Embraer Deferred Prosecution Agreement

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D efendant.
DefendantEmbraerS.A.(theitcompany''),pursuantto authoritygrantedbythe
Company'sBoard ofDiredors,and the United StatesDepartmentofJustice, Crim inalD ivision,
C rim inallnform ation and A cceptance ofResponsibilitv
The Com pany acknowledgesand agreesthatthe Section willfiletheattached
tw o-eounterim inalInform ation in the U nited States Distrid Courtforthe Southem D istrictof
United Statesin violation ofTitle l8,United StatesCode,Section 371,thatis,to violatetheantibribery and books and records provisionsofthe Foreign CorruptPracticesA ctof 1977
(çiFCPA''),asamended,Title 15,United StatesCode,Sections78dd-1,78m(b)(2)(A),78m(b)(5),
and78ff(a);and (ii)onecountofviolatingtheinternalcontrolsprovisionsoftheFCPA,Title 15,
UnitedStatesCode,Sections78m(b)(2)(B),78m(b)(5),and78ff(a).lnso doing,theCompany:
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trialpursuantto the Sixth A m endm entto the United StatesConstitution,Title 18,U nited States
conductdescribed in theattached StatementofFactsand consentstothefili
ng ofthe
Inform ation.asprovided underthe term softhisA greement, in the United States DistrictCourt
forthe Southern DistrictofFlorida. The Section agreesto deferprosecution ofthe Com pany
pursuantto theterm sand conditionsdescribed below .
The Company adm its, accepts,and acknow ledgesthatitisresponsible under
U nited StatesIaw forthe actsofitsofficerss directors,employees,and agentsas charged in the
Inform ation,and assetforth in the attached Statem entofFacts. and thatthe allegations described
in the lnformation and the factsdescribed in the attached Statem entofFacts are true and
accurate. Should the Section pursuetheprosecution thatisdeferred by thisAgreem ent, the
Company stipulatestothe adm issibility oftheattached StatementofFactsin anyproceeding,
including any trial,guilty plea,orsentencing proceeding, and willnotcontradictanything in the
Statem entofFactsatany such proceeding,
Term ofthe Aereem ent
This Agreem entiseffective fora period beginning on the date on which the
lnformation isfiled andendingthreeyearsfrom thelaterofthedateonwhich theInformation is
filedorthedateon which theindependentcompliancemonitor(the'çM onitor'')isretained by the
Company,asdescribed in Paragraphs1l-l3 below (the$$Term'') The Com pany agrees,
how ever,that,in the eventthe Section determ ines, in itssole discretion,thatthe Com pany has
know ingly violated any provision ofthisA greem ent, an extension orextensionsofthe Term m ay
be imposed by the Section,in itssole discretion, forup to a totaladditionaltim e period ofone
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year,withoutprejudicetotheSection'srighttoproceedasprovidedinParagraphs16 20 below .
A ny extension ofthe A greem entextendsallterm softhisA greem ent, including the term softhe
m onitorship in A ttachm entD , foran equivalentperiod. Conversely,in the eventthe Section
finds,in itssole discretion, thatthere existsa change in circum stances sufscientto elim inate the
necd forthe m onitorship in Attachm entD , andthattheotherprovisionsofthisAgreementhave
been satisfied,the Agreementmay be term inated early.
the provisions ofthe A greem entshallbe deem ed nulland void, and the Term shallbe deem ed to
have notbegun.
RelevantC onsiderations
The Section enters into thisAgreem entbased on the individualfacts and
circum stancespresented by thiscase, including:
theCompanydidnotvoluntarilydisclosetheFCPA violationstotheSection;the
investigation of the m attercom m enced when the Securitiesand Exchange
Commission (içSEC'')servedtheCompanywith asubpoena;
non-privileged relevantfactsknown to the Com pany, including inform ation about
individualsinvolved in the m isconduct, which assisted in the prosecutionsof
individualsby foreign authoritiesforthem isconductdescribed in the attached
Statem entofFacts;
theCompanyhadan inadequatecomplianceprogram atthe timeofthe criminal
theCompany now hasdesigned and isimplem entinga moreadequatecompliance
program and system ofinternalaccounting controls,has com m itted to ensuring
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thatthese w illbe im plem ented in a m annerthatsatisfies the elem ent
ssetforth in
Attachm entC to this Agreement, and hasagreed to engagethe M onitorpursuant
to the term s described herein;
the Com pany hasengaged in partialrem ediation:ithasdisciplined a num berof
Company employeesandexecutivesengaged inthe misconductdescribed in the
attached Statem entofFacts, butdidnotdisciplineaseniorexecuti
responsibility forthe em ployeesengaged in those discussions;
thenatureandseriousnessoftheoffense, including itspervasivenessthroughout
each ofthe Com pany'sthree separate salesdivisionsand the involvementofhighIevelexecutives in each setofcrim inalconductrecounted in the attached
Statem entofFacts;
theCompany hasnopriorcriminalhistory;
theCompany hasagreedto continueto cooperatewith the Section assetforth in
thisA greem entin any investigation ofthe Com pany and itsofficers, directors,
em ployeessagents,businesspartners, and consultantsrelating to violations ofthe
theCompanyhasagreedtodisgorgetheprofitsfrom themisconductdescribedin
the attached Statem entofFactsto the SEC and to Brazilian authorities;
the A greem ent,pay a crim inalpenalty of20% below the low end ofUnited States
Sentencing G uidelinesrange, and the M onitorw illbe im posed pursuantto the
term soutlined herein.
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Future Cooperation and D isclosure Requirem ents
The Company shallcooperate fully w ith the Section in any and a1lm atters
relating to the conductdescribed in thisAgreelnentand the attached StatelnentofF
acts,and any
individualorentity referred to therein, aswellas otherconductrelated to corruptpaym ents
books,records,and accounts, orthe failure to implem entadequate internalaccounting controls
subjtcttoapplicablelaw andregulations,untilthelaterofthedateuponwhichallinvestigations
and prosecutionsarising outofsuch conductare concluded, orthe end ofthe Term . Atthe
requestofthe Section,the Com pany shallalso cooperate fully w ith otherdom estic orforeign law
enforcem entand regulatory authoritits and agencies, asw ellastheM ultilateralDevelopm ent
Banks(t'MDBs''),inanyinvestigationoftheCompany, itsparentcompany oritsaffiliates, or
any ofitspresentorform erofficers, directors,em ployees, agents,and consultants,orany other
party,in any and a11m attersrelating to possible corruptpaym ents. The Company agreesthatits
cooperation pursuantto thisparagraph shallinclude, butnotbe lim ited to,the following:
The Com pany shalltruthfully disclose al1factualinform ation not
protected by a valid claim ofattorney-clientprivilege orw ork productdoctrine w ith respectto its
activities,those ofitsparentcompany and affiliates, and those ofitspresentand form erdirectors,
officers,em ployees,agents,and consultants, including any evidence orallegations and internal
orexternalinvestigations,aboutwhich the Com pany hasany know ledge oraboutw hich the
Section m ay inquire. Thisobligation oftruthfuldisclosure includes, butisnotlim ited to,the
obligation ofthe Com pany to provide to the Section, upon request,any docum ent,record or
othertangible evidenceaboutwhich the Section m ay inquire ofthe Com pany.
Upon requestofthe Section, the Company shalldesignateknow ledgeable
em ployees,agentsorattorneysto provideto the Section the inform ation and m aterials described
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m ustatalltim esprovidecom plete, truthful,and accurate inform ation.
The Company shalluse itsbesteffortsto fnake available forinterviewsor
testimony,asrequested by the Section, presentorform erofficers,directors, em ployees,agents
and consultants ofthe Com pany. Thisobligation includes,butisnotlim ited to, sw orn tcstim ony
enforcem entand regulatory authorities. Cooperation underthisParagraph shallinclude
identification ofw itnessesw ho, to the know ledgeofthe Company, m ay have m aterial
W ith respectto any infonuation, testim ony,docum ents,recordsorother
tangible evidence provided to the Section pursuantto thisAgreem ent, the Company consentsto
anyandalldisclosures,subjecttoapplicablelaw andregulations,toothergovernmental
authorities,including United Statesauthoritiesand those ofa foreign governm ent, aswellasthe
M DBS,ofsuch m aterialsasthe Section, in its sole discretion,shalldeem appropriate.
ln addition to the obligationsin Paragraph 5, during the Term ,should the
Com pany learn ofcredible evidence orallegations ofcorruptpaym ents, false books,records,and
accounts,orthe failureto implem entadequate internalaccounting controls, the Com pany shall
prom ptly reportsuch evidence orallegations to the Section.
Pavm entofM onetarv Penaltv
The Section and the Com pany agree thatapplication ofthe U nited States
rangeyieldsthe follow ing analysis:
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Th: 2015 U SSG are applicable to thism atler.
OffenseLevel.BaseduponUSSG j2Cll,thetotaloffenselevelis42
calculated as follow s:
(a)(2) BaseOffenseLevel
(b)(1) MultipleBribes
(b)(3) HighLevelOfficial
(b)(2) Valueofbenefitreceivedmorethan$65,000,000 +24
( seFine.BaseduponUSSG j8C2.4(a)(2), thebase fine is$83,816,476
asthe pecuniary gain exceedsthe fine indicated in the O ffense LevelFine
Table,nam ely $72,500,000)
Culpability Score. Based upon USSG j8C2.
calculated asfollows:
BaseCulpability Score
(b)(3) theorganizationhad5,000ormoreemploytesand
an individualwithin high-levelpersonnelofthe
organization participated in,condoned, or w as
w illfully ignorantofthc offense
(g)(1) Theorganization fullycooperatedinthe
investigation,and clearly dem onstrated recognition
and affirm ative acceptance ofresponsibility forits
crim inalconduct
Calculation ofFine Ranze:
Base Fine
M ultipliers
Fine Range
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The Company agreesto payam onetary penalty in theamountof$107,285,090 tothe United
StatesTreasury no laterthan tsve business daysaftertht Gling ofthe lnform ation. The Company
and the Section agree thatthispenalty isappropriate given the facts and circum stancesofthis
case,assetforthabove.The$107,285,090penalty isfinaland shallnotberefunded.
