Risk Factors

Before making an investment decision, potential investors should carefully consider all information available on this website, especially the risks mentioned below. Even‘s business, financial condition and results of operations may be adversely and materially affected by any of these risks and, therefore, adversely impact the securities issued by the Company.

The risks described below are known by Even and Management believes that they can materially affect the Company. Additional risks unknown by Even or immaterial risks can also affect the Company’s businesses. For further information, see the Reference Form.

1) Risks relating to the Company

  • Even may not be able to fully implement its business strategy, nor may it be able to maintain its growth at the same rates as in recent years or the business success of its developments.
  • A lack of financing or an increase in interest rates may adversely affect the ability or willingness of prospective home buyers to finance their purchases of real estate properties.
  • Evenīs business depends upon the availability of financing for our working capital needs, land acquisition and construction, as well as for the purchase of their properties by prospective buyers.
  • The loss of members of Evenīs senior management could have a material adverse effect on itīs financial condition and itīs results of operations.
  • Problems with Evenīs real estate projects that are beyond their control may damage their reputation and expose them to civil liability.
  • Evenīs financial results depend upon funds distributed by their subsidiaries and they can give no assurance that such funds will be distributed to them.
  • If Evenīs partnerships do not succeed, or if Even is not able to maintain good relationships with their partners, their business and operations may be materially adversely affected.

2) Risks relating to the Real Estate sector

  • The real estate industry is highly competitive in Brazil and Even can lose its market share under certain circumstances.
  • The Company is exposed to risks related to real estate development, construction and sale of properties.
  • Even’s activities are subject to extensive regulation, which can increase its cost and limit its development, or otherwise adversely affect its activities.
  • The increase in rates of existing taxes or the creation of new taxes can materially affect the Company.
  • The development of real estate activities involves risks normally related to the granting of financing.

3) Risks related to Macroeconomic Factors

  • The Brazilian government has exercised, and continues to exercise, significant influence over the Brazilian economy. This involvement, as well as Brazilian political and economic conditions, may adversely affect us and the market price of our common shares.
  • Inflation and government efforts to combat inflation may contribute significantly to economic uncertainty in Brazil .
  • Political, economic and social events and the perception of risk in other countries, especially in emerging markets, may adversely affect the Brazilian economy, our business and the market value of Brazilian securities, including our common shares.
  • The real estate sector historically has a direct link with the performance of the national economy. Any downturn in the level of the Brazilian economy, caused by internal and / or external crises, can cause real estate companies, including Even, to reduce operating and revenue levels, as well as an increase in the default rate of transactions already closed.

4) Risks Related to Even’s Common Shares

  • An active and liquid market for Evenīs common shares may not develop, thereby limiting the sale of their common shares by investors.
  • Even may need to raise additional capital in the future through the issuance of securities, which may result in a dilution of the holdings of investors in their common shares.
  • In acquiring the common shares, an investor will bear an immediate dilution in the book value of his investment.
  • Even may no longer have a controlling shareholder or control group holding more than 50% of the voting capital, which may leave it open to alliances and disputes between shareholders, and other events arising from the absence of a controlling shareholder or control group holding more than 50% of the voting capital.
  • The interests of the Company’s controlling shareholders may differ from the interests of other Company common shareholders.
  • Payment of dividends, interest on equity and other distributions to shareholders in an amount higher than the minimum mandatory amount provided for in article 202 of Brazilian Corporation Law are subject to certain restrictions imposed by the Company’s 5th and 6th debenture issues.