significant differences between accounting
practices previously adopted in Brazil and IFRS, including reconciliation of
equity and comprehensive income, are described in item 10.4.
ii. Individual financial statements
The accompanying individual financial statements (Company) were prepared
in accordance with accounting practices adopted in Brazil issued by Brazilian
FASB (CPC) and are published together with the consolidated financial
statements.
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10.5 Critical accounting policies
I. Consolidation
a) Basis of consolidation as from January 1, 2010
The financial statements of the subsidiaries are prepared as of the same
reporting date as those of the Company, using accounting practices that
are consistently adopted by the consolidated subsidiaries. All
intercompany balances, revenues and expenses as well as unrealized
gains and losses arising from intercompany transactions between the
consolidated Group companies are fully eliminated.
Net income for the period and comprehensive income are attributed to the
Company shareholders and to noncontrolling interests in consolidated
companies. Losses are attributed to noncontrolling interests, even when
they result in a negative balance.
b) Basis for consolidation up to January 1, 2010
The following differences were applicable as of December 31, 2009 and
were adjusted for comparison purposes:
• Noncontrolling interests represent the portion of profit or loss and net
assets not held by the Company and were presented separately in the
consolidated income statement and within equity in the consolidated
statement of financial position, separately from equity attributable to
equity holders of the Company. Acquisitions of noncontrolling interests
were accounted for using the Company extension method, whereby the
difference between the consideration and the book value of the equity
interest acquired is recognized as goodwill.
• In the event of loss of control, the Company accounted for equity loss
in the investment held as of the date of the respective loss of control.
c) Investments, new acquisitions and corporate reorganizations
The consolidated financial statements under IFRS are comprised of the
financial statements of WEG S.A. (the Company) and its subsidiaries.
On September 1, 2010, subsidiary WEG Indústrias S.A. was renamed to
RF Reflorestadora S.A., and, subsequently, the paint division was split off
and transferred to WEG Tintas Ltda.
On May 25, 2010, WEG Group acquired the controlling interest of Zest
Group, a company headquartered in South Africa formed by the leading
distributor of electric motors in that market and by companies specialized
in assembling industrial electric panels, integrating products for the
assembly of gensets, as well as in service providing. At June 30, 2010,
the assets and liabilities of this subsidiary were consolidated. Revenue,
costs and expenses were consolidated as from July 1, 2010.
On June 1, 2010, WEG Group acquired Sensores Eletrônicos Instrutech
Ltda. and Logotech Sensores Eletrônicos Ind. e Com. Ltda. to
complement WEG’s line of products with integrated electronic sensor
systems and products.
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10.5 Critical accounting policies
On June 11, 2010, WEG acquired additional stake in the capital of
Mexican transformer manufacturer Voltran S.A., taking its capital interest
therein from 30% to 60%, thereby changing from affiliate to subsidiary. At
June 30, 2010, the assets and liabilities of this subsidiary were
consolidated. Revenue, costs and expenses were consolidated as from
July 1, 2010.
The surplus of price paid on the acquisition of the controlling interest of
the subsidiaries Instrutech, Logotech, Voltran and Zest was allocated as
goodwill until the goodwill allocation studies are concluded. Company
management believes that these studies will be concluded within a year
from the acquisition of these subsidiaries’ controlling interest.
II. Business combinations
In acquiring a business, the Company evaluates the financial assets and
liabilities assumed in order to classify them according to the contractual
terms, economic circumstances and applicable conditions, within up to one
year from the acquisition date. In case of a phased business combination,
the fair value on the date of acquisition of the shareholdings previously held
in acquiree is remeasured at fair value as of acquisition date, and related
impacts are recognized in the income statement.
Goodwill is initially measured as excess consideration transferred in relation
to net assets acquired (identifiable assets and assumed liabilities). When
consideration is lower than the fair value of net assets acquired, the
difference is recognized as gains in the income statement.
After initial recognition, goodwill is measured at cost, less any accumulated
impairment. For impairment testing purposes, purchase goodwill in a
business combination is, as from acquisition date, allocated to each of the
Company’s cash generating units that are expected to be benefited by the
synergies of the combination, irrespective of whether other assets or
liabilities of acquiree are attributed to these units.
When goodwill is attributed to a cash generating unit and a portion of this unit
is sold, goodwill related to the sold portion shall be included in cost of the
operation in determining gain or loss.
Goodwill on this operation is determined based on the proportional amount of
the portion sold in relation to the cash generating unit.
III. Foreign currency translation
Assets and liabilities relating to foreign currency-denominated operations,
except for investments, are translated into local currency (Brazilian real - R$)
at the rate of exchange in force at the financial statements closing date.
Exchange gains and losses deriving from restatement of these assets and
liabilities between the date of the transactions and the period clo sing dates
are recognized as financial income or expenses in the income statement.
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10.5 Critical accounting policies
a) Functional currency of Group companies
The consolidated quarterly information under IFRS are reported in Brazilian
reais (R$), which is the functional currency of the Company and its
subsidiaries located in Brazil.
The functional currency of foreign subsidiaries is determined based on the
principal economic environment in which they operate, and when it is
different from the reporting currency of the quarterly information, these are
translated into real (R$) at the closing date.
b) Transactions and balances
Transactions in foreign currency are initially recorded at the exchange rate of
the functional currency prevailing on the transaction date. Monetary assets
and liabilities denominated in foreign currency are translated at the exchange
rate of the functional currency as of the balance sheet date. All differences
are recorded in the income statement. Nonmonetary assets measured based
on historical cost in foreign currency are translated using the exchange rate
in effect on the date of the initial transactions. Nonmonetary assets
measured at fair value in foreign currency are translated using the exchange
rate of the date on which fair value was determined.
c) Translation of the balance sheets of Group companies
Assets and liabilities of foreign subsidiaries are translated into Brazilian real
at the exchange rate of the balance sheet date and the corresponding
income statements are translated at the exchange rate of the date of the
transactions. Exchange differences resulting from the referred to translation
are recorded separately in equity. Upon sale of a foreign subsidiary, the
accumulated deferred amount recognized in equity, referring to this foreign
subsidiary, is recognized in the income statement.
Goodwill on the acquisition of a foreign subsidiary after January 1, 2009 and
any adjustments to fair value of the book value of assets and liabilities
resulting from the acquisition are treated as assets and liabilities of the
foreign subsidiary and translated at the closing date.
IV. Cash and cash equivalents
These include the balances in checking accounts and immediately liquid
short-term investments recorded at cost plus earnings earned through the
period closing date, based on the rates agreed upon with financial
institutions, which do not exceed market or realizable value.
V. Trade accounts receivable
These correspond to amounts receivable from customers for the sale of
goods or rendering of services in the normal course of business and are
stated at present value and realizable value.
The allowance for doubtful accounts was calculated considering the analysis
of credit risks, which takes into account the history of losses, being sufficient
to cover losses on amounts receivable.
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10.5 Critical accounting policies
VI. Inventories
These are stated at the average acquisition or production cost, considering
the present value when applicable. Provisions for: (i) realization, (ii) slowmoving and (iii) obsolete inventory items are recorded when considered
necessary by management. Imports in progress are shown at the
accumulated cost of each import. The Company adopts the absorption
costing method for inventory valuation, using the moving weighted average
cost.
VII. Related parties
Input purchase and sale transactions are carried out under conditions and
terms similar to those of transactions with unrelated parties.
VIII. Property, plant and equipment
For fair value measurement purposes, the Company measured its property,
plant and equipment at deemed cost. Assets not measured at deemed cost
are stated at cost of acquisition and/or construction, plus interest capitalized
during the construction period, as applicable, less depreciation, excepting for
land that is not depreciated. Loan costs incurred during the period of
construction, modernization and expansion of industrial units are included.
Expenses with maintenance or repair that do not significantly increase the
useful lives of the assets are recorded as expense when incurred. Gains and
losses on disposals are determined comparing sales price with the residual
book value and recognized in the income statement.
Depreciation is calculated by the straight line method taking into
consideration the economic useful lives of the assets, which is periodically
reviewed in order to adjust the
depreciation rates.
IX. Intangible assets
These are valued at acquisition cost, less amortization and any impairment
losses, as applicable. Intangible assets with defined useful lives are
amortized over the period of at least 5 years and taking into consideration
the estimated term of generation of future economic benefits.
Goodwill based on expected future profitability, without defined useful life,
was amortized until December 31, 2008, however, subject to impairment
testing every year or whenever there is any indication of impairment.
X. Recoverable amount measurement
Property, plant and equipment and intangible assets, as well as other noncurrent assets, as applicable, are measured annually at recoverable amount
through future cash flows. At December 31, 2010, no impairment of these
assets was identified.
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XI. Other current and noncurrent assets
These are stated at cost or realizable value, plus, when applicable, the
related earnings received and any incurred monetary and exchange
variations, as well as any present value adjustments.
XII. Provisions
Provisions for legal proceedings are recognized when the Company and its
subsidiaries have a present or not formalized obligation arising from past
events, the settlement of which is likely to result in an outflow of economic
benefits and its amount can be reliably estimated. Provisions are periodically
reviewed observing their nature and supported by the opinion of the
Company’s legal advisors.
XIII. Other current and noncurrent liabilities
These are stated at known or calculated amounts, plus corresponding
financial charges on a pro rata daily basis, when applicable, as well as
monetary and exchange variations incurred and adjustment to present value.
XIV.Interest on equity and dividends
For corporate purposes, interest on equity is stated as allocation of profits
directly under net equity. For tax purposes, it was treated as a financial
expense, reducing the tax bases of income and social contribution taxes
(IRPJ and CSLL).
Distribution of interest on equity and dividends is recognized as a liability
based on the
Company’s minimum statutory dividends. Any amount in excess of the
minimum mandatory dividends is recognized as a liability when approved by
a General Shareholders’ Meeting or the Board of Directors.
XV. Present value adjustment
Assets and liabilities resulting from short-term operations, when relevant,
were adjusted to present value at discount rates reflecting best market
valuations. Adjustment to present value was measured on an exponential
“pro rata daily” basis, as from the inception date of each transaction.
Reversal of adjustments to monetary assets and liabilities was recorded as
financial income or financial expenses.
XVI.Statement of cash flows
This is prepared by the indirect method, in accordance with CPC 03.
XVII. Statement of value added
This is prepared in accordance with CPC 09.
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10.5 Critical accounting policies
XVIII.Pension plan
The Company sponsors a defined benefit pension plan and also grants
certain post employment health plans to executives. These benefits are
funded on a cash basis. Costing of benefits granted is established separately
for each plan, using the projected unit credit method.
The actuarial commitments associated with pension and post-retirement
benefit plans are accrued, pursuant to the procedures of CPC 33, based on
annual independent actuarial calculations prepared in accordance with the
projected unit credit method, net of the plan’s underlying assets, with the
corresponding costs recognized during the employees’ working life. The
“projected unit credit” method considers that each period of service triggers
an additional benefit unit, and these units accumulate in order to compute a
final liability amount.
Additionally, other actuarial assumptions are used, such as estimated
medical assistance cost increases, biological and economic scenarios, as
well as historical data of costs incurred and employees’ contributions.
XIX. Financial instruments
The Company’s financial instruments include:
Cash and cash equivalents: These are stated at market value, which
approximates book value.
Short-term investments: Market value is reflected in the amounts recorded in
the balance sheet. Short-term investments are classified as for trading.
Trade accounts receivable: These are recognized at amortized cost using
the effective
interest rate method, being classified as loans and receivables.
Suppliers: These are recognized at amortized cost using the effective
interest rate method, being classified as loans and receivables.
Loans and financing: The main purpose of this financial instrument is to
generate funds for the Company’s expansion programs and to meet its shortterm cash needs.
• Loans and financing in local currency - these are classified as financial
liabilities not measured at fair value and are recorded at their updated
amounts based on the agreed rates. The market value of these loans
approximates their book value for being financial instruments with
exclusive characteristics from specific financing sources.
• Loans and financing in foreign currency - these are contracted to meet
working capital needs for commercial operations in Brazil and foreign
subsidiaries, being restated by the agreed rates.
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XX. Government grants and assistance
Government grants are recognized when there is reasonable certainty that
the benefit will be received and that all the corresponding conditions will be
fulfilled. When the benefit refers to an expense item, it is recognized as
revenue over the period of the benefit, on a systematic basis in relation to
costs that the benefit intends to offset. When the benefit refers to an asset, it
is recognized as deferred income and posted to income for equal amounts
over the expected useful life of the asset. When the Company receives nonmonetary benefits, the asset and the benefit are recorded at the nominal
value and reflected in the income statement over the expected useful life of
the asset, in equal annual installments.
XXI. Revenue recognition
Revenue from sale of goods is recognized in the income statement when all
the risks and rewards inherent to the product are transferred to buyer and it
is likely that economic benefits will flow to the Company.
XXII. Taxes
a) Income and social contribution taxes
Taxes on income are computed on taxable profit (based on accounting
records) and profit computed as a percentage of gross revenue (“lucro
presumido”) pursuant to the prevailing legislation. Deferred income and
social contribution taxes were calculated pursuant to CVM Rule No.
371/02. The Company and its Brazilian-based subsidiaries opted for the
Transition Tax Regime (“RTT”), introduced by Law No. 11941/09,
whereby the calculations of IRPJ, CSLL, PIS and COFINS, for the twoyear period 2008-2009, continue to be determined in accordance with the
accounting methods and criteria set by Law No. 6404/76, effective on
December 31, 2007.
b) Sales taxes
Revenues, expenses and assets are recognized net of sales taxes,
except: (i) when sales taxes incurred on the purchase of goods or
services may not be recovered from the tax authorities, case in which
sales taxes are recognized as part of the cost of acquisition of the asset or
the expense item, as applicable; (ii) when the amounts receivable and
payable are presented together with the amount of sales taxes, and (iii)
the net amount of sales taxes, recoverable or payable, is included as a
component of the amounts receivable or payable in the balance sheet.
XXIII. Earnings per share – base and diluted
Base earnings per share are calculated dividing profit attributable to the
Company’s shareholders by the weighted average number of common
shares issued in the year. Diluted earnings per share are calculated
adjusting the weighted average number of outstanding common shares
considering all common shares that could potentially cause dilution.
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10.6 Internal controls over preparation of financial statements Degree of effectiveness and deficiencies and
recommendations included in the independent auditor’s report
We believe that the accounting and internal control system adopted by the
Company is consistent with its type of activity and volume of transactions.
a) Effectiveness of these controls, indicating any deficiencies and related
corrective measures.
The accounting and internal control system is sufficiently reliable to ensure
that the financial statements are free of material misstatement. Internal
controls are mostly performed using the SAP integrated information system,
and are considered adequate for the prevention or detection of fraud or
errors.
The Company has made substantial investments in information systems,
having implemented advanced systems – such as the "Enterprise Resource
Planning (ERP)" – that allow the quality collection, management and analysis
of accounting and business information. Additionally, the Company has
internal audit systems and procedures designed to validate and streamline
business processes.
b) Deficiencies and recommendations on internal controls included in the
independent auditor’s report.
As a result of the independent auditor’s review, the Company receives a
management letter. These recommendations are reviewed regularly, for
continual improvement of internal controls.
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10.7 Allocation of funds from public offerings of securities and
diversion thereof, if any
The Company did not engage in public offerings.
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10.8 Relevant items not disclosed in the financial statements
The Company published its financial statements in February 2011 including
relevant information until that date. There have been no other relevant items to
be disclo sed to date.
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10.9 Comments on items not disclosed in the financial statements
N/A
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10.10 Business plan
Our business plan is based on factors driving long-term growth in the demand
for our products. We believe these factors are structural and will continue
having, to greater or lesser degree, influence on demand in the coming years.
These factors are:
• Growing demand for industrial equipment (electric motors, automated
systems and related equipment) that provide greater energy efficiency. This
increasing demand is due to the industrial sector companies’ search for
higher productivity and reduced operating costs.
• The growing concern about environmental impacts associated with
conventional power generation turns the use of renewable energy sources
more attractive, such as small hydroelectric power plants, biomass-powered
plants and wind power plants, driving the demand for generators,
transformers and automated systems and equipment.
• Finally, the ever increasing use of sensor systems and equipment and digital
control in all steps of electric power generation, transmission and
consumption. Our traditional electric products are more closely associated
with more comprehensive electronic systems, on systems generally known
under the generic name of smartgrid.
We are second to none in the Brazilian electric motor market and we have
significant positions in all business segments we operate in the domestic
market. This has been built over time by continuously expanding and enhancing
the technology content of our line of products, keeping to our strategy of offering
complete and integrated industrial solutions.
In addition, we operate globally with product distribution to more than 100
countries across five continents and direct operations in more than 20 of the
major global markets and industrial operations in Brazil, Argentina, Mexico,
Portugal and China. In 2010, we announced the acquisition of industrial
operations in South Africa, as part of the Zest Group acquisition, and our
increased interest in the capital of Voltran, a Mexican-based transformer
manufacturer. Also, in early 2011, our new electric motors plant in India started
production.
This geographic presence has allowed us to continually grow in foreign markets,
minimizing the impacts of economic changes in each country or region. We
continue to actively seek new opportunities in the various global markets and
we expect to maintain our standard of business performance both in terms of
revenue growth and the result of operations.
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10.10 Business plan
Investments
Considering the nature of the equipment and facilities we use in our production
process, we have great flexibility in managing the investment program based on
actual demand. Thus, we seek to optimize active capacity by accelerating or
delaying investments, and thus maximizing the return on invested capital.
Year 2009
Capital expenditures for the expansion of output capacity amounted to R$ 226.3
million in 2009, with 72% being allocated to industrial and other facilities in
Brazil, and the remaining amount to the production units and other subsidiaries
abroad.
Given the slackened demand we faced in 2009, the investment program was
managed with a view to avoiding the expansion of idle capacity. Considering the
nature of the equipment and facilities we use in our production process, we
have great flexibility in managing the investment program based on actual
demand by accelerating or delaying investments. By optimizing active capacity,
we maximize the return on invested capital.
Year 2010
Capital expenditures for the expansion of output capacity amounted to R$ 233
million in 2010, with 60% being allocated to industrial and other facilities in
Brazil, and the remaining amount to the production units and other subsidiaries
abroad.
Expenditures for capacity expansion in 2010 grew gradually due to the
improved demand over the year. The investment is always managed so as to
optimize capacity use while maximizing the return on invested capital.
We highlight the investments in two new production units to go into operation in
the first months of 2011:
• WEG Linhares, where we will implement a new industrial facilities, starting a
long-term project dedicated initially to the production of electric motors, to
receive additional investments over the next years for the verticalized
production of a wide line of products;
• WEG India, our first production unit in that country, dedicated to production
of high-voltage equipment for industrial and infrastructure applications.
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10.10 Business plan
2011 Forecast
Our capital budget for 2011 includes the following investments:
Investments (in R$ million )
- Property, plant and equipment (plant expansion/overhaul)
- Current assets (working capital)
Total investments
193.0
140.4
333.4
These investments will be financed with the Capital Budget Reserve and with
funds to be raised from financial institutions in Brazil, preferably the lines of
credit from BNDES.
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10.11 Other factors having a material influence
N/A
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11.1 Forecasts and assumptions disclosed
The Company did not make forecasts regarding its operating or financial
performance for the next years.
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11.2 Follow-up and changes to the forecasts disclosed
N/A
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12.1 Follow-up and changes to the forecasts disclosed
a) Duties of each body and committee:
(i) Board of Directors
The Board of Directors shall have the power to:
a) establish the general guidelines for the Company’s business;
b) review and express an opinion on Executive Board proposals to be
submitted to the General Meeting;
c) submit to the General Meeting the proposed allocation of net income
for the year, pursuant to Article 38 of the Company’s Articles of
Incorporation;
d) propose changes to the Articles of Incorporation to the General
Meeting;
e) elect and remove the Company’s Officers and define their duties, as
well as approve the Company’s organization chart;
f) appoint an alternate Officer in case of absence, temporary
incapacity or vacancy of office, pursuant to the provisions of article
31 of the Company’s Articles of Incorporation;
g) oversee the management activities performed by the Executive
Board and express an opinion on the Management Report and
Executive Board accounts;
h) call General Meetings;
i ) express a previous opinion on the below procedures to be
performed by the Executive Officers when amounts and/or periods
exceed the limits imposed by the Board of Directors:
i.1) any intercompany loan, loan and/or financing agreements to be
executed by the Company and/or its subsidiaries with credit
financial institutions;
i.2) acquisition, sale and/or any kind of encumbrance on the
Company’s fixed assets; and
i.3) setting credit limits to customers.
j) authorize the Company to provide associates, affiliates or
subsidiaries with sureties, collaterals and other guarantees of any
amounts;
l) approve the assignment, transfer, and acquisition of any license
rights to trademarks, patents, industrial production processes and
technologies;
m) appoint and terminate independent auditors;
n) distribute among members of the Board of Directors and the
Executive Board the global compensation and bonuses determined
at the General Shareholders’ Meeting;
o) authorize investments and shares in other companies or ventures in
Brazil and abroad;
p) approve the Executive Board strategic plan and operating budgets;
q) approve plans for expansion and diversification of activities, as well
as for opening and closing branches, agencies or offices;
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12.1 Follow-up and changes to the forecasts disclosed
r) authorize the acquisition of the Company’s shares to cancel or keep
them in treasury for later disposal;
s) resolve any issues not addressed in these Articles of Incorporation,
and which legally do not fall within the authority of the General
Meeting or the Supervisory Board;
t) decide on the execution of loan agreements between the Company
and:
(i) its Controlling Shareholder;
(ii) its subsidiaries; and
(iii) affiliates in which the Company’s equity interest is less than 75%;
u) approve the issuance of simple unsecured nonconvertible
debentures, and authorize the issuance of any credit instruments for
raising funds, such as bonds, notes, commercial papers, and others
commonly used on the market, also deciding on the conditions for
issuance and redemption;
v) establish the list of three institutions to be submitted to the General
Meeting to prepare the appraisal report on the Company’s shares
for purposes of public offerings, pursuant to Chapters XII and XIII of
these Articles of Incorporation.
x) submit its Stock Purchase Option Plan to the General Meeting for
approval, under the terms of the Law No. 6404/76 article 168
paragraph 3.
(ii) Supervisory Board
The powers of the Supervisory Board are established by the Brazilian
Corporation Law, as follows:
a) oversee, by any of its members, the acts of the officers and ensure
that they comply with their legal and statutory duties;
b) express an opinion on the annual management report, including
supplementary information deemed necessary or useful for
deliberation at a general meeting;
c) express an opinion on any management proposals to be submitted
to a general meeting, regarding changes in capital stock, issuance
of debentures or subscription bonuses, investment plans or capital
budgets, dividend distribution, transformation, merger, consolidation
or carve-outs;
d) report, by any of its members, any error, fraud or criminal acts it may
discover to the administrative bodies, and, if these fail to take the
necessary steps to protect the company’s interests, to a general
meeting suggesting an appropriate course of action;
e) call the annual general meeting should the administrative bodies
delay doing so for more than one month, and an extraordinary
general meeting whenever serious or urgent matters occur,
including the matters it may deem necessary in the meetings’
agenda;
f) review, at least on a quarterly basis, the trial balance sheet and
other financial statements regularly prepared by the company;
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12.1 Follow-up and changes to the forecasts disclosed
g) review the financial statements for the fiscal year and express an
opinion thereon;
h) perform such duties during liquidation, bearing in mind the special
provisions which regulate liquidation events.
a)
Date the Supervisory Board is established, if not permanent, and
committees are set up
The Company’s Supervisory Board operates on a permanent basis.
The Company has set up no committees.
b) Performance evaluation mechanisms for each body or committee.
Board of Directors and Executive Board (WEG Group)
(i) Fixed Compensation
Fixed compensation is established considering the provisions of
article 152 of Law No. 6404/76, with the overall management
compensation amount being submitted to the Annual General
Meeting of each WEG Group company. On establishing the
individual amount to be paid monthly to each member, the Board
of Directors considers, with regard to each member: their
responsibilities; time they dedicate to their duties; their
competence and professional reputation, and the market price for
their services. The Company has a periodic salary survey
conducted by a specialized firm.
(ii) Variable Compensation
Variable compensation is based on profit sharing and is defined in
article 38 of the Articles of Incorporation, which limits its maximum
amount, pursuant to legal limitations, to 10% (ten per cent) of net
income, not exceeding annual management’s compensation,
whichever is less (Brazilian Corporation Law article 152
paragraph 1).
Every year, the Board of Directors establishes the profit sharing
criteria for directors and officers (Executive Board and Board of
Directors).
Profit sharing is calculated on the consolidated net income, at a
rate from 0.0% to 2.5%, according to a performance indicator
known as “activity result to capital invested” as long as it is, at
least, 10% in 2011 (12% in 2010).
The Company considers capital invested to be the sum of its
working capital assets and liabilities and property, plant and
equipment.
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12.1 Follow-up and changes to the forecasts disclosed
Supervisory Board
Compensation of members of the Supervisory Board complies with
the provisions set forth in paragraph 3, article 162 of Law No.
6404/76. It shall be fixed by the General Meeting that elects the
Supervisory Board members, as proposed by the Board of
Directors, and shall not be less than 10% of the average
compensation paid to each director, excluding benefits,
entertainment allowances and profit sharing.
In the Annual General Meeting (“AGO/E”) held on April 26, 2011,
the individual monthly amount was established at R$ 5,375.00 (R$
5,000.00 in 2010).
Also, reimbursement of all lodging and transportation expenses
incurred to fulfill the duties to which they were appointed was
approved.
c)
Regarding the executive board members, their duties and
individual powers
The Chief Executive Officer is assigned with the following duties,
among others:
a) pursue the Company’s institutional representation and guide its
general activities;
b) establish policies for the development of the Company and its
subsidiaries;
c) approve the Company’s and its subsidiaries’ strategic plans,
budgets and investments, subjecting them to ratification by the
Board of Directors;
d) guide, coordinate and oversee Officers’ activities;
e) call and preside at all meetings held by the Executive Board; and,
f) ensure the faithful compliance with these Articles of Incorporation,
and the decisions of the General Meeting and of the Board of
Directors.
In addition to an ordinary vote, the Chief Executive Officer shall also be
entitled to the casting vote to break any deadlocks in decisions within
the authority of the Executive Board.
The Investor Relations Officer shall:
a) represent the Company before the CVM and other capital market
entities and financial institutions;
b) enforce the rules issued by CVM applicable to the Company; and
c) manage the investor relations policy.
Other Officers shall:
a) replace one another in the event of absence or incapacity; and
b) perform the executive duties and the powers they are assigned with
for purposes of planning, developing and managing the business of
the Company and its subsidiaries.