Furtherm ore,nothing in thisA greem entshallbe deem ed an agreem entby the Section that
$107,285,090 isthemaximum penalty thatmay be imposed in any futureprosecution, and the
Section isnotprecluded from arguing in any future prosecution thatthe Courtshould im pose a
higherfine,although tht Section agrtesthatunderthose circum stances, itw illrecom m end to the
Courtthatany amountpaidunderthisAgreementshould beoffsetagainstany finethe Court
soughtinconnection withthepaymentofany partofthis$107,285,090 penalty.TheCompany
shallnotseek oracceptdirectly orindirectly reim bursem entorindemnification from any source
w ith regard to tht penalty ordisgorgem entam ountsthatthe Com pany pays pursuantto this
A greem entorany otheragreemententered into w ith an enforcem entauthority orregulator
concerning the facts setforth in the attached Statem entofFacts.
ConditionalR elease from Liabilitv
SubjecttoParagraph 1* 20,theSectionagrees,exceptasprovidedinthis
Agreem ent,thatitw illnotbring any crim inalorcivilcase againstthe Com pany relating to any
ofthe conductdescribed in the attached Statem entofFactsorthe crim inallnform ation filed
pursuantto thisAgreem entorforthe conductthatthe Com pany disclosed to the Section priorto
the signing ofthisA greem ent. The Section,however,may use any inform ation related to the
conductdescribed inthe attached StatementofFactsagainstthe Company: (a)inaprosecution
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prosecution orotherproceeding relatingtoany crimeofviolence;or(d)in aprosecution orother
proceeding relating to a violation ofany provision ofTitle 26 ofthe U nited StatesCode.
ThisAgreem entdoes notprovideany protection againstprosecution for
any future conductby the Company.
ln addition,thisAgreem entdoesnotprovide any protection against
prosecution ofany individuals,regardlessoftheiraffiliation w ith the Com pany.
Corporate Com plianceProzram
The Com pany representsthatithasim plem ented and willcontinue to implem ent
a com pliance and ethicsprogram throughoutitsoperations,including those ofits affiliates,
include interacting w ith foreign officialsorotheractivities carrying a high risk ofcorruption,
designed to preventand detectviolationsofthe FCPA and otherapplicable anti-corruption laws.
ln orderto addressany deficienciesin its internalaccounting controls,policies,
and procedures,the Com pany representsthatithasundertaken,and w illcontinue to undertake in
the future,in a m annerconsistentw ith aIlofits obligationsunderthis Agreem ent,a review ofits
existing internalaccounting controls,policies,and proceduresregarding com pliance w ith the
FCPA and otherapplicable anti-corruption law s. W here necessary and appropriate,the
Com pany agreesto adopta new complianceprogram ,orto m odify itsexisting one,including
internalcontrols,compliancepolicies,andproceduresin orderto ensurethatitmaintains:(a)an
effective system ofinternalaccounting controls designed to ensure the m aking and keeping of
fairand accuratebooks,records,and accounts;and (b)arigorousanti-corruption compliance
program thatincorporatesrelevantinternalaccounting controls,asw ellaspoliciesand
proceduresdesigned to effectively detectand deterviolationsofthe FCPA and otherapplicable
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anti-corruption law s. The compliance program ,including the internalaccounting controls
system w illinclude,butnotbe lim ited to,the m inim um elem ents setforth in Attachm entC.
IndependentCom pliance M onitor
Prom ptly afterthe Section'sselection pursuantto Paragraph 12 below ,the
Com pany agreesto retain a M onitorforthe term specified in Paragraph 13. The M onitor's
dutiesand authority,and the obligationsofthe Com pany w ith respectto theM onitorand the
Section,are setforth in Attachm entD,which is incorporated by reference into thisA greem ent.
U pon the execution ofthisA greement,and afterconsultation w ith the Section,theCom pany w ill
propose to the Section apoolofthree qualified candidatesto serve as the M onitor. lfthe Section
determ ines,in its sole discretion,thatany ofthe candidatesare not,in fact,qualitsed to serveas
the M onitor,orifthe Section,in itssole discretion,isnotsatisied w ith the candidatesproposed,
the Section reservesthe rightto seek additionalnom inationsfrom the Com pany.
The partiesw illendeavorto com pletethe monitorselection processw ithin sixty days ofthe
execution ofthisA greem ent. The M onitorcandidatesortheirteam m em bers shallhave,ata
m inim um ,the follow ing qualifications:
dem onstrated expertise w ith respectto the FCPA and otherapplicable
anti-conuption law s,including experience counseling on FCPA issues;
experience designing and/orreview ing corporate com pliance policies,
proceduresand internalcontrols,including FCPA and anti-corruption policies,proceduresand
the ability to accessand deploy resourcesasnecessary to discharge the
M onitor'sdutiesasdescribed in the A greem ent;and
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suftscientindependence from the Com pany to ensure effective and
im partialperform ance ofthe M onitor'sdutiesas described in the A greem ent.
The Section retainsthe right,in itssolediscretion,to choose the M onitorfrom
am ong the candidatesproposed by the Com pany,though the Com pany m ay expressits
Com pany shallpropose an additionalthree candidatesw ithin twenty businessdaysafter
receivingnoticeoftherejection.ThisprocessshallcontinueuntilaM onitoracceptabletoboth
parties ischosen. The Section and the Com pany w illusetheirbesteffortsto com pletethe
selection processw ithin sixty calendardaysofthe execution ofthisA greem ent. Ifthe M onitor
resignsorisothenvise unable to fulfllhis orherobligationsas setoutherein and in A ttachm ent
M onitorcandidates from which the Section w illchoose a replacem ent.
The M onitor'sterm shallbe three years from the date on which the M onitoris
The M onitor'spowers,duties,and responsibilities,aswellasadditicmalcircum stances thatm ay
supportan extension ofthe M onitor'sterm ,are setforth in Attachm entD .The Com pany agrees
thatitw illnotem ploy orbe affiliated w ith the M onitororthe M onitor's firm foraperiod ofnot
Iess than two yearsfrom the date on which the M onitor'sterm expires. N orw illthe Com pany
discussw ith the M onitororthe M onitor'sfirm the possibility offurtherem ploym entor
affiliation during the M onitor'sterm .
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Deferred Prosecution
ln consideration ofthe undertakingsagreed to by the Com pany herein,the
Section agreesthatany prosecution ofthe Com pany forthe conductsetforth in the attached
Statem entofFacts be and hereby isdeferred forthe Term .
The Section furtheragreesthatifthe Com pany fully compliesw ith allofits
obligationsunderthisA greem ent,the Section willnotcontinue the crim inalprosecution against
the Com pany described in Paragraph land,atthe conclusion ofthe Term ,thisAgreem entshall
expire. W ithin six m onthsofthe Agreem ent'sexpiration,the Section shallseek dism issalwith
prejudiceofthecriminallnformationfiledagainsttheCompanydescribedinParagraph 1,and
agreesnotto file chargesin the future againstthe Com pany based on the conductdescribed in
thisAgreem entand the attached Statem entofFacts.
Breach ofthe Aereem ent
lf,duringtheTerm,theCompany (a)commitsany felonyunderU.S.federallaw;
(b)providesin connection withthisAgreementdeliberately false,incomplete,ormisleading
inform ation,including in connection w ith itsdisclosure ofinform ation aboutindividual
culpability;(c)failsto cooperate assetforth in Paragraphs5 and6 ofthisAgreement;(d)failsto
im plem enta com pliance program assetforth in Paragraphs9 and l0 ofthisA greementand
FCPA,wouldbeaviolationoftheFCPA;or(9 otherwisefailsspecificallytoperform orto
fulfillcom pletely each ofthe Com pany'sobligations underthe Agreem ent,regardlessofw hether
the Section becom esaw are ofsuch abreach afterthe Term iscomplete,the Company shall
knowledge,including,butnotlim ited to,the charges in the lnform ation described in Paragraph
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l,which m ay be pursued by the Section in the U .S.DistrictCourtforthe Southern Districtof
Florida orany otherappropriate venue. Detenuination ofw hetherthe Com pany hasbreached
the A greem entand w hetherto pursue prosecution ofthe Com pany shallbe in the Section'ssole
discretion. Any such prosecution m ay beprem ised on inform ation provided by the Com pany or
itspersonnel. A ny such prosecution relating to the conductdescribed in the attached Statem ent
ofFactsorrelating to conductknow n to the Section priorto the date on which thisAgreem ent
w assigned thatisnottim e-barred by the applicable statute oflim itations on the date ofthe
signing ofthisA greem entm ay be com m enced againstthe Com pany,notw ithstanding the
expiration ofthe statute oflim itations,between the signing ofthisA greem entand the expiration
ofthe Term plusone year. Thus,by signing thisA greem ent,the Com pany agreesthatthe statute
oflim itationsw ith respectto any such prosecution thatis nottim e-barred on the date ofthe
signing ofthisA greem entshallbe tolled forthe Term plus one year. ln addition,the Company
agreesthatthe statute oflim itations asto any violation offederallaw related to corrupt
paym ents,false books,records,and accounts,orthe failureto implem entadequate internal
accounting controls,including violation ofthe anti-bribery orinternalcontrolsprovisionsofthe
FCPA orviolation ofthe TravelAct,Title l8,U nited StatesCode,Section 1952,thatoccurs
during the Term w illbe tolled from the date upon which the violation occurs untilthe earlierof
the date upon which the Section ism ade aw are ofthe violation orthe duration ofthe Term plus
five years,and thatthisperiod shallbe excluded from any calculation oftim e forpurposesofthe
application ofthe statute oflim itations,
ln the eventthe Section determ inesthatthe Com pany has breached this
A greem ent,the Section agreesto provide the Com pany w ith w ritten notice priorto instituting
any prosecution resulting from such breach. W ithin thirty daysofreceiptofsuch notice,the
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Com pany shallhave the opportunity to respond to the Section in writing to explain the nature
and circum stances ofthe breach,asw ellasthe actionstheCom pany hastaken to addressand
rem ediatethe situation,w hich the Section shallconsiderin determ ining w hetherto pursue
prosecution ofthe Com pany.
ln the eventthatthe Section determ inesthatthe Com pany has breached this
Agreement: (a)allstatementsmadeby oron behalfofthe Company to the Section ortothe
Court,including the attached Statem entofFacts,and any testim ony given by the Com pany
subsequentto thisA greem ent,and any leadsderived from such statementsortestim ony,shallbe
adm issible in evidence in any and a11crim inalproceedings broughtby the Section againstthe
Company;and(b)theCompanyshallnotassertanyclaim undertheUnitedStatesConstitution,
Rule11(9 oftheFederalRulesofCriminalProcedure,Rule410oftheFederalRulesof
Evidence,orany otherfederalrulethatany such statem entsortestim ony m ade by oron behalfof
the Com pany priororsubsequentto thisAgreem ent,orany leadsderived therefrom ,should be
suppressed orare otherwise inadm issible.The decision whetherconductorstatem entsofany
currentdirector,officerorem ployee,orany person acting on behalfof,oratthe direction of,the
Com pany,w illbe im puted to the Com pany forthe purpose ofdetennining whetherthe Com pany
hasviolated any provision ofthisA greem entshallbe in the solediscretion ofthe Section.
