October 22, 2018 058/2018-PRE

CIRCULAR LETTER

To: ’s Market Participants – BM&FBOVESPA Segment

Re: Accreditation Process for Market Makers in Options on Single Stocks ABEV3, B3SA3, BRFS3, BRML3, CCRO3, CIEL3, CMIG4, CPLE6, CSAN3, ECOR3, ELET3, ENBR3, ITUB4, JBSS3, KLBN11, LREN3, MRVE3, NATU3, QUAL3, RENT3, SANB11, SBSP3, SMLS3, TIMP3, UGPA3, USIM5, VIVT4, and WEGE3.

Up to five market makers for options on each of the stocks listed below will be accredited under this program.

If the number of accreditation requests exceeds the number of openings, the market makers to be accredited will be selected at the sole discretion of B3.

Ambev S.A. (ABEV3) S.A. (KLBN11) B3 S.A. – Brasil, Bolsa, Balcão (B3SA3) S.A. (LREN3) MRV Engenharia e Participações S.A. BRF S.A. (BRFS3) (MRVE3) BR Malls Participações S.A. (BRML3) Natura Comésticos S.A. (NATU3) CCR S.A. (CCRO3) Qualicorp S.A. (QUAL3) Cielo S.A. (CIEL3) Rent a Car S.A. (RENT3) (CMIG4) Banco S.A. (SANB11) (CPLE6) (SBSP3) S.A. (CSAN3) Smiles Fidelidade S.A. (SMLS3) Ecorodovias S.A. (ECOR3) TIM Participações S.A. (TIMP3) (ELET3) Participações S.A. (UGPA3) EDP – Energias do Brasil S.A. (ENBR3) S.A. (USIM5) Itaú Unibanco Holding S.A. (ITUB4) Telefônica Brasil S.A. (VIVT4) JBS S.A. (JBSS3) Weg S.A. (WEGE3)

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Accreditation procedure

Institutions that wish to take part in the program are advised to consult the Procedures Guide for the Accreditation of Derivatives Contract Market Makers, available at www.b3.com.br/en_us, Products and Services, Trading, Market Maker, Join in, Accreditation.

Timetable

Send Accreditation Register account Start of activity End of obligation Instrument

By Nov. 09, 2018 Nov 23, 2018 Dec. 14, 2018 Dec. 13, 2019

B3 may at its sole discretion assess accreditation applications submitted after these deadlines, provided the delay is duly justified.

Activity parameters

Market makers accredited for this program must execute buy and sell orders in accordance with the following activity parameters:

Minimum period of Contract Underlying Minimum lot Spread activity during months trading sessions

ABEV3 12,000 0.03 B3SA3 7,500 0.05 BRFS3 5,100 0.09 BRML3 9,300 0.05 CCRO3 9,500 0.05 CIEL3 10,000 0.05 CMIG4 8,000 0.05 80% 1st and 2nd CPLE6 3,500 0.07 CSAN3 3,000 0.07 ECOR3 10,600 0.05 ELET3 3,700 0.05 ENBR3 8,900 0.03 ITUB4 10,000 0.07 JBSS3 6,000 0.05

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Minimum period of Contract Underlying Minimum lot Spread activity during months trading sessions

KLBN11 5,800 0.05 LREN3 5,000 0.05 MRVE3 8,100 0.05 NATU3 2,800 0.07 80% 1st and 2nd QUAL3 4,900 0.05 RENT3 4,200 0.10 SANB11 2,900 0.07 SBSP3 3,500 0.07 SMLS3 1,400 0.10 TIMP3 11,100 0.05 UGPA3 3,200 0.10 USIM5 17,000 0.03 VIVT4 3,100 0.07 WEGE3 6,700 0.05

Market makers are required to register bids and offers for at least ten of the last thirty minutes of each trading session. They must maintain this activity until the fifth business day before expiration of the first contract month available for trading. As of the fourth business day prior to this expiration date, market makers are no longer required to trade in the first contract month but are obliged to trade in the next two contract months admitted to trading.

The mandatory series and the rules for their selection by market makers are available at www.b3.com.br/en_us, Products and Services, Trading, Market maker, Derivatives, Options.

Test period

Market makers enjoy the benefits specified below without having to observe the activity parameters for up to ten business days before the start of their mandatory activity so that they can execute connectivity, session and order routing tests, as well as the necessary technological configurations. After the test period, market makers’ activities will be monitored by B3.

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Maximum number of parameter breaches

Any market maker’s accreditation to this program may be cancelled in the event of more than twelve unjustified breaches of the activity parameters and/or of the obligations set forth in this Circular Letter and in the Agreement of Accreditation for Market Maker Activity, or if the justification is not accepted by B3.

Minimum activity period

If a market maker desists from the accreditation process without having begun its activities under this program, it will be exempted from meeting the thirty-day minimum activity period required by Circular Letter 109/2015-DP, dated October 8, 2015. If a market maker withdraws after the start of its activity, it must comply with the thirty-day notice period without fail so that its deaccreditation can be communicated to the market.

Benefits

Market makers are exempt from payment of exchange and other fees on transactions involving all option series, including non-mandatory series.

They are also exempt from payment of exchange and other fees on cash market transactions in the stocks underlying the options, provided such trades are performed for the purpose of delta hedging in the same trading session as the options.

For the purposes of this program, the delta hedging coefficient is defined as fifty per cent (50%) of the cash contract’s notional value applied to the quantity of options traded for all series of the underlying on the calculation date.

The message flows, trades and volume generated by the accredited institutions will not be considered for the purposes of the Trading Message Control Policy, as per Circular Letter 039/2013-DP, dated May 27, 2013, and Circular Letter 050/2013-DP, dated July 30, 2013.

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General provisions

B3 will resolve any omissions regarding this accreditation process and the program.

Further information can be obtained from the Chief Product and Client Officer’s team by telephone on +55 11 2565 5860/5338/5185 or by email at [email protected].

Gilson Finkelsztain José Ribeiro de Andrade Chief Executive Officer Chief Product and Client Officer

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