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12.1 Follow-up and changes to the forecasts disclosed
d) Performance evaluation mechanisms for Board of Directors,
committees and Executive Board
N/A
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12.2 Rules, policies and practices relating to general meetings
a) Call Period
General Meetings shall be convened by the Board of Directors or as
otherwise legally defined. The first call notice shall be published at least 15
(fifteen) days in advance, and the second call notice shall be published at
least 8 (eight) days in advance. The second call notice will be published only
if the Meeting has not taken place on first call.
b) Powers and authority
The General Meetings have their powers vested by current legislation.
In addition to the issues within its authority, as defined by current legislation
and the Articles of Incorporation, the Special General Meeting shall also
have the power to discuss:
• the cancellation of the company’s registration with the CVM;
• delisting from “Novo Mercado”;
• appointment of the institution or specialized firm that will determine the
Company’s economic value for purposes of public tender offers defined in
Chapters XII and XIII of these Articles of Incorporation, based on the list of
three entities submitted by the Board of Directors.
For deliberations on the matters dealt with in the previous paragraph, a
minimum quorum, as defined in the São Paulo Exchange (BOVESPA) “Novo
Mercado” Listing Rules, shall be observed.
c) Physical or electronic addresses where the documents relating to the
general meeting will be available to shareholders for review
The documents relating to the General Meeting are available to shareholders
at the Company’s registered office, Avenida Prefeito Waldemar Grubba,
3300, Jaraguá do Sul/SC, and on our internet website in the Investor
Relations area www.weg.net/ri.
d) Identification and management of conflicts of interest.
The Company, its shareholders, management and members of the
Supervisory Board undertake to resolve, through arbitration pursuant to the
BOVESPA Market Arbitration Chamber Rules, any and all disputes or
controversies that may arise among them, particularly relating to or resulting
from the application, validity, effectiveness, interpretation, breach and related
effects, of the provisions contained in the Corporations Law, the Company’s
Bylaws, the rules issued by the National Monetary Council, by the Central
Bank of Brazil and by the CVM, as well as other rules applicable to the
operation of capital markets in general, in addition to those included in the
Novo Mercado Listing Rules, in the Novo Mercado Participation Agreement
and the Arbitration Rules of the Market Arbitration Chamber.
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12.2 Rules, policies and practices relating to general meetings
e) Powers of attorney required of management for the exercise of voting
rights
In order to attend and deliberate on the General Meetings, Shareholders
must provide the Company with an identification and proof of their capacity
as Shareholders by means of documentation supplied by the depository
institution. For purposes of deliberation, any changes in shareholdings on the
date of the General Meeting will be disregarded.
The Company will review the representation documents required of
shareholders on the basis of good faith, assuming that the stated
representations are true. Except for cases where the power of attorney, if
applicable, and proof of share custody, when the Company’s records list
those shares as being owned by the custodian, fail to be provided, no other
formal irregularity, such as presentation of copy of documents, or lack
authentication of copies, will result in preventing the vote by a shareholder
whose regular documentation is doubted.
f) Formalities required for acceptance of powers of attorney granted by
shareholders, indicating if the issuer accepts such documents granted
by shareholders by in electronic format.
N/A
g) e-forums and worldwide websites available to receive and share
shareholders’ comments on general meetings’ agendas.
N/A
h) Live video and/or audio conferencing of general meetings.
N/A
i) Mechanisms designed to include shareholders’ proposals on the
agenda.
N/A
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12.3 Dates and newspapers of publication of information required
by Law No. 6404/76
FY ended
Publication
12/31/2010 Financial Statements
Call notice for the Annual General
Meeting that reviewed the financial
statements
Newspaper - Braz ilian State
DOESC – Santa Catarina State Gazette - SC
Newspaper - Correio do Povo de Jaraguá do Sul - SC
Newspaper - Valor Econômico - São Paulo - SP
Dates
2/24/2011
2/24/2011
2/24/2011
DOESC – Santa Catarina State Gazette - SC
3/28/2011
3/29/2011
3/30/2011
3/26/2011
3/29/2011
3/30/2011
3/26/2011
3/29/2011
3/30/2011
2/25/2010
2/25/2010
2/25/2010
Newspaper - Correio do Povo de Jaraguá do Sul - SC
Newspaper - Valor Econômico - São Paulo - SP
12/31/2009
Financial statements
Call notice for the Annual General
Meeting that reviewed the financial
statements
Newspaper - Correio do Povo de Jaraguá do Sul - SC
Newspaper - Valor Econômico - São Paulo - SP
DOESC – Santa Catarina State Gazette - SC
Newspaper - Correio do Povo de Jaraguá do Sul - SC
Newspaper - Valor Econômico - São Paulo - SP
Minutes of the Annual General Meeting
that reviewed the financial statements
12/31/2008
Financial statements
Call notice for the Annual General
Meeting that reviewed the financial
statements
DOESC – Santa Catarina State Gazette - SC
Newspaper - Correio do Povo de Jaraguá do Sul - SC
Newspaper - Valor Econômico - São Paulo - SP
DOESC – Santa Catarina State Gazette - SC
Newspaper - Valor Econômico - São Paulo - SP
DOESC – Santa Catarina State Gazette - SC
Newspaper - A Notícia - Joinville/SC - SC
Newspaper - Valor Econômico - São Paulo - SP
Minutes of the Annual General Meeting
that reviewed the financial statements
129
DOESC – Santa Catarina State Gazette - SC
DOESC – Santa Catarina State Gazette - SC
Newspaper - A Notícia - Joinville/SC - SC
3/26/2010
3/29/2010
3/26/2010
3/29/2010
3/30/2010
3/26/2010
3/29//2010
3/30/2010
3/30/2010
4/27/2010
4/27/2010
4/27/2010
2/18/2010
2/18/2010
3/4/2009
3/5/2009
3/6/2009
3/4/2009
3/5/2009
3/6/2009
3/5/2009
3/6/2009
6/4/2009
4/6/2009
4/6/2009
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12.4 Rules, policies and practices relating to the Board of Directors
12.4. Describe the rules, policies and practices relating to the Board of
Directors indicating:
a) timing of meetings
The Board of Directors shall meet whenever necessary, at least once
every quarter, to be convened by its Chairperson, or in his/her absence
or incapacity, the Vice- Chairperson, at least 3 (three) days in advance.
In the last few years, the Board of Directors have met at least 11 times
a year.
b) shareholders’ agreement provisions, if any, imposing any
restriction or limitation on the exercise of voting rights by board
members
The Articles of Incorporation contains shareholders’ agreement
provisions.
Shareholders’ agreements, duly filed at the Company’s registered
office and ruling on the acquisition and sale of shares, the preemptive
right to acquire shares and the right to vote, shall always be complied
with by the Company.
The duties and responsibilities arising under such agreements will
extend to third parties, as long as such agreements have been duly
filed with the Company’s registration books and on share certificates, if
any, subject to Article 118 of the Brazilian Corporation Law.
The Company shall not file a shareholders’ agreement establishing the
exercise of controlling powers, as long as its signatories have not
subscribed to the Controlling Shareholders’ Consent referred to in the
São Paulo Exchange (BOVESPA) “Novo Mercado” Listing Rules.
c) rules on identification and resolution of conflicts of interest
N/A
130
Reference Form - 2011 - WEG SA
Version : 1
12.5 Description of arbitration clause for resolution of conflicts
The Company, its shareholders, management and members of the Supervisory
Board undertake to resolve, through arbitration pursuant to the BOVESPA
Market Arbitration Chamber Rules, any and all disputes or controversies that
may arise among them, particularly relating to or resulting from the application,
validity, effectiveness, interpretation, breach and related effects, of the
provisions contained in the Brazilian Corporation Law, the Company’s Articles of
Incorporation, the rules issued by the National Monetary Council (CMN), by the
Central Bank of Brazil and by the CVM, as well as other rules applicable to the
operation of capital markets in general, in addition to those included in the Novo
Mercado Listing Rules, in the Novo Mercado Participation Agreement and the
Arbitration Rules of the Market Arbitration Chamber.
131
Reference Form - 2011 - WEG SA
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12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Name
Age
Management body
CPF (Brazilian Individual Taxpayer Registry)
Other titles and functions exercised in the issuer
Occupation
Elective office held
Antônio Cesar da Silva
56
304.467.599-53
Industrialist
Part of the Executive Board of holding company WEG S.A.
Part of the Executive Board of subsidiary WEG Equipamentos Elétricos S.A.
Part of the Executive Board of subsidiary WEG Indústrias S.A.
Part of the Executive Board of subsidiary WEG Linhares Equipamentos Elétricos Ltda.
Part of the Executive Board of subsidiary WEG Logística Ltda.
Part of the Executive Board of subsidiary WEG Amazônia S.A.
Harry Schmelzer Junior
52
444.489.619-15
Industrialist
Part of the Executive Board of holding company WEG S.A.
Part of the Executive Board of subsidiary WEG Equipamentos Elétricos S.A.
Part of the Executive Board of subsidiary WEG Indústrias S.A.
Part of the Executive Board of subsidiary WEG Linhares Equipamentos Elétricos Ltda.
Part of the Executive Board of subsidiary WEG Logística Ltda.
Part of the Executive Board of subsidiary WEG Amazônia S.A.
Part of the Executive Board of subsidiary WEG Administradora de Bens Ltda.
Part of the Executive Board of subsidiary WEG Tintas.
Laurence Beltrão Gomes
40
585.750.140-72
Industrialist
Part of the Executive Board of holding company WEG S.A.
Part of the Executive Board of subsidiary WEG Equipamentos Elétricos S.A.
Part of the Executive Board of subsidiary WEG Indústrias S.A.
Part of the Executive Board of subsidiary WEG Linhares Equipamentos Elétricos Ltda.
Part of the Executive Board of subsidiary WEG Logística Ltda.
Part of the Executive Board of subsidiary WEG Amazônia S.A.
Part of the Executive Board of subsidiary WEG Administradora de Bens Ltda.
Part of the Executive Board of subsidiary WEG Tintas.
Luis Angelo Noronha de Figueiredo
52
374.258.970-91
Industrialist
132
Election date
Investiture date
Term of office
Appointed by the controlling
shareholder
Executive Board only
Officer
2/23/2010
2/23/2010
2 years
Yes
Executive Board only
10 - Chairman / Superintendent
2/23/2010
2/23/2010
2 years
Yes
Executive Board only
12 - Investor Relations Officer
2/23/2010
2/23/2010
2 years
Yes
Executive Board only
Officer
4/26/2010
4/26/2010
2 years
Yes
Reference Form - 2011 - WEG SA
Version : 1
12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Name
Age
Management body
CPF (Brazilian Individual Taxpayer Registry)
Other titles and functions exercised in the issuer
Occupation
Elective office held
Part of the Executive Board
Part of the Executive Board
Part of the Executive Board
Part of the Executive Board
Part of the Executive Board
Part of the Executive Board
Part of the Executive Board
Part of the Executive Board
Part of the Executive Board
Part of the Executive Board
Part of the Executive Board
Roberto Bauer
081.730.109-78
Part of the Executive Board
Part of the Executive Board
Part of the Executive Board
Part of the Executive Board
Sérgio Luiz Silva Schwartz
of holding company WEG S.A.
of subsidiary WEG Equipamentos Elétricos S.A.
of subsidiary WEG Indústrias S.A.
of subsidiary WEG Linhares Equipamentos Elétricos Ltda.
of subsidiary WEG Logística Ltda.
of subsidiary WEG Amazônia S.A.
of subsidiary WEG Administradora de Bens Ltda.
of subsidiary WEG Tintas.
of subsidiary Logotech Ltda.
of subsidiary Instrutech Ltda.
of subsidiary Equisul Ltda.
59
Industrialist
of holding company WEG S.A.
of subsidiary WEG Equipamentos Elétricos S.A.
of subsidiary WEG Logística Ltda.
of subsidiary WEG Amazônia S.A.
50
383.104.659-04
Part of the Executive
Part of the Executive
Part of the Executive
Part of the Executive
Part of the Executive
Part of the Executive
Part of the Executive
Siegfried Kreutzfeld
294.190.859-53
Part of the Executive
Part of the Executive
Part of the Executive
Part of the Executive
Part of the Executive
Sinésio Tenfen
293.669.689-53
Industrialist
of holding company WEG S.A.
of subsidiary WEG Equipamentos Elétricos S.A.
of subsidiary WEG Linhares Equipamentos Elétricos Ltda.
of subsidiary WEG Logística Ltda.
of subsidiary WEG Amazônia S.A.
of subsidiary WEG Administradora de Bens Ltda.
of subsidiary WEG Tintas
55
Industrialist
of holding company WEG S.A.
of subsidiary WEG Equipamentos Elétricos S.A.
of subsidiary WEG Linhares Equipamentos Elétricos Ltda.
of subsidiary WEG Amazônia S.A.
of subsidiary RF Reflorestamento S.A.
56
Industrialist
133
Board
Board
Board
Board
Board
Board
Board
Board
Board
Board
Board
Board
Election date Term of office
Appointed by the controlling
Investiture date
shareholder
Executive Board only
Officer
2/23/2010
2/23/2010
2 years
Yes
Executive Board only
11 - Vice-Chief Executive Officer/ Chief
Operating Officer
2/23/2010
2 years
2/23/2010
Yes
Executive Board only
Officer
2/23/2010
2/23/2010
2 years
Yes
Executive Board only
Officer
2/23/2010
2/23/2010
2 years
Yes
Reference Form - 2011 - WEG SA
Version : 1
12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Name
Age
Management body
Election date
CPF (Brazilian Individual Taxpayer Registry)
Other titles and functions exercised in the issuer
Occupation
Elective office held
Investiture date
Part of the Executive Board of holding company WEG S.A.
Part of the Executive Board of subsidiary WEG Equipamentos Elétricos S.A.
Part of the Executive Board of subsidiary Hidráulica Industrial S.A. Ind. e Com. - “HISA”
Part of the Board of Directors of other group companies
Umberto Gobbato
59
160.589.760-49
Industrialist
Part of the Executive Board of holding company WEG S.A.
Part of the Executive Board of subsidiary WEG Equipamentos Elétricos S.A.
Part of the Executive Board of subsidiary Logotech Ltda.
Part of the Executive Board of subsidiary Instrutech Ltda.
Part of the Executive Board of subsidiary Equisul Ltda.
Wilson José Watzko
52
352.366.129-34
Industrialist
Part of the Executive
Part of the Executive
Part of the Executive
Part of the Executive
Elétricos Ltda.
Board
Board
Board
Board
Executive Board only
Officer
2/23/2010
2/23/2010
2 years
Yes
Executive Board only
Officer
2/23/2010
2/23/2010
2 years
Yes
of holding company WEG S.A.
of subsidiary WEG Equipamentos Elétricos S.A.
of subsidiary RF Reflorestadora S.A..
of subsidiary WEG Linhares Equipamentos
Part of the Executive Board of subsidiary WEG Logística Ltda.
Part of the Executive Board of subsidiary WEG Amazônia S.A.
Part of the Executive Board of subsidiary WEG Administradora de Bens Ltda.
Part of the Executive Board of subsidiary WEG Tintas.
Part of the Executive Board of subsidiary Logotech Ltda.
Part of the Executive Board of subsidiary Instrutech Ltda.
Part of the Executive Board of subsidiary Equisul Ltda.
Carlos Diether Prinz
50
Executive Board only
489.859.459-04
Industrialist
Officer
Part of the Executive Board of holding company WEG S.A.
Part of the Executive Board of subsidiary WEG Equipamentos Elétricos S.A.
Décio da Silva
54
Board of Directors
344.079.289-72
Industrialist
20 - Chairman of the Board of Directors
Part of the Board of Directors of subsidiaries WEG Equipamentos Elétricos S.A, RF Reflorestadora S.A., WEG Amazônia S.A.
Nildemar Secches
589.461.528-34
134
Term of office
Appointed by the controlling
shareholder
62
Industrialist
Board of Directors only
27 - Independent (Sitting) Member
2/23/20102 years
2/23/2010Yes
4/27/20102 years
4/27/2010Yes
4/27/20102 years
4/27/2010Yes
Reference Form - 2011 - WEG SA
Version : 1
12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Name
Age
Management body
Election date
CPF (Brazilian Individual Taxpayer Registry)
Other titles and functions exercised in the issuer
Occupation
Elective office held
Investiture date
Term of office
Appointed by the controlling
shareholder
Martin Werninghaus
50
Board of Directors only
485.646.309-82
Businessperson 22
- (Sitting) Member
Part of the Board of Directors of subsidiaries WEG Equipamentos Elétrico S.A., RF Reflorestadora S.A., WEG Amazônia S.A.
4/27/2011
4/27/2011
2 years
Yes
Miriam Voigt Schwartz
48
Board of Directors only
514.080.829-34
Businessperson 22
- (Sitting) Member
Part of the Board of Directors of subsidiaries WEG Equipamentos Elétricos S.A., RF Reflorestadora S.A., WEG Amazônia S.A.
4/27/2010
4/27/2010
2 years
Yes
Moacir Rogério Sens
019.552.339-34
67
Board of Directors only
Businessperson 22
- (Sitting) Member
4/27/2010
4/27/2010
2 years
Yes
Douglas Conrado Stange
006.287.949-91
65
Board of Directors only
Businessperson 22
- (Sitting) Member
4/27/2010
4/27/2010
2 years
Yes
Wilson Pinto Ferreira Junior
51
4/27/2010
2 years
012.217.298-10
Industrialist
4/27/2010
No
Alidor Lueders
62
Supervisory Board
114.466.179-04
Businessperson 43
- (Sitting) Member
Members of the Supervisory Board do not hold any title other than that to which they were appointed in the Company.
4/26/2011
4/26/2011
Next Annual General Meeting
Yes
Eduardo Grande Bittencourt
72
Supervisory Board
003.702.400-06
Accountant
43
- (Sitting) Member
Members of the Supervisory Board do not hold any title other than that to which they were appointed in the Company.
4/26/2011
4/26/2011
Next Annual General Meeting
Yes
Hayton Jurema da Rocha
Supervisory Board
- (Sitting) Member
appointed by noncontrolling
153.667.404-44
Economist
45
common shareholders
Members of the Supervisory Board do not hold any title other than that to which they were appointed in the Company.
4/26/2011
Next Annual General Meeting
4/26/2011
No
Ilário Bruch
59
Supervisory Board
069.088.619-53
Businessperson 46
- (Deputy) Member
Members of the Supervisory Board do not hold any title other than that to which they were appointed in the Company.
4/26/2011
26/04/2011
Next Annual General Meeting
Yes
135
Board of Directors only
- Independent (Sitting)
27
Member
52
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12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Name
CPF (Brazilian Individual Taxpayer Registry)
Other titles and functions exercised in the issuer
Eduardo da Gama Godoy
Age
Management body
Election date
Occupation
Elective office held
Investiture date
47
26/04/2011
Next Annual General Meeting
395.416.650-04
Accountant
46 - (Deputy)Member
Members of the Supervisory Board do not hold any title other than that to which they were appointed in the Company.
4/26/2011
Yes
Marcelo Adolfo Moser
4/26/2011
Next Annual General Meeting
4/26/2011
No
Supervisory Board
48 - (Deputy) Member appointed by
217.282.409-72
Economist
noncontrolling common shareholders
Members of the Supervisory Board do not hold any title other than that to which they were appointed in the Company.
Professional experience / Criminal record
Antônio Cesar da Silva- 304.467.599-53
Educational Background:
1984 - Bachelor of Business Administration – Universidade Regional de
Joinville - UNIVILLE
2003 - MBA in Management Skills - Universidade do Estado de SC-UDESC
Professional Experience:
With WEG Group companies:
1976 to 1980 - Budget Area
1981 to 1983 - Head of the Treasury Department
1984 to 1985 - Manager of the Finance Department
1986 to 1988 - Branch Manager
1989 to 2003 - Manager of the Sales Department
2004 to 2010 - Chief Sales Officer
Currently - Chief Sales and Marketing Officer
Criminal convictions over the past 5 years: Nil
Harry Schmelzer Junior - 444.489.619-15
Educational Background:
1982 - Bachelor of Electrical Engineering - FEJ -Faculdade de Engenharia
Joinville/SC
1987 - MBA in Business Administration - ESAG / UDESC
136
56
Supervisory Board
Term of office
Appointed by the controlling
shareholder
Reference Form - 2011 - WEG SA
Version : 1
12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Professional Experience:
With WEG Group companies:
1981 to 1982 - Started as a Trainee
1982 to 1983 - Worked in the Application of Electrical Machines Sector
1983 to 1985 - Head of Technical Sales
1985 to 1986 - Head of Application of Processes
1986 to 1991 - Sales Manager of WEG Acionamentos
1991 to 1992 - Chief Sales Officer of WEG Acionamentos
1992 to 2005 - Chief Operating Officer of WEG Acionamentos
2005 to 2006 - Chief Operating Officer of WEG Motores
2006 to 2007 - Chief Regional Officer for Europe – WEG Exportadora
Currently - Chief Executive Officer
Criminal convictions over the past 5 years: Nil
Laurence Beltrão Gomes - 585.750.140-72
Educational Background:
• 1995 - Bachelor in Economics - Universidade Federal do RS/ UFRGS
• 2005 - Master Degree in Business Administration - Universidade Federal do RS/UFRGS
Professional Experience:
With WEG Group:
• Appointed CFO in February 2010
With Other Publicly-Held Companies:
• 2006 to 2010 - Chief Finance and Investor Relations Officer - SLC Agrícola S.A.
Further Professional Experience:
• 1993 to 1995 - Trainee – Banco Bozano, Simonsen S/A – RS
• 1996 to 1998 - Finance Supervisor – Avipal Group (Eleva S/A) – RS
• 1998 to 1999 - Treasury Sales Manager – Banco ABN Amro S/A – SP
• 1999 to 2006 - Finance Manager – SLC Participações S/A – RS
Criminal convictions over the past 5 years:
Nil
137
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12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Luis Angelo Noronha de Figueiredo- 374.258.970-91
Educational Background:
• 1982 – Mechanical Engineering – PUC Porto Alegre/RS
• 2000 – MBA in Advanced Personnel Management - ISPG – Curitiba/PR
• MBA in Organizational Behavior - UnicenP – Curitiba/PR
Professional Experience with WEG Group Companies:
• Appointed Chief Human Resources Officer in April 2010
Further Professional Experience:
With Empresa Brasileira de Compressores S.A. - Embraco:
• 2009 to 2010 – Vice-Chief Executive Officer for Human Capital
• 2005 to 2009 – Corporate People Management Officer
• 2002 to 2005 – Corporate People Manager
• 2002 to 2002 – Brazil Plant Manager
Criminal convictions over the past 5 years:
Nil
Roberto Bauer - 081.730.109-78
Educational Background:
• 1975 - Bachelor of Electrical Engineering – Universidade Federal de SC/UFSC
• 1980 - Graduate Degree in Business Administration - Universidade Federal de SC/UFSC
Professional Experience:
With WEG Group Companies:
• 1977 to 1979 - Research Lab Assistant Manager
• 1979 to 1982 - Manager of Special Products Department
• 1982 to 1985 - Chief Sales Officer
• 1986 to 1988 - Chief Production Officer
• 1988 to 2003 - Chief Operating Officer
• 2003 to 2006 - Chief International Operating Officer
• 2007 to 2009 - Chief Operating Officer
• Currently - Chief International Officer
With Other Companies:
Member of the Board of Directors of subsidiary TRAFO Equips Elétricos S.A.
Chairman of the Board of Directors of subsidiary Hidráulica Industrial S.A. “HISA”
Criminal convictions over the past 5 years: Nil
138
Reference Form - 2011 - WEG SA
Version : 1
12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Sérgio Luiz Silva Schwartz - 383.104.659-04
Educational Background:
• 1990 - Bachelor of Accounting Sciences – Universidade Regional de Joinville/SC
• 1994 - Graduate Degree in Managerial Practices – UDESC
• 1999 - MBA in Executive Team Management – FGV.
• 2003 - MBA in Business Logistics - FGV
Professional Experience:
1991 to 1993 - Manager of the Supply Department
2004 to 2007 - Chief Operating Officer
Currently - Vice-Chief Executive Officer and CFO
With WEG Group Companies:
1993 to 2002 - Manager of the Sales Planning Department
2002 to 2004 - Chief Logistics Officer
2007 to 2010 - Vice-Chief Executive Officer and International Officer
Criminal convictions over the past 5 years: Nil
Siegfried Kreutzfeld - 294.190.859-53
Educational Background:
1974 – Electrical Engineering - FEJ – Faculdade de Engenharia de Joinville
1988 – Graduate Degree in Business Administration - FERJ – Fundação Educacional Regional Jaraguá
1990 - Graduate Degree in Advertising and Marketing FAE – FERJ
1993 - Graduate Degree in Industrial Administration - FERJ – Fundação Educacional Regional – Jaraguá
1996 - Graduate Degree in Rotating Electrical Machines - UFSC – Universidade Federal de Santa Catarina
1998 - Master Degree in Rotating Electrical Machines - UFSC – Universidade Federal de Santa Catarina
Professional Experience:
With WEG Group Companies:
1979 to 1982 - Electrical Engineer – Electrical Projects
1982 to 1991 - Head of Electrical Engineering Area
1991 to 1992 - Product Research and Development Coordinator
1992 to 1995 - Product R&D Coordinator for Product Engineering
1995 to 2001 - Product Research and Development Manager
2001 to 2004 - Single-phase Motors Engineering Manager
2004 to 2008 - Chief Engineering Officer
Currently - Chief Operating Officer for the Motors Unit
Criminal convictions over the past 5 years: Nil
139
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Version : 1
12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Sinésio Tenfen - 293.669.689-53
Educational Background:
1979 - Bachelor of Electrical Engineering – Faculdade de Engenharia FEJ
1987 - Graduate Degree in Business Administration – Escola Superior de Administração e Gerência - ESAG
Professional Experience:
With WEG Group Companies:
1979 to 1982 - Project Designer of Synchronous and Direct Current Electric Machines
1982 to 1984 - Head of Synchronous and Direct Current Electric Machines Project and Application Area
1984 to 1986 - Head of the Sales Area
1986 to 1998 - Sales Department Manager
1998 to 2003 - Energy Business Center Manager
2004 to 2006 - Chief Operating Officer
2007 to 2010 - Chief Technical /Sales Officer
Appointed Chief Operating Officer for the Energy Unit in February 2010
Criminal convictions over the past 5 years: Nil
Umberto Gobbato - 160.589.760-49
Educational Background:
• 1974 - Electronic Engineering, Universidade Federal do Rio Grande do Sul
• 1984 -Graduate Degree in Industrial Automation, Universidade de Brasília
• 1998 - MBA Executive STC – Fundação Dom Cabral/J. L. Kellog Graduate School of Management
With WEG Group Companies:
• Since 1991, Chief Operating Officer of Weg Automação
Criminal convictions over the past 5 years: Nil
Wilson José Watzko - 352.366.129-34
Educational Background:
• 1976 - Accounting Technician
• 1985 - Bachelor of Economics
• 1988 - Graduate Degree in Business Administration (SC)
• 1990 - Graduate Degree in Business Administration (PR)
• 2002 - Master Degree in International Economic and Social Affairs – UMINHO
Professional Experience:
With WEG Group Companies:
• 1985 to 1986 - Auditor in the Audit Department
• 1986 to 1990 - Economist in the Financial Planning Department
• 1990 to 1991 - Administrative Department Manager
• 1991 to 2010 - Controllership Department Manager, accountant of WEG S.A. and WEG Group
• Appointed Chief Controllership Officer in February 2010.