The Com pany acknow ledgesthatthe Section hasm ade no representations,
assurances,orprom isesconcerning whatsentence m ay be imposed by the Courtifthe Com pany
acknow ledges thatany such sentence issolely within the discretion ofthe Courtand thatnothing
in thisAgreem entbindsorrestrictsthe Courtin the exercise ofsuch discretion.
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Thirty daysafterthe expiration ofthe period ofdeferred prosecution specified in
thisAgreem ent,the Company,by the ChiefExecutive Officerofthe Com pany and the Chief
FinancialOfficerofthe Company,w illcertify to the Section thatthe Com pany hasm etits
disclosure obligations pursuantto Paragraph 6 ofthisA greem ent. Each certification willbe
deem ed a m aterialstatem entand representation by the Com pany to the executive branch ofthe
UnitedStatesforpurposesofl8U.S.C.j 1001,anditwillbedeemedtohavebeenmadeinthe
Sale.M ereer.or O ther Chanee in Corporate Form ofCom panv
Exceptasm ay otherwise be agreed by the parties in connection with aparticular
transaction,the Com pany agreesthatin the eventthat during the Tenm,itundertakesany change
in com orate form ,including ifitsells,merges,ortransfersbusinessoperationsthatare m aterial
to the Com pany's consolidated operations,orto the operations ofany subsidiariesoraffiliates
involved in the conductdescribed in the attached Statem entofFacts,asthey existas ofthe date
ofthis Agreem ent,whethersuch sale isstructured asa sale,assetsale,m erger,transfer,orother
change in corporate form ,itshallinclude in any contractforsale,m erger,transfer,orother
change in corporate form a provision binding the purchaser,orany successorin interestthereto,
to the obligationsdescribed in thisAgreem ent. The Com pany shallobtain approvalfrom the
Section atleastthirty dayspriorto undertaking any such sale,m erger,transfer,orotherchange
in corporate form ,including dissolution,in orderto givethe Section an opportunity to determ ine
ifsuch change in corporate form w ould im pactthe term sorobligationsofthe Agreem ent.
Public Statem entsbv Com panv
The Com pany expressly agreesthatitshallnot,through presentorfuture
attorneys,officers,directors,em ployees,agentsorany otherperson authorized to speak forthe
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Com pany m ake any public statem ent,in litigation orotherwise,contradicting the acceptance of
responsibility by the Company setforth in Paragraph 2 above orthe factsdescribed in the
Com pany described below ,constitutea breach ofthisA greem ent,and the Com pany thereafter
whetherany public statem entby any such person contradicting a factcontained in the Statem ent
ofFactsw illbe im puted to the Com pany forthe purpose ofdetennining w hetherithas breached
thisAgreem entshallbe atthe sole discretion ofthe Section. lfthe Section determ inesthata
public statem entby any such person contradictsin w holeor in parta statem entcontained in the
attachtd Statem entofFacts,tht Stction shallso notify the Com pany,and tht Com pany m ay
daysafternotification. The Com pany shallbe perm itted to raise defensesand to assert
affirm ative claim s in otherproceedings relating to the m atterssetforth in the attached Statem ent
ofFactsprovided thatsuch defensesand claim sdo notcontradict,in whole orin part,a
statem entcontained in the attached Statem entofFacts. ThisParagraph doesnotapply to any
statem entm ade by any presentorform erofficer,director,em ployee,oragentofthe Com pany in
the course ofany crim inal,rtgulatory,orcivilcase initiated againstsuch individual,unless such
individualisspeaking on behalfofthe Com pany.
The Com pany agreesthatifitorany ofitsdirectorindirectsubsidiaries or
affiliates issues apressrelease orholdsany pressconference in connection w ith thisA greem ent,
theCompany shallfirstconsultwith theSectionto determine(a)whetherthetextoftherelease
orproposed statem entsatthe pressconference are true and accurate w ith respectto m atters
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The Section agrees,ifrequested to do so,to bring to the attention oflaw
enforcem entand regulatory authoritiesthe factsand circum stancesrelating to the nature ofthe
conductunderlying thisAgreem ent,including the nature and quality ofthe Company's
cooperation and rem ediation. By agreeing to provide thisinform ation to such authorities,the
Section isnotagreeing to advocate on behalfofthe Com pany,butrather is agreeing to provide
factsto be evaluated independently by such authorities.
Lim itationson Bindine EffectofA zreem ent
This Agreem entis binding on the Com pany and the Section butspeciflcally does
notbind any othercom ponentofthe Departm entofJustice,otherfederalagencies,orany state,
local,orforeign law enforcem entorregulatory agencies,orany otherauthorities,although the
Section willbring the cooperation ofthe Com pany and itscom pliance w ith itsotherobligations
underthisA greementto the attention ofsuch agenciesand authorities ifrequested to do so by
the Com pany.
N otice
Any notice to the Section underthisA greem entshallbe given by personal
delivery,overnightdelivery by a recognized delivery service,orregistered orcertified m ail,
addressed to FCPA Chief,Fraud Section,Crim inalDivision,U .S.D epartm entofJustice,1400
N ew York Avenue,W ashington,D .C.20005. A ny notice to the Company underthisA greem ent
shallbe given by personaldelivery,overnightdelivery by a recognized delivery service,or
registered orcertified m ail,addressed to John P.Rowley 111,815 ConnecticutA ve.N .W .,
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 18 of 59
W ashington,D .C.20006. Notice shallbe effective upon actualreceiptby the Section orthe
Com pany.
Com plete A ereem ent
ThisA greem ent,including its attachm ents,sets forth allthe term s ofthe
agreem entbetw een the Company and the Section. No am endm ents,m odifications oradditions
to thisA v eementshallbe valid unless they are in w riting and signed by the Section,the
attorneysforthe Com pany and a duly authorized representative ofthe Com pany.
oate: to/5/v-oté
By: /v t-
oate:ko 1n /.,0/:
Paulo Cesarde Souza e Silva,CEO
Em braerS.A .
/ ..
Fabiana Leschzlner,G eneralCounsel
fe/. o6v
Jo n P.Row ley III
J n E.M eyer
Richard N .Dean
Baker& M clkenzie LLP
EstherM .Flesch
Erica Sarubbi
Trench Rossie W atanabe
1 ?x
A ndrew W eissm ann
Chief,Fraud Section
Crim inalD ivision
United States Departm entofJustiee
BY :
Ja Linder,S iorTrialAttorney
Joh -A lex Rom ano,TrialA ttorney
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 19 of 59
Ihave read this A greem entand carefully reviewed every partofitwith outside counsel
forEm braerS.A.(thed
agree,on behalfofthe Com pany, to each ofitsterm s. Before signing this A greem ent I
consulted outside counselforthe Com pany. Counselfully advised m e ofthe rights ofthe
Com pany,ofpossible defenses, ofthe Sentencing G uidelines'provisions
and ofthe
consequencesofentering into thisA greem ent.
lhave carefully reviewed the term s ofthisA greem entw ith the Board ofDirectors ofthe
Company. Ihave advised and caused outside counselforthe Com pany to advise th
e Board of
Directors fully ofthe rightsofthe Company, ofpossible defenses,ofthe Sentencing Guidelines'
provisions,and ofthe consequences ofentering into theA greem ent.
No prom ises orinducem ents have been m ade otherthan those contained in this
A greem ent. Furtherm ore,no one has threatened orforced m e, orto m y know ledge any person
authorizing thisAgreem enton behalfofthe Com pany, in any w ay to enterinto this Agreem ent.
lam also satisfied w ith outside counsel'srepresentation in this m atter. Icertify thatlam the
ChiefExecutive O fficerforthe Com pany and that1havebeen duly authorized by the Com pany
to execute this Agreem enton behalfofthe Com pany.
Ilate: o cx 3 t'zxït
r'Qfz...x $-
h 1c
Paulo Cesarde Souza e Silva
ChiefExecutive O fficer
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 20 of 59
Ihave read this Agreem entand carefully review ed every partofitw ith outside counsel
agree,on behalfofthe Com pany, to each ofits term s. Before signing this A greem ent
consulted outside counselforthe Company. Counselfully advised me ofthe rights ofthe
Com pany,ofpossible defenses, ofthe Sentencing Guidelines'provisions and ofthe
consequences ofentering into thisA greem ent.
lhave carefully reviewed the terms ofthisAgreem entw ith the Board ofD irectorsofthe
Com pany. Ihave advised and caused outside counselforthe Company to advise the Board of
Directorsfully ofthe rights ofthe Com pany, ofpossible defenses,ofthe Sentencing G uidelines'
provisions,and ofthe consequences ofentering into the A greem ent.
No prom ises orinducem ents have been m ade otherthan those contained in this
A greem ent. Furtherm ore,no one hasthreatened orforced m e, orto m y knowledge any person
authorizing this Agreem enton behalfofthe Com pany, in any w ay to enterinto thisA greem ent.
lam also satisfied w ith outside counsel'srepresentation in this m atter. Icertify that1am the
G eneralCounselforthe Com pany and that1have been duly authorized by the Com pany to
execute thisA greem enton behalfofthe Com pany.
oate: do 1s /l(;
f/n h
Fabiana Leschzine
G eneralCounsel
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 21 of 59
1am counselforEm braerS.A.(the(t
Agreem ent. ln connection w ith such representation, Ihave exam ined relevantCom pany
docum ents and have discussed the term softhis A greem entwith the Co
m pany Board of
Directors. Based on ourreview ofthe foregoing m aterials and discussions Iam ofthe opinion
thatthe representative ofthe Com pany has been duly authorized to enterinto thisA greem enton
behalfofthe Com pany and thatthisA greem enthas been duly and validly authorized,executed,
and delivered on behalfofthe Company and is avalid and binding obligation ofthe Com p
Further,lhave carefully reviewed the term softhisA greem entw ith the Board ofD irectors and
both theChiefExecutiveOfficerand GeneralCounseloftheCompany. 1have fully advised
them oftherightsofthe Company, ofpossible defenses,ofthe Sentencing Guidelines'
provisionsand ofthe consequencesofentering into this Agreement. To m y know ledge,the
decision ofthe Com pany to enterinto thisA greem ent, based on the authorization ofthe Board of
Directors,is an inform ed and voluntary one.
