Cetip Mercados Organizados : Material Fact - Combination of BM&FBovespa and Cetip - Additional Information

Fato Relevante ICVM 565_FINAL - ENG -Publish

BM&FBOVESPA S.A. - BOLSA DE VALORES, MERCADORIAS E FUTUROS CNPJ nº 09.346.601/0001-25

NIRE 35.300.351.452

Publicly-held Company

CETIP S.A. - MERCADOS ORGANIZADOS

CNPJ nº 09.358.105/0001-91 NIRE 33.300.285.601

Publicly-held Company

MATERIAL FACT

BM&FBOVESPA S.A. - BOLSA DE VALORES, MERCADORIAS E FUTUROS ("BM&FBOVESPA") and CETIP S.A. - MERCADOS ORGANIZADOS ("CETIP") hereby

jointly inform you that on this date the management of BM&FBOVESPA, of COMPANHIA SÃO JOSÉ HOLDING ("Holding Company") and of CETIP (Holding Company jointly with BM&FBOVESPA and CETIP, the "Companies") as well as the Companies have entered into the Merger and Justification Agreement ("Merger and Justification Agreement") for the purposes of the corporate reorganization described below ("Transaction"): (a) the absorption of the shares issued by CETIP by the Holding Company, whose total of the shares is on this date (and shall be on the date of the approval of the absorption of the shares issued by CETIP) the property of BM&FBOVESPA, and (b) the subsequent merger of the Holding Company by BM&FBOVESPA, which shall be submitted for approval by the respective shareholders, in extraordinary general shareholders meetings, all called on this date, to be held, upon a first call notice, on May 20 2016.

1. CORPORATIONS INVOLVED IN THE TRANSACTION AND THEIR ACTIVITIES

   
   

2. BM&FBOVESPA.

3. Identification. BM&FBOVESPA S.A. - BOLSA DE VALORES, MERCADORIAS E FUTUROS, publicly held company with head offices in the City of São Paulo, State of São Paulo, at Praça Antônio Prado, 48, 7th floor, Postal Code 01010-901, enrolled with the Brazilian National Taxpayer's Registry ("CNPJ/MF") under No. 09.346.601/0001-25.

4. Activities. BM&FBOVESPA is a company that operates organized markets for securities and derivative contracts, as well as providing registration, clearing and settlement services, acting, principally, as central counterparty for the cash settlement of trades executed in its environments.

5. CETIP.

6. Identification. CETIP S.A. - MERCADOS ORGANIZADOS, publicly held company with head offices in the City of Rio de Janeiro, State of Rio de Janeiro, at Av. República do Chile,

   230, 11th floor, Postal Code 20031-919, enrolled with the CNPJ/MF under No. 09.358.105/0001-91.

7. Activities. CETIP is a company that offers registration, central securities depository, trading and settlement services for assets and securities, besides providing electronic solutions for the delivery of information required for the registration of contracts and financial liens by transit bodies.

8. Holding.

9. Identification. COMPANHIA SÃO JOSÉ HOLDING (current corporate name of NETANYA EMPREEENDIMENTOS E PARTICIPAÇÕES S.A.), privately owned company with head offices in the City of São Paulo, State of São Paulo, at Praça Antônio Prado, 48, Postal Code 01010-901, enrolled with the CNPJ/MF under No. 23.791.728/0001-84.

10. Activities. The Holding Company is a non-operational corporation whose main purpose is to hold stakes in other corporations and whose shares are on this date, in their totality, the property of BM&FBOVESPA, and shall be extinguished as a result of this Transaction.




11. DESCRIPTION AND PURPOSE OF THE TRANSACTION

    
    

12. Description.

    The Transaction shall comprise the following steps, all interdependent, and whose completion shall be subject to the applicable corporate approvals and observance of the conditions referred to in item 5 below:

13. capital increase of the Holding, upon the issuance of new common shares, nominative and with no par value, which shall be fully subscribed and paid in by BM&FBOVESPA, in local currency, until the Date of Completion of the Transaction, as defined below, at the total issuance price of at least R$7,920,019,939.00, of which a portion, to be defined in the general meeting, shall be assigned to the creation of a capital reserve ("Capital Increase of the Holding");

14. on the same date, as a subsequent and interdependent act of the Capital Increase of the Holding, merger of the totality of the shares issued by CETIP by the Holding, by its economic value, resulting in the issuance, by the Holding, in favor of the shareholders of CETIP owners of the merged shares ("Shareholders of CETIP"), of common and redeemable preferred shares issued by the Holding, provided that each common share issued by CETIP shall be exchanged for 1 common share and 3 redeemable preferred shares issued by the Holding (considering the amount of shares in the CETIP's capital stock and adjustments mentioned in the Merger and Justification Agreement) ("Merger of CETIP's Shares"). After the completion of the Transaction, CETIP shall preserve its own legal identity and net worth, and no legal succession shall exist;

15. on the same date, as a subsequent and interdependent act of the Merger of CETIP's Shares, redemption of the totality of the preferred shares issued by the Holding, upon payment, for every 3 redeemed preferred shares issued by the Holding, of the Redemption Value for Every Three Redeemable Preferred Shares of the Holding

    ("Redemption"). Once redeemed, the preferred shares of the Holding shall be cancelled against the capital reserve; and

16. on the same date, as a subsequent and interdependent act of the Redemption, merger of the Holding by BM&FBOVESPA, by the book value of the Holding (already considered the effects of the Capital Increase of the Holding, the Merger of CETIP's Shares and the Redemption), with the consequent extinction of the Holding and the succession, by BM&FBOVESPA, of all of its assets, rights and obligations, with the consequent migration of the Shareholders of CETIP to the capital stock of BM&FBOVESPA ("Merger of the Holding").