With Other Publicly-Held Companies:
• 1998 to 1999 - Member of the Supervisory Board of Perdigão S.A.
• 2006 to 2006 - Member of the Supervisory Board and Audit Committee of Perdigão S.A.
Criminal convictions over the past 5 years: Nil
140
Reference Form - 2011 - WEG SA
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12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Carlos Diether Prinz - 489.859.459-04
Educational Background:
• 1984 - Bachelor of Electrical Engineering - Universidade Federal de SC/UFSC
• 1987 - Graduate Degree in Business Administration - Escola Superior de Administração e Gerência/ SC
• 2000 - Graduate Degree in Force Transformers - FURB/SC
Professional Experience:
With WEG Group Companies:
• 1985 to 1986 - Trainee
• 1986 to 1987 - Budget Analyst
• 1987 to 1989 - Head of the Sales Area
• 1989 to 2006 - Manager of the Sales Department
• 2006 to 2010 - Executive Officer
• Currently - Chief Operating Officer
Criminal convictions over the past 5 years: Nil
Décio da Silva - 344.079.289-72
Educational Background:
1978 – Bachelor of Mechanical Engineering – Universidade Federal de SC/UFSC
1980 – Graduate Degree in Business Administration – Escola Superior de Administração e Gerência – ESAG – Joinville/SC
Professional Experience:
With WEG Group Companies:
1979 to 1979 - Quality Control Assistant
1980 to 1980 - Head of the Quality Control Area
1980 to 1982 - Manager of the Manufacturing Department
1982 to 1985 - Manager of the Electromechanical Department
1985 to 1986 - Chief Production Officer
1986 to 1988 - Chief Regional Officer WEG (SP)
1988 to 1989 - Chief Sales Officer
1989 to 2007 - Chief Executive Officer
Currently - Chairman of the Board of Directors.
With Other Publicly-Held Companies (currently):
Member of the Board of Directors of BRF – Brasil Foods S.A.
Member of the Board of Directors of Iochpe Maxion S.A.
Further Professional Experience (currently):
2008 to 2010 - Member of the Board of Directors of Algar Group
2007 to 2010 - Member of the Advisory Council of IPT – Instituto de Pesquisas Tecnológicas de SP
Currently - Chairman of the Board of Directors of Oxford S.A.
Currently - Board Member of IEDI – Instituto de Estudos para o Desenvolvimento Industrial de SP
Currently -Officer of WPA Participações e Serviços S.A.
Criminal convictions over the past 5 years:
Nil
141
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12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Nildemar Secches - 589.461.528-34
Educational Background:
Bachelor of Mechanical Engineering – USP de São Carlos
Graduate Degree in Finance – PUC do Rio de Janeiro
PhD in Economics – Unicamp de Campinas Experiências Profissionais:
With WEG Group Companies:
Former Chairman of the Board of Directors
Currently - Member of the Board of Directors
With Other Publicly-Held Companies (currently):
Co-Chairman of the Board of Directors of BRF – Brasil Foods S.A.
Member of the Board of Directors of Ultrapar Participações S/A.
Member of the Board of Directors of Iochpe Maxion S/A.
Member of the Board of Directors of Suzano Papel e Celulose S.A.
Further Professional Experience:
Former Chief Executive Officer of BRF - Brasil Foods S.A. and Officer of BNDES
Criminal convictions over the past 5 years: Nil
Martin Werninghaus - 485.646.309-82
Reference Form - 2011 - WEG SA
Educational Background:
1983 - Bachelor of Economics - Fundação Educacional e Regional de Joinville/SC
1987 - Graduate Degree in Business Administration – Escola Superior de Administração e Gerência – ESAG
Professional Experience:
With WEG Group Companies:
1984 to 1986 - Head of the Sales Support Area
1986 to 1988 - Sales Manager - WEG Transformadores
1988 to 1991 - Chief Regional Officer of WEG S.A. - SP
1991 to 1998 - Chief Operating Officer of WEG Transformadores
1998 to 2002 - Chief Production Officer of WEG Motores
2002 to 2004 - Chief Operating Officer of WEG Euro (Portugal)
2004 to 2006 - Chief Operating Officer of WEG Química
Currently - Member of the Board of Directors
Further Professional Experience (currently):
Member of the Board of Directors of WPA Participações e Serviços S.A.
Criminal convictions over the past 5 years: Nil
142
Reference Form - 2011 - WEG SA
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12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Miriam Voigt Schwartz - 514.080.829-34
Educational Background:
Bachelor of Dentistry - Universidade Federal de SC - UFSC
Graduate Degree in Pediatric Dentistry – Associação Odontológica do Norte do Paraná
Professional Experience:
With WEG Group Companies:
Currently - Member of the Board of Directors
Further Professional Experience (currently):
2007 to 2010 - Officer of WEG Participações e Serviços S.A.
Dentist
Currently - Family Committee Coordinator of WPA S/A.
Criminal convictions over the past 5 years: Nil
Moacir Rogério Sens - 019.552.339-34
Educational Background:
1968 - Bachelor of Mechanical Engineering - Universidade Federal de SC/UFSC
Professional Experience:
With WEG Group Companies:
1968 to 1969 - Project Designer of Machines and Tools
1969 to 1972 - Head of the Quality Control Department
1972 to 1974 - Head of the Production Control Planning Department
1974 to 1975 - Manager of the Engineering Division
1975 to 1977 - Manager of Manufacturing Plant # III
1977 to 1978 - Manager of the Technology Division
1978 to 2006 - Chief Technical Officer of WEG Group
1986 to 1991 - Chief Operating Officer of WEG Automação
1994 to 2005 - Chief Operating Officer of WEG Motores
Since 2007 - Member of the Board of Directors.
With Other Publicly-Held Companies (currently):
Member of the Board of Directors of Intelbrás S.A.
Further Professional Experience:
Chairman of the Board of Trustees of Fundação CERTI – Centro de Referência de Tecnologias Inovadoras.
Criminal convictions over the past 5 years: Nil
143
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12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Douglas Conrado Stange - 006.287.949-91
Reference Form - 2011 - WEG SA
Educational Background:
Bachelor of Administration – Fundação Universitária de Joinville/SC
Graduate Degree in Business Administration – Escola Superior de Administração e Gerência - Florianópolis/SC Experiências Profissionais:
With WEG Group Companies:
1967 to 1970 - Office Assistant
1970 to 1974 - Head of the Costs and Budget Area
1974 to 1978 - Manager of Planning, Budget, Costs and Finance
1978 to 1979 - Manager of the Cost Accounting Division
1979 to 1984 - Chief Control Officer
1984 to 1994 - Chief Operating Officer of WEG Motores
1994 to 2007 - Chief Operating Officer of WEG Exportadora
2007 to 2008 - Chief Operating Officer of WEG Motores
Further Professional Experience:
1998 to 2004 – Member of the Board of Directors of Datasul S.A.
Criminal convictions over the past 5 years: Nil
Wilson Pinto Ferreira Junior - 012.217.298-10
Educational Background:
Bachelor of Business Administration – Universidade Mackenzie
Bachelor of Electrical Engineering – Escola de Engenharia da Universidade Mackenzie
Graduate Degree in Occupational Safety Engineering - Universidade Mackenzie
Graduate Degree in Marketing - Fundação Getúlio Vargas
Graduate Degree in Electric Power Distribution Management – Swedixh Power Co.
Master Degree in Engineering - Universidade de São Paulo - USP
Professional Experience (currently):
Chairman of Board of Directors of National Electric System Operator (ONS)
Chief Executive Officer of CPFL Energia Group
Chief Executive Officer of CPFL Companhia Piratininga de Força e Luz Group
Chief Executive Officer of CPFL Geração S.A. Group
Chief Executive Officer of CPFL Companhia Paulista de Força e Luz Group
Criminal convictions over the past 5 years: Nil
144
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12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Alidor Lueders - 114.466.179-04
Reference Form - 2011 - WEG SA
Educational Background:
1972 - Bachelor of Laws – FURB – Blumenau/SC
1987 - Graduate Degree in Business Administration -ESAG
1992 - Graduate Degree in Advanced Management Program in France
CTE and INSEAD – The European Institute of Business Administration
2000 - MBA in Business Administration
Professional Experience:
With WEG Group Companies:
1971 to 1979 - Manager of the Legal and Systems Audit Department
1979 to 2010 - Chief Administrative/Finance and Investor Relations Officer. Held positions as Assistant Director, Control Officer, Chief Operating Officer of WEG Transformadores
2007 to 2011 - Member of the Board of Directors of subsidiary HISA – Hidráulica Industrial S.A. Ind. e Com.
With Other Publicly-Held Companies (currently):
Member of the Supervisory Board of Marisol S.A.
Member of the Supervisory Board of Fras-Le S.A.
Further Professional Experience (currently):
Chairman of the Board of Directors of Zen S.A.
Member of the Board of Directors of Frigorífico Riosulense S.A.
Member of the Board of Directors of Hidráulica Industrial S.A. “HISA”
Vice-Chairman of the Board of Directors of Dudalina S.A.
Member of the Board of Directors of Tuper S.A.
Member of the Board of Directors of Dancor S.A.
Member of the Board of Trustees of WEG Seguridade Social
Chief Executive Officer of União Saúde S/S Ltda from 2007 to 2009
Member of DPL Assessoria Empresarial Ltda
Criminal convictions over the past 5 years: Nil
145
Reference Form - 2011 - WEG SA
Version : 1
12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Eduardo Grande Bittencourt - 003.702.400-06
Educational Background:
Bachelor of Accounting Sciences – Faculdade de Ciências Econômicas do RS
Graduate Degree in Business Administration - Universidade Federal do RS
Professional Experience:
With Other Publicly-Held Companies (currently):
Member of the Supervisory Board of Tupy S.A.
Member of the Supervisory Board of Bematech S.A.
Member of the Board of Directors of CP Eletrônica S.A.
Member of the Supervisory Board of Ligth S.A.
Member of the Supervisory Board of Santos Brasil Participações S.A.
Member of the Supervisory Board of Santos Brasil S.A.
Further Professional Experience:
Founder and former managing partner of Handel, Bittencourt &Cia Auditores Independentes
Criminal convictions over the past 5 years: Nil
Hayton Jurema da Rocha - 153.667.404-44
Reference Form - 2011 - WEG SA
Educational Background:
1982 - Bachelor of Economics – Universidade Federal de Alagoas
1999 - MBA in Business Management – Universidade Federal de Pernambuco
2000 - Corporate Governance – Faculdade de Economia e Administração - USP
2006 - Graduate Degree in Marketing – IAG/ PUC RJ
Professional Experience:
1999 to 2000 - Member of the Board of Trustees of Sebrae/BA
2000 to 2002 - Member of the Board of Directors of Coelba-BA
2002 to 2002 – Member of the Board of Directors of Paranapanema/RJ
2003 to 2005 - Member of the Board of Trustees of Sebrae/DF
2001 to 2003 - People Management Director - Banco do Brasil
2003 to 2005 - State Chief Operating Officer - Banco do Brasil
2005 to 2007 - Government Chief Operating Officer – Banco do Brasil
Currently - Member of the Superrvisory Board of CELESC (since 2008)
Criminal convictions over the past 5 years: Nil
146
Reference Form - 2011 - WEG SA
Version : 1
12.6 / 8 Composition and professional experience of the issuer’s management and supervisory board
Ilário Bruch - 069.088.619-53
Educational Background:
Bachelor of Finance Administration
Graduate Degree in Accounting Services Quality Management:
With Other Publicly-Held Companies:
Member of the Supervisory Board of Marisol S.A.
Further Professional Experience:
Accountant and Administrative Manager of Menegotti Indústrias Metalúrgicas Ltda.
Managing Partner and Accountant of Bruch Contabilidade e Assessoria S/C Ltda.
Criminal convictions over the past 5 years: Nil
Eduardo da Gama Godoy - 395.416.650-04
Educational Background:
Bachelor of Accounting Sciences – Faculdade Porto Alegrense – FAPCCA-RS
Bachelor of Business Administration – Faculdade Porto Alegrense – FAPCCA-RS
Professional Experience:
Further Professional Experience (Currently):
Partner Auditor of HB Audit – Auditores Independentes S.S.
Partner Accountant of Godoy Empresarial Serviços Contábeis
Deputy Member of the Supervisory Board of Ondontoprev
Member of the Supervisory Board of Padtec S.A.
Member of the Supervisory Board of IdeiasNet S.A.
Criminal convictions over the past 5 years: Nil
Marcelo Adolfo Moser - 217.282.409-72
Reference Form - 2011 - WEG SA
Educational Background:
Bachelor of Economics – Faculdade de Ciências Políticas e Econômicas Cândido
MBA in Advanced Finances – FIPECAFI - USP
Professional Experience:
Further Professional Experience (Currently):
1998-2000 - Manager Abroad – Banco do Brasil AG. Los Angeles (USA)
2000-2000 - Manager of Banco do Brasil Division
2001-2002 – Member and Vice-President of Brazilian American Merchant Bank – BAMB
2002-2004 – Officer of Banco do Brasil Securities Ltd.
Executive manager ofBanco do Brasil (currently)
Officer and Executive Officer of Banco do Brasil Leasing CO. (currently)
Criminal convictions over the past 5 years: Nil
147
Reference Form - 2011 - WEG SA
Version : 1
12.7 Composition of corporate committees and audit, financial and
remuneration committees
Reason for not completing the table
The Company does not have any specific committees.
All issues are submitted and discussed at the Board of Director`s meetings.
148
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Version : 1
12.9 Existence of any marital relationship, common law marriage or kinship up to the second degree related to
the officers of the issuer, subsidiaries and controlling shareholder
Business name of issuer,
subsidiary or
Name
Title
Officer of the issue r or subsidiary
Miriam Voigt Schwartz
Member of the Board of Directors
Re lated party
Sérgio Luiz Silva Schwartz
Vice Chief Executive Office
Notes
149
National Register of
Individuals (CPF)
controlling shareholder
514.080.829-34
WEG S.A.
383.104.659-04
WEG S.A.
Type of kinship with the office rs of
the
National Register of Legal
Entities (CNPJ)
issuer or subsidiary
84.429.695/0001-11 Spouse (1st degree kinship)
84.429.695/0001-11
Reference Form - 2011 - WEG SA
Version : 1
12.10 Relationships involving subordination, service delivery or
control between officers and subsidiaries, controlling
shareholders and others
Justification for noncompletion of the table-format information:
The Company has had no relationships involving subordination, service delivery
or control for the past 3 fiscal yearsbetween the Company’s officers and the
Company’s direct or indirect subsidiaries or indirectly by the Company, direct or
indirect controlling shareholder, Company’s suppliers, customers, debtors or
creditors.
150
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Version : 1
12.11 Any agreements, including insurance policies, which provide
for the payment or reimbursement of expenses incurred by the
officers
N/A
151
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Version : 1
12.12 Other relevant information
The Company reports relevant information about the officers of its subsidiaries.
a) Board of D irectors of H idráulica Industr ial S.A. Ind. e Com. - H ISA
Name
Sinésio Tenfen
Jorge Leo Pechlet Ritter V.Tennenberg
Eduardo de Nóbrega
Age
56
69
49
Occupation
Engineer
Businessperso
n
Engineer
CPF
293.669.689-53
Elective Office
Held
Chairman
003.161.309-82
042.357.178-80
Vice-Chairman
Member
Election Investiture Term of
Date
Date
Office
3/31/11
3/31/11
2 Years
3/31/11
3/31/11
3/31/11
3/31/11
2 Years
2 Years
Appointed by
the controlling
shareholder
Yes
Other
Titles
1
No
Yes
-
1. Part of the Executive Board of holding company WEG S.A. and of subsidiaries WEG Equipamentos Elétricos S.A., and Hidráulica Industrial S.A. Ind. e Com. - HISA
b) Executive Board of other WEG Group companies
Name
Aldo Felipe Manke
Alfredo Ângelo Moretti
Celso Vili Siebert
Eduardo de Nóbrega
Helcio Makoto Morikossi
Jorge Tennenberg
Luis Alberto T iefensee
Luis Gustavo Lopes Iensen
Milton Oscar Castella
Newton Massao Idemori
Reinaldo Richter
Reinaldo Stuart Junior
Ronaldo Klitzke
1
2
3
4
5
6
Age
49
53
58
49
50
37
55
53
56
54
57
51
58
Occupation
Industrialist
Industrialist
Industrialist
Engineer
Industrialist
Industrialist
Industrialist
Industrialist
Industrialist
Industrialist
Industrialist
Industrialist
Industrialist
CPF
557.653.949-49
487.824.599-91
247.562.539-20
042.357.178-80
022.622.258-69
801.525.549-04
215.804.990-15
271.090.540-04
293.685.109-20
644.728.178-53
292.181.609-15
481.802.549-68
292.294.309-78
Part of the Executive Board of subsidiary WEG Equipamentos Elétricos S.A.
Part of the Executive Board of subsidiary RF Reflorestadora S.A.
Part of the Executive Board of subsidiary WEG Linhares Equipamentos Elétricos Ltda.
Part of the Executive Board of subsidiary WEG Tintas Ltda.
Part of the Executive Board of subsidiary WEG Amazônia S.A.
Part of the Executive Board of subsidiary Hidráulica Industrial S.A. Ind. e Com. - “HISA”.
152
Ele ctive Office
Held
Officer
Officer
Officer
Officer
Officer
Officer
Officer
Officer
Officer
Officer
Officer
Officer
Officer
Election Investiture
Date
Date
2/23/10
2/23/10
2/23/10
2/23/10
2/23/10
2/23/10
1/1/11
1/1/11
2/23/10
2/23/10
3/25/09
3/25/09
2/23/10
2/23/10
2/23/10
2/23/10
2/23/10
2/23/10
2/23/10
2/23/10
2/23/10
2/23/10
2/23/10
2/23/10
2/23/10
2/23/10
Investiture
Date
1/22/12
1/22/12
1/22/12
1/22/12
1/22/12
1/22/12
1/22/12
1/22/12
1/22/12
1/22/12
1/22/12
1/22/12
1/22/12
Appointed by
the controlling
shareholder
C.A.
C.A.
C.A.
C.A.
C.A.
C.A.
C.A.
C.A.
C.A.
C.A.
C.A.
C.A.
C.A.
Othe r
Titles
1
1,3 and 5
1
1
1
6
1,2,3 and 5
1
1 and 3
1
4
1
2
Reference Form - 2011 - WEG SA
Version : 1
12.12 Other relevant information
c) Résumé of each member of the board of directors and officers.
Board of Directors of Hidráulica Industrial S.A. Ind. e Com. - HISA
Sinésio Tenfen – Chairman
Educational Background:
• 1979 - Bachelor of Electrical Engineering – Faculdade de Engenharia FEJ
• 1987 - Graduate Degree in Business Administration – Escola Superior de
Administração e Gerência - ESAG
153
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Version : 1
12.12 Other relevant information
Professional Experience:
With WEG Group Companies:
• 1979 to 1982 - Project Designer of Synchronous and Direct Current
Electric Machines
• 1982 to 1984 - Head of Synchronous and Direct Current Electric
Machines Project and Application Area
• 1984 to 1986 - Head of the Sales Area
• 1986 to 1998 - Sales Department Manager
• 1998 to 2003 - Energy Business Center Manager
• 2004 to 2006 - Chief Operating Officer
• 2007 to 2010 - Chief Technical /Sales Officer
• Appointed Chief Operating Officer for the Energy Unit in February 2010
Criminal convictions over the past 5 years:
Nil
Jorge Leo Pechler Ritter von Tennenberg – Vice-Chairman
Educational Background:
• 1960 - Accounting Technician
Professional Experience:
With WEG Group Companies:
• 1970 to 2002 - Chief Administrative Officer of subsidiary Hidráulica
Industrial S.A. - “HISA”
• Currently - Vice-Chairman of the Board of Directors of subsidiary
Hidráulica Industrial S.A. - “HISA”
Criminal convictions over the past 5 years:
Nil
Eduardo de Nóbrega – Member
Educational Background:
• 1987 – Industrial Mechanical Engineering – UBC – Universidade Braz
Cubas
Reference Form - 2011 - WEG SA
• 1989 – Graduate Degree in General Management – FMU – Faculdade
Metropolitana Unidas
154
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12.12 Other relevant information
Professional Experience:
With WEG Group Companies:
• 2010 – Industrial Manager
• Currently – Chief Industrial Officer
• Currently – Member of the Board of Directors of subsidiary HISA.
Further Professional Experience:
•
•
•
•
•
•
1992 to 1994 – Processes Engineer of Gevisa S.A
1994 to 1998 – Methods and Processes Supervisor of Gevisa S.A.
1998 to 1999 – Production and Materials Manager of Gevisa S.A.
1999 to 2003 – Industrial Manager of Gevisa S.A.
2003 to 2007 – Chief Industrial Officer of Gevisa S.A.
2007 to 2009 – Chief Operations Officer of Alstom Hidro Energia Brasil
Ltda.
Criminal convictions over the past 5 years:
Nil
EXECUT IVE BOARD
Aldo Felipe Manke - Officer
Educational Background:
• 1984 - Bachelor of Electrical Engineering - Universidade Federal de SC/
UFSC
• 1999 - Graduate Degree in Materials Management – FURB/SC
• 2000 - Graduate Degree in Power Transformers - Fundação Fritz Muller
Professional Experience:
With WEG Group Companies:
•
•
•
•
•
•
1992 to 1995 - Head of the Sales Department
1995 to 1998 - Head of the Supply Department
1998 to 1999 - Executive Assistant
1999 to 2005 - Manager of the Technical Department
2005 to 2010 - Manager of the Export Sales Department s
Currently - Chief Industrial Officer
Criminal convictions over the past 5 years:
Nil
Alfredo Angelo Moretti - Officer
Educational Background:
• 1983 - Bachelor of Electrical Engineering - Faculdade de Engenharia de
Joinville/FEJ
• 1996 - Graduate Degree in Quality and Productivity Management Fundação Educacional Regional de Jaraguá do Sul/ FERJ
• 1997 - Graduate Degree in Rotating Electrical Machines - Universidade
Federal de Santa Catarina/ UFSC
155
Reference Form - 2011 - WEG SA
Version : 1
12.12 Other relevant information
• 1999 - Graduate Degree in Materials Management - Universidade
Regional de Blumenau/ FURB
• 2003 - Master Degree in Business Administration - Universidade Federal
do Rio Grande do Sul/ UFRGS
Professional Experience:
With WEG Group Companies:
•
•
•
•
•
•
1984 to 1986 - Engineer in the Maintenance Area
1987 to 1995 - Head of the Maintenance Area
1996 to 2000 - Head of the Quality Control Area
2001 to 2004 - Manager of the Production Department
2005 to 2006 - Manager of the Training Department
Currently - Chief Production Officer
Criminal convictions over the past 5 years:
Nil
Celso Vili Siebert – Officer
Educational Background:
• 1975 - Bachelor of Electrical Engineering - Universidade Federal de
SC/UFSC
• 1999 - Executive Negotiation Course – Harvard University/MIT – USA
• 2002 - Advanced Management Program – FDC /INSEAD - France.
Professional Experience:
With WEG Group Companies:
•
•
•
•
•
•
•
•
•
1978 to 1982 - Head of R&D
1982 to 1985 - Engineering Manager
1985 to 1987 - Quality Manager
1987 to 1991 - Product Engineering Manager
1991 to 1994 - Executive Officer of WEG - USA
1994 to 2001 - Chief Executive Officer of WEG - USA
2001 to 2004 - Chief Sales Officer
2004 to 2007 - Executive Logistics Officer
Currently - Chief Regional Officer for the Americas, Africa, India and AsiaPacific
Criminal convictions over the past 5 years:
Nil
Eduardo de Nóbrega – Officer
Educational Background:
• 1987 – Industrial Mechanical Engineering – UBC – Universidade Braz
Cubas
• 1989 – Graduate Degree in General Management – FMU – Faculdade
Metropolitana Unidas
156
Reference Form - 2011 - WEG SA
Version : 1
12.12 Other relevant information
Professional Experience:
With WEG Group Companies:
• 2010 – Industrial Manager
• Currently – Chief Industrial Officer
• Currently – Member of the Board of Directors of subsidiary HISA.
Further Professional Experience:
•
•
•
•
•
•
1992 to 1994 – Processes Engineer of Gevisa S.A
1994 to 1998 – Methods and Processes Supervisor of Gevisa S.A.
1998 to 1999 – Production and Materials Manager of Gevisa S.A.
1999 to 2003 – Industrial Manager of Gevisa S.A.
2003 to 2007 – Chief Industrial Officer of Gevisa S.A.
2007 to 2009 – Chief Operations Officer of Alstom Hidro Energia Brasil
Ltda.
Criminal convictions over the past 5 years:
Nil
Hélcio Makoto Morikossi – Officer
Educational Background:
• 1983 - Mechanical Engineering – Escola de Engenharia Mauá
• 2005 - Fundação Dom Cabral (PDE)
Professional Experience:
With WEG Group Companies:
•
•
•
•
•
•
•
1989 to 1991 - Sales Coordinator (WEG-SP)
1991 to 1992 - Sales Analyst
1992 to 1993 - Assistant Manager
1993 to 1993 - Head of Automation Sales Area
1993 to 1994 - Executive Assistant
1994 to 1995 - Sales Manager (WEG-SP)
Currently - Chief Sales Officer
Criminal convictions over the past 5 years:
Nil
Jorge Tennenberg – Officer
Educational Background:
• Mechanical Technician
• Mechanical Engineering (Incomplete)
Professional Experience:
With WEG Group Companies:
• Since 1999 – Executive Officer of subsidiary Hidráulica Industrial S.A.
“HISA”.