Date:/p/$ 9m/6
:,/. êH '
John P.Rowley III
ak r& M cKenzie LLP
ounselforEmbraerS.A .
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 22 of 59
The follow ing Statem entofFactsis incorporated by reference aspartofthe D eferred
CriminalDivision,FraudSection (the'dsection'')andEmbraerSA.(CEEMBRAER'').
EM BRA ER hereby agreesand stipulatesthatthe follow ing inform ation istrue and accurate.
EM BRAER adm its,accepts, and acknow ledgesthatitisresponsible forthe acts ofitsofficers
directors.em ployees,and agents. Should the Section pursue the prosecution thatisdeferred by
thisA greem ent,EM BRAER agreesthatitw illneithercontestthe adm issibility of nor
contradict,thisStatem entofFacts in any such proceeding. The follow ing factstook place during
the relevanttime fram e and establish beyond a reasonable doubtthe charges setforth in the
crim inallnform ation attached to thisA greem ent:
RelevantEntitiesand lndividuals
EM BRAER w as an aircraftm anufacturing company incorporated and
headquarttred in Brazil. EM BRAER m anufactured com m ercial, executive,and defense aircraft
and sold them to govem mentaland privatecustomersthroughouttheworld. EM BRAER
m aintained itsN orth Am erican regionaloffice in FortLauderdale, Florida. Sharesof
EMBRAER'SstocktradedontheNew YorkStockExchange(i4NYSE'')asAmericandepositary
receipts($(ADRs''),and EM BRAER wasrequired to fileperiodicreportswiththeSecuritiesand
ExchangeCommission(iiSEC''junderSection 15(d)oftheSecuritiesExchangeAct,15U.S.C.j
78o(d). Accordingly,EM BRAER wasan issuerwithin themeaning ofthe Foreign Corrupt
PracticesAct(i$FCPA''),Title l5,United StatesCode,Sections78dd-1and 78m .
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 23 of 59
EmbraerRepresentationsLLC (çfEmbraerRL'')wasasubsidiary wholly owned
by EM BRAER,and incorporated in Delaw are. Em braerRL's financialstatem entsw ere
consolidated into EM BRA ER'S Gnancialstatem ents. Em braerRL held and m aintained a bank
accountin N ew Y ork from w hich EM BRA ER m ade im properpaym ents during the relevant
tim e.
iûEm braerExecutive A ,''an individualwhose identity isknown to the United
Statesand EM BRAEK wasan executivein EM BRAER'SDefenseand GovernmentM arkets
D ivision,
ddEm braerExecutive B,''an individualw hose identity is know n to the United
States and EM BRAER, was an executive in EM BRA ER'S Executive JetsD ivision.
ikEmbraerExecutive C ,''an individualw hose identity is know n to the United
Statesand EM BRA ER , w asan executive in EM BRAER'SComm ercialJets Division.
(tEm braerExecutive D ,''an individualwhose identity isknown to the United
Statesand EM BRAER,wasan executive in EM BRAER 'SCom m ercialJetsD ivision.
KsDom inican Official,''an individualwhose identity isknow n to the U nited States
and EM BRAER,was an officialin ahigh-leveldecision-m aking position in the governm entof
the Dom inican Republic. Dom inican Officialhad influence overdecisionsm ade by the Fuerza
AéreadeReptiblicaDominicana(ddFAD''),which wastheDom inicanRepublic'sAirForceand
which w as a dddepartm ent''and iiagency''ofa foreign governm ent, asthose term s are defined in
the FCPA,Title 15,U nited StatesCode, Section 78dd-1(9(1).Beginningatleastby M ay 2007,
EM BRA ER rtferred to Dom inican Offk ialasthe itG eneralM anager''orûûM anaging Directorof
theProject.'' DominicanOfficialwasakçforeignofficial''asthatttrm isusedintheFCPA, Title
A -2
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 24 of 59
issaudiArabia Official,''an individualw hose identity isknown to the United
Statesand EM BRAER,w asan officialin a high-leveldecision-m aking position in a state-owned
and controlled com pany in SaudiArabia thatperform ed a governm entfunction. SaudiArabia
Officialhad intluenceoverdecisionsmadeby the instrumentality (ddsaudiArabia
Instrumentality''),which wasan ttinstrumentality''ofaforeign government,asthattenm is
definedintheFCPA,Title l5,United StatesCode,Section78dd-l(9(1)('dinstrumentality'').
SaudiA rabia Officialw as a foreign official.
iiM ozam biqueO fficial,''an individualwhose identity isknown to tht United
States and EM BRAER ,wasan officialin a high-leveldecision-m aking position in the
governm entofM ozam bique.M ozambique O fficialhad intluence overdecisionsm ade by
LinhasAéreasdeMoçambique,S.A.($$LAM ''),thestate-ownedcommercialairlinein
M ozam bique thatperformed a governm entfunction,and which w asan instrum entality.
M ozam bique Officialw as a fortign official.
dsA gentA,''an individualw hose identity is known to the United Statesand
EM BRAER,purportedly provided legitim ate agency servicesto EM BRAER in connection with
the sale ofaircraftto the governm entofJordan. ln reality,A gentA w as retained forthe purpose
offunneling bribesto Dom inican Officialto obtain orretain businessin the Dom inican
iiA gentB,''a com pany,the identity ofwhich is known to the United Statesand
EM BRA ER,purportedly provided legitim ate agency servicesto EM BRAER in connection w ith
the sale ofaircraftto SaudiA rabia lnstrum entality. ln reality,AgentB w asretained forthe
purposesoffunneling bribesto SaudiA rabia Officialto obtain orretain business in connection
with the sale.
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 25 of 59
AiA gentC,''an individualwhose identity isknow n to the United States and
EM BRAER,purportedly provided legitim ate agency servicesto EM BRAER in connection with
the sale ofaircraftto the governm entofM ozambique. In reality,AgentC w asretained forthe
purposesoffunneling bribesto M ozam bican ofscials,including M ozam bique Official,to obtain
orretain business in M ozam bique.
itA gentD,''an individualwhose identity is known to the United Statesand
EM BRAEK purportedlyprovided legitimate agency servicestoEM BRAER pursuantto two
separate agency agreem entsin connection w ith the sale ofaircraftto the governmentofIndia.
The Unlaw fulSchem es
The Dom inican Republic
From in oraround August2008 through atleastin oraround October2010,
EM BRAER,through itsem ployeesand agents,agreed to pay and did pay Dom inican Official
approximately $3.52 million to obtainadefensecontractvaluedatapproximately $96.4 million.
Beginning in oraround June 2007,EM BRAER began effortsto sellthe Super
Tucano aircraft,a turbine-driven m ilitary aircrafttypically used form issionsto fightdrug
trafficking,counterinsurgence m issions,and training,to theFAD . There w asno public bid or
tenderforthis sale. Rather,EM BRAER developed and negotiated the sale directly w ith
representativesofthe FA D,and Dom inican O fficialw asEM BRAER 'Sprim ary pointofcontact
atthe FA D .
By m id-2008,m any ofthetenmsofthe sale had been negotiated butthe
DominicanRepublicSenate(leDominican Senate'')hadnotyetapproved thedeal'sfinancing or
the purchase agreem ent,which w ere necessary stepsforthe com pletion ofthe sale. EM BRAER
A -4
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 26 of 59
employeesand Dom inican Officialbegan discussing how they could influence the Dom inican
Senate to providethe necessary approvals.
On oraboutA ugust25,2008,an EM BRA ER executive informed Em braer
Executive A by emailthatDom inican Officialw ould be talking to a Dom inican Senatorabout
com pensation forthe SenatorbutthatDom inican Officialw anted to talk to Em braerExecutive A
before having thatconversation. Em braerExecutive A inform ed the otherEM BRAER executive
thatEm braerExecutive A and Dom inican Officialhad already spoken.
On oraboutSeptem ber 1,2008,Em braerExecutive A agreed to pay D om inican
Official3.7% ofthevalueofthecontract(whichultimately cametoapproximately $3.52
million)ifthesalewascompleted.Thatsameday,EmbraerExecutiveA emailedanother
EM BRAER executive thatthe D om inican Senate'sm eeting to approve financing ofthe
transaction w ould soon take place and thatSdthey w antto have the agentagreem entdoc signed
before the m eeting.''
ln oraround early Septem ber2008,Dom inican Officialand Embraer Executive A
agreed thatthepaym entreferred to in Paragraph 18 would bepaid to three separate D om inican
shellentities:onewould receive$2.5million,asecond would receive$920,000,and athird
would receive$100,000.
ln oraround A ugust2008,Dom inican Officialprom oted the SuperTucano
contractbefore the Dom inican Senate Finance Comm ittee and presented the term softhedealto
the Dom inican Senate. The following m onth,on oraboutSeptem ber 16,2008,the D om inican
Senate approved the financing forthe deal.
On oraboutDecem ber24,2008,the D om inican Senate approved the sale and
financing contracts forthe eightSuperTucano aim lanes,agreeing to purchase the aircraftfor
A -5
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 27 of 59
approximately $96.4 million.Shortly beforeitdid so,the Secretary oftheFAD issued aletterto
EM BRAER authorizing Dom inican Officialto sign,on behalfofthe D om inican Republic,
invoicesand certificatescalled forby the salescontract.
On oraboutJanuary 9,2009,EM B RAER publicly announced its sale ofeight
SuperTucano aircraftto the Dom inican Republic.
