Frequently asked questions
Find answers here to the most frequently asked questions about IR.
- What do investors need to do to invest in Vale's
To invest in Vale local shares, traded on the São Paulo Stock Exchange – BM&FBOVESPA, it is
necessary to contact a stockbroker. A list of stockbrokers who operate in Brazil is
available on the BM&FBOVESPA website. Information about how to trade Vale ADRs, traded on
the New York Stock Exchange – NYSE, can be obtained with your stockbroker, the New York
Stock Exchange (NYSE) (www.nyse.com), NYSE Euronext Paris or JP Morgan, the Company's
depositary bank for its ADRs (www.adr.com)
- What are the Golden Shares?
Golden shares are preferred special class shares. They are required to be held by the
Federative Republic of Brazil. The holder of the golden shares is entitled to the same
rights (including with respect to voting, dividend preference and liquidation preference)
as holders of preferred class A shares. In addition, the holder of the golden shares is
entitled to veto any of our proposed action relating to the following matters:
1. a change in our name
2. a change in the location of our head office
3. a change in our corporate purpose as regards the working of mineral deposits
4. any liquidation of our company
5. any disposal or winding up of activities of any one or more of the following stages of
the integrated systems of our iron ore mining:
a) mineral deposits, ore deposits, mines,
6. any change in the by-laws relating to the rights accorded to the classes of capital
stock issued by us
c) ports and maritime terminals
7. any change in the by-laws relating to the rights accorded the golden shares.
- What are American Depositary Receipts (ADRs)?
American Depositary Receipts (ADRs) are certificates, issued by US banks, representing
shares of those companies that are based outside the United States. ADRs were created to
facilitate trading in the shares of non-US companies in US equity markets. The
certificates are priced and traded in dollars on US stock exchanges. Many Brazilian
companies have their shares traded on the New York Stock Exchange (NYSE) through this
financial instrument. As well as obtaining visibility in the international market,
companies that issue ADRs may find it easier to raise money in international markets when
required. In March 2002, with the last phase of Vale privatization, the ADRs representing
the common shares issued by the Company also began trading on the NYSE, in the form of
Level III (ticker code VALE).
- What is meant by the term ADR ratio?
What is the ADR ratio of Vale? The ADR ratio is the ratio between the shares and the ADRs of
a given company. In the case of Vale, each ADR represents one common share of the Company.
- What is meant by the terms custodian agent and
The Company's custodian agent is the institution in Brazil which registers the shares in the
name of those who buy them, and guarantees their ownership of these shares. Vale's
custodian agent is Banco Bradesco S.A.
The depositary bank is the institution that
issues ADRs, maintains a record of the holders of ADRs, registers the trades carried out
and distributes the dividends or interest on shareholders equity payments in dollars to
the holders of the ADRs. Vale's depositary bank for its ADRs is Citibank N.A.
- Who is your ADR depositary bank and transfer agent?
Our ADR depositary bank and transfer agent is Citibank N.A. Any inquiries regarding an
individual ADR holding can be directed to Citibank N.A.
- How can I buy Vale's ADRs?
You can hold ADRs directly through Citibank N.A. as depositary, in which case you are a
'registered' holder. Registered ownership occurs when the owner of the stock is registered
(or recorded) on the books (or records) of the corporation. Registered ownership is also
known as "direct" ownership and the registered holder is known to the corporation as one
of its shareholders. Registered shareholders receive all corporate communications,
dividends, annual reports and proxy material directly from the company through the ADR
depositary bank. Ownership comes in two forms: physical certificates, which evidence
shares, or book-entry shares, which are evidenced by an account statement.
to registered holders, beneficial or 'street name' holders usually hold their shares
through a bank or brokerage account and are not directly registered on the books of the
company. Investors purchasing shares throu gh a broker must specifically direct the broker
to register the shares with the corporation, if they wish to become a registered holder.
- What are the benefits of holding ADRs?
ADRs eliminate many of the obstacles of holding non-U.S. securities since they trade and
settle according to U.S. market practices, are quoted and traded in dollars and pay
dividends in dollars. They eliminate custodian safekeeping charges in the issuer's home
country and facilitate prompt dividend payments and corporate action notifications.
- How do I convert my foreign shares into ADRs and vice
You or your broker can transfer your foreign shares to Citibank’s custodian bank in the
issuer's home country, along with ADR brokerage delivery instructions. Upon confirmation
that the custodian has received the foreign shares, Citibank N.A. will issue the
corresponding number of ADRs to you, representing the newly deposited shares, via your
broker. To convert your ADRs back into foreign shares, you can instruct your broker to
cancel the ADRs, by delivering the ADRs to Citibank NA, and providing the broker with
complete delivery instructions in the issuer's home country. Citibank NA will instruct the
local custodian to release the underlying shares accordingly.