Criminal convictions over the past 5 years:
Nil
157
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12.12 Other relevant information
Luís Alberto Tiefensee – Officer
Educational Background:
• 1978 - Bachelor of Mechanical Engineering - Universidade Regional
Integrada Santo Angelo-RS
• 1988 - Graduate Degree in Business Administration - Escola Superior de
Administração e Gerência – ESAG
• 2003 - MBA in Business Management - Centro Universitário de Jaraguá
do Sul – UNERJ
Professional Experience:
With WEG Group Companies:
•
•
•
•
•
•
•
•
1980 to 1982 - Engineer in the Tooling Area
1983 to 1988 - Head of the Tooling Area
1989 to 1993 - Manager of the Industrial Engineering Department
1994 to 1996 - Manager of the Tooling Department
1997 to 1999 - Manager of the Stamping Department
2000 to 2001 - Manager of the Tooling Department
2002 to 2006 - Chief Production Officer
Currently - Chief Industrial Officer
Criminal convictions over the past 5 years:
Nil
Luís Gustavo Lopes Iensen – Officer
Educational Background:
• 1980 - Bachelor of Mechanical Engineering – Universidade Federal de
Santa Maria/UFSM
• 1992 - Graduate Degree in Business Administration - Escola Superior de
Administração e Gerência – ESAG
Professional Experience:
With WEG Group Companies:
•
•
•
•
•
•
•
•
•
1981 to 1983 - Mechanical Engineer in the Control Department
1983 to 1987 - Head of Area in the Inspection Department I/II
1987 to 1990 - Manager of the Quality Control Department
1990 to 1993 - Manager of the Product Engineering Department
1993 to 1994 - Manager of the Quality Control Department
1994 to 2003 - Manager of the Sales Department
2004 to 2006 - Executive Officer of WEG Portugal
2007 to 2008 - Chief Regional Officer for Asia, in China
Currently - Chief Regional Officer for Europe, in Germany
Criminal convictions over the past 5 years:
Nil
158
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12.12 Other relevant information
Milton Oscar Castella – Officer
Educational Background:
• 1979 – Electrical Engineering – FEJ Faculdade de Engenharia de
Joinville/SC
• 1994 – Graduate Degree in Managerial Practices -Escola Superior de
Administração e Gerência – ESAG
• 1996 – Graduate Degree in Rotating Electrical Machines - UFSC
Professional Experience:
With WEG Group Companies:
•
•
•
•
•
•
1980 to 1984 - Project Analyst
1984 to 1985 - Head of the Synchronous and DC Machines Project Area
1985 to 1990 - Head of the Electric Projects Area
1990 to 1992 - Manager of the Quality Control Department
1992 to 2008 - Engineering and Industrial Motors Manager
Currently - Chief Engineering Officer
Criminal convictions over the past 5 years:
Nil
Newton Massao Idemori – Officer
Educational Background:
• 1979 - Bachelor of Mechanical Engineering - Universidade Mackenzie de
São Paulo.
• 1995 - Graduate Degree in Business Administration - FGV-SP.
Professional Experience:
With WEG Group Companies:
• Appointed New Products Development Officer for WEG Energia in
January 2010.
With Other Publicly-Held Companies:
• 1981 to 1991 - Thermal Area Manager of ABB – Asea Brown Boveri
• 1997 to 2008 - Regional Sales Manager of GE Energy
• 2008 to 2009 - Chief Regional Officer for Brazil of Dresser-Rand do Brasil
Ltda
Criminal convictions over the past 5 years:
Nil
Reinaldo Richter – Officer
Educational Background:
• 1983 - Bachelor of Accounting Sciences - UNIVILLE - Joinville/SC
• 1987 - Graduate Degree in Business Administration - Escola Superior de
Administração e Gerencia - ESAG
159
Reference Form - 2011 - WEG SA
Version : 1
12.12 Other relevant information
Professional Experience:
With WEG Group Companies:
•
•
•
•
•
•
•
1981 to 1985 - Administrative Assistant
1985 to 1986 - Head of Personnel Area l
1986 to 1991 - Sales / Administrative Manager
1991 to 1992 - Administrative Department Manager
1992 to 1995 - Commercial Department Manager
1995 to 2007 - Sales Department Manager
Currently - Chief Officer for the Paints Division
Criminal convictions over the past 5 years:
Nil
Reinaldo Stuart Junior – Officer
Educational Background:
• 1982 - Mechanical Engineering - Universidade Federal de SC/ UFSC
• 1994 - Graduate Degree in Managerial Practices - Escola Superior de
Administração e Gerência - ESAG
• 2005 - Master Degree in Mechanical Engineering - Universidade Federal
de SC/ UFSC
Professional Experience:
With WEG Group Companies:
•
•
•
•
•
•
1983 to 1987 - Head of Area in the Quality Department
1988 to 1989 - Executive Assistant – Quality
1989 to 1996 - Quality Manager
1996 to 1998 - Quality Department Manager
1998 to 2006 - Technical Department Manager
Currently - Chief Industrial Officer
Criminal convictions over the past 5 years:
Nil
Ronaldo Klitzke – Officer
Educational Background:
• 1978 - Bachelor of Veterinary Medicine / UDESC
• 1988 - Graduate Degree in Business Administration / ESAG
• 2001 - MBA in Corporate Management, Marketing and Finance / INPG
Professional Experience
Reference Form - 2011 - WEG SA
With WEG Group Companies:
• 1986 - 1988 – Veterinarian / Livestock Department Manager
• Currently – Chief Forestry Officer
Criminal convictions over the past 5 years:
Nil
160
Reference Form - 2011 - WEG SA
Version : 1
13.1 Description of compensation policies and practices, including
non-statutory board members
a) Compensation of the Board of Directors and the Executive Board (WEG
Group)
(i)
Fixed compensation
Fixed compensation payable to the Board of Directors and the Executive
Board is established considering the provisions of article 152 of Law No.
6404/76, with the overall management compensation amount being
submitted to the Annual General Meeting of each WEG Group company.
On establishing the individual amount to be paid monthly to each
member, the Board of Directors considers, with regard to each member:
their responsibilities; time they dedicate to their duties; their competence
and professional reputation, and the market price for their services. The
Company has a periodic salary survey conducted by a specialized firm.
(ii) Variable Compensation
Variable compensation is based on profit sharing and is defined in article
38 of the Articles of Incorporation, which limits its maximum amount,
pursuant to legal limitations, to 10% (ten per cent) of net income, not
exceeding annual management’s compensation, whichever is less
(Brazilian Corporation Law article 152 paragraph 1).
Every year, the Board of Directors establishes the profit sharing criteria
for directors and officers (Executive Board and Board of Directors).
Profit sharing is calculated on the consolidated net income, at a rate
from 0.0% to 2.5%, according to a performance indicator known as
“activity result to capital invested” as long as it is, at least, 10% in 2011
(12% in 2010)
The Company considers capital invested to be the sum of its working
capital assets and liabilities and property, plant and equipment.
b) Compensation of the Supervisory Board
Compensation of members of the Supervisory Board complies with the
provisions set forth in paragraph 3, article 162 of Law No. 6404/76. It shall be
fixed by the General Meeting that elects the Supervisory Board members, as
proposed by the Board of Directors, and shall not be less than 10% of the
average compensation paid to each director, excluding benefits,
entertainment allowances and profit sharing.
In the Annual General Meeting (“AGO/E”) held on April 26, 2011, the
individual monthly amount was established at R$ 5,375.00 (R$ 5,000.00 in
2010).
Also, reimbursement of all lodging and transportation expenses incurred to
fulfill the duties to which they were appointed was approved.
161
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Version : 1
13.1 Description of compensation policies and practices, including
non-statutory board members
a) Board of Directors and Executive Board
Compensation consists of a fixed monthly fee, which aims to reward the
duties performed by each member, on continuing and developing the
corporate businesses under their responsibility.
Profit sharing - variable income - is calculated on the consolidated net
income, at a rate from 0.0% to 2.5%, and granted to the Board of Directors
and Statutory Board, aiming to recognize the contribution of each member in
attaining the results and performance achieved by the Company.
b) Supervisory Board
Compensation consists of a fixed monthly fee, which aims to reward the
duties performed by each member, on continuing and developing the
corporate businesses under their responsibility.
162
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Version : 1
13.2 Total compensation of the Board of Directors, Executive Board
and Supervisory Board
Total compensation forecast - Current FY 12/31/2011 - Annual Amounts
Board of Directors
Number of members
Executive Board
Supervisory Board
Total
7.00
11.00
3.00
21.00
1,400,000.00
800,000.00
200,000.00
2,400,000.00
Direct/indirect benefits
0.00
0.00
0.00
0.00
Participation in committees
0,00
0,00
0,00
0,00
Other
0,00
0,00
0,00
0,00
0.00
0.00
0.00
0.00
1,400,000.00
800,000.00
0.00
2,200,000.00
Compensation for meeting
attendance
0.00
0.00
0.00
0.00
Commissions
0.00
0.00
0.00
0.00
Other
0.00
0.00
0.00
0.00
Post-employment benefits
0.00
0.00
0.00
0.00
Termination benefits
0.00
0.00
0.00
0.00
Stock-based compensation
0.00
0.00
0.00
0.00
2,800,000.00
1,600,000.00
200,000.00
4,600,000.00
Fixed annual
compensation
Salary or fees
Description of other fixed
compensation items
Variable compensation
Bonus
Profit sharing
Description of other variable
compensation items
Notes
Total compensation
Total compensation - FY 12/31/2010 - Annual Amounts
Board of Directors
Number of members
Executive Board
Supervisory Board
Total
7.00
11.17
4.33
22.50
1,052,000.00
528,000.00
256,000.00
1,836,000.00
35,000.00
0.00
0.00
35,000.00
Participation in committees
0.00
0.00
0.00
0.00
Other
0.00
0.00
0.00
0.00
Fixed annual
compensation
Salary or fees
Direct/indirect benefits
163
Reference Form - 2011 - WEG SA
Version : 1
13.2 Total compensation of the Board of Directors, Executive Board
and Supervisory Board
Description of other fixed compensation items
Variable compensation
Bonus
0.00
0.00
0.00
0.00
484,000.00
243,000.00
0.00
727,000.00
Compensation for meeting
attendance
0.00
0.00
0.00
0.00
Commissions
0.00
0.00
0.00
0.00
Other
0.00
0.00
0.00
0.00
Post-employment benefits
0.00
0.00
0.00
0.00
Termination benefits
0.00
0.00
0.00
0.00
Stock-based compensation
0.00
0.00
0.00
0.00
1,571,000.00
771,000.00
256,000.00
2,598,000.00
Profit sharing
Description of other variable
compensation items
Notes
Total compensation
164
Reference Form - 2011 - WEG SA
Version : 1
13.2 Total compensation of the Board of Directors, Executive Board
and Supervisory Board
Total compensation - FY 12/31/2009 - Annual Amounts
Board of Directors
Number of members
Executive Board
Supervisory Board
Total
7.00
7.00
3.00
17.00
1,077,000.00
370,000.00
167,000.00
1,614.000.00
32,000.00
0.00
0.00
32,000.00
Participation in committees
0.00
0.00
0.00
0.00
Other
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
581,000.00
200,000.00
0.00
781,000.00
Compensation for meeting
attendance
0.00
0.00
0.00
0.00
Commissions
0.00
0.00
0.00
0.00
Other
0.00
0.00
0.00
0.00
Post-employment benefits
0.00
0.00
0.00
0.00
Termination benefits
0.00
0.00
0.00
0.00
Stock-based compensation
0.00
0.00
0.00
0.00
1,690,000.00
570,000.00
167,000.00
2,427,000.00
Fixed annual
compensation
Salary or fees
Direct/indirect benefits
Description of other fixed
compensation items
Variable compensation
Bonus
Profit sharing
Description of other variable
compensation items
Notes
Total compensation
165
Reference Form - 2011 - WEG SA
Version : 1
13.3 Variable compensation of the Board of Directors, Executive
Board and Supervisory Board
FY 2009 (In thousands of R$)
Body
Number of Members
Regarding the bonus:
Lower limit defined in the compensation plan
Upper limit defined in the compensation plan
Amount defined in the compensation plan, in
case the goals set are met
Amount actually recognized in the income
statement
Board of
Directors
Supervisory
Board
Executive
Board
7.00
3.00
7.00
17.00
315
1,111
N/A
N/A
108
382
423
1,493
1,111
N/A
382
1,493
581
N/A
200
781
Total
FY 2010 (In thousands of R$)
Body
Number of Members
Regarding the bonus:
Lower limit defined in the compensation plan
Upper limit defined in the compensation plan
Amount defined in the compensation plan
(limited to 100% of fixed compensation), in
case the goals set are met
Amount actually recognized in the income
statement
Reference Form - 2011 - WEG SA
Board of
Directors
Supervisory
Board
Executive
Board
Total
7.00
4.33
11.17
22.50
969
N/A
N/A
487
1,456
969
N/A
487
1,456
484
N/A
243
727
Version : 1
Year 2011 (In thousands of R$)
Board of
Directors
7.00
Supervisory
Board
3.00
- Lower limit defined in the
compensation plan
0.0% on net
income
N/A
0.0% on
net income -
- Upper limit defined in the
compensation plan
2.5% on net
income
N/A
2.5% on
net
income
-
- Amount defined in the
compensation plan (limited to 100%
of fixed fee), in case the goals set
are met
2.5% on net
income
N/A
2.5% on
net
income
-
-
N/A
-
Body
Number of Members
Regarding the
bonus:
- Amount actually recognized in the
income statement
166
Executive
Board
Total
11.00
21.00
Reference Form - 2011 - WEG SA
Version : 1
13.4 Stock-based compensation plan of the Board of Directors and
Executive Board
The Company has no stock-based compensation plan, but in Attachment Item 22.4, we report on the WEG S.A Stock Purchase Option Plan, approvedby
the Special General Meeting (“AGE”) held on February 22, 2011.
167
Reference Form - 2011 - WEG SA
Version : 1
13.5 Stakes in shares, units of interest and other convertible
securities held by members of the Board of Directors,
Executive Board and Supervisory Board - by body
13.5 Number of shares directly and indirectly held by members of the
Board of Directors, Executive Board and Supervisory Board as of
12/31/2010:
Body
Board of Directors - directly held
Executive Board
Supervisory Board
TOTAL
168
Total Shares Held
(Common
Shares only)
3,220,790
1,997,559
1
5,218,350
Reference Form - 2011 - WEG SA
Version : 1
13.6 Stock-based compensation of board of directors and executive
board
N/A
169
Reference Form - 2011 - WEG SA
Version : 1
13.7 Information on options outstanding held by the Board of
Directors and Executive Board
As reported in item 13.4, the WEG S.A Stock Purchase Option Plan was
approvedby the Special General Meeting (“AGE”) held on February 22, 2011,
and there are currently no options outstanding.
170
Reference Form - 2011 - WEG SA
Version : 1
13.8 Options exercised and options granted related to stock-based
compensation of the Board of Directors and Executive Board
As reported in item 13.4, the WEG S.A Stock Purchase Option Plan was
approvedby the Special General Meeting (“AGE”) held on February 22, 2011,
and there are currently no options exercised or granted.
171
Reference Form - 2011 - WEG SA
Version : 1
13.9 Information required to understand the data disclosed in items
13.6 to 13.8 - Stock and option pricing method
N/A
172
Reference Form - 2011 - WEG SA
Version : 1
13.10 Existing pension plans offered to members of the Board of
Directors and Executive Board
The purpose of the benefit plan is to supplement the post-employment benefits
granted by the government-sponsored social security system. The plan,
managed by WEG, provides its members with lifetime annuity benefits,
supplementary illness benefits, supplementary disability benefits, death annuity
benefits, and lump-sum death benefits.
Body
Number of Members
Name of Plan
Number of Board members entitled to retirement
Conditions for early retirement
Updated amount of accumulated contributions made to
the pension plan until the latest fiscal year closing, less
the amount of contributions paid directly by officers
Total amount of accumulated contributions made during
the latest fiscal year, less the amount of contributions
paid directly by directors and officers
Early withdrawal allowed? If so, on what condition?
173
Board of Directors
3
Benefit Plan
2
50 years of age and 10 years
of contributions
3.612
In thousands of R$
Executive
Board
See item
13.15
Total
3
See item
13.15
2
See item
13.15
3.612
See item
13.15
404
404
Yes, on ceasing to participate in the plan, withdrawal of the amount
equivalent to 2% for each year of service limited to 50% of the total
balance.
Reference Form - 2011 - WEG SA
Version : 1
13.11 Highest, lowest and average individual compensation paid to the Board of Directors, Executive Board and
Supervisory Board
Annual amounts (in R$)
Executive Board
Number of members
Board of Directors
Supervisory Board
12/31/2010
11.17
12/31/2009
7.00
12/31/2010
7.00
12/31/2009
7.00
12/31/2010
4.33
12/31/2009
3.00
116,000.00
125,000.00
302,000.00
359,000.00
59,000.00
56,000.00
42,000.00
67,000.00
98,000.00
112,000.00
40,000.00
56,000.00
69,000.00
81,000.00
224,000.00
241,000.00
59,000.00
56,000.00
Highest indiv idual
compensation
Lowest individual
compensation
Ave rage individual
compensation
Notes
Executive Board
Board of Directors
Supervisory Board
174
Reference Form - 2011 - WEG SA
Version : 1
13.12 Mechanisms involving compensation or termination benefits
for directors or officers in case of removal from office or
retirement
N/A
175
Reference Form - 2011 - WEG SA
Version : 1
13.13 Percentage rate of total compensation held by members of the
Board of Directors, the Executive Board or the Supervisory
Board who are related parties to controlling shareholders
MEMBERS
YEAR
2009
2010
2011
176
BODY
Board of Directors
Board of Directors
Board of Directors
FEES
BENEFITS
PROFIT
SHARING (% )
(% )
(% )
(% )
43
43
43
35
33
34
-
35
33
34
Reference Form - 2011 - WEG SA
Version : 1
13.14 Compensation paid to the members of the Board of Directors,
the Executive Board and the Supervisory Board grouped per
body, for any reason other than the office held by them
N/A
177
Reference Form - 2011 - WEG SA
Version : 1
13.15 Compensation paid to the members of the Company’s Board
of Directors, the Executive Board and the Supervisory Board
recognized in the statement of income of direct or indirect
controlling shareholders, of companies under common
control, and of the issuer’s subsidiaries
Below we present the following information:
a) Compensation obtained in subsidiary WEG Equipamentos Elétricos S.A.
(i) COMPENSATION - IN THOUSANDS OF R$
Year
Body
Profit
sharing
166
-
Total
647
-
552
552
-
1.467
1.633
222
-
5.966
6.613
706
-
5.830
6.314
500
-
726
726
-
1.757
1.979
500
-
8.313
9.019
1.000
-
7.000
7.500
-
6.500
7.000
13.500
14.500
Board of Directors
Supervisory Board
Members
4,00
-
Fees
481
-
Executive Board
Total
Board of Directors
Supervisory Board
7,00
14,00
3,00
-
3.947
4.428
484
-
Executive Board
Total
Board of Directors
Supervisory Board
11,17
14,17
3,00
-
Executive Board
Total
11,00
14,00
Benefits
-
2009
2010
2011
(ii) VARIABLE COMPENSATION Year 2009 (In thousands of R$)
Body
Number of Members
Regarding the Bonus:
- Lower limit defined in the compensation plan
- Upper limit defined in the compensation plan
- Amount defined in the compensation plan, in case the goals set
are met
- Amount actually recognized in the income statement
Year 2010 (In thousands of R$)
Body
Number of Members
Regarding the Bonus:
- Lower limit defined in the compensation plan
- Upper limit defined in the compensation plan
- Amount defined in the compensation plan (limited to 100% of fixed
compensation), in case the goals set are met
- Amount actually recognized in the income statement
178
Board of
Directors
4.00
Supervisory
Board
0.00
Executive
Board
7.00
Total
11.00
47
402
402
N/A
N/A
N/A
494
3,380
3,380
541
3,782
3,782
166
N/A
1,467
1,633
Board of
Directors
3.00
Supervisory
Board
0.00
Executive
Board
11.17
Total
14.17
446
446
N/A
N/A
N/A
4,446
4,446
4,892
4,892
222
N/A
1,757
1,979
Reference Form - 2011 - WEG SA
Version : 1
13.15 Compensation paid to the members of the Company’s Board
of Directors, the Executive Board and the Supervisory Board
recognized in the statement of income of direct or indirect
controlling shareholders, of companies under common
control, and of the issuer’s subsidiaries
Year 2011 (In thousands of R$)
Executive
Supervisory
Board
Board
0.00
11.00
Board of
Directors
3.00
Body
Number of Members
Regarding the Bonus:
- Lower limit defined in the compensation plan
- Upper limit defined in the compensation plan
- Amount defined in the compensation plan (limited to 100% of fixed
compensation), in case the goals set are met
- Amount actually recognized in the income statement
0.0% on
net income
2.5% on
net income
2.5% on
net income
-
N/A
0.0% on
net income
2.5% on
net income
2.5% on
net income
-
N/A
N/A
N/A
Total
14.00
-
(iii) PENSION PLAN IN EFFECT (In thousands of R$)
Board of
Directors
Body
Number of Members
Name of Plan
Number of Board members entitled to
-
Executive
Board
Total
10
10
Benefit Plan
8
8
retirement
Conditions for early retirement
50 years of age and 10 years of contribution
Updated amount of accumulated contributions made to the pension plan
until the latest fiscal year closing, less the amount of contributions
10,882
10,882
paid directly by directors and officers
Total amount of accumulated contributions made during the latest
fiscal year, less the amount of contributions paid directly
2,008
2,008
by directors and officers
Yes, on ceasing to participate in the plan,
Early withdrawal allowed? If so, on what condition?
withdrawal of the amount equivalent to 2% for each
year of service limited to 50% of the total balance.
(iv) COMPENSATION PAID (In thousands of R$)
Year
2009
2010
2011
179
Body
Board of Directors
Supervisory Board
Executive Board
Board of Directors
Supervisory Board
Executive Board
Board of Directors
Supervisory Board
Executive Board
Highest
Compensation
291
1,020
399
1,134
573
1,815
Lowest
Compensation
72
592
98
336
141
637
Average
Compensation
162
852
236
744
333
1,227
Reference Form - 2011 - WEG SA
Version : 1
13.15 Compensation paid to the members of the Company’s Board
of Directors, the Executive Board and the Supervisory Board
recognized in the statement of income of direct or indirect
controlling shareholders, of companies under common
control, and of the issuer’s subsidiaries
b) Total compensation obtained in WEG S.A. and subsidiary WEG
Equipamentos Elétricos S.A.
(i) COMPENSATION - IN THOUSANDS OF R$
Year
Profit
sharing
747
-
Total
2,337
167
552
584
35
-
1,667
2,414
706
-
6,536
9,040
2,277
256
6,358
8,150
1,900
200
726
761
-
2,000
2,706
1,900
-
9,084
11,617
3,800
200
7,800
9,900
-
7,300
9,200
15,100
19,100
Body
Board of Directors
Supervisory Board
Members
7.00
3.00
Fees
1,558
167
Executive Board
Total
Board of Directors
Supervisory Board
7.00
17.00
7.00
4.33
4,317
6,042
1,536
256
Executive Board
Total
Board of Directors
Supervisory Board
11.17
22.50
7.00
3.00
Executive Board
Total
11.00
21.00
Benefits
32
-
2009
2010
2011
(ii) VARIABLE COMPENSATION
Year 2009 (In thousands of R$)
Body
Number of Members
Regarding the Bonus:
- Lower limit defined in the
compensation plan
- Upper limit defined in the
compensation plan
- Amount defined in the compensation
plan, in case the goals set are met
Board of
Directors
7.00
Supervisory
Board
3.00
N/A
Executive
Board
7.00
362
Total
17.00
602
964
1,513
N/A
3,762
5,275
1,513
N/A
3,762
5,275
747
N/A
1,667
2,414
- Amount actually recognized in the
income statement
Year 2010 (In thousands of R$)
Body
Number of Members
Regarding the Bonus:
- Lower limit defined in the compensation plan
- Upper limit defined in the compensation plan
- Amount defined in the compensation plan
(limited to 100% of fixed compensation, in
case the goals set are met
- Amount actually recognized in the
income statement
180
Board of
Directors
7.00
Supervisory
Board
4.33
Executive
Board
11.17
Total
22.50
1,415
N/A
N/A
4,933
6,348
1,415
N/A
4,933
6,348
706
N/A
2,000
2,706
Reference Form - 2011 - WEG SA
Version : 1
13.15 Compensation paid to the members of the Company’s Board
of Directors, the Executive Board and the Supervisory Board
recognized in the statement of income of direct or indirect
controlling shareholders, of companies under common
control, and of the issuer’s subsidiaries
Year 2011 - Proposed (In thousands of R$)
Board of
Directors
7.00
Supervisory
Board
3.00
Executive
Board
11.00
Total
21.00
- Lower limit defined in the compensation plan
0.0% on
net income
N/A
0.0% on
net income
-
- Upper limit defined in the compensation plan
2.5% on
net income
N/A
2,5% on
net income
-
- Amount defined in the compensation plan (limited to 100% of fixed
compensation), in case the goals set are met
- Amount actually recognized in the income statement
2.5% on
net income
-
N/A
N/A
2.5% on
net income
-
Body
Number of Members
Regarding the Bonus:
-
(iii) PENSION PLAN IN EFFECT (In thousands of R$)
Board of
Directors
3
Body
Number of Members
Name of Plan
Number of Board members entitled to retirement
Conditions for early retirement
Updated amount of accumulated contributions made to the pension plan
until the latest fiscal year closing, less the amount of contributions
Conditions for early retirement
Total amount of accumulated contributions made during the latest
fiscal year, less the amount of contributions paid directly
by directors and officers
Executive
Board
10
Benefit Plan
2
8
10
50 years of age and 10 years of contribution
3,612
10,882
14,494
404
2,008
2,412
Yes, on ceasing to participate in the plan,
amount corresponding to 2% for each
year of service limited to 50% of the total balance.
Early withdrawal allowed? If so, on what condition?
(iv) COMPENSATION PAID (In thousands of R$)
Year
2009
2010
2011
Body
Board of Directors
Supervisory Board
Executive Board
Board of Directors
Supervisory Board
Executive Board
Board of Directors
Supervisory Board
Executive Board
Highest
Compensation
650
56
1,145
701
59
1,250
1,006
65
1,982
Lowest
Compensation
184
56
659
196
40
378
282
65
708
Average
Compensation
334
56
933
325
59
813
543
67
1,373
(v) Percentage rate of total compensation of each body recognized in the
Company’s income statement relating to members of the Board of
Directors, the Executive Board or the Supervisory Board who are
related parties to direct or indirect controlling shareholders
Year
2009
2010
2011
181
Body
Board of Directors
Board of Directors
Board of Directors
Total
13
Members
43
43
43
Fees
45
50
59
Benefits
-
Profit
sharing
42
50
60
Reference Form - 2011 - WEG SA
13.16 Other relevant information
Profits are shared based on fixed annual fees.
