» Purpose

Long-term financing to support investments made by micro, small and medium-sized companies (MPMEs) comprising the production chain of the Brazilian aviation industry, aimed at expanding this chain.
Long-term financing to support investments made by micro, small and medium-sized companies (MPMEs) comprising the production chain of the Brazilian aviation industry, aimed at expanding this chain.


» Modalities

BNDES Pró-Aeronáutica is divided in two subprograms:
• BNDES Pró-Aeronáutica - Company 
• BNDES Pró-Aeronáutica - Export 


» Clients

Micro, small and medium-sized companies (MPMEs), headquartered in Brazil and an integral part of the production chain in the Brazilian aviation industry.


» Budget

R$ 100 million, with annual budget limited to R$ 50 million. 


» Effectiveness

Until 06.30.2010.



» BNDES Pró-Aeronáutica - Company

Long-term financing to support investments made by micro, small and medium-sized companies (MPMEs) comprising the production chain of the Brazilian aviation industry, aimed at expanding this chain.

Support can also be offered through subscribed securities.


» Types of financial support

Direct, indirect non automatic or mixed.

Notes: 
a) In direct operations, after contracting the operation with BNDES, the Client will have its financial statements audited by an External Independent Auditor duly accredited by the Securities and Exchange Commission (CVM). 
b) For direct operations resulting in risks to the BNDES in the amount of up to R$ 10 million of the business group, and not including real guarantees and collaterals, the Individual Income Tax statement (IRPF) of the guarantors of the operation will be required.
c) Indirect operations for investments supported by the program under the conditions of Venture Capital and Technological Innovation are not allowed.


» Eligible projects

• Implementation, expansion, recovery, modernization and development of aviation services and goods carried out under the risk partnerships model between micro, small and medium-sized companies established in Brazil and aircraft manufacturers in Brazil or abroad; 

• Innovation and technological development, including those originated in risk partnerships under the terms of the subitem above. 


» Eligible items

• New Brazilian machinery and equipment, accredited by the BNDES; 

• Tests and experiments; 
• Civil construction, assembly lines and installations; 

• Software developed in Brazil and associated services, under the criteria provided in PROSOFT Comercialização; 

• Studies, consulting and projects; 

• Expenses with managerial qualification, training and recycling, as well as technical and operational support; 

• Expenses with the development and validation of industrial processes, such as Thermal Treatment, Non-Destructive Tests and Superficial Treatments for Steel and Aluminum and Shot Peening; 

• Research, technological development and innovation efforts; 

• Investments in: (i) incremental innovations in the development of goods and processes; (ii) complementary investments directly related to the instruction and formation of competitive or innovative environments; and/or (iii) creation, expansion and appropriateness of the capacity to manufacture and sell the results of the innovation process; 

• Expenses with national or international certification; 

• Associated working capital; and 

• New machinery and equipment imported, not manufactured in Brazil, considering that: 
1. The amount financed by company cannot surpass US$ 3 million in reais for each 12 months; 
2. The same procedure for the tax exemptions from the Ministry of Development, Industry and Foreign Trade (MDIC) must apply; 
3. The Client must prove to the BNDES that there is no similar machinery and equipment in Brazil. 


» Minimum Amount for Financing

R$ 1 million.


» Interest rate

• Direct Support = Financial Cost + BNDES Spread + Credit Risk Rate 
• Indirect Support = Financial Cost + BNDES Spread + Accredited Financial Institution Spread 


» Financial Cost, BNDES Spread and Maximum Level of Participation
 
Depends on the item:

Eligible item	Financial conditions
Support for companies to develop the capacity to systematically undertake innovative activities	Equal to those in the Innovative Capital line
Support for innovative technological projects earmarked for the development of new or significantly improved goods and/or processes	Equal to those in the Technological Innovation line
New, imported machinery and equipment	Equal to those in the Equipment Import line
Other items	Equal to those in the MPMEs - Investment line

» Credit Risk Rate

In proportion to the Client’s risk, limited to 1.8% p.a.


» Accredited Financial Institution Spread

Agreed between the Accredited Financial Institution and the Client, respecting the limit of 3% p.a.


» Maturity

According to the project, the payment capacity of the company and the business group.


» Guarantees and Collaterals

1. Direct Operations: Defined during the analysis of the operation. At the BNDES' discretion, the constitution of real guarantees and collaterals for financing operations resulting in risks, to the BNDES, in the amount of up to R$ 10 million of the business group is not required, and individual guarantees and collaterals must be constituted in these cases. In the other financing, the guarantees and collaterals applicable to the BNDES operations will be required. 