- Where can I direct inquiries relating to ADR dividend
payments, transfer of ADR certificates, consolidation of shareholder accounts and locating lost
Citibank Shareholder Services
Address - P.O. Box 43077
Providence RI 02940-3077
Phone - 1-877-248-4237 (1-877-CITIADR)
The phone number outside the U.S. is 781-575-4555
- What are Vale's shareholders debentures?
The shareholders debentures represent negotiable instruments issued by the Company in favor
of the debenture holders, who are entitled to receive a premium paid semi-annually, under
the terms of their indenture, and they should not be confused with shares, as the latter
represent units of a company's share capital.
- What is the purpose of shareholders debentures?
In the context of Vale's privatization process, with a view to ensuring pre-privatization
shareholders the right to participate in possible future benefits of Vale's and its
subsidiaries' mining deposits, the 6th Debentures Issuance (“Shareholders Debentures”) was
- How was the issuance of shareholders debentures?
Vale's shareholders, on the date of the Special Shareholders' Meeting held on April 18th, 1997,
were entitled to receive the shareholders debentures, not convertible into shares, in the
proportion of one debenture to each share.
- How do I know if I am a holder of shareholders
debentures issued by Vale and how do I regularize my registration details and update my bank
Investors must go to a branch of Banco Bradesco S.A., bookkeeping agent for Vale's
shareholders debentures, with their personal identification documents (ID, Individual
Taxpayer ID - CPF - and Proof of Residence), as well as proof of bank domicile. Further
guidance can be obtained by calling 0800-701-1616 (Investor Guidance Channel).
- What should I do if the General Manager does not find
the position or does not know how to proceed to regularize the registration?
If the General Manager does not know the procedure, please ask him/her to contact Bradesco's
Shares and Custody Department (DAC), by phone (11) 3684-9441 or email email@example.com.
- Why should the debenture holder keep the register
updated with the bookkeeping bank?
The debenture holder's registration details are used, for example, to pay the premium from
Vale's shareholders debentures. Inconsistent or outdated details make it impossible for
the bookkeeping agent to make the payment.
- I have updated my registration. Will I be able to
receive the premiums on shareholders debentures retroactively?
According to the legal provision, the amounts that have been made available to the debenture
holder for a period of more than 03 (three) years are forfeited in favor of the Company.
Thus, from the date on which the registration was updated, the debenture holder will only
be entitled to receive premiums for the last 03 years.
- Is it mandatory to hire financial advisors to update
the registration and regularize the position of a debenture holder?
No. The hiring of financial advisors for this purpose is not mandatory. The registration
update can be requested directly by the debenture holder to Banco Bradesco, the Company's
bookkeeping agent, which will inform the procedure to be followed for the update. In
general, in order to request the regularization of registration details, the debenture
holder must go to a branch of Banco Bradesco S.A., bookkeeping agent for Vale's
shareholders debentures, with their personal identification documents (RG, CPF and Proof
of Residence). Further guidance can be obtained by calling 0800-701-1616 (Investor
Guidance Channel). Alternatively, investors can also contact Vale's Investor Relations
area by e-mail firstname.lastname@example.org. Neither Bradesco nor Vale
charge any fee to provide information on shareholders debentures or to update the
- How can shareholders contact Vale's investor relations
Contact can be made with Vale's Investor Relations Department through the following e-mail
address: email@example.com or by the phone +55 21 3485-3900.
- What is the measure of operational earnings adopted by
EBIT (Earnings Before Interest and Taxes) is the principal measure of operational earnings
of Vale. This represents the operational earnings, or in other words, it is calculated as
earnings after costs and operational expenses. By means of the EBIT, the Company can
assess the purely operational performance, that is, without the impacts of its financial
structure, non-operational items and other items of a tax nature.
- What is the measure for generating cash adopted by
EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is the principal
measure of the generation of cash of Vale. This is calculated by the sum of the EBIT with
depreciation, amortization and depletion, non-recurrent items (such as the retiring of
assets) and the dividends received from non-consolidated subsidiaries. The retiring of
assets is part of the calculation since it represents a non-cash expense. The dividends
received from non-consolidated subsidiaries are also included in the calculation of the
EBITDA for they represent cash owned by the Company.
- Does Vale have shares linked to Fundo 157?
No. The shares issued by Vale were not linked to Fundo 157 or compulsory loans. Therefore, amounts related to the fund cannot be converted or paid into shares issued by Vale. Any contact, whether by phone, e-mail or correspondence, about the referred fund does not come from Vale.
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