|Transaction description||Increase in the percentage of commission paid by Brasilseg Companhia de Seguros S.A. (“Brasilseg”) to BB Corretora de Seguros e Administradora de Bens S.A. (“BB Corretora”) for sales of rural lien insurance; and reviewing the methodology used to calculate the additional commissions payable by Brasilseg to BB Corretora in case of outperforming the sales target of certain products.
|Related parties names||BB Corretora de Seguros e Administradora de Bens S.A., Brasilseg Companhia de Seguros S.A. and Banco do Brasil S.A. (“BB”).
|Relation between the parties and the Company||BB - Controller
BB Corretora – Controlled company
Brasilseg – Affiliated company
|Object, terms and conditions||The change in the 2º Amendment of the Operational Agreement to Act in the Insurance Segment (“Operational Agreement” or “Agreement”), is intended both to increase the percentage of commission paid by Brasilseg to BB Corretora for sales of rural lien insurance and to revise the methodology used to calculate the additional commissions payable in case of outperforming the sales target of certain products.
The agreement provides, among other provisions, the minimum parameters related to the sales volume of certain products through BB Corretora, commercialized within Banco do Brasil distribution channel. In case the sales volume, at the end of each fiscal year, overcomes the minimum established in the Agreement, Brasilseg must pay an additional commission to BB Corretora.
The change in the methodology used to calculate the additional commission will be valid for the three-year period 2020-2022, and aims to replace the Credit Life for Farmers insurance to Life insurance as an eligible product, with no change regarding to Credit Life insurance products.
The assessment will be annual, effective from January 01st, 2020.
|Participation of the Counterparty or its Shareholders and Management during the Company’s decision process
||The counterparty did not participate of BB Seguridade’s decision and did not act as its representative during the transaction negotiation.|
|Reasons for the company to conduct the transaction with the related and not with third parties
||The Company would not be able to conduct the transaction with a third party other than Brasilseg since the Operational Agreement provides exclusivity between the parties to develop and to distribute insurance products, which are the object of the transaction.
|Description of measures and procedures adopted to assure the arm’s length format of the transaction||All the conditions were analyzed and validated by BB Seguridade, BB Corretora and Brasilseg’s technical divisions and then approved by BB Seguridade’s Board of Directors and appreciated by the Related Parties Transactions Commitee as provided in the Company’s Related Parties Transactions Policy.