Beginning atleastw hen EM BRAER publicly announced the sale,Dom inican
Officialrepeatedly contacted EM BRA ER requesting the paym entsthathad been prom ised. For
example,on oraboutM arch 16,2009,Dom inican Officialem ailed an EM BRAER em ployee
demanding thatEM BRAER begin m aking the agreed-upon paym ents,noting that(sinterested and
comprom ised parties''w ere exerting pressure.
Based on theserepeated requests,on oraboutApril24,2009,Em braerRL wired
$100,000to oneoftheshellcompaniesreferenced in Paragraph 19 from EmbraerRL'sbank
accountin N ew York to a bank accountin the D om inican Republic.
Following the$100,000paymentreferenced inParagraph 24,Dominican Official
persisted w ith effortsto collectthe prom ised paym ents,and an executive in EM BRAER'Slegal
departm entprovided seniorEM BRAER m anagersw ith guidance on how to m akethose
paym ents in a m annerthatw ould concealtheirtrue purpose.
Forexample,on oraboutSeptem ber30,2009,an EM BRAER em ployee sentan
em ailto an EM BRA ER executive detailing how an executive in EM BRA ER 'S legaldepartment
had advised using a third-party agent,(lAgentA,''who had previously provided agency services
to EM BRAER,to rem itthe rem aining tw o paym entsto Dom inican Officialinstead ofdirectly
paying the shellcompaniesthatD om inican Officialhad identified.
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 28 of 59
On oraboutO ctober16,2009,an EM BRAER executive em ailed the sam e
executive in EM BRA ER'Slegaldepartm entasking foradditionalguidanceon how to proceed,
adding thatEM BRA ER feared pressureatany m om entfrom Etfourstarsr''which w asa reference
to Dom inican governm entofficials.
O n oraboutN ovem ber5,2009,Em braerExecutive A em ailed A gentA to say
thatD om inican Oftscialwould be A gentA 'spointofcontactin the D om inican Republic,that
Dom inican O fficialw asan ''FA D colonelbutthe classm ate of4 stargenerals,''thatDom inican
O fficialhad provided a 'ssafe''phone num berto use,and thatDom inican O fficialhad been
designated asthe interm ediary betw een EM BR AER and the groupsS'involved on the otherside.''
On oraboutNovem ber 16,2009,Dom inican Officialem ailed Em braerExecutive
A to confirm thatDom inican Oftscialhad spoken w ith A gentA ,and expressed satisfaction over
A gentA 'scooperation,butw arned thatatleastone ofthe outstanding paym entsneeded to be
m ade by the end ofthem onth.
On oraboutM arch 12,20l0,Em braerRL and A gentA 'scom pany entered into a
purported agency agreem ent,pursuantto which Em braerRL w ould pay AgentA 'scom pany an
8% com m ission on any successfulsalesofaircraftto the Jordanian A irForce. The agreem ent
called forEmbraerRL to make advancepaymentstoAgentA'scompanyof$2.5million and
$920,000,which,when totaled,equaled the$3,420,000thatEM BRAER hadpromisedto
D om inican Official.
On oraboutApril6,20l0,AgentA 'scom pany subm itted to Em braerRL two
invoicesforddsalespromotion services''inthe amountsof$2.5millionand$920,000.An
internalEM BRAER m em orandum indicated thatthe paym entswere related to the com m ission
owed forthe SuperTucano aircrafts sold to the governm entofthe Dom inican Republic,not
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 29 of 59
potentialsalesto the Jordanian A irForce. lndeed,EM BRA ER neversold any aircraftto the
Jordanian A irForce,A gentA rendered no services in connection w ith any attem pted sale to the
Jordanian A irForce,and A gentA rendered no legitim ate servicesto EM BRAER related to the
sale ofSuperTucanosto the FAD .
On oraboutM ay 24 andJune25,2010,EmbraerRL wired$2.5m illion and
$920,000,respectively,from itsNew York bankaccountto AgentA'scompany'sbankaccount
in Uruguay.
On oraboutOctober21,2010,D om inican O fficialsentan em ailto A gentA from
an emailaccountin the United Statesthatcontained w iring instructions fora Panam anian bank
account.AgentA transferred morethan$3 million to Dominican Official,including morethan
61m illion to thePanam anian bank accountidentified in the October21,2010,em ail.
The paym entsto A gentA 'scom pany w ere falsely booked as sales com m issions
in Em braerRL'sinternalaccounting recordsand asselling expensesin EM BR AER'S
consolidated20l0snancialstatement. TheApril24,2009,paym entof$100,000 to oneofthe
Dom inican shellcom paniesw as Iikew ise falsely booked asa selling expense in EM BRAER'S
consolidated 2010 statem ent.
SaudiA rabia
From in oraround N ovem ber2009 through February 2011,EM BRA ER agreed to
payanddid pay SaudiArabiaOftscialmorethan $1.5million to obtain acontractforthesaleof
threebusinessjets,valuedatapproximately$93million,to SaudiArabialnstrumentality.
ln oraround 2007,EM BRAER learned thatSaudiA rabia lnstrum entality was
interestto purchasing aircraftfrom EM BRAER and one otherm anufacturer.
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 30 of 59
ln oraround early Decem ber2009,EmbraerExecutive B m etw ith SaudiArabia
O fficialin London.SaudiArabia Ofûcialoffered to help EM BRAER win the aircraftcontract
andtochangethetermsofthedealfrom thesaleofusedjetstonew jets,whichwouldbeamore
lucrativetransaction forEM BRA ER,ifEM BRAER com pensated SaudiA rabia Official.
Em braerExecutive B knew thatSaudiArabia Officialwasa high-leveloffcialatSaudiArabia
lnstrum entality and believed thatSaudiA rabia Officialcould deliveron the prom ise.
SaudiArabia Officialand EmbraerExecutive B negotiated the am ountofSaudi
aircraft. Em braerExecutive B sentan em ailto Em braerExecutive B's supervisorand another
EM BRAER executive on oraboutDecem ber l0,2009,indicating thatSaudiArabia O fficialhad
willhavetolobby formorefundstotakenew raircraft)overused.''EmbraerExecutiveB added,
''ltlhereismoretocometoreplacetheentirefleettheyhavewith 170,s(sic)(SaudiArabia
On oraboutDecember2:,2009,EmbraerExecutive B and SaudiArabia Official
agreed on aper-aircraftpaymentof$550,000.foratotalamountof$1.65 million.Two days
later,on oraboutDecem ber30,2009,Em braerExecutive B told anotherEM BRA ER executive
thatSaudiArabialnstrumentalityhadoptedtopurchasethreenew jets.
Em braerExecutive B devised a plan to concealthe paym entsto SaudiArabia
Officialby funneling them through A gentB ,which had no experience in the aircraftindustry or
in SaudiArabia.
A -9
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 31 of 59
On oraboutJanuary 5,2010,Em braerExecutive B sentan em ailaboutthe
transaction w ith SaudiA rabia lnstrum entality to a numberofEM BRA ER em ployees
an(agencyjbasis.''EmbraerExecutiveB reportedintheemailaboutameetingbetweenitthe
the com m ittee thatallocated funds forthe purchase, and stated that''ourcontacton the
transaction (headofthedept)hasadvisedthatwemusthold ourpriceduringthenegotiation on
furtheronthis.''EmbtaerExecutiveB explainedthatit(dhaEd)beenmadeextremelyclearand
concessionthatexceedsour$120klimit,thiswouldbefrom the(agencycommissionlamountin
On oraboutFebruary 26,2010,pursuantto Em braerExecutive B'srequest,
EM BRA ER extcutives,including one in EM BRAER'S legaldepartm ent,approved the agency
arrangem entw ith AgentB,pursuantto which A gentB would purportedly serve asEM BRA ER'S
salesagentforthe dealwith SaudiA rabia Instrum entality.
On oraboutM arch 5,2010,EmbraerRL executed an agency contractw ith Agent
B signed by EM BRA ER executives,pursuantto w hich A gentB w asto içprom ote salesof...
aircraftm anufactured by Em braer...solely and specifically to''a subsidiary ofSaudiArabia
Instrum entality.
Lessthan two weekslater,on oraboutM arch l5,2010,EM BRAER and a U.S.-
based subsidiary ofSaudiArabia Instrum entality entered into an aircraftpurchase agreem ent,
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 32 of 59
pursuanttowhicb the subsidiary agreedtopurchasethreenew aircraftforapproximately$93
m illion. The aircraftwere delivertd in oraround N ovtm berand Decem berof2010.
ln oraround Decem ber2010,AgentB subm itted three invoices, each in the
amountof$550,000,foritspurportedcommission,even though AgentB hadnotrenderedany
servicesto EM BRAER in connection w ith tht sale. ExecutivesatEM BRAER approvtd paying
the invoices. The paym entsw ere m adethrough tw o w ire transfers from Em braerRL'sbank
accountinNew York to AgentB'sbank accountin SouthAfrica:$550,000 on orabout
Dectmber22,20l0,and $1.1milliononoraboutFebruary 18s201l.Em braerRL booked tht
paym ents asddsales com m issions''and the paym entswere consolidated into the parent'sfinancial
statem ents.
AgentB subsequently transferred morethan $1.4 million ofthe $1.65m illion it
received from Em braerRL to bank accountsheld by SaudiA rabia Oftscial's longtim e
acquaintance,who in turn kepta portion ofthe m oniesand transferred the rem ainderto Saudi
Arabia O fficial.
M ozam bique
From in oraround M ay 2008 through atleastSeptem ber2008,EM BRAER
negotiated the sale oftw o com m ercialaircraftto LAM .
EM BRAER subm itted a formalproposalto LA M on oraboutM ay 21,2008,for
thesaleoftwo commercialaircraftforapproximately $32 million each,with an option forLAM
to buy tw o m ore aircraftatthe sam e price. The proposalfollowed nearly three yearsofwork by
EmbraerExecutive D to convince LA M to purchase from EM BRAER ratherthan com petitors.
ln m id-August2008,during negotiationsbetw een EM BRAER and LAM ,A gent
C,who had notpreviously w orked orhad any contactw ith EM BR AER,contacted Em braer
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 33 of 59
Executive D and said thatAgentC would be serving as a consultanton the dealreferenced in
Paragraph 48.
50. RatherthanrejectAgentC'ssolicitation,onoraboutAugust11,2008,Embraer
Executive D sentan em ailto tw o EM BRA ER executivesand proposed thatthey iicreate som e
m arginsforthecom m issions''forA gentC in the pricing ofthe tw o optionalaircraftLAM could
buy afterpurchasing the firsttw o.