2. Indirect Operations: Agreed between the financial institution and the client, under the rules provided by Brazil's Central Bank. The pledge of credit rights from financial investment is not allowed. 

See: Guarantees and Collaterals


» Application

Requests for financial support should be sent to the BNDES by Inquiry Letter filled out according to the guidelines in the Previous Inquiry Information Guide – sent by the interested company or by the accredited financial institution of preference, to:

The Brazilian Development Bank - BNDES
Planning Division (AP)
Department of Priorities (DEPRI)
Av. República do Chile, 100 - Protocolo - Térreo
20031-917 - Rio de Janeiro/RJ.


» Other procedures

1. During the analysis of the operation, the terms of the Partnership Agreement between the Bank’s Clients and their respective clients will be assessed, in order to prove its economic-financial appropriateness and feasibility. 

2. Prior Settlement Premium: at the BNDES' discretion, in financing operations guaranteed only by the controllers’ guarantees, the BNDES will be entitled to a premium equal to 30% of the debt balance, should the Client pay up the contract prior to the final date. 

3. Transformation into a Corporation: at the BNDES' discretion, in direct financing operations guaranteed only by the controlling partners’ guarantees, the company will be required to become a Corporation. 

4. Right of First Offer: at the BNDES' discretion, in direct financing operations guaranteed only by the controlling partners’ guarantees, these partners must give the right of first offer to the BNDES, upon the issuance of any bond convertible into stocks and upon any increase in the capital of the Client and its subsidiaries, in case of the entrance of other investors. The enforcement of such right by BNDESPAR will be at the BNDES' discretion, and this right is limited to the amount of the credit updated by means of the Long-Term Interest Rate (TJLP) from the date the funding is released until the date the bonds are subscribed, or the future capital injection, under the same conditions of the subscribers or investors. 



» BNDES Pró-Aeronáutica - Export

The program is offered in the following modalities:

• BNDES Exim Pre-shipment 

Financing in the pre-shipment stage for the manufacture and provision of goods and services earmarked for export, by the micro, small and medium-sized companies that are an integral part of the Brazilian aviation industry production chain.


» Types of financial support

Direct or indirect.


» Clients

• Indirect operations: Exporter MPMEs, headquartered in Brazil, that are an integral part of the production chain of the Brazilian aviation industry. 

• Direct operations: MPMEs headquartered in Brazil, that are an integral part of the production chain of the Brazilian aviation industry, provided that: 
- The company is set up and has been operating for more than 3 years, upon the submission of the Previous Inquiry to the BNDES; and 
- It is proven to have exported, directly either by supplying other exporter companies of the Brazilian aviation production chain with more than US$ 200,000 in aviation goods, and/or with services, before submitting the Previous Inquiry to the BNDES. 


» Minimum amount for direct support

US$ 200,000.


» Interest rate

• Direct support = Financial cost + BNDES Spread 
• Indirect Support = Financial Cost + BNDES Spread + Accredited Financial Institution Spread 


» Financial Cost

TJLP or Libor + exchange rate variation


» BNDES Spread

1.0 % p.a., with the following composition:

• Direct support = BNDES basic spread (0.5%) + Credit risk rate (0.5%) 

• Indirect support = BNDES basic spread (1.0% p.a.), as the financial intermediation rate will not be charged 


» BNDES maximum apread

Up to 100% of the export amount, except for the commercial agent’s commission and any advanced financial resources.


» Maximum terms

• Of loan: up to 36 months, from the 15th day of the month following the date the loan agreement is executed. 

• Of shipment: up to 36 months, from the 1st day of the month following the date the loan agreement is executed. 

The term of shipment ends on the last day of the month immediately prior to the end of the term of the loan.


» Amortization system

A lump sum payment or in 18 equal and subsequent monthly installments. The last installment will be due in the last month of the term of loan, while payments will always be due date on the 15th day of each month.

The lump sum payment or the first amortization installment must be paid at least by or in the third month, from the 15th day of the month following the date the loan agreement is executed.


» Guarantees and Collaterals

• Direct operations: 
- Loans of up to US$ 2 million: the controlling partners’ guarantees or bank aval; in these cases, the BNDES’ risks per client will be limited to US$ 2 million. 
- Other Loans: the guarantees and collaterals applicable to the BNDES operations will be required for credit. 

• Indirect operations: agreed between the accredited financial institution and the client, under the rules provided by Brazil's Central Bank. The pledge of credit rights from financial investment is not allowed. 