182
Version : 1
Reference Form - 2011 - WEG SA
Version : 1
14.1 Human resources
a) headcount (total, per group based on activities performed and per
geographic location)
State
Espírito Santo
Total Espírito Santo
Amazônia
Total Amazônia
Santa Catarina
Total Santa Catarina
São Paulo
Total São Paulo
Rio Grande do Sul
Total Rio Grande do Sul
Employees abroad
Grand Total
Classification
Administrative
Production
Services
Administrative
Production
Services
Administrative
Production
Services
Sales
Administrative
Production
Services
Sales
Administrative
Production
Services
Sales
Year
2009
2008
0
0
0
0
9
151
23
183
1,299
11,648
3,558
876
17,381
74
937
131
78
1,220
34
280
92
20
426
2,310
21,520
2010
4
68
27
99
21
398
74
493
1,278
10,970
4,406
904
17,558
50
472
144
223
889
33
191
113
30
367
3,146
22,552
0
0
0
0
16
291
24
331
1,237
10,189
3,351
742
15,519
54
473
155
167
849
40
326
107
24
497
2,091
19,287
b) number of outsourced personnel (total, per group based on activities
performed and by geographic location)
Year
State
Amazônia
Santa Catarina
São Paulo
Rio Grande do Sul
Grand Total
Classification
Production
Production
Production
Production
2008
101
16
0
0
117
2009
146
17
0
0
163
2010
127
0
0
0
127
c) turnover rate
The Company’s monthly turnover rate was 1.3% in 2010, 2.0% in 2009 and
1.1% in 2008.
d) issuer’s exposure to labor-related liabilities and contingencies
See item 4.6
183
Reference Form - 2011 - WEG SA
Version : 1
14.2 Comments on material changes - Human resources
In 2010, the Company recorded an increase of approximately 16.9% in its
headcount as compared to 2009. This was due to the recovery of production in
Brazil and foreign units.
184
Reference Form - 2011 - WEG SA
Version : 1
14.3 Description of the issuer’s employee compensation policies
a) policy on salaries and variable compensation
WEG Group’s compensation management system seeks to establish
conditions for a fair and competitive policy that can:
• Define pay structures that can attract and retain employees.
• Establish the responsibilities of each position within the organization
through job descriptions.
• Determine the value of each job based on a point evaluation system.
• Devise rules to ensure equitable treatment.
• Establish market-consistent policies.
We adjust salary ranges whenever necessary in compliance with labor
legislation and the base date of collective bargaining agreements relating to
the professional category.
Additionally, we offer salary adjustments considering employees’
qualification, promotion and merit, always based on their performance, level
and position in the salary range.
WEG offers its employees a profit sharing program based on the following
criteria:
• Distribution of up to 12.5% of net income for the year, provided that
minimum profitability is 10% of net equity and based on targets being
met.
• Overall targets, per business unit and per department.
• Distribution is based on the fixed compensation of each employee.
• Targets are defined annually, with early payment of part of the profits
every half-year.
b) policy on benefits
WEG provides its employees with on-site meals, medical and dental
assistance plans, life insurance, private pension plan, nursery school
allowance, transportation subsidy, and school allowance for technical,
graduate, post-graduate and language courses, as well as profit sharing
and other benefits.
c) features of stock-based compensation plans for employees other than
directors and officers, identifying:
There are no stock-based compensation plans for non-directors and
officers.
185
Reference Form - 2011 - WEG SA
Version : 1
14.4 Description of the relationships between the issuer and unions
The Company seeks to have a proactive relationship with employers’ unions,
which, in turn, are in good terms with the various trade unions, always seeking
to engage in conversations and negotiations to find solutions that satisfy all the
parties involved.
JARAGUÁ DO SUL – SINDICATO DOS TRABALHADORES NA INDÚSTRIA
METALURGICA E METAL MECANICA DE JARAGUÁ DO SUL (Trade Union of
the Metallurgy and Mechanical Industry of Jaraguá do Sul), Rua João
Planischeck, 157, CEP: 89252-220 - Jaraguá do Sul – SC, Phone#: 047 33712100 / 047 3371-2058.
SÃO PAULO – FEDERAÇÃO DOS TRABALHADORES NAS INDUSTRIAS
METALURGICAS, MECANICAS E DE MATERIAL ELETRICO DO ESTADO DE
SÃO PAULO (Workers’ Federation of the Metallurgy, Mechanical and Electric
Material Industries of São Paulo State), Rua Pará, 66, Bairro Higienópolis - São
Paulo, Capital. CEP 01243-020 - Phone#: (11) 3217.5255
ITAJAÍ - SINDICATO DOS TRABALHADORES NAS INDÚSTRIAS
METALÚRGICAS, MECÂNICAS, MATERIAL ELÉTRICO E DE CONSTRUÇÃO
NAVAL DE ITAJAÍ E REGIÃO (Trade Union of the Metallurgy, Mechanical,
Electric Material and Shipbuilding Material Industries of Itajaí and neighboring
areas), Rua Cap. Adolfo Germano de Andrade, 106 - Phone#: 3348-3505 Itajaí - Santa Catarina
SÃO BERNARDO DO CAMPO – SINDICATO DOS METALURGICOS DO ABC
(Metalworkers’ Union of the ABC Region) (São Bernardo do Campo, Diadema,
Ribeirão Pires and Rio Grande da Serra), Rua João Basso, 231 - Centro - São
Bernardo do Campo - SP - CEP: 09721-100 - Phone#: (11) 4128-4200 - Fax#:
(11) 4127-3244
MANAUS – SINDICATO DOS TRABALHADORES NAS INDÚSTRIAS
METALURGICAS, MECANICAS E DE MATERIAL ELÉTRICO DE MANAUS
(Trade Union of the Metallurgy, Mechanical and Electric Material Industries of
Manaus), Av. Joaquim Nabuco, 1919 - 4º andar sala 402 – Centro, CEP 69020031, CIDADE Manaus Phone#: (92)-233-8591 / 627-3123/3125 Fax#: (92)-2338320
BLUMENAU – SINDICATO DOS TRABALHADORES NAS INDÚSTRIAS
METALÚRGICAS, MECÂNICAS E DO MATERIAL ELÉTRICO DE BLUMENAU
(Trade Union of the Metallurgy, Mechanical and Electric Material Industries of
Blumenau), Rua Paulo Zimmermann, 205 – 1º andar – Centro – Blumenau –
SC Phone#: (47) 326-5158
GUARAMIRIM – SINDICATO TRAB. IND. QUIMICAS, PLAST. BORR.PAP.
ISOPOR, MUN. JARAGUA, CORUPA, GUARAMIRIM, MASSARANDUBA E
SCHROEDER (Trade Union of the Chemical, Plastic, Rubber, Paper and
Styrofoam Industries of the cities of Jaragua, Corupa, Guaramirim,
Massaranduba and Schroeder), Rua José Leier, 388, Jaraguá do Sul - SC,
89251-092, Phone#: (0xx)47 3371-6407
186
Reference Form - 2011 - WEG SA
Version : 1
14.4 Description of the relationships between the issuer and unions
CORUPA – SINDICATO DOS TRABALHADORES NAS INDÚSTRIAS DA
CONSTRUÇÃO E DO MOBILIÁRIO DE JOINVILLE (Trade Union of the
Construction and Furniture Industries of Joinville), Rua Itajaí , 33 - Joinville/SC |
CEP: 89.201-090 Phone/Fax#: (47) 3422-2304
JOAÇABA – SINDICATO DOS TRABALHADORES NAS INDÚSTRIAS
METALÚRGICAS, MECÂNICAS E DO MATERIAL ELÉTRICO DE JOAÇABA E
HERVAL D´OESTE (Trade Union of the Metallurgy, Mechanical and Electric
Material Industries of Joaçaba and Herval D’Oeste), Rua Getúlio Vargas, 419Joaçaba -SC
GRAVATAÍ - SINDICATO DOS TRABALHADORES NAS INDUSTRIAS
METALÚRGICAS, MECÂNICAS E DE MATERIAL ELÉTRICO DE GRAVATAÍ
(RS) (Trade Union of the Metallurgy, Mechanical and Electric Material Industries
of Gravataí) Avenida Ely Correa(rs 030), 1001 - Parque dos Anjos - Gravataí RS - CEP 94.010-972 - Phone#: (51) 3488-3937
HORTOLÂNDIA - SINDICATO DOS TRABALHADORES NAS INDÚSTRIAS
METALÚRGICAS, MECÂNICAS, MATERIAL ELÉTRICO E ELETRÔNICO E
DE FIBRAS ÓPTICAS DE CAMPINAS E REGIÃO (Trade Union of the
Metallurgy, Mechanical, Electric and Electronic Material and Fiber-Optics
Industries of Campinas and neighboring areas), Rua Dr. Quirino 560 - Centro Campinas - SP - CEP 13.015-080. - Phone#: (19) 3775-5555
LINHARES - SINDICATO DOS TRABALHADORES NAS
INDÚSTRIASMETALÚRGICAS, MECÂNICAS, DE MATERIAL ELÉTRICO E
ELETRÔNICO NO ESTADO DO ESPIRITO SANTO (Trade Union of the
Metallurgy, Mechanical and Electric and Electronics Material Industries),Rua do
Rosario, 100 – Centro – Vitória - ES - CEP 29016-095 - Phone#: (27) 32230744
187
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
Shareholder
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Number of common shares held (Units)
Common shares held (% )
Part of the shareholders’
agreement
Number of preferred shares held
(Units)
Controlling shareholder
Preferred shares held (% )
Date of latest amendment
Total number of shares
(Units)
Total shares %
Detailed information on classes of shares (Units)
Share class
Number of shares (Units)
Theo Werninghaus Tavares
084.072.009-21
Brazilian-SC
2,400
Joaquim Werninghaus Tavares
072.736.389-19
Brazilian-SC
No
Brazilian-SC
Daniel Ricardo Behnke
051.107.199-00
No
Brazilian-SC
Heidi Behnke
505.049.679-91
No
Brazilian-SC
2,907,134
Eduardo Werninghaus
007.667.789-32
No
Brazilian-SC
238,100
Paulo Dario Paranhos Trejes
395.336.030-20
No
Brazilian-SC
50,000
Werner Ricardo Voigt
009.954.369-91
No
Brazilian-SC
532,000
0.000387%
0.000000%
38,454
0.006193%
0.000000%
48,454
0.007804%
0.000000%
2,907,134
0.468209%
0.000000%
238,100
0.038347%
0.000000%
50,000
0.008053%
0.000000%
532,000
0.085681%
Yes
0
No
0.085681%
2,400
Yes
0
0.008053%
0.000000%
Yes
0
0.038347%
0.000387%
Yes
0
0.468209%
2,400
Yes
0
0.007804%
0.000000%
Yes
0
0.006193%
48,454
Yes
0
0.000387%
38,454
188
No
0.000387%
2,400
Anne Marie Werninghaus
050.451.569-18
Shares %
Yes
0
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
Shareholder
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Number of common shares held (Units)
Common shares held (% )
Part of the shareholders’
agreement
Number of preferred shares held
(Units)
Controlling shareholder
Preferred shares held (% )
Date of latest amendment
Total number of shares
(Units)
Total shares %
Detailed information on classes of shares (Units)
Share class
Number of shares (Units)
Fabio Roberto de Oliveira
751.465.849-15
Brazilian-SC
300
Diether Werninghaus
310.427.409-68
No
0.000048%
Brazilian-SC
3,302,226
Lilian Werninghaus
435.912.999-87
No
Brazilian-SC
No
Brazilian-SC
Dabliuve Administradora Ltda
80.957.400/0001-29
No
Brazilian-SC
5,746,229
Clécio Fábio Zucco
516.816.929-53
No
Brazilian-SC
17,000
Roseli Werninghaus
720.590.369-68
Yes
0
No
0.002738%
Brazilian-SC
No
0
No
957,662
0.154236%
316,282,127
50.938890%
WPA Participações e Serviços S.A.
83.489.963/0001-28
189
Yes
0
0.925460%
300
0.000048%
0.000000%
3,302,226
0.531841%
0.000000%
12,800
0.002062%
4/30/2011
0.000000%
1,006,000
0.162022%
1/15/2007
0.000000%
5,746,229
0.925460%
2/28/2011
0.000000%
17,000
0.002738%
957,662
0.154236%
316,282,127
50.938890%
Yes
0
0.162022%
0.000000%
Yes
0
0.002062%
1,006,000
No
0
0.531841%
12,800
Sergio Luiz Silva Schwartz
383.104.659-04
Shares %
Yes
0
No
0.000000%
Yes
0
4/30/2011
0.000000%
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
Shareholder
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Number of common shares held (Units)
Common shares held (% )
Part of the shareholders’
agreement
Number of preferred shares held
(Units)
Controlling shareholder
Preferred shares held (% )
Date of latest amendment
Total number of shares
(Units)
Total shares %
Detailed information on classes of shares (Units)
Share class
Number of shares (Units)
Amelie Voigt Trejes
091.667.319-76
No
125,590
0.020227%
Eggon João da Silva Administradora Ltda.
80.957.384/0001-74
4,618,200
0.743785%
Maria Luisa Werninghaus Bernoldi
076.461.079-13
Brazilian-SC
Luisa Werninghaus
007.667.599-89
No
Brazilian-SC
No
Brazilian-SC
Ricardo Werninghaus
043.365.399-01
No
Brazilian-SC
138,154
Mariana Werninghaus
060.449.029-19
No
Brazilian-SC
138,154
Bernardo Armin Werninghaus Bernoldi
089.703.269-10
No
Brazilian-SC
2,400
0.743785%
0.000000%
2,400
0.000387%
0.000000%
1,784,493
0.287402%
0.000000%
40,454
0.006515%
0.000000%
138,154
0.022250%
0.000000%
138,154
0.022250%
0.000000%
2,400
0.000387%
Yes
0
No
0.000387%
4,618,200
5/25/2007
0.000000%
Yes
0
0.022250%
0.020227%
Yes
0
0.022250%
125,590
Yes
0
0.006515%
12/31/2010
0.000000%
Yes
0
0.287402%
40,454
Yes
0
0.000387%
1,784,493
Davi Ricardo Behnke
041.310.259-90
Yes
0
No
2,400
190
Shares %
Yes
0
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
Shareholder
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Number of common shares held (Units)
Common shares held (% )
Part of the shareholders’
agreement
Number of preferred shares held
(Units)
Controlling shareholder
Preferred shares held (% )
Date of latest amendment
Total number of shares
(Units)
Total shares %
Detailed information on classes of shares (Units)
Share class
Number of shares (Units)
Julia da Silva Geffert de Oliveira
037.581.239-33
Brazilian-SC
963,816
3MR Administradora Ltda
09.420.817/0001-93
Brazilian-SC
No
Brazilian-SC
Clica Voigt Administradora Ltda
09.420.895/0001-98
Laura Augusta da Silva
435.911.329-34
No
Brazilian-SC
Eggon João da Silva
009.955.179-91
No
Brazilian-SC
EW Administradora Ltda
09.559.591/0001-06
No
Brazilian-SC
Starp Participacoes Ltda
10.889.654/0001-71
No
Brazilian-SC
5,747,784
Yes
0
No
0.925711%
0.155228%
7/31/2010
0.000000%
4,615,847
0.743406%
7/31/2010
0.000000%
9,963,420
1.604661%
7/31/2010
0.000000%
9,963,420
1.604661%
0.000000%
38,381
0.006181%
0.000000%
1,375,100
0.221467%
7/31/2010
0.000000%
1,730,051
0.278634%
7/31/2010
0.000000%
5,747,784
0.925711%
Yes
0
0.278634%
963,816
Yes
0
0.221467%
1,730,051
Yes
0
0.006181%
1,375,100
Yes
0
1.604661%
38,381
Yes
No
Brazilian-SC
0.000000%
0
1.604661%
9,963,420
Yes
0
0.743406%
9,963,420
191
No
0.155228%
4,615,847
Voigt Schwartz Administradora Ltda
09.414.489/0001-12
Shares %
Yes
0
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
Shareholder
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Number of common shares held (Units)
Common shares held (% )
Part of the shareholders’
agreement
Number of preferred shares held
(Units)
Controlling shareholder
Preferred shares held (% )
Date of latest amendment
Total number of shares
(Units)
Total shares %
Detailed information on classes of shares (Units)
Share class
Number of shares (Units)
Zocalo Participacoes Ltda
10.690.540/0001-06
Brazilian-SC
5,993,900
Balder Participacoes Ltda
10.651.773/0001-91
Brazilian-SC
No
Brazilian-SC
Helana Participacoes Ltda
10.889.243/0001-86
No
Brazilian-SC
Tamaris Participacoes Ltda
10.668.402/0001-12
No
Brazilian-SC
Paula da Silva Janssen
065.548.759-05
No
Brazilian-SC
Walter Janssen Neto
248.808.509-00
No
Brazilian-SC
Helena Marina da Silva Petry
063.432.389-05
No
5,993,900
0.965349%
7/31/2010
0.000000%
5,955,276
0.959128%
7/31/2010
0.000000%
9,963,419
1.604661%
7/31/2010
0.000000%
5,934,469
0.955777%
7/31/2010
0.000000%
2,618,108
0.421660%
0.000000%
7,000
0.001127%
0.000000%
685,724
0.110439%
0.000000%
7,000
0.001127%
Yes
0
No
0.001127%
7/31/2010
0.000000%
Yes
0
0.110439%
Brazilian-SC
7,000
Yes
0
0.001127%
685,724
Yes
0
0,421660%
7,000
Yes
0
0.955777%
2,618,108
Yes
0
1.604661%
5,934,469
Yes
0
0.959128%
9,963,419
192
No
0.965349%
5,955,276
Si Voigt Administradora Ltda
09.370.501/0001-34
Shares %
Yes
0
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
Shareholder
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Number of common shares held (Units)
Common shares held (% )
Part of the shareholders’
agreement
Number of preferred shares held
(Units)
Controlling shareholder
Preferred shares held (% )
Date of latest amendment
Total number of shares
(Units)
Total shares %
Detailed information on classes of shares (Units)
Share class
Number of shares (Units)
Henrique da Silva Geffert
051.130.719-51
Brazilian
963,820
Alberto da Silva Geffert
034.304.249-50
Brazilian
No
Brazilian-SC
Kátia da Silva Bartsch
436.418.739-91
No
Brazilian-SC
Zaira Zimmermann da Silva
046.818.429-58
No
Brazilian-SC
6,996
Joana Zimmermann da Silva
058.297.959-57
No
Brazilian-SC
7.000
Ana Flavia da Silva Petry
063.432.379-25
No
Brazilian-SC
7,000
Ricardo Bartsch Filho
004.860.759-23
No
Brazilian-SC
126,381
0.155338%
0.000000%
7,000
0.001127%
0.000000%
75,300
0.012127%
0.000000%
6,996
0.001127%
0.000000%
7,000
0.001127%
0.000000%
7,000
0.001127%
0.000000%
126,381
0.020354%
Yes
0
No
0.020354%
964,500
Yes
0
0.001127%
0.000000%
Yes
0
0.001127%
0.155228%
Yes
0
0.001127%
963,820
Yes
0
0.012127%
0.000000%
Yes
0
0.001127%
75,300
Yes
0
0.155338%
7,000
193
No
0.155228%
964,500
Renata da Silva Janssen
035.997.069-99
Shares %
Yes
0
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
Shareholder
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Number of common shares held (Units)
Common shares held (% )
Part of the shareholders’
agreement
Number of preferred shares held
(Units)
Controlling shareholder
Preferred shares held (% )
Date of latest amendment
Total number of shares
(Units)
Total shares %
Detailed information on classes of shares (Units)
Share class
Number of shares (Units)
Bruna da Silva Bartsch
004.860.769-03
Brazilian-SC
Shares %
No
Yes
126,377
0.020354%
0
0.000000%
126,377
0.020354%
214,564,809
34.556785%
0
0.000000%
214,564,809
34.556785%
TREASURY SHARES - Date of latest amendment:
500,000
0.080528%
0
0.000000%
500,000
0.080528%
100.000000%
0
0.000000%
620,905,029
100.000000%
OTHER
TOTAL
620,905,029
194
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
3MR Administradora Ltda
Maria Conceição Werninghaus
501.886.159-20
7,457,791
Brazilian-SC
49.219287
Share class
Number of shares (Units)
Shares %
TOTAL
Mariana Werninghaus
060.449.029-19
118,295
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
Martin Werninghaus
485.646.309-82
7,457,791
0
0.000000
Brazilian-SC
49.219287
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
0
195
Brazilian-SC
0.780713
0.000000
No
0
No
0
No
0
0
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
09.420.817/0001-93
Total Shares %
Capital
breakdown
No
0.000000
7,457,791
49.219287
No
0.000000
118,295
0.780713
No
0.000000
7,457,791
49.219287
0.000000
0
0.000000
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
3MR Administradora Ltda
Ricardo Werninghaus
043.365.399-01
118,295
Brazilian-SC
0.780713
Share class
Number of shares (Units)
Shares %
TOTAL
TOTAL
0
0.000000
15,152,172
196
100.000000
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
09.420.817/0001-93
No
0
No
0.000000
118,295
0
0.000000
15,152,172
Total Shares %
Capital
breakdown
0.780713
100.000000
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
3MR Administradora Ltda
Ricardo Werninghaus
043.365.399-01
118,295
Brazilian-SC
0.780713
Share class
Number of shares (Units)
Shares %
TOTAL
TOTAL
0
0.000000
15,152,172
197
100.000000
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
09.420.817/0001-93
No
0
No
0.000000
118,295
0
0.000000
15,152,172
Total Shares %
Capital
breakdown
0.780713
100.000000
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Balder Participacoes Ltda
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
10.651.773/0001-91
Total Shares %
Capital
breakdown
Decio da Silva
344.079.289-72
13,655,156
Brazilian-SC
99.999986
Share class
Number of shares (Units)
Shares %
TOTAL
Joana Zimmermann da Silva
058.297.959-57
1
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
Brazilian-SC
0.000007
No
0
No
0.000000
13,655,156
99.999986
No
0
No
0.000000
1
0.000007
0
0.000000
0
0.000000
0
0.000000
13,655,158
100.000000
0
0.000000
13,655,158
100.000000
No
0
No
0.000000
1
0.000007
TOTAL
Zaira Zimmermann da Silva
046.818.429-58
1
Brazilian-SC
Share class
Number of shares (Units)
Shares %
TOTAL
0
0.000000
198
0.000007
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Clica Voigt Administradora Ltda
Cladis Voigt Trejes
514.081.639-34
20,030,844
Brazilian-SC
88.958626
Share class
Number of shares (Units)
Shares %
TOTAL
Felipe Voigt Trejes
057.698.049-80
1,243,095
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
20,030,844
88.958626
No
0
No
0.000000
1,243,095
5.520687
0.000000
0
0.000000
0
0.000000
5.520687
No
0
No
0.000000
1,243,095
5.520687
0
0.000000
22,517,034
100.000000
5.520687
Brazilian-SC
Share class
Number of shares (Units)
Shares %
TOTAL
TOTAL
0
0.000000
199
Capital
breakdown
No
0.000000
Pedro Voigt Trejes
057.698.199-01
1,243,095
22,517,034
Total Shares %
No
0
Brazilian-SC
0
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
09.420.895/0001-98
100.000000
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Dabliuve Administradora Ltda
Cladis Voigt Trejes Administradora Ltda.
08.703.890/0001-00
79,302,024
Brazilian-SC
32.899893
Share class
Number of shares (Units)
Shares %
TOTAL
Miriam Voigt Schwartz Administradora Ltda
08.649.305/0001-30
79,302,024
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
Brazilian-SC
32.899893
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
80.957.400/0001-29
Total Shares %
Capital
breakdown
No
0
Yes
0.000000
12/20/2007
79,302,024
32.899893
No
0
Yes
0.000000
12/20/2007
79,302,024
32.899893
0
0.000000
0
0.000000
0
0.000000
241,040,370
100.000000
0
0.000000
241,040,370
100.000000
No
0
Yes
0.000000
12/20/2007
79,302,024
32.899893
TOTAL
Valsi Voigt Administradora Ltda.
08.655.197/0001-09
79,302,024
Brazilian-SC
32.899893
Share class
Number of shares (Units)
Shares %
TOTAL
0
0.000000
200
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Eggon João da Silva Administradora Ltda.
Decio da Silva Administradora Ltda.
08.649.347/0001-71
52,813,901
SC
19.999999
Share class
Number of shares (Units)
Shares %
TOTAL
Eggon João da Silva
009.955.179-91
10
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
Katia da Silva Bartsch Administradora Ltda.
08.710.197/0001-64
52,813,901
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
Marcia da Silva Petry Administradora
08.647.713/0001-53
52,813,901
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
0
0.000000
201
Brazilian-SC
0.000005
SC
19.999999
Brazilian-SC
19.999999
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
80.957.384/0001-74
Total Shares %
Capital
breakdown
No
0
Yes
0.000000
12/20/2007
52,813,901
19.999999
No
0
Yes
0.000000
10
0.000005
No
0
Yes
0.000000
12/20/2007
52,813,901
19.999999
No
0
Yes
0.000000
12/20/2007
52,813,901
19.999999
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Eggon João da Silva Administradora Ltda.
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
80.957.384/0001-74
Total Shares %
Capital
breakdown
OTHER
0
0.000000
0
0.000000
0
0.000000
19.999999
No
0
Yes
0.000000
12/20/2007
52,813,901
19.999999
No
0
Yes
0.000000
12/20/2007
52,813,901
19.999999
0
0.000000
264,069,515
100.000000
Solange da Silva Janssen Administradora Ltda.
08.680.120/0001-99
52,813,901
SC
Share class
Number of shares (Units)
Shares %
TOTAL
Tania Marisa da Silva Administradora Ltda.