On oraboutA ugust 13,2008,Em braerExecutive C sentan em ailto several
EM BRA ER executivesrecounting a conversation w ith AgentC , in which AgentC told Embraer
Extcutivt C that,tven though EM BRAER had notbeen prepared to have a consultant, isw e'd
like to have a (gesture'when delivering the firstplane.'' Em braerExecutive C proposed in the
emailthatddwehaveto show somegestureandmaybethevaluementionedbyganother
EMBRAER executive)(50K to80K)wouldfittheactualneed....''EmbraerExecutiveC had
advised AgentC how to setup a com pany to which EM BRAER could m ake purported
consultancy paym ents,telling AgentC thatin orderto receive a paym entfrom EM BRA ER,
AgentC iineedstohaveacompany,names,addressandnotbeestablishedinatax-heaven(sicq
country ....''
ln response,an EM BRAER executive who had received the em ailreferenced in
Paragraph 51,agreed thatthey couldoffertopay AgentC $50,000foreach ofthefirsttwo
planessold,and goup to $80,000perplaneifnecessary,whilealsoagreeingtoapaymentof
som ewhere betw een 2 and 2.5% ofthe purchase price ofthe two optionalplanes, should LA M
purchase them .
On oraboutAugust18,2008,EmbraerExecutiveC conveyedthe$50,000 offer
to A gentC. Em braer Executive C reported afterward in an em ailto otherEM BRAER executives
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 34 of 59
thatitappearedthatAgentC wasiiexpectingga1muchhigherfee,''and,indeed,afterhearingthe
am ount,AgentC intimated thatLAM may award the contractto a com petitorinstead.
On oraboutAugust25, 2008,M ozam bique O fficialcalled Em braerExecutive D .
ln an em ailthe sam e day to otherEM BRAER executives, Em braerExecutive D recounted the
conversation,notingthatMozambiqueOfficialhad(lhighlightedthat(M ozambiqueOfficiallhad
received very nasty com m entsfrom som e individuals, in relation to Em braer'scomm ission
proposalto(AgentC).''M ozambiqueOfficialfurtherS'indicatedthatsomeindividualsfeltthat
Em braer'sproposalwasan insult, and in a sense,itw ould have been less insulting to give
nothing,even ifthisw asnotan acceptable solution.'' Em braerExecutive D asked M ozam bique
OfficialSswhatwouldgAgentCqexpectfrom Embraer.''MozambiqueOfficialrespondedthat,
i'in the currentcircum stances, EM ozambi
som e pushback from Em braerExecutive D ,M ozambiqu: Oficiali'finally suggested thatwe
mightgetawaywith800,000USD (2x400,000).''WhenEmbraerExecutiveD told
M ozam bique OftscialthatEM BRAER %%had no budgetforsuch consultancy fee,''M ozam bique
Officialsuggested taking itfrom the profitm argin on thetwo optionalaircraftand also ibasked if
(EMBRAER)could increasetheaircraftprice....''
O n oraboutSeptem ber 15,2008,EM BRAER and LA M executed the purchase
agreementforthe saleoftwo E190 aircraftatapproximately $32,690,000 eachwith a$312,000
dow n paym entfora third aircraft. M ozam bique Officialw asone ofthree LA M executivesthat
signed the purchase agreem enton behalfofLA M .
On oraboutApril22,2009,seven m onthsafterthe execution ofthe purchase
agreem entbutbefore delivery ofthe tsrstaircraft,Em braerRL entered into an agency agreement
with a com pany A gentC had recently form ed in the Dem ocratic Republic of Sâo Tom é and
A -13
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 35 of 59
Principe. Tw o EM BRAER executivessigned the agency agreem enton EM BRAER'Sbehalf.
Tht agency agrtementauthoriztd AgentC'scom pany to prom ote salesofthe E190 iisoltly and
specifically''to LAM ,even though the sale ofsuch aircrafthad already been completed seven
m onthspriorto the execution ofthe agreem ent,A gentC's com pany did notexistatthe tim e the
purchaseagreementwassigned,andAgentC'scompanydidnotperform any legitim atework in
connection w ith the purchase agreem ent. The agreem entw ith AgentC'scom pany falsely stated
thatthe salesprom otion efforts identified therein had begun in oraround M arch 2008.
Pursuantto the agency agreem entdtscribed in Paragraph 56,Em braerRL agreed
topay AgentC'scompany $400,000 peraircraft(theexactamountM ozambique Officialhad
previously saidEM BRAER could ttgetaway''with paying). However,neitherAgentC nor
A gentC 'scom pany everprovided any legitim ate servicesto EM BRA ER .
EM B RAER delivered the tw o aircraftto LA M on oraboutJuly 30,2009,and
Septem ber2,2009.Follow ing the delivtry ofeach aircraft,AgentC's com pany subm itted two
invoicestoEM BRAER for$400,000 each,onedatedAugustl5,2009,and onedated September
24,2009. An EM BRAER executive signed and approved both invoices forpaym ent. On or
aboutAugust3l,2009,EmbraerRL wired $400,000,from itsU.s.-based bank accountto an
accountata bank in Sâo Tom éand Prfncipe,forfurthercreditto the an accountata bank in
Portugal,w hich w as held by A gentC 'scom pany. On oraboutOctobtr2,2009,Em braerRL
wired an additional$400,000 from itsU.s.-based bank accountto AgentC'scompany's
Portugal-based bank account. Em braerRL recorded these paym entsasiisales Com m ission''and
they wereconsolidatedinto EM BRAER'SbooksunderiiNetOperating (expenses)income''asa
iiselling''expense,specifically,SssalesCom m ission.''
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 36 of 59
On oraboutJuly 3,2008,EM BRAER executed acontractto provide three highly
specialized militaryaircrafttothe lndian AirForce forapproximately $208 million.ln
connection w ith the deal,EM BRAER retained the servicesofA gentD pursuantto a 2005
agency agreement.ltlaterpaid $5.76millionto AgentD pursuantto afalseagency agreement
signed in oraround 2008.
ln oraround January 2005,EM BRAER executed an agency agreem entw ith a
shellcompany domiciled in theUnited Kingdom and aftsliatedwith AgentD (although Agent
D'snameneverappeared in theagreement).Undertheagency agreement,EM BRAER agreedto
pay the shellcom pany a com m ission of9% ofthe value ofany defense contracts EM BRAER
obtained in India because EM BRAER believed AgentD could help ensure thatany contract
would be aw arded on a single-source,ratherthan com petitive,basis. EM BRA ER personnel
thoughtthe agreem entw ith AgentD w asillegalunderIndian law and thustook stepsto conceal
itstxistence,including secreting tht solt fully-extcuted version ofthe agretm tntin a safe
dtpositbox in London thatcould be opened only w hen b0th an EM BR AER em ployee and Agent
D oran associate ofAgentD were present.
Lessthan a m onth afterexecuting the agency agreem entw ith the shellcompany,
on oraboutFebruary 8,2005,EM BRA ER announced thatithad signed a mem orandum of
understanding((1M OU'')with India'sDefenceResearchand DevelopmentOrganisation to
supportthe developm entofa new early warning radarsystem forthe lndian A irForce,which
EM BRAER believed could ultim ately resultin EM BRAER securing a contractforthe sale of
three Em braer 145 aircraft.
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 37 of 59
On oraboutJuly 3,2008,nearly three yearsaftersigning theM OU , the lndian Air
Forceagreed to purchasethreeaircraftfrom EM BRAER forapproximately $208m illion (the
dslndiacontract'').Thenextday,on oraboutJuly 4,2008,AgentD contactedEM BRAER
employeesand demanded paym entofthe com m ission pursuantto thecontractreferenced in
Paragraph 60.
A gentD continued making dem andsforpaym entand, in oraround February and
M arch 2009,an EM BRAER executive m etwith lawyersrepresenting A gentD to discussAgent
D'spaymentdemands.Followingthesediscussions,EM BRAER executivesagreed to pay $5.76
m illion to AgentD to sdtle the claim .
To concealthe paym entreferenced in Paragraph 63, EM BRAER created a false
agency agreem ent. On oraboutN ovem ber21,2009,m ore than a yearafterEM BRAER was
awarded the lndia contract,EM BRAER,through itswholly owned subsidiary, ECC Investm ent
SwitzerlandAG ($iECC''),executedanagencyagreementwithashellcompanydomiciledin
Singapore and aftiliattd w ith A gtntD foritspurported services asan agentin a sale EM BRAER
had m ade to an unrelated custom erin anothercountry thathad purchased an EM BRAER aircraft
m ore than a yearearlier,in oraround July 2008. The Singaporean shellcom pany never
perform ed any servicesrelated to thatsale orto the sale to the lndian A ir Force.
The sam eday thatthe agency agreem entw asexecuted,the Singaporean shell
company delivcredthreeinvoicesto ECC,each for$1.92m illion.EM BRAER,throughECC,
rem itted three paym entsto the shellcom pany shortly thereafter.EM BRA ER'Sbooks and
recordsdid notreflectthatthistransaction wasrelated to itsarrangem entw ith AgentD .
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 38 of 59
From the unlawfulconductdescribed above,Em braer's totalprofits were
EM BR AER 'SInternalAccountine Controls
D uring the relevantperiod,EM BRAER know ingly and w illfully failed to devise
and maintain an adequate system ofinternalaccounting controls. In particular,and asrelevant
here,EM BRAER hadnointernalaccountingcontrolsthat,amongotherthings,(a)required
executed contractwith athird-party beforepaymentcouldbemadeto it;(c)required
docum entation orotherproofthatserviceshad been rendered by a third-party before paym ent
paym entswere m ade pursuantto appropriate controls,including those described above.
Forexam ple,in connection with the Dom inican Republic bribery schem e,
EM BRA ER m ade paym entsto one ofthe shellcom panies identified by D om inican O fficial,
even though a foreign ofûcialhad told EM BRA ER to which com pany to m ake agency paym ents,
and EM BRAER had conducted no diligence on the shellcom pany,did nothavea signed contract
w ith the shellcom pany,and knew thatthe shellcom pany had notperform ed any legitim ate
services in exchange forthepaym ent.