17. Purpose of the Transaction.

    The purpose of the Transaction is for CETIP to become a wholly-owned subsidiary of BM&FBOVESPA, with the receipt by the CETIP Shareholders, assuming CETIP's total capital stock is represented on the Date of Completion of the Transaction (as defined below) by 264,883,6101 common shares, excluding treasury shares, and subject to the provisions set forth in the Merger and Justification Agreement, upon the receipt, for each common share issued by CETIP of which they are owners on the referred date, of:

18. a cash portion in local currency in the amount of R$30.75, adjusted, including by the CDI rate, between April 8, 2016 and the Financial Settlement Date, under the terms provided in the Merger and Justification Agreement (after the adjustments, the "Redemption Value for Every Three Redeemable Preferred Shares of the Holding") to be paid in a lump sum, in a single installment, no later than forty (40) days counted as of the day on which the fulfilment of the last of the Conditions Precedent; and

19. 0.8991 of a share of common stock issued by BM&FBOVESPA ("Reference Exchange Ratio"), adjusted under the terms provided in the Merger and Justification Agreement (after the adjustments, the "Final Amount of BM&FBOVESPA Shares for each Common Share of the Holding").




20. MAIN BENEFITS, COSTS AND RISKS OF THE TRANSACTION

    
    

21. Main Benefits.

    It is sought, with the Transaction, the creation of a world-class market infrastructure company, of high systemic importance, prepared to compete in an increasingly sophisticated and challenging global marketplace, enhancing the security, solidity and efficiency of the Brazilian market.

    
    

    
    

    1 Estimated considering that on the date of the Transaction there will be 264,883,610 shares of stock in CETIP (considering a total of 262,978,823 shares, excluding 3,513,011 treasury shares and including 5,417,798 shares deriving from early vesting of stock option plans). The number of CETIP's outstanding shares may vary by the Date of Completion of the Transaction.

    The combination of the activities of the Companies shall strengthen significantly the business model of the combined entity, to the extent that it will broaden the level of diversification of revenues, allowing the financial institutions, custodians, indenture agents, resource managers and brokers the consolidation of their processes and back-office systems and treasury, with significant reduction of the costs and operational risks for the whole financial system, as well as gaining efficiency in the interaction with the financial and capital markets oversight bodies.

    Considering the complementarity of the Companies, their combination will be positive to clients, market participants, investors and companies that need resources to invest or financial instruments to manage their risks. The combination shall also result in greater capital efficiency for clients, given the possibility of using over-the-counter or exchange- traded derivatives in one central counterparty, together with other securities and financial assets.

22. Costs of the Transaction.

    The managements of BM&FBOVESPA and the Holding Company estimate that the joint costs for the Companies from the execution of the Transaction will be approximately R$50 million, including costs with publications, auditors, valuation experts, lawyers and other professionals hired for consulting purposes for the transaction.

    The management of CETIP estimates that the costs of the execution of the Transaction will be, for CETIP, approximately R$50 million, including costs on publications, auditors, valuation experts, lawyers and other professionals hired for consulting purposes for the transaction.

23. Risks of the Transaction.




The market value of the common shares of BM&FBOVESPA at the moment of the Completion of the Transaction may vary significantly in relation to their price on the date on which the Merger and Justification Agreement was signed. Although the Merger and Justification Agreement established mechanisms to deal with a determined level of fluctuation for BM&FBOVESPA common shares, the price fluctuation of the shares may result from a range of factors that are beyond the control of the Companies, including changes to its business, operations and projections, timetable and regulatory questions and general market and economic conditions, as well as those related to the industry. BM&FBOVESPA and CETIP cannot terminate the Merger and Justification Agreement as a result of changes to the price variation of the common shares of any one of the Companies.

The success of the Transaction will depend, in part, on the Companies' ability to execute growth opportunities and cost savings resulting from the merger of the businesses of BM&FBOVESPA and CETIP. It is not certain, however, whether such opportunities and economies will be successful. If these objectives are not met successfully, the benefits hoped for from the Transaction may not occur in full or totally, or may take longer than expected to occur.

BM&FBOVESPA and CETIP operate and, until the Completion of the Transaction, will continue to operate, independently. Both of the Companies will face important challenges in integrating functions, merging organizations, processes and operations in a timely and