08.649.342/0001-49
52,813,901
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
TOTAL
0
0.000000
264,069,515
202
SC
19.999999
100.000000
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
EW Administradora Ltda
Eduardo Werninghaus
007.667.789-32
6,013,594
Brazilian-SC
99.999983
Share class
Number of shares (Units)
Shares %
TOTAL
Luisa Werninghaus
007.667.599-89
1
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
Brazilian-SC
0.000017
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
09.559.591/0001-06
Total Shares %
Capital
breakdown
No
0
No
0.000000
6,013,594
99.999983
No
0
No
0.000000
1
0.000017
0
0.000000
0
0.000000
0
0.000000
6,013,595
100.000000
0
0.000000
6,013,595
100.000000
TOTAL
203
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Helana Participacoes Ltda
Ana Flavia da Silva Petry
063.432.379-25
19,588
Brazilian-SC
Share class
Number of shares (Units)
Shares %
TOTAL
Helena Marina da Silva Petry
063.432.389-05
19,588
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
Marcia da Silva Petry
508.022.759-15
8,278,994
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
0.235484
Brazilian-SC
0.235484
Brazilian-SC
99.529032
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
10.889.243/0001-86
Total Shares %
Capital
breakdown
No
0
No
0.000000
19,588
0.235484
No
0
No
0.000000
19,588
0.235484
No
0
No
0.000000
8,278,994
99.529032
0
0.000000
0
0.000000
0
0.000000
8,318,170
100.000000
0
0.000000
8,318,170
100.000000
TOTAL
204
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Si Voigt Administradora Ltda
Dora Voigt de Assis
062.427.629-51
430,933
Brazilian-SC
Share class
Number of shares (Units)
Shares %
TOTAL
Livia Voigt
0
0.000000
062.427.659-77
1,862,833
1.968291
Brazilian-SC
8.508509
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
09.370.501/0001-34
Total Shares %
Capital
breakdown
No
0
No
0.000000
430,933
1.968291
No
0
No
0.000000
1,862,833
8.508509
0
0,000000
0
0.000000
0
0.000000
21,893,766
100.000000
0
0.000000
21,893,766
100.000000
No
0
No
0.000000
19,600,000
89.523200
TOTAL
Valsi Voigt
514.080.909-53
19,600.000
Brazilian-SC
89.523200
Share class
Number of shares (Units)
Shares %
TOTAL
0
0.000000
205
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Starp Participacoes Ltda
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
10.889.654/0001-71
Total Shares %
Capital
breakdown
OTHER
0
0.000000
0
0.000000
0
0.000000
0.115485
No
0
No
0.000000
9,006
0.115485
No
0
No
0.000000
9,006
0.115485
No
0
No
0.000000
7,780,392
99.769030
0
0.000000
7,798,404
100.000000
Paula da Silva Janssen
065.548.759-05
9,006
Brazilian-SC
Share class
Number of shares (Units)
Shares %
TOTAL
Renata da Silva Janssen Decker
035.997.069-99
9,006
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
Solange da Silva Jannsen
304.390.949-68
7,780,392
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
TOTAL
0
0.000000
7,798,404
206
Brazilian-SC
0.115485
Brazilian-SC
99.769030
100.000000
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Tamaris Participacoes Ltda
Alberto da Silva Geffert
034.304.249-50
1,250,615
Brazilian-SC
17.079731
Share class
Number of shares (Units)
Shares %
TOTAL
Henrique da Silva Geffert
051.130.719-51
1,248,707
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
Julia da Silva Geffert de Oliveira
037.581.239-33
1,248,707
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
0
Brazilian-SC
17.053674
Brazilian-SC
17.053674
0.000000
Tania Marisa da Silva
247.167.159-49
3,574,188
Brazilian-SC
48.812921
Share class
Number of shares (Units)
207
Shares %
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
10.668.402/0001-12
Total Shares %
Capital
breakdown
No
0
No
0.000000
1,250,615
17.079731
No
0
No
0.000000
1,248,707
17.053674
No
0
No
0.000000
1,248,707
17.053674
0
0.000000
0
0.000000
No
0
No
0.000000
3,574,188
48.812921
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Tamaris Participacoes Ltda
Tania Marisa da Silva
247.167.159-49
3,574,188
Brazilian-SC
48.812921
Share class
Number of shares (Units)
Shares %
TOTAL
TOTAL
0
0.000000
7,322,217
208
100.000000
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
10.668.402/0001-12
Total Shares %
Capital
breakdown
No
0
No
0.000000
3,574,188
48.812921
0
0.000000
7,322,217
100.000000
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Voigt Schwartz Administradora Ltda
Eduardo Voigt Schwartz
010.528.409-22
405,289
Brazilian-SC
Share class
Number of shares (Units)
Shares %
TOTAL
Mariana Voigt Schwartz
009.273.789-73
405,289
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
Mirian Voigt Schwartz
514.080.829-34
33,126,664
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
1.194231
Brazilian-SC
1.194231
Brazilian-SC
97.611538
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
09.414.489/0001-12
Total Shares %
Capital
breakdown
No
0
No
0.000000
405,289
1.194231
No
0
No
0.000000
405,289
1.194231
No
0
No
0.000000
33,126,664
97.611538
0
0.000000
0
0.000000
0
0.000000
33,937,242
100.000000
0
0.000000
33,937,242
100.000000
TOTAL
209
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
Date of latest amendment
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Common shares held (% )
Number of preferred shares held
(Units)
Controlling shareholder
Detailed information on shares (Units)
Total Shares %
Number of common shares held (Units)
Preferred shares held (% )
CONTROLLING SHAREHOLDER / INVESTOR
WPA Participações e Serviços S.A.
Dabliuve Administradora Ltda
80.957.400/0001-29
31,615,379
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
83.489.963/0001-28
Capital
breakdown
No
0
No
0.000000
4/29/2011
31,615,379
33.333333
No
0
No
0.000000
4/29/2011
31,615,379
33.333334
No
0
No
0.000000
4/29/2011
31,615,379
33.333333
0.000000
0
0.000000
0
0.000000
100.000000
0
0.000000
94,846,137
100.000000
33.333333
Share class
Number of shares (Units)
Shares %
TOTAL
Eggon João da Silva Administradora Ltda
80.957.384/0001-74
31,615,379
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
G Werninghaus Admininstradora Ltda
80.952.849/0001-02
31,615,379
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
33.333334
33.333333
TOTAL
94,846,137
210
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Zocalo Participacoes Ltda
Bruna da Silva Bartsch
004.860.769-03
1
Brazilian-SC
Share class
Number of shares (Units)
Shares %
TOTAL
Katia da Silva Bartsch
436.418.739-91
13,559,908
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
1
0.000007
No
0
No
0.000000
13,559,908
99.999986
0.000000
0
0.000000
0
0.000000
0.000007
No
0
No
0.000000
1
0.000007
0
0.000000
13,559,910
100.000000
Brazilian-SC
99.999986
Brazilian-SC
Share class
Number of shares (Units)
Shares %
TOTAL
TOTAL
0
0.000000
211
Capital
breakdown
No
0.000000
Ricardo Bartsch Filho
004.860.759-23
1
13,559,910
Total Shares %
No
0
0.000007
0
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
10.690.540/0001-06
100.000000
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Cladis Voigt Trejes Administradora Ltda.
Cladis Voigt Trejes
514.081.639-34
79,449,654
79,449,654
99.999996
No
0
Yes
0.000000
1
0.000002
0.000000
0
0.000000
0
0.000000
0.000002
No
0
Yes
0.000000
1
0.000002
0
0.000000
79,449,656
100.000000
Number of shares (Units)
Shares %
TOTAL
Felipe Voigt Trejes
057.698.049-80
1
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
0.000002
Share class
Number of shares (Units)
Shares %
TOTAL
TOTAL
0
0.000000
79,449,656
212
Capital
breakdown
Yes
0.000000
Share class
Pedro Voigt Trejes
057.698.199-01
1
Total Shares %
No
0
99.999996
0
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.703.890/0001-00
100.000000
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Dabliuve Administradora Ltda
Cladis Voigt Trejes Administradora Ltda
08.703.890/0001-00
79,302,024
32.899893
Share class
Number of shares (Units)
Shares %
TOTAL
Miriam Voigt Schwartz Administradora Ltda
08.649.305/0001-30
79,302,024
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
32.899893
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
80.957.400/0001-29
Total Shares %
Capital
breakdown
No
0
Yes
0.000000
4/1/2011
79,302,024
32,899893
No
0
Yes
0.000000
4/1/2011
79,302,024
32,899893
0
0.000000
0
0.000000
0
0,000000
241,040,370
100.000000
0
0.000000
241,040,370
100,000000
32.899893
No
0
Yes
0.000000
4/1/2011
79.302.024
32,899893
TOTAL
Valsi Voigt Administradora Ltda
08.655.197/0001-09
79,302,024
Share class
Number of shares (Units)
Shares %
TOTAL
0
0.000000
213
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Dabliuve Administradora Ltda
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
80.957.400/0001-29
Total Shares %
Capital
breakdown
Werner Ricardo Voigt
009.954.369-91
3,134,298
Brazilian-SC
1.300321
No
0
Share class
Number of shares (Units)
Shares %
TOTAL
0
0.000000
214
Yes
0.000000
3,134,298
1.300321
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Decio da Silva Administradora Ltda.
Joana Zimmermann da Silva
058.297.959-57
26,100,338
50.000000
Share class
Number of shares (Units)
Shares %
TOTAL
OTHER
0
0.000000
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.649.347/0001-71
Total Shares %
Capital
breakdown
No
0
Yes
0.000000
26,100,338
50.000000
0
0.000000
0
0.000000
0
0.000000
52,200,676
100.000000
0
0.000000
52,200,676
100.000000
50.000000
No
0
Yes
0.000000
26,100,338
50.000000
TOTAL
Zaira Zimmermann da Silva
046.818.429-58
26,100,338
Share class
Number of shares (Units)
Shares %
TOTAL
0
0.000000
215
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Eggon João da Silva Administradora Ltda
Decio da Silva Administradora Ltda.
08.649.347/0001-71
52,813,901
19.999999
Share class
Number of shares (Units)
Shares %
TOTAL
Eggon João da Silva
009.955.179-91
10
0
0.000000
Brazilian-SC
0.000005
Share class
Number of shares (Units)
Shares %
TOTAL
Katia da Silva Bartsch Administradora Ltda.
08.710.197/0001-64
52,813,901
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
Márcia da Silva Petry Administradora Ltda
08.647.713/0001-53
52,813,901
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
0
0.000000
216
19.999999
19.999999
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
80.957.384/0001-74
Total Shares %
Capital
breakdown
No
0
Yes
0.000000
11/16/2010
52,813,901
19.999999
No
0
Yes
0.000000
10
0.000005
No
0
Yes
0.000000
11/16/2010
52,813,901
19.999999
No
0
Yes
0.000000
11/16/2010
52,813,901
19.999999
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Eggon João da Silva Administradora Ltda
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
80.957.384/0001-74
Total Shares %
Capital
breakdown
OTHER
0
Solange da Silva Janssen Administradora Ltda
08.680.120/0001-99
52,813,901
0.000000
0
0.000000
0
0.000000
19.999999
No
0
Yes
0.000000
11/16/2010
52,813,901
19.999999
No
0
Yes
0.000000
11/16/2010
52,813,901
19.999999
0
0.000000
264,069,515
100.000000
Share class
Number of shares (Units)
Shares %
TOTAL
Tânia Marisa da Silva Administradora Ltda
08.649.342/0001-49
52,813,901
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
TOTAL
0
0.000000
264,069,515
217
19.999999
100.000000
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
G Werninghaus Admininstradora Ltda
Diether Werninghaus Administradora Ltda
08.680.015/0001-50
58,380,742
Share class
24.731536
Number of shares (Units)
TOTAL
0
Eduardo & Luisa Werninghaus Administradora Ltda
08.680.096/0001-98
58,380,742
Total Shares %
Capital
breakdown
No
0
Yes
0.000000
1/15/2007
58,380,742
24.731536
No
0
Yes
0.000000
1/15/2007
58,380,742
24.731536
No
0
Yes
0.000000
1/15/2007
58,380,742
24.731536
No
0
Yes
0.000000
2,534,918
1.073856
Shares %
0.000000
24.731536
Share class
Number of shares (Units)
Shares %
TOTAL
Heidi Behnke Administradora Ltda
08.601.978/0001-10
58,380,742
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
Lilian Werninghaus
435.912.999-87
2,534,918
0
0.000000
Share class
Number of shares (Units)
Shares %
TOTAL
0
0.000000
218
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
80.952.849/0001-02
24.731536
Brazilian-SC
1.073856
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
G Werninghaus Admininstradora Ltda
Martin Werninghaus Administradora Ltda
08.605.191/0001-27
58,380,742
24.731536
No
0
Number of shares (Units)
Shares %
0
0.000000
0
0.000000
236,057,886
100.000000
Share class
TOTAL
OTHER
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
80.952.849/0001-02
Total Shares %
Capital
breakdown
Yes
0.000000
1/15/2007
58,380,742
24.731536
0
0.000000
0
0.000000
0
0.000000
236,057,886
100.000000
TOTAL
219
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Katia da Silva Bartsch Administradora Ltda.
Bruna da Silva Bartsch
004.860.769-03
26,100,338
Share class
TOTAL
OTHER
0
Ricardo Bartsch Filho
004.860.759-23
26,100,338
Share class
TOTAL
TOTAL
52,200,676
220
50.000000
No
0
Number of shares (Units)
Shares %
0
0.000000
0.000000
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.710.197/0001-64
Total Shares %
Capital
breakdown
Yes
0.000000
26,100,338
50.000000
0
0.000000
0
0.000000
50.000000
No
0
Yes
0.000000
26,100,338
50.000000
Number of shares (Units)
Shares %
0
0.000000
100.000000
0
0.000000
52,200,676
100.000000
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Marcia da Silva Petry Administradora
Ana Flávia da Silva Petry
063.432.379-25
17,400,226
33.333333
No
0
Number of shares (Units)
Shares %
0
0.000000
33.333334
No
0
Number of shares (Units)
Shares %
0
0.000000
33.333333
No
0
Number of shares (Units)
Shares %
0
0.000000
0
0.000000
52,200,678
100.000000
Share class
TOTAL
Helena Marina da Silva Petry
063.432.389-05
17,400,226
Share class
TOTAL
Marcia da Silva Petry
508.022.759-15
17,400,226
Share class
TOTAL
OTHER
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.647.713/0001-53
Total Shares %
Capital
breakdown
Yes
0.000000
17,400,226
33.333333
Yes
0.000000
17,400,226
33.333334
Yes
0.000000
17,400,226
33.333333
0
0.000000
0
0.000000
0
0.000000
52,200,678
100.000000
TOTAL
221
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Miriam Voigt Schwartz Administradora Ltda
Eduardo Voigt Schwartz
010.528.409-22
39,724,828
50.000000
No
0
Number of shares (Units)
Shares %
0
0.000000
50.000000
No
0
Number of shares (Units)
Shares %
0
0.000000
0
0.000000
79,449,656
100.000000
Share class
TOTAL
Mariana Voigt Schwartz
009.273.789-73
39,724,828
Share class
TOTAL
OTHER
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.649.305/0001-30
Total Shares %
Capital
breakdown
No
0.000000
39,724,828
50.000000
No
0.000000
39,724,828
50.000000
0
0.000000
0
0.000000
0
0.000000
79,449,656
100.000000
TOTAL
222
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Solange da Silva Janssen Administradora Ltda.
Total number of shares
(Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.680.120/0001-99
Total Shares %
Capital
breakdown
OTHER
0
Paula da Silva Janssen
065.548.759-05
26,100,338
Share class
TOTAL
Renata da Silva Janssen Decker
035.997.069-99
26,100,338
Share class
TOTAL
TOTAL
52,200,676
223
0.000000
0
0.000000
0
0.000000
50.000000
No
0
Yes
0.000000
26,100,338
50.000000
Number of shares (Units)
Shares %
0
0.000000
50.000000
No
0
Yes
0.000000
26,100,338
50.000000
Number of shares (Units)
Shares %
0
0.000000
100.000000
0
0.000000
52,200,676
100.000000
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Common shares held (% )
Number of preferred shares held
(Units)
Preferred shares held (% )
Controlling shareholder
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.649.342/0001-49
CONTROLLING SHAREHOLDER / INVESTOR
Tania Marisa da Silva Administradora Ltda.
Alberto da Silva Geffert
034.304.249-50
17,400,226
Brazilian-SC
Share class
Number of shares (Units)
Shares %
TOTAL
Henrique da Silva Geffert
051.130.719-51
17,400,226
0
0.000000
Share class
Number of shares (Units)
TOTAL
Julia da Silva Geffert de Oliveira
037.581.239-33
17,400,226
Share class
33.333334
Brazilian-SC
33.333333
No
0
No
0
0.000000
33.333333
No
0
Brazilian-SC
Total Shares %
Capital
breakdown
Yes
0.000000
17,400,226
33.333334
Yes
0.000000
17,400,226
33.333333
Yes
0.000000
17,400,226
33.333333
Shares %
0
Number of shares (Units)
TOTAL
OTHER
Total number of shares
(Units)
Shares %
0
0.000000
0
0.000000
0
0.000000
0
0.000000
52,200,678
100.000000
0
0.000000
52,200,678
100.000000
TOTAL
224
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held Preferred shares held (% )
(Units)
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Valsi Voigt Administradora Ltda.
Dora Voigt de Assis
062.427.629-51
39,724,828
Share class
50.000000
Number of shares (Units)
TOTAL
Livia Voigt
0
062.427.659-77
39,724,828
Share class
TOTAL
OTHER
0
Total Shares %
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.655.197/0001-09
Capital breakdown
No
0
No
0.000000
39,724,828
50.000000
No
0
No
0.000000
39,724,828
50.000000
Shares %
0.000000
50.000000
Number of shares (Units)
Total number of shares
(Units)
Shares %
0.000000
0
0.000000
0
0.000000
0
0.000000
79,449,656
100.000000
0
0.000000
79,449,656
100.000000
TOTAL
225
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held Preferred shares held (% )
(Units)
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Cladis Voigt Trejes Administradora Ltda
Cladis Voigt Trejes
514.081.639-34
79,449,654
Brazilian-SC
99.999998
Share class
Number of shares (Units)
Shares %
TOTAL
Felipe Voigt Trejes
057.698.049-80
1
0
0.000000
Share class
Number of shares (Units)
99.999998
No
0
Yes
0.000000
1
0.000001
0.000000
0
0.000000
0
0.000000
0.000001
No
0
Yes
0.000000
1
0.000001
0
0.000000
79,449,656
100.000000
Pedro Voigt Trejes
057.698.199-01
1
Brazilian-SC
Share class
Number of shares (Units)
0
79,449,656
226
Capital breakdown
79,449,654
0
TOTAL
TOTAL
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.703.890/0001-00
Yes
0.000000
0.000001
0
Total Shares %
No
0
Brazilian-SC
TOTAL
OTHER
Total number of shares
(Units)
100.000000
Shares %
0.000000
Shares %
0.000000
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held Preferred shares held (% )
(Units)
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Decio da Silva Administradora Ltda.
Joana Zimmermann da Silva
058.297.959-57
26,100,338
Brazilian-SC
50.000000
Share class
Number of shares (Units)
TOTAL
OTHER
0
Total number of shares
(Units)
Total Shares %
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.649.347/0001-71
Capital breakdown
No
0
Yes
0.000000
26,100,338
50.000000
Shares %
0.000000
0
0.000000
0
0.000000
0
0.000000
52,200,676
100.000000
0
0.000000
52,200,676
100.000000
No
0
Yes
0.000000
26,100,338
50.000000
TOTAL
Zaira Zimmermann da Silva
046.818.429-58
26,100,338
Brazilian-SC
50.000000
Share class
Number of shares (Units)
Shares %
TOTAL
0
0.000000
227
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held Preferred shares held (% )
(Units)
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Diether Werninghaus Administradora Ltda
Anne Marie Werninghaus
050.451.569-18
58,458,160
Brazilian-SC
99.999999
Share class
Number of shares (Units)
TOTAL
Diether Werninghaus
310.427.409-68
1
Share class
0
TOTAL
OTHER
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.680.015/0001-50
Capital breakdown
No
0
Yes
0.000000
58,458,160
99.999999
No
0
Yes
0.000000
1
0.000001
0.000000
0.000001
0
Total Shares %
Shares %
Brazilian-SC
Number of shares (Units)
Total number of shares
(Units)
Shares %
0.000000
0
0.000000
0
0.000000
0
0.000000
58,458,161
100.000000
0
0.000000
58,458,161
100.000000
TOTAL
228
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held Preferred shares held (% )
(Units)
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Eduardo & Luisa Werninghaus Administradora Ltda
Eduardo Werninghaus
007.667.789-32
29,229,081
Brazilian-SC
50.000000
Share class
Number of shares (Units)
TOTAL
Luisa Werninghaus Bernoldi
007.667.599-89
29,229,081
Brazilian-SC
50.000000
Share class
Number of shares (Units)
TOTAL
OTHER
0
0
Total number of shares
(Units)
Total Shares %
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.680.096/0001-98
Capital breakdown
No
0
Yes
0.000000
29,229,081
50.000000
No
0
Yes
0.000000
29,229,081
50.000000
Shares %
0.000000
Shares %
0.000000
0
0.000000
0
0.000000
0
0.000000
58,458,162
100.000000
0
0.000000
58,458,162
100.000000
TOTAL
229
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held Preferred shares held (% )
(Units)
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
Total number of shares
(Units)
Total Shares %
Capital breakdown
CONTROLLING SHAREHOLDER / INVESTOR
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.601.978/0001-10
Heidi Behnke Administradora Ltda
Daniel Ricardo Behnke
051.107.199-00
29,229,081
Brazilian-SC
50.000000
Share class
Number of shares (Units)
TOTAL
Davi Ricardo Behnke
041.310.259-90
29,229,081
Brazilian-SC
50.000000
Share class
Number of shares (Units)
TOTAL
OTHER
0
0
No
0
Yes
0.000000
29,229,081
50.000000
No
0
Yes
0.000000
29,229,081
50.000000
Shares %
0.000000
Shares %
0.000000
0
0.000000
0
0.000000
0
0.000000
58,458,162
100.000000
0
0.000000
58,458,162
100.000000
TOTAL
230
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held Preferred shares held (% )
(Units)
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.710.197/0001-64
Katia da Silva Bartsch Administradora Ltda.
Bruna da Silva Bartsch
004.860.769-03
26,100,338
Brazilian-SC
50.000000
Share class
Number of shares (Units)
TOTAL
OTHER
0
Yes
0.000000
26,100,338
50.000000
Shares %
0.000000
0
0.000000
0
0.000000
No
0
Yes
0.000000
26,100,338
50.000000
0.000000
52,200,676
100.000000
Share class
Number of shares (Units)
231
Capital breakdown
0.000000
Brazilian-SC
50.000000
52,200,676
No
0
Total Shares %
0
Ricardo Bartsch Filho
004.860.759-23
26,100,338
TOTAL
TOTAL
Total number of shares
(Units)
Shares %
0
0.000000
100.000000
0
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held Preferred shares held (% )
(Units)
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.647.713/0001-53
Márcia da Silva Petry Administradora Ltda
Ana Flávia da Silva Petry
063.432.379-25
17,400,226
Brazilian-SC
33.333333
Share class
Number of shares (Units)
Shares %
TOTAL
Helena Marina da Silva Petry
063.432.389-05
17,400,226
0
0.000000
Share class
Number of shares (Units)
Brazilian-SC
33.333334
TOTAL
Márcia da Silva Petry
508.022.759-15
17,400,226
Brazilian-SC
33.333333
Share class
Number of shares (Units)
TOTAL
OTHER
Total number of shares
(Units)
0
Total Shares %
Capital breakdown
No
0
Yes
0.000000
17,400,226
33.333333
No
0
Yes
0.000000
17,400,226
33.333334
No
0
Yes
0.000000
17,400,226
33.333333
Shares %
0.000000
Shares %
0
0.000000
0
0.000000
0
0.000000
0
0.000000
52,200,678
100.000000
0
0.000000
52,200,678
100.000000
TOTAL
232
Reference Form - 2011 - WEG SA
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15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held Preferred shares held (% )
(Units)
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
Total number of shares
(Units)
Total Shares %
Capital breakdown
CONTROLLING SHAREHOLDER / INVESTOR
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.605.191/0001-27
Martin Werninghaus Administradora Ltda
Mariana Werninghaus
060.449.029-19
29,229,081
Brazilian-SC
50.000000
Share class
Number of shares (Units)
TOTAL
OTHER
0
50.000000
Shares %
0.000000
0
0.000000
0
0.000000
No
0
Yes
0.000000
29,229,081
50.000000
0.000000
58,458,162
100.000000
Share class
Number of shares (Units)
233
29,229,081
0.000000
Brazilian-SC
50.000000
58,458,162
Yes
0.000000
0
Ricardo Werninghaus
043.365.399-01
29,229,081
TOTAL
TOTAL
No
0
Shares %
0
0.000000
100.000000
0
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held Preferred shares held (% )
(Units)
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Miriam Voigt Schwartz Administradora Ltda
Eduardo Voigt Schwartz
010.528.409-22
39,724,828
Brazilian-SC
50.000000
Share class
Number of shares (Units)
TOTAL
Mariana Voigt Schwartz
009.273.789-73
39,724,828
Brazilian-SC
50.000000
Share class
Number of shares (Units)
TOTAL
OTHER
0
0
Total number of shares
(Units)
Total Shares %
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.649.305/0001-30
Capital breakdown
No
0
Yes
0.000000
39,724,828
50.000000
No
0
Yes
0.000000
39,724,828
50.000000
Shares %
0.000000
Shares %
0.000000
0
0.000000
0
0.000000
0
0.000000
79,449,656
100.000000
0
0.000000
79,449,656
100.000000
TOTAL
234
Reference Form - 2011 - WEG SA
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15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held Preferred shares held (% )
(Units)
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Solange da Silva Janssen Administradora Ltda
Total number of shares
(Units)
Total Shares %
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.680.120/0001-99
Capital breakdown
OTHER
0
0.000000
Paula da Silva Janssen
065.548.759-05
26,100,338
Brazilian-SC
50.000000
Share class
Number of shares (Units)
TOTAL
Renata da Silva Janssen Decker
035.997.069-99
26,100,338
Brazilian-SC
50.000000
Share class
Number of shares (Units)
TOTAL
TOTAL
52,200,676
235
0
0
0.000000
0
0.000000
No
0
Yes
0.000000
26,100,338
50.000000
No
0
Yes
0.000000
26,100,338
50.000000
0.000000
52,200,676
100.000000
Shares %
0.000000
Shares %
0
0.000000
100.000000
0
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held Preferred shares held (% )
(Units)
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
Tânia Marisa da Silva Administradora Ltda
Alberto da Silva Geffert
034.304.249-50
17,400,226
Brazilian-SC
33.333333
Share class
Number of shares (Units)
Shares %
TOTAL
Henrique da Silva Geffert
051.130.719-51
17,400,226
0
0.000000
Brazilian-SC
33.333333
Share class
Number of shares (Units)
TOTAL
Julia da Silva Geffert de Oliveira
037.581.239-33
17,400,226
Brazilian-SC
33.333334
Share class
Number of shares (Units)
TOTAL
OTHER
0
Total number of shares
(Units)
Total Shares %
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.649.342/0001-49
Capital breakdown
No
0
Yes
0.000000
17,400,226
33.333333
No
0
Yes
0.000000
17,400,226
33.333333
No
0
Yes
0.000000
17,400,226
33.333334
Shares %
0.000000
Shares %
0
0.000000
0
0.000000
0
0.000000
0
0.000000
52,200,678
100.000000
0
0.000000
52,200,678
100.000000
TOTAL
236
Reference Form - 2011 - WEG SA
Version : 1
15.1 / 15.2 - Shareholding structure
CONTROLLING SHAREHOLDER / INVESTOR
SHAREHOLDER
National Register of Individuals (CPF)/Legal
Entities (CNPJ)
Nationality-State
Part of the shareholders’
agreement
Controlling shareholder
Common shares held (% )
Number of preferred shares held Preferred shares held (% )
(Units)
Date of latest amendment
Detailed information on shares (Units)
Number of common shares held (Units)
CONTROLLING SHAREHOLDER / INVESTOR
National Register of
Individuals (CPF)/Legal
Entities (CNPJ)
08.655.197/0001-09
Valsi Voigt Administradora Ltda
Dora Voigt de Assis
062.427.629-51
39,724,828
Brazilian-SC
50.000000
Share class
Number of shares (Units)
TOTAL
Lívia Voigt
0
062.427.659-77
39,724,828
Share class
Total Shares %
Capital breakdown
No
0
Yes
0.000000
39,724,828
50.000000
No
0
Yes
0.000000
39,724,828
50.000000
Shares %
0.000000
Brazilian-SC
50.000000
Number of shares (Units)
TOTAL
OTHER
Total number of shares
(Units)
Shares %
0
0.000000
0
0.000000
0
0.000000
0
0.000000
79,449,656
100.000000
0
0.000000
79,449,656
100.000000
TOTAL
237
Reference Form - 2011 - WEG SA
Version : 1
15.3 Capital distribution
Date of late st gene ral mee ting / Date of
latest amendment
Number of individual shareholders
(Units)
Number of corporate shareholders
(Units)
Number of institutional investors
(Units)
4/26/2011
8,535
719
406
Outstanding shares
Outstanding shares corresponding to all the issuer’s shares except for those
held by the controlling interest holder, individuals related to it, the directors and
officers of the issuer and treasury shares
Number of common shares (Units)
209,767,872
31.811654%
Number of preferred shares (Units)
0
31.811654%
209,767,872
33.590000%
Total
238
Reference Form - 2011 - WEG SA
15.4 Shareholders organization chart
239
Version : 1
Reference Form - 2011 - WEG SA
Version : 1
15.5 Shareholders’ agreements, duly filed at registered office of the
issuer or to which the controlling shareholder is a party
The Company does not have any shareholders’ agreement.