A lso in connection with the Dominican Republic bribery schem e,EM BRAER
m ade paym entsto AgentA forservicespurportedly rendered in connection with an aircraftsale
to the Jordanian A irForce,even though EM BRAER neversold any aircraftto the Jordanian A ir
Force,and EM BRAER knew thatA gentA had rendered no servicesin connection w ith any
attem pted sale to the Jordanian A irForce,and even though an internalEM BRAER m em orandum
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 39 of 59
indicated thatthe paym entsw ere related to the com m ission ow ed forthe SuperTucano aircrafts
sold to the governm entofthe Dom inican Republic,notpotentialsalesto the Jordanian A irForce
Further,in connection w ith the SaudiArabia bribery schem e,EM BRAER m ade
paymentsto AgentB ,even though ithad conducted m inim aldue diligence on AgentB,did so
alm ostexclusively on the basisofinform ation Em braerExecutive B personally provided to its
contractsand legaldepartm ents,and did notrequire any proofofservices from A gentB before
m aking paym ent.
Sim ilarly,in connection w ith the M ozam bique schem e,the only due diligence
thatEM BRAER conducted on AgentC 'scom pany w asIim ited to collecting the com pany's
registration docum ents,corporate by-laws,and board m inutesdirectly from A gentC,and
EM BRAER did notrequire any proofofservicesfrom AgentC before m aking paym ent.
N um eroushigh-levelEM BRAER executivesknew thatthe variousagency
agreem entsreferenced above falsely represented thatpaym entsw ere being m ade forlegitim ate
agency services,and thatthe true purpose ofthe paymentsm ade to the agentsw asto funnel
bribesto foreign officials. M any ofthe high-levelexecutivesw ho knew aboutthe false nature of
the agreem entsand the im properpurpose ofthe paym entshad the authority and responsibility to
ensure thatEM BRA ER devised and m aintained an adequate system ofinternalaccounting
controls,knew thatEM BRA ER 'S then-existing internalaccounting controlsfailed to prevent
EM BRA ER from entering into false agency agreem entsand m aking im properpaym ents,and
know ingly and w illfully failed to implementadequate internalaccounting controlsto addressthe
known weaknesses,in partto perm itEM BRAER to enterinto false agency agreem entsand
funnelbribesto foreign officials.
A -18
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 40 of 59
W HEREAS,EmbraerS.A.(theidcompany'')hasbeen engaged in discussionswith the
United StatesDepartmentofJustice,CriminalDivision,FraudSection(the''Section'')regarding
issuesarising in relation to certain improperpaymentsto foreign officialsto facilitatetheaward
ofcontractsand assistin obtaining businessforthe Com pany;and
W HEREAS,in orderto resolve such discussions,it isproposed thatthe Com pany enter
into a certain agreem entw ith the Section;and
W HEREA S,the Company'sG eneralCounsel,Fabiana Leschziner,togetherw ith outside
counselfor the Com pany,have advised the Board of Directors of the Com pany of its rights,
possible defenses,the Sentencing G uidelines'provisions,and the consequences ofentering into
such agreem entwith the Section;
Therefore,the Board ofD irectorshas RESOLVED that:
the Company with (i)one countofconspiracy to comm itoffensesagainstthe United States in
violation ofTitle l8.United StatesCode,Section 37l,thatis,to violate the anti-bribery and books
and recordsprovisionsoftheForeign CorruptPracticesActof1977 (k6FCPA''),asamended,l5
U.S.C. jj78dd-1,78m(b)(2)(A),78m(b)(5),and 78ff(a);and (ii)onecountofviolation ofthe
waives indictm ent on such charges and enters into a deferred prosecution agreem ent with the
Section;and(c)agreestoacceptamonetarypenaltyagainstCompanytotaling $107,285,090,and
to pay such penalty to the United States Treasury w ith respect to the conductdescribed in the
lnform ation'
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 41 of 59
The Com pany acceptsthe term sand conditionsofthis A greem ent,including,but
to the United States Constitution,Title 18,United StatesCode,Section 3161,and FederalRule of
CriminalProcedure 48(b);and (b)a knowing waiverforpurposesofthisAgreementand any
chargesby the United Statesarising outoftheconductdescribed in the attached Statem entofFacts
ofany objectionwithrespecttovenueandconsentstothefilingoftheInformation,asprovided
underthe term s ofthisA greem ent,in the United StatesD istrictCourtforthe Southern Districtof
Florida;and (c)a knowing waiverofany defensesbased on the statute of limitationsforany
prosecution relating to the conduct described in the attached Statem ent of Facts or relating to
conductknow n to the Section prior to the date on which this A greem entw as signed that is not
tim e-barred by the applicable statuteoflim itationson thedate ofthe signing ofthisAgreem ent;
Paulo Cesarde Souza e Silva,ChiefExecutive OfficerofCom pany,and Fabiana
Leschziner,G eneralCounselof Company,are hereby authorized.em pow ered and directed,on
behalfofthe Company,to execute the Deferred Prosecution Agreem entsubstantially in such form
as reviewed by this Board ofD irectors atthis m eeting w ith such changes asthe Paulo Cesar de
Souza e Silva,ChiefExecutive O fficerofCom pany,and Fabiana Leschziner,GeneralCounselof
Com pany,m ay approve;
Paulo Cesarde Souza e Silva,ChiefExecutive Officerof Com pany,and Fabiana
Leschziner,GeneralCounselofCompany,are hereby authorized,em pow ered and directed to take
any and all actions as m ay be necessary or appropriate and to approve the form s,term s or
provisionsofany agreem entorotherdocum ents as may be necessary orappropriate,to carry out
and effectuate the purpose and intentofthe foregoing resolutions;and
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 42 of 59
A 11of the actions of Paulo Cesar de Souza e Silva,Chief Executive O fficer of
Com pany, and Fabiana Leschziner, General Counsel of Com pany, which actions w ould have
been authorized by the foregoing resolutions except that such actions w ere taken prior to the
adoption of such resolutions,are hereby severally ratified,confirm ed,approved,and adopted as
actions on behalfofthe Com pany.
oate: lo/o/.
Corporate Secretary
EmbraerS.A .
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 43 of 59
ln orderto addressany deficiencies in itsinternalcontrols,com pliance codt,policies,
S'Company'')agreesto continueto conduct,in amannerconsistentwith al1ofitsobligations
underthisAgreem ent,appropriate reviewsof itsexisting internalcontrols,policies,and
W here necessary and appropriate,the Company agreesto adoptnew orto m odify
existing internalcontrols,com pliance code,policies,and proceduresin orderto ensure thatit
maintains; (a)asystem ofinternalaccounting controlsdesigned toensurethatthe Company
makesandkeepsfairandaccuratebooks,records,andaccounts;and(b)arigorousanticorruption com pliance program thatincludespoliciesand proceduresdesigned to detectand
deterviolationsofthe FCPA and otherapplicable anti-corruption law s. Ata m inim um ,this
should include,butnotbe lim ited to,the follow ing elem entsto the extentthey are notalready
partofthe Company'sexisting internalcontrols,com pliance code,policies,and procedures:
H igh-LevelComm itment
The Com pany w illensurethatits directorsand seniorm anagem entprovide
strong,explicit,and visible supportand com m itm entto itscom orate policy againstviolations of
theanti-corruption law sand itscompliancecode.
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 44 of 59
Policiesand Procedures
The Company willdevelop and prom ulgate a clearly articulated and visible
corporatepolicy againstviolationsofthe FCPA and otherapplicableforeign law counterparts
(collectively,thelsanti-corruption 1aws,''),whichpolicy shallbememorialized in awritten
com pliancecode.
The Com pany w illdevelop and prom ulgate compliance policiesand procedures
designed to reduce the prospectofviolations ofthe anti-corruption law s and the Com pany's
compliance code,and the Com pany w illtake appropriate m easuresto encourage and supportthe
observance ofethics and com pliance policiesand procedures againstviolation ofthe anticorruption law sby personnelatalllevelsofthe Com pany. These anti-corruption policies and
proceduresshallapply to alldirectors,officers,and employeesand,w here necessary and
butnotlim ited to,agentsand interm ediaries,consultants,representatives,distributors,team ing
policiesand procedures isthe duty ofindividualsatalllevelsofthe com pany. Such policiesand
hospitality,entertainm ent,and expenses;
custom ertravel'
charitable donations and sponsorships;
facilitation paym ents'
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 45 of 59
solicitation and extortion.
The Com pany w illensure thatithasa system offinancialand accounting
procedures,including a system ofinternalcontrols,reasonably designed to ensurethe
maintenance offair and accurate books,records,and accounts. Thissystem should be designed
to provide reasonable assurances that:
transactionsare executed in accordance with m anagem ent's generalor
specific authorization;
transactionsare recorded asnecessary to perm itpreparation offinancial
statem ents in conform ity with generally accepted accounting principles orany othercriteria
applicable to such statem ents,and to m aintain accountability forassets;
accessto assets isperm itted only in accordance with m anagem ent's
generalorspecific authorization;and
the recorded accountability forassetsis com pared w ith the existing assets
atreasonable intervalsand appropriate action istaken w ith respectto any differences.
Periodic Risk-Based Review
The Com pany w illdevelop thesecom pliance policiesand procedures on the
basisofa periodic risk assessm entaddressing the individualcircum stancesofthe Com pany,in
particularthe foreign bribery risksfacing the Com pany,including,butnotIim ited to,its
geographicalorganization,interactionsw ith varioustypesand levels of governm entofficials,
and perm itsin the Company'soperations,degree ofgovernm entaloversightand inspection,and
volum e and im portance ofgoodsand personnelclearing through custom s and im m igration.
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 46 of 59
The Com pany shallreview itsanti-corruption com pliance policiesand
proceduresno lessthan annually and update them as appropriate to ensure theircontinued
effectiveness,taking into accountrelevantdevelopm entsin the field and evolving international
and industry standards.
ProperO versightand Independence
The Company w illassign responsibility to one ormore seniorcorporate
executivesofthe Company forthe implem entation and oversightofthe Company'santi-
authority to reportdirectly to independentm onitoring bodies,including internalaudit,the
Com pany'sBoard ofD irectors,orany appropriate com m ittee ofthe Board ofDirectors,and
shallhave an adequate levelofautonom y from m anagem entasw ellassufficientresourcesand
authority to m aintain such autonom y.