» Exports evidence

• Services export: at the BNDES' discretion, the commercial agreement, invoice or commercial bill with the acceptance of the importer may be required, in isolation or cumulatively, in addition to the exchange rate agreements related to the amount financed and other documents, as defined upon the approval of the operation. 

• Goods export: the List of Shipment Registrations (SRs) containing the relevant shipment dates, the numbers of the SRs recorded, the amounts of the SRs used in the operation in American Dollars (US$), as well as the numbers of the Dispatch Requests (DRs) may be required. 


» Application

Applications for direct support should be sent to the BNDES by means of Previous Inquiry sent by the interested company directly to:

The Brazilian Development Bank - BNDES
Planning Division (AP)
Department of Priorities (DEPRI)
Av. República do Chile, 100 - Protocolo - Térreo
20031-917 - Rio de Janeiro, RJ 

The company will be charged the study committee fee.

For indirect support, the Previous Inquiry must be submitted to the BNDES via the accredited financial institution of preference.


» Further conditions

• In direct operations, when the Previous Inquiry is sent to the BNDES and throughout the operation, the client must submit financial statements audited by external independent auditors accredited by the Securities and Exchange Commission. 

• Other conditions include those for the Line of Financing BNDES Exim Pre-shipment. 



• BNDES Exim Post-shipment 

Support for the international sale of goods and services manufactured or provided by micro, small and medium-sized companies that are an integral part of the Brazilian aviation production chain, in the modality of refinancing, upon the discount of credit bonds or the assignment of credit rights related to the client’s exports (supplier’s credit).


» Clients

Micro, small and medium-sized exporter companies, headquartered in Brazil, that are an integral part of the production chain of the Brazilian aviation industry.


» Level of Participation

Up to 100% of the export amount, except for the commercial agent’s commission and any advanced financial resources.


» Term of Loan

Up to 5 years.


» Discount rate

Libor corresponding to the operation maturity + BNDES basic spread equal or higher than 0.5% p.a.


» Further charges and commissions

The same as that effective for the line of financing BNDES Exim Post-shipment.


» Guarantees and Collaterals

The operation must count on the following collaterals, in isolation or cumulatively:

• Credit bonds (promissory notes or bills of exchange): endorsed by an accredited financial institution and with credit limits established with the BNDES, with right of recourse, or guaranteed by a financial institution with headquarters abroad (with a limit at the BNDES) and endorsed by the client, in favor of the BNDES; 

• Stand-By Letter of Credit: filed by a financial institution with headquarters abroad, with a limit at the BNDES, or qualified by an accredited financial institution and with credit limits at the BNDES, in Brazil, the credit rights of which must be assigned (without right of recourse) by the client to the BNDES; 

• Export credit insurance: the rights to damages are assigned by the client to the BNDES, complemented by an instrument assuming confessing the debt signed by the client (regarding the installment not covered by the insurance) accompanied by a bank guarantee issued by an accredited financial institution and with credit limits at the BNDES, in favor of the BNDES; 

• Further collaterals or guarantors: at the BNDES' discretion, including: bank avals or endorsements (with right of recourse) of the client, in credit bonds, in favor of the BNDES, or an instrument that assumes and confesses the debt (regarding the installment not covered by the credit insurance), accompanied by the guarantee of the controlling partners of the client, under the following criteria: 
- the client must be a company effectively set up and operating for more than 3 years at the time the Previous Inquiry is submitted to the BNDES, besides proving to have exported, directly or by supplying another export company in the Brazilian aviation production chain, more than US$ 200,000 in aviation goods and/or services, before sending the Previous Inquiry; 
- the operation must be between US$ 200,000 and US$ 2 million, the maximum amount of risk per client; 
- the submission of the Previous Inquiry to the BNDES must be directly made by the client, and the client will be charged the study committee fee; 
- the application for financing must be registered upon submission of the Previous Inquiry to the BNDES; 
- if the client provides any direct collateral to the operation before sending the Previous Inquiry to the BNDES and throughout the operation, the client must submit financial statements audited by external independent auditors accredited by the Securities and Exchange Commission. 
- further specific criteria may be adopted by the BNDES. 


» Application

Applications for direct support should be sent to the BNDES via Previous Inquiry sent by the interested enterprise directly to:

The Brazilian Development Bank - BNDES
Planning Division (AP)
Department of Priorities (DEPRI)
Av. República do Chile, 100 - Protocolo - Térreo
20031-917 - Rio de Janeiro/RJ.

For indirect support, the Previous Inquiry must be submitted to the BNDES by the accredited financial institution of preference.


» Further conditions

Other conditions include those of the Line of Financing BNDES Exim Post-shipment.