Reference Form - 2011 - WEG S.A
240
Reference Form - 2011 - WEG SA
Version : 1
15.6 Significant changes to interests held by the members of the
group of controlling shareholders and by the issuer’s directors
and officers
N/A
241
Reference Form - 2011 - WEG SA
15.7 Other relevant information
N/A
242
Version : 1
Reference Form - 2011 - WEG SA
Version : 1
16.1 Description of the issuer’s rules, policies and practices
regarding transactions with related parties
Business transactions involving the purchase and sale of products, raw
materials and services, as well as financial transactions involving loans, funding
among the Group companies and management compensation were carried out
as described in 16.2.
243
Reference Form - 2011 - WEG SA
Version : 1
16.2 Information about transactions with related parties
Re lated party
Transaction
Amount involved
date
(Re ais)
Existing balance
Amount (Reais)
Duration
Loan
Collection
or other type of charges
debt inte rest
WEG Equipamentos Elétricos S.A.
Re lation with the issue r
12/31/2009
Subsidiary
1,746,000,00
Subject of the contract
Management of Financial Resources
Guarantee and insurance
N/A
Te rmination or extinguishment
Nature and reason for the transaction
N/A
RF Reflorestadora S.A.
12/31/2009
Re lation with the issue r
Subject of the contract
Subsidiary
Management of Financial Resources
22,970,000.00
Guarantee and insurance
Te rmination or extinguishment
N/A
N/A
1,746,000,00
N/A
N/A
NO
0.000000
22,970,000.00
N/A
N/A
NO
0.000000
4,644,000.00
N/A
N/A
NO
0.000000
139,000.00
N/A
N/A
NO
0.000000
Nature and reason for the transaction
WEG Equipamentos Elétricos S.A.
Re lation with the issue r
12/31/2010
Subsidiary
Subject of the contract
Management of Financial Resources
Guarantee and insurance
N/A
Te rmination or extinguishment
N/A
4,644,000.00
Nature and reason for the transaction
RF Reflorestadora S.A.
12/31/2010
Re lation with the issue r
Subsidiary
Subject of the contract
Management of Financial Resources
244
139,000.00
Reference Form - 2011 - WEG SA
Version : 1
16.2 Information about transactions with related parties
Re lated party
Transaction
Amount involved
date
(Re ais)
Existing balance
Amount (Reais)
Duration
Loan
or other type of
debt interest
Guarantee and insurance
Te rmination or extinguishment
Nature and reason for the transaction
245
N/A
N/A
Collection
charges
Reference Form - 2011 - WEG SA
Version : 1
16.3 Identification of the measures adopted to address conflicts of
interest and that the transaction was carried out at arm’s
length or was adequately compensated
The transactions carried out among WEG Group companies do not entail
potential conflicts of interest, considering their common control. The
transactions involving members of management follow the principles of
impersonality and impartiality.
246
Reference Form - 2011 - WEG SA
Version : 1
17.1 Information on Capital Stock
Date of authorization or
Approval
Type of Capital
26/04/2011
Value of Capital
(Brazilian reais)
Payment
deadline
Number of
Common Shares
(Units)
Number of
Pre fe rred Shares
(Units)
Issued Capital
2,265,367,031.00
Already paid-up
620,905,029
0
Type of Capital
26/04/2011
2,265,367,031.00
620,905,029
0
247
620.905.029
Paid Up Capital
2,265,367,031.00
620,905,029
0
Type of Capital
22/02/2011
620.905.029
Subscribed Capital
Type of Capital
26/04/2011
Total No. of shares (Units)
620.905.029
Authorized Capital
0.00
633,323,029
0
633.323.029
Reference Form - 2011 - WEG SA
Version : 1
17.2 Capital Stock Increases
Date of
Body which
Resolution
deliberated
(dd/mm/yyyy) the increase
06/04/2009
Date
issuance
GSM/E
Criteria to determine
Issuance price
Form of payment
28/12/2009
ESM
Criteria to determine
Issuance price
Form of payment
26/04/2011
248
Common
(Units)
Preferred
(Units)
Total Shares
(Units)
Subscription/
Previous
capital
06/04/2009
439.500.000,00
Without
issuance of
shares
0
0
0
28/12/2009
12.294.000,00
Public
Subscription
3.278.300
0
3.278.300
Issuance price Quotation
factor
0,00000000
0,00
0,68000000 3,75
R$ per unit
R$ per unit
Appraisal report elaborated by third parties, in the scope of merger of subsidiary TRAFO Equipamentos Elétricos
S.A.
Substitution of shares issued by TRAFO merged by WEG S.A.
AGO/E
Criteria to determine Issuance price
Form of payment
of Total value of issuance Type of
(Reais)
increase
26/04/2011
453.073.406,00
Without
issuance of
shares
0
0
0
0,00000000
0,00
R$ per unit
Reference Form - 2011 - WEG SA
Version : 1
17.3 Information on share split, grouping and dividends
Justification for the lack of filling out of this field:
The Company did not split, group or offer dividents in the last three fiscal years.
249
Reference Form - 2011 - WEG SA
Version : 1
17.4 Information on reduction of capital stock
Justification for the lack of filling out of this field:
The Company has not carried out capital stock reductions in the last three fiscal
years.
250
Reference Form - 2011 - WEG SA
17.5 Other relevant information
N/A
251
Version : 1
Reference Form - 2011 - WEG SA
Version : 1
18.1 Share rights
252
Type of shares or overdue tax liability
Common
Tag along
100,000000
Entitled to Div idends
25% (twenty five percent) at least, of adjusted net
income as per article 202 of the Brazilian
Corporation Law, distribution of dividends and;or
equity, as per Law 9,249/95, added to dividends.
Right to vote
Full
Conve rtible
No
Entitled to capital reimbursement
No
Restricted circulation
No
Conditions to alte r the rights which were
protected by said securities
Not applicable
Othe r relevant characte ristics
Not applicable
Reference Form - 2011 - WEG SA
18.2 Description of possible statutory regulations which
significantly limit the shareholders’ right to vote or which
forces them to carry out a public offering
N/A
253
Version : 1
Reference Form - 2011 - WEG SA
Version : 1
18.3 Description of exceptions and conditional clauses relative to
equity or political rights provided for in the bylaws
N/A
254
Reference Form - 2011 - WEG SA
Version : 1
18.4 Trade volume and higher and lower quotes of the negotiated securities
Fiscal Year
Quarter
(dd/mm/yyyy)
31/12/2010
Security
Species
Class
Market
31/03/2010
Shares
Common
Stock exchange
30/06/2010
Shares
Common
Stock exchange
30/09/2010
Shares
Common
Stock exchange
31/12/2010
Shares
Common
Stock exchange
Exercício
social
Quarter
Managing entity
Negotiated
Value of highest Value of lowest Quotation factor
Financial Volume
quote (Reais)
quote (Reais)
(Reais)
BM&FBOVESPA S.A. - Bolsa de Valores,
357,865,580
19.75
16.51 R$ per Unit
Mercadorias e Futuros
BM&FBOVESPA S.A. - Bolsa de Valores,
266,412,364
19.48
15.00 R$ per Unit
Mercadorias e Futuros
BM&FBOVESPA S.A. - Bolsa de Valores,
380,689,143
18.79
16.33 R$ per Unit
Mercadorias e Futuros
BM&FBOVESPA S.A. - Bolsa de Valores,
660,994,368
24.16
18.40 R$ per Unit
Mercadorias e Futuros
31/12/2009
Security
Species
Class
Market
Entidade administrativa
Negotiated
Value of highest Value of lowest Quotation factor
Financial Volume
quote (Reais)
quote (Reais)
(Reais)
Stock exchange BM&FBOVESPA S.A. - Bolsa de Valores,
213,070,336
12.77
9.91 R$ per Unit
Mercadorias e Futuros
31/03/2009
Shares
Common
30/06/2009
Shares
Common
Stock exchange BM&FBOVESPA S.A. - Bolsa de Valores,
Mercadorias e Futuros
462,612,618
15.75
10.59 R$ per Unit
30/09/2009
Shares
Common
Stock exchange BM&FBOVESPA S.A. - Bolsa de Valores,
Mercadorias e Futuros
417,145,979
16.73
12.03 R$ per Unit
31/12/2009
Shares
Common
Stock exchange BM&FBOVESPA S.A. - Bolsa de Valores,
Mercadorias e Futuros
430,584,657
19.38
15.24 R$ per Unit
Fiscal Year
Quarter
31/12/2008
Securities
Species
Class
Market
31/03/2008
Shares
Common
Stock exchange
30/06/2008
Shares
Common
Stock exchange
30/09/2008
Shares
Common
Stock exchange
31/12/2008
Shares
Common
Stock exchange
255
Managing Entity
Negotiated
Financial Volume
(Reais)
BM&FBOVESPA S.A. - Bolsa de Valores, 576,198,181
Mercadorias e Futuros
BM&FBOVESPA S.A. - Bolsa de Valores, 662,651,154
Mercadorias e Futuros
BM&FBOVESPA S.A. - Bolsa de Valores, 400,452,413
Mercadorias e Futuros
BM&FBOVESPA S.A. - Bolsa de Valores, 364,299,037
Mercadorias e Futuros
Value of highest
quote (Reais)
Value of lowest Quotation factor
quote (Reais)
23.41
16.74
R$ per Unit
21.61
16.03
R$ per Unit
18.68
13.02
R$ per Unit
17.38
8.84
R$ per Unit
Reference Form - 2011 - WEG SA
18.5 Description of other securities issued
Justification for the lack of filling out of this field:
The Company does not have other issued securities other than shares.
256
Version : 1
Reference Form - 2011 - WEG SA
Version : 1
18.6 Brazilian markets in which securities are accepted for
negotiation
The Company maintains its shares (WEGE3) being traded in the Stock, Futures
and Commodities exchange, BM&F Bovespa.
257
Reference Form - 2011 - WEG SA
Version : 1
18.7 Information on the class and species of security admited for
trade in foreign markets
On September 27, 2010, we announced the negotiation of American Depository
Receipts (ADR), level 1, in the scope of the program that sponsors depository
receipts of Company shares (“Program”).
The Program did not represent a capital increase or issuance of new shares.
With this program WEG seeks to offer more access options to investors,
including those domiciled abroad, broadening the liquidity of shares.
Each ADR represents 1 Company-issued common share, in the terms of the
depository contract between the Company and JP Morgan Chase Bank, N.A.,
being traded in the over-the-counter market, under code “WEGZY”.
We present below the following information regarding our ADR program.
258
Country:
United States of America
Market:
Over the Counter or OTC
Date of admission for negotiation:
September 27, 2010
Negotiation Segment:
ADR level 1
Percentage of negotiation volume
abroad in comparison with the total
volume of negotiation of each class
and species in the last fiscal year:
Symbol:
Less than 1%
WEGZY
CUSIP::
94858P 20 9
Local ISIN
BRWEGEACNOR0
Proportion of depository ce rtificates
abroad in comparison with each class
and species of shares.
At most 50,000,000 ADRs / shares, which
represent less than 1% of the total shares
issued by the Company.
Depository Bank:
JP Morgan Chase Bank, N.A.
Custodian Bank:
Banco Bradesco S.A.
Reference Form - 2011 - WEG SA
Version : 1
18.8 Public offerings carried out by issuer or third parties, including
controlling shareholders affiliated companies and
subsidiaries, regarding securities of the issuer
N/A
259
Reference Form - 2011 - WEG SA
18.9 Description of public acquisition offers made by the issuer
regarding shares issued by third parties
N/A
260
Version : 1
Reference Form - 2011 - WEG SA
18.10 Other relevant information
N/A
261
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Reference Form - 2011 - WEG SA
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19.1 Information on repurchase plans for shares of the issuer
Decision
date
Repurchase
Period
Av ailable
rese rves
and
Species
Profit (Brazilian reais)
Class
Amount Foreseen
% re l. circ.
(Units)
Approved
Acquired quantity PMP
(Units)
Quotation factor % acquired
Other charac.
26/04/2011
26/04/2011 to
26/04/2012
0.00
Common
500,000
The objective of the Repurchase Plan is to support the Company’s Share Purchase Option Plan
262
0.080528
500.000
2011
R$ per Unit
100.000000
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19.2 Transactions of securities held in treasury
Justification for the lack of filling out of this field:
The Company did not have securities in treasury on December 31, 2010 and or
December 31, 2009.
On April 26, 2011 a share buyback program was approved (see item 19.1).
Between April 27 and 28, 2011, 500,000 shares were acquired at an average
price of R$ 20.11. They were found in the treasury on the date of presentation
of this Form.
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19.3 Information regarding securities held in treasury on the
closing date of the last fiscal year
Justification for the non-filling out of the form:
The Company does not have the values of the securities in treasury on the
closing date of the last fiscal year.
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19.4 Other relevant information
N/A
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20.1 Information on the negotiation policy of securities
Date of Approval
June 23, 2008
Position and/or function For the POLICY, concerned persons are those who due to their function or position in
The Company have continuous, frequent and repetitive Access to Privileged Information,
Therefore Concerned Persons are, among others:
1. Shareholders and direct and indirect controllers,
2. The members of the Board of Directors,
3. The members of the Fiscal Council,
4. The Members of the Executive Board,
5. The members of any bodies with technical or consulting or statutory positions
6. Other people, according to the decision of the Investor Relations Board
In specific cases, the following people can be compared to Concerned Persons:
1. Any Corporation in which a Concerned Person may influence the negotiation decision of
securities
2. Any person Who has Access to Privileged Information through the Concerned Person
and has signed a specific Confidentiality Agreement.
3. For spouses, companions, and any dependents, including those in the person’s income
tax statement, regarding income and companies which are directly or indirectly
controlled by it.
Main Characteristics
The objectives of the DISCLOSURE POLICY OF MATERIAL ACT OR FACT ANDO F NEGOT IATIONS OF
SECURITIES (“POLICY”),
1.
2.
3.
The POLICY establishes the guideline and procedures which guide WEG S.A. and other companies of the
WEG group (“WEG” or “The Company”) and people connected to it, involving:
1.1 The treatment of material facts or actions, in the maintenance of confidentiality as in its appropriate
disclosure;
1.2 The negotiation of securities issued by WEG or connected to the Company.
The POLICY was established according to the terms of CVM Instruction No. 358 of January 3, 2002, and
the “Novo Mercado” Regulation of the São Paulo Stock Exchange (“BOVESPA”)
The POLICY cannot be amended due to a Material fact or action which has still no t been disclosed.
Prohibition period and
description of the
inspection procedures
CONCERNED PEOPLE should not negotiate the Securities issued by WEG on the date of
the formal communication of the Investor Relations Officer, up to the date of disclosure of a
Material Fact or Event, or a new communication approving trading. Concerned People must
maintain confidentiality over their own temporary trade impossibility. The members of the
management who leave the Company before the public disclosure of a material fact or event
which began during their time in office, must also respect the impossibility of trade for a sixmonth period as of the date they left the Company.
Automatic impossibility of trading:
1. Between the 15th (fifteenth) Day prior to the date (inclusive), (i) of quarterly information
disclosure and; (ii) before the disclosure of Annual Standardized Financial Statements.
2. While in course of acquisition or sale of shares issued by WEG by WEG itself, its
subsidiaries, affiliates or other company under common control, or if an option or term of
office for said purpose has been issued.
The temporary impossibility of trading will be established based on the chance of an event
occurring which may be deemed as a material fact, considering the judgment over when the
fact which was a mere speculation and became reality, even if this cannot be assured.
1. Even if the criteria of relevance and materiality defined above are not observed, the
Investor Relations Office may prohibit trading to preserve the best market functioning of
the securities issued by WEG or to preserve legitimate interests of WEG or its
shareholders.
2. Partial prohibition to the negotiation may be established to Concerned People and third
parties who may know about the non-published specific fact or event.
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20.2 Other relevant information
See “DISCLOSURE POLICY FOR MATERIAL FACT OR EVENT AND
NEGOTIATION OF WEG S.A. securities in item 21.1
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21.1 Description of norms, by-laws or internal procedures
regarding the disclosure of information
DISCLOSURE POLICY OF MATERIAL FACT OR EVENT
AND REGARDING TRADE OF WEG S.A. SECURITIES
Purposes of the POLICY
1. This POLICY FOR DISCLOSURE OF MATERIAL FACT OR EVENT AND
NEGOTIATION OF SECURITIES (“POLICY”)establishes the guidelines or
procedures which guide WEG S.A. and other companies of the WEG Group
(“WEG” or “the Company”), and concerned people, involving:
1.1 The treatment of material facts and events, in the maintenance of
confidentiality and in their proper disclosure;
1.2 The negotiation of securities issued by WEG or which they refer to.
2. This POLICY was established according to the terms of CVM Instruction 358 of
January 3, 2002 and of the “Novo Mercado” Regulation of the São Paulo Stock
Exchange (“BOVESPA”).
3. The POLICY cannot be altered while a Material Fact or Event has not been
disclosed.
Definitions
Securities Issued by WEG
4. The following items are considered Securities Issued by WEG: shares,
negotiable rights, subscription receipts, issued debentures offered publicly by WEG
or by publicly held companies controlled by WEG, as well as securities issued by
third parties whose value is guided or originated from securities issued by WEG.
Material Fact or Event
5. Any decision, event or fact which may considerably influence the quotation of
securities issued by WEG or in the decision making of investors regarding the
purchase, sale or exercise of any rights inherent to the condition of security holder,
according to the law is considered to be a Material Fact or Event.
6. As guiding objective criterion, in a non-imposition manner, the weighted influence
of the material act or fact defined above, is taken from the concept of materiality of
said event in the context of WEG’s activities, considering the material event or fact
which, alone or combined may cause variation in:
6.1. Annual gross revenue by 5% or more
6.2. Annual EBITDA by 5% or more
6.3. Net income for the year by 5% or more
6.4. Net Shareholders’ Equity by 5% or more.
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21.1 Description of norms, by-laws or internal procedures
regarding the disclosure of information
Privileged Information
7. Knowledge regarding a Material Fact or Event is considered to be privileged
information until it is disclosed to the regulatory bodies, such as the Brazilian
Securities and Exchange Commission (“CVM”) and the São Paulo Stock Exchange
(BOVESPA) and the shareholders and other members of the capitals market, as
stipulated by this POLICY.
Non-Equitable Practice
8. The use of privileged information for the self benefit or benefit of other parties, any
type of advantage through any type of negotiation of securities issued by the
Company or related thereto is considered to be a Non-Equitable Practice.
Concerned Parties
9. Concerned parties are those who due to their function or position in the Company
have continuous, frequent and repetitive access to Privileged Information. Thus,
Concerned Parties, among others, are the following:
9.1.
9.2.
9.3.
9.4.
9.5.
The direct and indirect controlling shareholders,
The members of the Board of Directors,
The members of the Fiscal Council,
The Executive Directors
The members of any bodies with technical or consulting functions, created by
a disposition in the By-Laws.
9.6. Other people according to the resolution of the Investor Relations Officers
10. In specific cases, the following parties can be compared to Concerned parties:
10.1. Any corporation in which a Concerned Party may influence decision making
regarding the trade of securities.
10.2. Any person who has had access to Privileged Information through a
Concerned Party and who has signed a specific confidentiality agreement.
10.3. For natural persons to a spouse, partner, any dependent included in its
annual declaration of income tax and corporations controlled by them directly
or indirectly.
Responsibilities of the Concerned Parties
Duty to Adhere to the POLICY
11. Adhere formally to the POLICY upon signature of the applicable term of adhesion
(Exhibit I, II, or III) upon engagement, election, promotion or transfer, or of the
knowledge about material fact or event, in which they shall declare their knowledge
regarding the terms of the POLICY and are responsible for observing.
11.1. The Disclo sure Committee shall define, jointly with each one of the Officers
of the Company, which employees, positions and third parties who must
adhere to the POLICY.
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21.1 Description of norms, by-laws or internal procedures
regarding the disclosure of information
Duty to Maintain Confidentiality
12. Not use Privileged Information to obtain any sort of advantages in the trade of
securities issued by WEG through non-equitable practices, in self benefit or that of
others.
13. To act diligently in order to maintain confidentiality regarding the Privileged
Information which is accessible to you, observing the law and other pertinent
regulations.
14. Only transmit Privileged Information to third parties which are not related to this
POLICY if it is absolutely necessary for the performance of professional functions
in the normal course of the Company’s business.
14.1. Said transmission of Privileged Information must only take place in the
necessary extent for the desired purposes, always preceded by an
explanation of the confidential characteristics of said information and the
extension in the duty to maintain this confidentiality.
14.2. If the transmission of privileged information takes place in a frequent and
repetitive manner, said non-concerned party must adhere to this POLICY by
signing the pertinent term of adhesion.
14.3. The Concerned Party who wishes to resign from WEG or who does not wish
to be part of the business or project which the Privileged Information pertains
to. The Party will be subject to confidentiality until said information is publicly
disclosed.
Duty to Observe Blackout Period
15. Not trade Securities issued by WEG as of the date of formal communication by the
Investor Relations Office up to the date of public disclosure of Material Fact or
Event, or a new formal communication approving trade. The Concerned Parties
must maintain confidentiality about their own temporary blackout status. The
administrators who resign from the Company before the public disclosure of a
Relevant Fact or Event which began during their time in office, must also respect
the trade restriction for a six-month period after their resignation.
15.1. Respect the automatic blackout period:
15.1.1. Between the 15th (fifteenth) day prior to and the day of (i) the disclosure of
quarterly financial results (filing of the Quarterly Information Form - ITR with
the CVM); and (ii) the disclosure of annual financial results (filing of the
Standard Financial Statement Form - DFP with the CVM), with no formal
notification from the Investor Relations Officer being required. WEG shall
disclose, at the beginning of each fiscal year, and shall keep it updated
throughout the period, a calendar of corporate events including the
estimated dates for disclosure of its quarterly and annual financial results,
as set out in attachment IV to this POLICY.
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21.1 Description of norms, by-laws or internal procedures
regarding the disclosure of information
15.1.2. While the purchase or sale of WEG issued shares by WEG itself, its
subsidiaries, affiliates or other company under common control is in
course, or if an option or term of office has been granted for the same
purpose.
Duty to Inform about Ownership and Trade
16. The Concerned Parties must inform the Investor Relations Office about the
quantities, characteristics and form of acquisition of securities issued by WEG, as
well as possible changes in the positions held, as per the “Individual Trade Form”
according to Exhibit VI of this POLICY.
16.1.
The initial communication must be done immediately after investiture.
16.2
Subsequent trading shall be notified immediately after it has taken place,
and the Related Persons must require the brokers used in the trading
operation to provide this information to the Investor Relations Officer.
Duty to Inform of Trading of Material Ownership
17. The shareholders that elect members of the Board of Directors or the Supervisory
Board, as well as any natural or artificial person, or group of persons acting
together or representing the same interest, that have direct or indirect equity
interest equivalent to a minimum 5% (five percent) of shares comprising the capital
stock of WEG must provide the Investor Relations Officer with the information
required in the “Statement of Equity Ownership”, as set out in attachment V to this
POLICY, upon the occurrence of events defined by applicable legislation and/or
regulations.
Responsibility of the Investor Relations Officer
To Manage and Handle Violations
18. Manage the application of this POLICY and adopt the necessary measures for its
strict enforcement.
19. Handle POLICY violations, define penalties and inform them to the appropriate
level of authority for each case.
Control Adherence and Trading
20. To maintain centralized and updated records of all Concerned Parties, being also
responsible for making these records available to the proper authorities upon
request.
21. Keep specific and individual control over all Concerned Parties, including the
number, characteristics and form of acquisition of the securities issued by WEG, as
well as any changes in these positions regularly providing this information to CVM
and BOVESPA.
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21.1 Description of norms, by-laws or internal procedures
regarding the disclosure of information
Define Blackout Period
22. Define the initial period of temporary prohibition to trading in Securities Issued by
WEG by Related Persons based on the likely occurrence of specific acts or facts
that might be deemed material, considering judgment of when the likelihood of
their occurrence passed from mere expectation on to an actual possibility, although
it cannot be assured.
