Investment Funds

Investment Funds in Agroindustrial Productive Chains (Fiagro)

• The product

  The Investment Fund in Agroindustrial Productive Chains (Fiagro) is a pool of funds from different investors for agribusiness investment assets, whether rural real estate or activities related to the agribusiness production sector. The fund manager is responsible for raising funds with investors through the sale of shares.

  The listed Fiagro fund considers the following categories:

  • Credit Rights Investment Fund (Fiagro-FIDC): Investment funds targeting the agroindustry for credit rights investments as established under CVM Instruction 356.

  (link http://conteudo.cvm.gov.br/legislacao/instrucoes/inst356.html)

  • Estate Investment Fund (Fiagro-FII): Real estate asset funds as established under CVM Instruction 472.

  (link: http://conteudo.cvm.gov.br/legislacao/instrucoes/inst472.html)

  • Private Equity Investment Fund (Fiagro-FIP): Private equity funds as established under CVM Instruction 578.

  (link: http://conteudo.cvm.gov.br/legislacao/instrucoes/inst578.html)

  Earnings:

  The earnings received by Fiagro and obtained from the sale or lease of rural properties are periodically distributed to shareholders.

  If Fiagro assets are invested in bonds and securities, the income will derive from earnings paid by those assets or from the difference between their buy and sell price (capital gain).

  It should be noted that Fiagro is incorporated as a closed-end condominium, that is, investors are not allowed to redeem their shares before the deadline stipulated for the fund’s term. A key feature of the product is that most funds have an indefinite term and, therefore, no settlement date is specified. Considering this, investors participating in the fund will only be able to exit a trade by selling their shares in the secondary market.

• Specifications

  Ticker	XXXX11B XXXX = 04 capital letters representing the name of the fund 11 = number representing fund shares, among other assets B= indicative of trading on the OTC market (when applicable)
  Quotation	BRL per share with 02 decimal places
  Settlement	Financial and Physical
  Settlement period	T+2 from trade date
  Market	Cash
  Round-lot	01 share

• Benefits

  Fiagro is yet another investment option in Brazilian agribusiness and helps boost the development of one of Brazil’s most productive sectors. The main benefits of the product include:  

  Diversification

  • Greater diversification with different types of agroindustrial assets, such as rural properties, equity interest and cash assets that are part of the agroindustrial supply chain, for example.

  Ease

  • Invest in agroindustrial supply chain assets without the need to purchase a rural property.

  • Paying out the full amount normally required for investment in a property not needed.

  • The fund’s professionals are responsible for the entire set of tasks related to the administration of a rural property, such as searching for rural properties, buy and sell procedures, maintenance, taxes, etc.

  Product characteristics

  • Increase in the fund's property prices leads to the appreciation of its share price thanks to the increase in the fund's equity.

  • Fund’s dividends are periodically distributed to shareholders.

  • Individual investors are exempt from income tax on dividends distributed by Fiagro, provided that:
    •  Fiagro shares are admitted to trading exclusively on stock exchanges or on the organized OTC market.
    • The chosen fund has at least fifty (50) shareholders.

  Note: Individual investors that own shares representing 10% or more of all the shares issued by Fiagro or whose shares grant them the right to receive earnings higher than 10% (ten per cent) of the earnings received by the fund are prohibited from using Fiagro.