22.1. Even if the previously defined relevance and materiality criteria are not
observed, the Investor Relations Officer may determine a blackout period to
preserve the proper operation of the market for the Securities Issued by
WEG or to safeguard the legitimate interests of WEG or its shareholders.
22.2. Partial prohibition to trading may be imposed only on those Related Persons
and third parties who become knowledgeable of specific acts or facts not yet
disclosed.
Define and Disclose Material Acts or Facts
23. Analyze and qualify an act or fact as a Material Fact and
appropriateness and/or need for disclosure. Provided that
confidentiality is not impaired, the Investor Relations Officer may
immediate disclose a material act or fact if it considers this to be the
legitimate interest.
define the
information
opt not to
Company’s
24. Prepare the Material Fact Release document, which must be clear, accurate and in
user-friendly language, including timely and comprehensive information required
for a perfect understanding.
24.1. WEG shall necessarily publish its documents in Portuguese, but English
versions thereof may be provided in due course for the convenience of
interested readers only.
24.2. Only the Chief Executive Officer, the Investor Relations Officer or a person
expressly appointed by either of them are allowed to comment on, clarify or
detail the content of the material act or fact as disclosed. Comments,
clarifications or details about immaterial acts or facts that have already been
subject to extensive disclosure may be provided by other WEG personnel,
pursuant to applicable policies as the case may be.
24.3. Material acts or facts shall preferably be disclosed before or after the trading
hours at the São Paulo Stock Exchange (BOVESPA). If it is imperative that
this disclosure take place during the BOVESPA trading hours, the Investor
Relations Officer shall request BOVESPA to suspend trading in the
securities issued by WEG for as long as it is necessary to properly
communicate the relevant information.
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21.1 Description of norms, by-laws or internal procedures
regarding the disclosure of information
25. Oversee the communication of Notices of Material Fact, in the following order of
priority:
25.1. To CVM, through the electronic media defined by this agency,
25.2. BOVESPA and, as applicable, to other stock exchanges and entities
operating in organized over-the-counter markets;
25.3. Directly to the parties in the capital markets in general, through usual or
convenient media, including publications in newspapers determined at
WEG’s General Meeting, which may be in summary form with an indication
of where the complete information is available.
Assist Investors
26. Assist investors, market analysts and interested parties, directly or through an
expressly appointed representative. Other employees shall only communicate with
investment experts and other parties in the capital market as expressly authorized
and directed to do so by the Investor Relations Officer in the presence of the
appointed representative.
26.1. WEG’s representatives in assisting shareholders and investors must zero in
on widely disclosed public information and not discuss or transmit Privileged
Information;
26.2. For the period of 15 days before publication of its financial results, on the
dates specified in the calendar of corporate events registered with the CVM
and the BOVESPA, pursuant to attachment IV, WEG shall not discuss,
provide information or estimate projections regarding these results. This
prohibition does not include discussing information that has been already
publicly disclosed.
26.3. WEG shall not express an opinion on rumors, speculations, news or
information whose source is not clearly identified, unless, by decision of the
Investor Relations Officer, it is understood that a formal expression by WEG
may help preserve an orderly trading of the securities issued by WEG.
26.4. WEG will neither disclose projections of future results nor make comments,
express opinions or judgments about other projections of results prepared
by third parties.
26.5. WEG may, in a timely manner, disclose its expected operating performance
for the coming fiscal years. These expectations regarding future
performance represent mere estimates and are based on management’s
expectations for the future, being largely subject to market changes, to the
overall economic performance of the country and business sector, and to
the international markets, being subject to changes.
26.6. WEG may, through the usual means adopted in its investor relations
activities, use or disclose the projections of results prepared by third parties.
This practice does not imply any assessment, value judgments or validation
of these expected results.
26.7. WEG shall not be liable for recommended investments, expected results,
target prices and other judgments and opinions of third parties about the
securities issued WEG.
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21.1 Description of norms, by-laws or internal procedures
regarding the disclosure of information
Responsibilities of the Disclosure and Trading Committee
27. The Disclosure and Trading Committee is hereby established as an advisory and
deliberative body composed of a maximum five (5) members, one of them
compulsorily being the Investor Relations Officer, who shall preside it, and the
others being selected by the Executive Board of WEG, which shall be assigned
with the following responsibilities:
27.1. Previously review the content of specific communications with the capital
market that may contain relevant information about WEG, ensuring that no
information about material acts or facts as yet undisclosed by the company is
improperly disclosed;
27.2. Consider the need for defining temporary blackout periods for the persons
related to this POLICY;
27.3. Determine the necessary procedures for the disclosure and communication
of this POLICY, also to WEG’s employees;
27.4. Rule on adherence by all persons required by law, as defined in this
POLICY;
27.5. Propose the adoption of applicable disciplinary measures, as a result of
noncompliance with the rules established in this POLICY, notwithstanding
the applicable administrative, civil and criminal penalties.
Penalties for POLICY Violations
28. Failure to comply with the rules established in this POLICY shall subject the
violator to disciplinary measures, pursuant to WEG’s internal rules of procedure
and those described in this item, notwithstanding the applicable administrative, civil
and criminal penalties.
29. Any related person that becomes aware of his/her violation must immediately
report it to the Investor Relations Officer. Failure to report violations of the POLICY
is considered misconduct.
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21.1 Description of norms, by-laws or internal procedures
regarding the disclosure of information
POLICY ON DISCLOSURE OF MATERIAL FACT OR EVENT AND TRADE OF WEG
S.A. SECURITIES
EXHIBIT I
TERM OF ADHESION FOR CONTROLLERS AND
MANAGEMENT
[name, nationality, marital status, profession], bearer of [CPF] and [RG], resident at [full
address], undersigned, in the position of [occupied position] of [WEG S.A. or
subsidiary], adheres to the DISCLOSURE POLICY OF MATERIAL FACTS OR
EVENTS and WEG S.A SECURITIES TRADE POLICY, received at this moment;
declaring to be aware of its terms and to fully observe them. The signatory also
declares to be fully aware of the penalties due to violations of the POLICY which will be
discussed by the Company’s Board of Directors.
Jaraguá do Sul, [month] [day], 20 [year].
________________________________________
[Full Name]
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21.1 Description of norms, regulations or internal procedures
regarding information
POLICY ON DISCLOSURE OF MATERIAL FACT OR EVENT AND TRADE OF WEG
S.A. SECURITIES
EXHIBIT II
TERM OF ADHESION FOR EMPLOYEES
[name, nationality, marital status, profession], bearer of [CPF] and [RG], resident at [full
address], undersigned, in the position of [occupied position] of [WEG S.A. or
subsidiary], adheres to the DISCLOSURE POLICY OF MATERIAL FACTS OR
EVENTS and WEG S.A SECURITIES TRADE POLICY, received at this moment;
declaring to be aware of its terms and to fully observe them. The signatory also
declares to be fully aware that a possible violation of said POLICY may be considered
a severe error.
Jaraguá do Sul, [month] [day], 20 [year].
________________________________________
[Full Name]
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21.1 Description of norms, regulations or internal procedures
regarding information
POLICY ON DISCLOSURE OF MATERIAL FACT OR EVENT AND TRADE OF WEG
S.A. SECURITIES
EXHIBIT III
TERM OF ADHESION FOR THIRD PARTIES
[name, nationality, marital status, profession], bearer of [CPF] and [RG], resident at [full
address], undersigned, in the position of [occupied position] of [WEG S.A. or
subsidiary], adheres to the DISCLOSURE POLICY OF MATERIAL FACTS OR
EVENTS and WEG S.A SECURITIES TRADE POLICY, received at this moment;
declaring to be aware of its terms and to fully observe them. Said duty is also extended
to all the employees and connected people to [Company engaged by WEG] which are
involved in the providing of services or products which are contracted by WEG S.A.
The signatory is also aware of the previously established dates regarding blackout
period and is also aware that a violation against said POLICY will mean lack of
compliance with the contract, allowing the Company, without any encumbrances to
terminate the contract which originated this adhesion and demand the payment of fine
therein established, without prejudice of loss and damages.
Jaraguá do Sul, [month] [day], 20 [year].
________________________________________
[Full Name]
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21.1 Description of norms, regulations or internal procedures
regarding information
POLICY ON DISCLOSURE OF MATERIAL FACT OR EVENT AND TRADE OF WEG
S.A. SECURITIES
EXHIBIT IV
CALENDAR FOR YEAR 200X
INCLUDES BLACKOUT PERIODS
FOR SECURITIES ISSUED BY WEG S.A.,
DUE TO PERIODICAL EVENTS (Financial Statements (DFP) and Quarterly
Information (ITR))
Periodical Events
Balance Sheet/ Financial Statements 31.12.0x
ITR – 1Q/0x
IAN (annual information) 200x
ITR – 2Q/0x
ITR – 3Q/0x
278
Blackout Periods
XX.0X.200X to XX.0X.200X
XX.0X.200X to XX.0X.200X
XX.0X.200X to XX.0X.200X
XX.0X.200X to XX.0X.200X
XX.0X.200X to XX.0X.200X
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21.1 Description of norms, regulations or internal procedures
regarding information
POLICY ON DISCLOSURE OF MATERIAL FACT OR EVENT AND TRADE OF WEG
S.A. SECURITIES
EXHIBIT V
INDIVIDUAL NEGOTIATION FORM
Negociação de Administrators and Concerned People – Art. 11 – CVM instruction
no. 358/2002
In [month/year]
( ) the following operations with securities and derivatives were the only ones to occur,
as per article 11 of CVM Instruction No. 358/2002. (1)
( ) no operations with securities and derivatives were carried out, according to article
11 of CVM Instruction no. 358/2002, considering that the following are my current
positions of securities and derivatives.
Name of Company:
Name: WEG S.A.
CPF (Individual Taxpayer’s ID)/CNPJ (Corporate Taxpayer’s ID):
Qualification:
Initial Balance:
Securities / Derivatives
Quantity of % interest
Same
Species/Class
Characteristics of the Bonds (2)
Total
Transactions in the Month:
Security/ Derivative
Characteristic
s of The
Bonds (2)
Interim
Operation
Purchase
Total
Purchase
Sale Total
Sales
Day
Quantity
Volume
Price (R$) (3)
Final Balance
Value Security/Derivative
Characteristics of the Bonds (2)
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Quantity% of interest
Same Species/Class
Total
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21.1 Description of norms, regulations or internal procedures
regarding information
(1) When filling out the form, exclude the lines which do not contain
information.
(2) Issuance/Series, convertible, simple, deadlines, sureties, species/class, etc.
(3) Quantity times price.
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21.1 Description of norms, regulations or internal procedures
regarding information
POLICY ON DISCLOSURE OF MATERIAL FACT OR EVENT AND TRADE OF WEG
S.A. SECURITIES
EXHIBIT VI
DECLARAT ION OF SHAREHOLDINGS
I, [name and qualification] in the position of [position] of WEG S.A., hereby DECLARE,
that in compliance with CVM Instruction no. 358/02, have [acquired or sold] the
[shares/other bonds and securities/rights over shares/other bonds and securities –
specify class and species, if it is the case] issued by WEG S.A., having
[reached/increased/decreased/been extinct] by [5 or more] % of my [direct/indirect]
shareholdings, corresponding to [shares/ other bonds and securities/rights over bonds
and securities/other bonds and securities] representative of WEG S.A. capital, as
described below:
I – Objective of my shareholdings and envisioned
quantity:..................................................
II – Number of shares, subscription bonuses, as well as share subscription rights and
share purchase options, per species and class, already held, direct or indirectly, by me
of by somebody connected to me:..................................................................
III – Number of debentures convertible into shares, already held, directly or indirectly,
by me or by a person connected to me (explain the number of shares which are object
of possible conversion, per class and species):........................................
IV – Appoint which agreement or contract regulates the exercise of voting rights or the
purchase and
sale of securities issued by the company:
I hereby assume the commitment to immediately communicate to the body in charge of
corporate events about any changes in the positions herein informed which represent
an increase or decrease of my shareholdings.
Jaraguá do Sul, [month] [day], 20 [year].
________________________________________
[Full Name]
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21.2 Description of disclosure policy of material fact or event and of
the procedures relative to the maintenance of secrecy
regarding the relevant information which has not been
disclosed
See “DISCLOSURE POLICY OF MATERIAL FACT OR EVENT AND TRADE
OF WEG S.A. SECURITIES in item 21.1
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21.3 Administrators responsible for implementing, maintaining,
evaluating and overseeing disclosure of information
See “DISCLOSURE POLICY OF MATERIAL FACT OR EVENT AND TRADE
OF WEG S.A. SECURITIES in item 21.1
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21.4 Other relevant information
Please refer to: “DISCLOSURE POLICY OF MATERIAL FACT OR EVENT AND
TRADE OF WEG S.A. SECURITIES in item 21.1
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22.1 Purchase or sale of any relevant asset which does not fit the
normal operations of the issuer
N/A
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22.2 Significant changes in the issuer’s manner of conducting
business
N/A
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22.3 Relevant contracts signed by the issuer and its subsidiaries,
not directly connected to its operational activities
N/A
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22.4 Other relevant information
WEG S.A. SHARE PURCHASE PLAN
1.
Objective of the Plan
The Share Purchase Plan (“Plan”) seeks the grant of Purchase Options for
the shares issued by WEG S.A. (“Company”) to statutory directors of the
Company or of its subsidiaries located in Brazil, seeking to attract, motivate
and retain them, as well as to align their interests with those of the
Company and shareholders.
2.
Management of the Plan
The Plan will be managed by the Board of Directors, observing the basic
terms and conditions here.
3.
Options
Each purchase option entitles its bearer to acquire 1 (one) common share
issued by the Company (BM&F BOVESPA: “WEGE3”), strictly in the terms
and conditions established in this Plan (“Option”).
4.
Programs
The Board of Directors may approve, every half-year, following the
distribution policy of the Company’s dividends, the Share Purchas Option
Programs (“Programs”), in which the participants will be defined, the
number of Options, the exercise price, the distribution of Options, the date
of validity and the other rules specific to each Program, following the basic
outline of this Plan.
Upon the launch of each Program, the Board of Directors will set the terms
and conditions of each Option in a Share Purchase Option Agreement and
Other Covenants (“Agreement”), to be signed between the Company and
each Participant, regarding the program established by the Board of
Directors. The defined contract must define at least the following conditions:
a) The number of shares which the Participant will be entitled to acquire
with exercise of the Option and price per share, according to the
Program;
b) The period during which the Option cannot be exercised and the limit
dates for the full or partial exercise of Options in which the rights of the
Option will expire;
c) Possible regulations on any restrictions to the transfer of shares
acquired as a condition of participation in the Plan and dispositions on
penalties regarding violation of said restrictions; and
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d) Any other terms and conditions which are necessary, observing the
general guidelines of this Plan.
5.
Participants of the Plan
The Company’s statutory directors or of its subsidiaries located in Brazil are
eligible for the Plan. The Participant who is interested in being part of the
Program to which they have been designated for should sign the due Term
of Adhesion, in the deadline set by each Program. The Participation will
always be voluntary.
6.
Condition to Be Part in Each Program and Option Distribution
As a pre-condition to be part in each Program, the Participant Will have to
invest 20% (twenty percent), or 40% (forty percent), or 60% (sixty percent)
of its variable remuneration in the period, in Company shares (the
“Invested Shares”).
For purposes of this Plan, the term “variable remuneration” means the net
value received by the Participant for the Profit Sharing Program (“PLR”) of
the Company, according to the criteria of distribution and performance
goals set periodically by the Company.
The Company will grant each Participant with Share Purchase Options in
proportion to the number of invested Shares, namely:
a) In case the Participant invests 20% (twenty percent) or more of their
PLR, however, no more than 40% (forty percent) in the purchase of
shares (Invested Shares), the quantity of purchase options to be
granted is the same as the number of Invested Shares which the
Participant acquired.
b) In case the Participant invests their PLR in a percentage equal or
higher than 40% (forty percent) and less than 60% (sixty percent) in the
purchase of shares (Invested Shares), the quantity of shares options to
be granted will be one and a half times (1.5) to the number of Invested
Shares acquired by the Participant.
c) In case the Participant invests their PLR in a percentage of 60% (sixty
percent) or more, up to 100% (one hundred percent) in the purchase of
shares (Invested Shares), the quantity of purchase options to be
granted will be two (2.0) times the number of Invested Shares
Acquired by the Participant.
The Board of Directors may alter the PLR percentages to be invested, as
well as the multiple Options to be granted to each Participant due to the
number of Invested Shares upon approval of each Program. The grants set
in each Program will not necessarily be the same for each Participant,
neither by equity or comparison, or divided Pro Rata.
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The Participants will have 15 (fifteen) days as of the date on which the
Company carries out the payment or credit of PLR to acquire the Invested
Shares and inform the Company within the same deadline.
7.
Withholding Period of Invested shares
In order for the Participant can make use of the right to exercise the share
purchase options provided for in this Plan, it is paramount that the
Participant maintain his/her shareholdings (Retention of Invested Shares),
at the following minimum levels:
a) 100% (one hundred percent) up to the date the Participant effectively
exercises his right to purchase shares relative to the first (1/3) third
which is approved for the exercise of share purchase option rights;
b) 66.67% (sixty-six percent point sixty seven) up to the date of the
effective exercise by the Participant of share purchase rights relative to
the second third (1/3) approved for exercise of share purchase rights;
c) 33.33% (thirty-three point thirty-three percent) to the date of the effective
exercise by the Participant of share purchase rights relative to the last
third (1/3) approved for exercise of share purchase rights;
The Participant must authorize the blockage for the negotiation of Invested
Shares in the books of the depository Institution of the Company Shares,
during the period of withholding of Invested Shares.
In the hypothesis that the shareholding position has not been maintained in
its minimum predicted levels in this clause, the Participant will lose right to
the Share Purchas Options which have not been exercised.
For purposes of this clause, the only shareholding position acquired
according to the Plan will be considered.
8.
Vesting
The acquisition of the right to exercise the Options (“Vesting”) will be
subject to the cumulative compliance with the Withholding Period of
Invested Shares and to the grace period of each Program. As long as the
Withholding Period of Invested Shares is maintained, the Vesting of
Options will take place in three equal and consecutive annual installments,
of 1/3 (one third) each. The first will installment take place as of the second
year the Program and the other installments will take place in the
subsequent years, as follows:
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Option Vesting
(as of the beginning date of each Program)
Before the second year
As of the second year
As of the third year
As of the fourth year
Percentage of Options
Vested
0%
33.3%
66.6%
100%
The Board of Directors, based on the evolution projections of the stock
exchange quotes of the Company’s shares, as well as in other market
factors, altering the Vesting of Options regulations, upon approval of new
Programs.
9.
Exercise of Options
The Options may be exercised by the Participants within this 24 (twenty
four) month period as of the date in which the due Vesting takes place
(“Option Deadline”). The exercise of each Option will be done upon the
delivery of the due Term of Options in the Year, duly filled out and signed
by the Participant.
Observing the Negotiation Policy of Securities Issued by the Company, the
Investor Relations Officer may, at any moment, establish additional
restrictions for the exercise of the Options on dates prior to the disclosure of
material facts by the Company including, but not limited to the dates prior to
the closing of the fiscal year and publication of the Company’s financial
statements, dates comprised between decisions to increase capital,
dividend distribution, share splits or bonuses, and the publication of the due
call notices or other notifications and other dates in which it is
recommended to suspend the exercise of Options.
The Options which are not exercised during the Option Deadline will
automatically be extinguished, of full right, independently of prior notice or
indemnification. Should the last date set for the exercise during the Option
Deadline coincide with the blackout period of Company issued securities, in
the terms of its Material Fact or Event Disclosure Policy or of the applicable
law, the Option Deadline will be extended until the next date set by the
Board of Directors for the exercise of Options.
10. Price of Exercise
The price to exercise the Options will be equivalent to the weighted average
per volume of the negotiations of the closing quotations of the Company’s
common shares, at BM&FBOVESPA S.A. – Futures and Commodities
Exchange (BM&FBOVESPA: “WEGE3”), for the 20 (twenty) floors prior to
the last day of the month prior to the month in which the corresponding
Program was approved.
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The Board of Directors, may, at its exclusive criteria, establish a discount of
up to 10% (ten percent) over the calculated average, as well as establishing
that the exercise price must be monetarily restated, as of the base date it
was determined on, through an index of prices to be defined by the
Company’s Administration Council in each Program or establish a price of
exercise with pre-fixed monetary restatement.
11. Payment Conditions
The payment must be done in cash, upon acquisition of the shares, as
determined by the Board of Directors for each Program, except in the case
the Participant chooses to immediately trade in the Stock Exchange part or
all of the acquired shares, observing the limitations imposed by this Plan,
should the payment be made upon issuance of a full payment promissory
note maturing on the first business day after the financial settlement of the
transaction.
12. Quantity Limit
The maximum number of share purchase options to be granted by this Plan
is limited to a maximum of 2% (two percent) of the total shares representing
the Company’s Capital Stock.
The Board of Directors will establish the criteria of option division between
the Participants, each time that the total quantity of options may surpass
the quantity level herein established.
After the exercise of the Option, the Board of Directors will define if the
capital stock of the Company must be increased through the issuance of
new shares to be subscribed by the Participants, according to art. 166, item
III, of Law no. 6,404/76 or if they will be used for settlement of the exercise
of Share Purchase Options held in treasury, observing the applicable law.
The shareholders, in the terms of art. 171, paragraph 3 of Law 6.404/76,
will not have preference in the grant and exercise of Options originating
from the Plan.
13. Non-binding
This Plan constitutes an exclusively civil costly business, which does not
create any obligation of employment or social security between the
Company and the Participant.
14. Non-Interference in The Employment and/or Term of Office
No disposition herein can be interpreted as a constitution of rights of
Participants, in addition to those inherent to the Options, whose nature is
exclusively civil, and will not entitle the Participants to rights regarding
guarantee of employment as an employee or officer.
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No disposition of this Plan will grant any Option Bearer Participant, rights
regarding surety of employment until the end of their term in office, or will in
any way interfere with the company’s right to destroy it or secure his/her
right for reelection.
15. Employee Termination
In case of Contract Termination of the Participant, all Options which have
been granted and are non-vested, will be automatically extinguished, in full
right, independently of prior notice or indemnification. Moreover, the bearer
of the right must exercise the exercisable Options on the date of termination
(Vested Options), within 30 (thirty) days of the Termination.
For purposes of this Plan, the term “Termination” means any act or fact
which ends the legal relationship of the Option Bearer with the Company,
except for death, permanent invalidity or Special Termination. Termination
involves, among others, the hypothesis of voluntary termination of the
participant, resignation, refusal of position, substitution, non re-election as
officer and termination with or without justifiable cause of the employment
or service providing agreement.
16. Special Termination
In the case of special Participant Termination, all options Vested may be
exercised within 12 (twelve) months from the date of Special Termination
upon payment in cash, and all non-vested Options may be exercised in its
deadlines and normal Vesting rules.
"Special Termination" for the purposes of this plan, is considered to be the
termination of the participant's career in the company upon the approval on
a case-by-case basis of the Board of Directors, at its sole discretion. Should
the Participant request a Special Termination, while evaluating the request
the Board of Directors will consider (i) the advance of the request, to be
formulated with at least 6 (six) months in advance; (ii) any professional
activity plan post-termination of the participant, which shall not include any
competitor activities performed by the company; (iii) other circumstances
applicable to the case. The decision of the Board of Directors will be
discretionary and not related to the rules for retirement by seniority or by
age, in accordance with the official Social Security (INSS) regulation or the
rules for supplemental private retirement plan sponsored by the company.
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Should it be found that the Participant is taking part in competitive activities
regarding those performed by the company, the Board of Directors may
declare extinct, in its own right, regardless of prior notice or indemnity, all
non-vested Options that have been awarded to the participant.
17. Death and Permanent Disability
In the case of death or permanent disability of the Participant, all NonVested Options will become exercisable in advance. The options Vested or
non-vested shall extend to their heirs and successors by succession or by
testamentary charge and may be exercised, in whole or in part by the heirs,
successors or spouses portion of the participant, upon payment in full, over
a twelve-month-period as of the date of death.
18. Limitation of Participant’s Rights
No Participant will be entitled to any of the rights and privileges of Company
shareholders until the Options are duly exercised and the transfer of shares
object of the Option Program are transferred.
19. Dividends and Bonuses
The shares purchased by the participants of the options will be entitled to
dividends, interest on equity and other corporate proceeds declared by the
company as of the date of the physical liquidation of the acquisition of
exercise through the transfer of such shares to the Participants.
20. Adjustments
Should changes be made in the shareholding of the company, involving an
increase, decrease, unfolding, grouping, increases in shares, or similar
modification in the company's shares, the Board of Directors will be
responsible for the adjustment of these modifications to the options are not
exercised by their holders.
21. Corporate Reorganization
If shareholders hold a Extraordinary General Meeting to discuss (i) delisting
from Novo Mercado so that their shares will be registered for trading out of
Novo Mercado; or (ii) an operation of corporate reorganization in which the
company resulting from this reorganization is not admitted for trading in
Novo Mercado, the Options to be exercised shall be released fully or
partially to the participants. The Board of directors should establish special
rules that enable the shares object of Options can be sold through a public
acquisition offering to be carried out in the terms of the Novo Mercado
Listing regulations of BM&FBOVESPA and of the By-laws in force.
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22. Sale of Control
In the case of direct or indirect sale, by the controllers of the Company,
through a sole operation, or through successive operations, of the number
of shares which implies in the change of the Company’s control, in the
terms of Novo Mercado Listing Regulation of BM&FBOVESP and the ByLaws in force.
23. Responsibility for Taxes
The Participant is exclusively responsible for any charges of taxes levied
over the exercise of the right to purchase shares, or upon sale of the
shares.
24. Date of Beginning and end of The Plan
The plan takes effect immediately after its approval by the extraordinary
general meeting of the company, and may be terminated, suspended or
amended at any time, by a proposal approved by the Board of Directors.
25. Additional Dispositions
The Board of Directors, seeking out the best interests of the Company and
its shareholders, may review the conditions of each Program, as long as
the basic principals are not altered, especially the maximum limits to issue
shares for the Plan, approved in the General Meeting.
The Board of Directors can also establish a particular treatment for the
cases and special situations, during the duration of the Plan, as long as the
rights which have already been granted to the Participants are not affected,
nor the basic principles of the Plan. Said private treatment will not constitute
a precedent for other Participants.
Any significant legal change regarding the regulation of publicly held
companies and/or any tax effects over an option plan may lead to a partial
or full review or even its suspension or extinction, at the exclusive decision
of the Board of Directors.
The omitted cases will be regulated by the Board of Directors.
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