Training and Guidance
The Com pany willimplem entm echanism sdesigned to ensure thatitsanti-
corruption com pliancecode,policies,and proceduresare effectively com m unicated to all
directors,officers,em ployees,and,where necessary and appropriate,agentsand business
employeesin positionsofleadership ortrust,positionsthatrequiresuch training(e.g.,internal
audit,sales,legal,compliance,finance),orpositionsthatotherwiseposeacorruption risktothe
Company,and,wherenecessary andappropriate,agentsand businesspartners;and (b)
corresponding certifications by alIsuch directors,officers,em ployees,agents,and business
partners,certifying com pliance w ith the training requirem ents.
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 47 of 59
The Com pany w illm aintain, orwhere necessary establish
forprovidingguidanceand adviceto directors oftk ers,em ployees
an effective system
and,where necessary and
appropriate,agentsand businesspartners, on complying with the Company'santi-corruption
com pliance code,policies, and procedurts,including when they need advice on an
InternalReporting and Investigation
The Com pany willm aintain, orw here necessary establish
an effective system
forinternaland,w hert possiblc, confidentialreporting by and protection of,directors
, of
em ployees,and,where appropriate, agentsand business partners concerning violationsofthe
anti-corruption law sorthe Com pany'santi- corruption com pliance code
The Com pany w illm aintain, orwhere necessary establish, an effective and
reliable processw ith sufficientresourcesforresponding to, investigating,and docum enting
alltgationsofviolationsofthe anti-conuption law sorthe Com pany's anti- corruption
compliance code,policies,and procedures.
The Company willim plem entm echanism sdesigned to effectively enforce its
compliance code,policies,and procedures, including appropriately incentivizing com pliance and
disciplining violations.
The Company w illinstitute appropriate disciplinary procedures to address,
am ong otherthings,violationsofthe anti-corruption lawsand the Com pany'santi- corruption
compliance code,policies,and procedures by the Com pany'sdirectors, officers,and em ployees.
Such proceduresshould be applied consistently and fairly, regardless oftheposition held by,or
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 48 of 59
perceived im portance of, tht director,officer, oremployee.The Com pany shallim plem ent
proceduresto ensure thatwhere m isconductis discovered
reasonable stepsare taken to rem edy
the harm resulting from such m isconduct, and to ensure thatappropriate stepsare taken to
preventfurthersim ilarm isconduct including assessing the internalcontrols,compliance code
policies,and proceduresand m aking m odifications necess
arytoensuretheoverallanticorruption com pliance program iseffective.
The Com pany w illinstitute appropriaterisk- based due diligence and compliance
requirem entspertaining to the retention and oversightofallagentsand b
usiness partners,
properly documented due diligencepertaining to the hiring and
appropriate and regularoversightofagentsand businesspartners;
inform ing agentsand businesspartnersofthe Com pany'scom m itmentto
abiding by anti-corruption law s, and ofthe Com pany'santi-corruption com pliance code
policies,and procedures;and
seeking a reciprocalcom m itm entfrom agentsand businesspartners.
W here necessary and appropriate, the Com pany w illinclude standard provisions
in agreem ents,contracts, and rencwalsthereofw ith aIlagentsand business partnersthatare
reasonably calculated to preventviolationsofthe anti-corruption law s, w hich m ay,depending
theagentorbusinesspartnertoensurecompliancewith theforegoing;and (c)rightsto ttrminate
an agentorbusinesspartnerasa resultofany breach ofthe anti-corruption law s, the Com pany's
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 49 of 59
com pliancecode,policies, orprocedures,orthe representations and undertakingsrtlated to s
m atters.
M ergers andAcquisitions
The Com pany w illdevelop and implem entpolicies and proceduresformergers
and acquisitionsrequiring thatthe Com pany conductappropriaterisk-basedduediligenceon
potentialnew businessentities, including appropriate FCPA and anti- corruption due diligence by
legal,accounting, and com pliance personnel.
The Com pany w illensure thatthe Com pany's com pliance code policies,and
proceduresregarding the anti-corruption law sapply asquickly as ispracticable to new ly
acquired businessesorentitiesm erged w ith the Com pany and w illprom ptly:
train the directors,officers, em ployees,agents,and businesspartners
consistentwithParagraph 8above on theanti-corruption lawsandtheCom pany'scom pliancc
code,policies,andproceduresregardinganti-corruption laws;and
where warranted,conductan FcpA -specific auditofaIlnewly acquired
orm erged businesses asquickly aspracticable.
M onitoring and Testing
The Com pany w illconductperiodic reviews and testing ofits anti- corruption
com pliance code,policies,and proceduresdesigned to evaluate and improve theireffectiveness
in preventing and detecting violationsofanti-corruption law sand the Com pany'santi- corruption
code,policies,and procedures,taking into accountrelevantdevelopm ents in the tseld and
evolving internationaland industry standards.
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 50 of 59
Thedutiesand authority ofthelndependentComplianceM onitor(theiiM onitor''), and
the obligationsofEm braerS.A.(the(d
affiliates,with respectto the M onitorand the U nited StatesD epartm entofJustice, Crim inal
TheCompanywillretaintheMonitorforaperiodofthree(3)years(theti-lkrm of
M onitor'
sM andate
The M onitor'sprim ary responsibility isto assessand m onitorthe Com pany's
com pliance with the term softhe A greem ent, including the Corporate Com pliance Program in
Attachm entC,so asto specifically addressand reduce the risk ofany recurrence ofthe
Company'sm isconduct. D uring the Term ofthe M onitorship, theM onitorwillevaluate,in the
m annersetforth below ,the effectivenessofthe internalaccounting controls, record-keeping,and
financialreporting policies and proceduresofthe Com pany asthey relate to the Com pany's
currentand ongoing com pliance w ith the FCPA and otherapplicable anti-conuption laws
maybenecessarytofulfilltheforegoingmandate(thedtMandate'').ThisM andateshallinclude
an assessm entofthe Board ofDirectors'and seniorm anagem ent'scom m itm entto, and effective
im plem entation of,the corporatecom plianceprogram described in Attachm entC ofthe
A greem ent.
D -l
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 51 of 59
Company '
s Obligations
The Company shallcooperate fully w ith the M onitor, and the M onitor shallhave
theauthority to take such reasonable steps as, in hisorherview ,m ay be necessary to be fully
inform ed aboutthe Company'scom pliance program in accordance w ith the principles setforth
herein and applicable law , including applicabledataprotection andlaborlawsand regulations
To thatend,the Com pany shall:facilitate the M onitor'saccessto the Com pany's docum entsand
resources;notlim itsuch access,exceptasprovided in Paragraphs5- 6;and provide guidance on
applicablelocallaw (suchasrelevantdataprotectionandlaborlaws) TheCom pany shall
provide the M onitorw ith accessto allinform ation, docum ents,records,facilities, and
employees,asreasonably requested by the M onitor, thatfallw ithin the scope ofthe M andate of
tht M onitorunderthe Agreem ent. The Com pany shalluse itsbestefforts to provide the M onitor
w ith accessto the Company'sform eremployeesand itsthird-party vendors, agents,and
Any disclosure by the Company to the M onitorconcerning corruptpaym ents,
false books and records,and internalaccounting controlfailures shallnotrelieve the Com pany of
any otherwise applicable obligation to truthfully disclose such mattersto the Section, pursuantto
the A greem ent.
Withholding Access
The parties agret thatno attorney-clientrelationship shallbe form ed betw een the
Company and the M onitor. ln the eventthatthe Com pany seeksto withhold from the M onitor
accessto inform ation,docum ents,records,facilities, orcurrentorformer em ployeesofthe
Companythatmay besubjecttoaclaim ofattorney-clientprivilegeortotheattorneyworkproductdoctrine,orwhere the Com pany reasonably believes production would otherwise be
Case 0:16-cr-60294-JIC Document 2 Entered on FLSD Docket 10/24/2016 Page 52 of 59
inconsistentwith applicable law , the Company shallwork cooperatively with the M onitorto
resolvethe m atterto the satisfaction ofthe M onitor.
lfthe m attercannotbe resolved, atthe requestofthe M onitor, the Com pany shall
prom ptly provide written notice to the M onitorand the Section. Such notice shallinclude a
generaldescription ofthenature ofthe inform ation, docum ents,records,facilities orcurrentor
formeremployees thatare being w ithheld, asw ellasthe legalbasisforw ithholding access. The
Section m ay then considerwhetherto m ake a furtherrequestforaccessto such inform ation,
docum ents,records,facilities,orem ployees.
M onitor's Coordination with the
Company and Review M ethodology
ln carrying outthe M andate,to the extentappropriate underthe circum stances,
the M onitorshould coordinate w ith Com pany personnel, including in-house counsel,com pliance
personnel,and internalauditors,on an ongoing basis. The M onitorm ay rely on the productof
the Com pany's processes,such asthe resultsofstudies, reviews,sam pling and testing
m ethodologies,audits,and analysesconducted by oron behalfofthe Com pany, aswellasthe
M onitorin carrying outthe M andate through increased efficiency and Com pany-specific
exptrtise,provided thatthtM onitorhas confidence in the quality ofthose resources.
The M onitor'sreviews should use a risk-based approach,and thus, the M onitoris
notexpected to conducta comprehensive review ofal1businesslines, al1businessactivities,or
allmarkets. In carrying outthe M andate,the M onitorshould consider, forinstance,risks
presentedby:(a)thecountriesand industriesin whichtheCompany operates;(b)currentand
futurebusinessopportunitiesand transactions;(c)currentand potentialbusinesspartners,
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theCompany'sgifts,travel,andentertainmentinteractionswithforeignofficials;and (e)the
Com pany'sinvolvem entwith foreign officials, including the am ountofforeign governm ent
regulation and oversightofthe Com pany, such aslicensing and perm itting,and the Company's
exposure to custom s and im m igration issues in conducting itsbusinessaffairs.
In undertaking the review sto carry outthe M andate, the M onitorshallform ulate
conclusionsbasedon,amongotherthings:(a)inspection ofrelevantdocum ents, including the
system sand proceduresofthe Com pany atsam ple sites, including internalaccounting controls,
currentand,where appropriate,formerdirectors, oftscers,em ployees,businesspartners, agents,
ofthe Com pany'scom pliance program .
M onitor's Written W ork Plans
To carry outthe M andate,during the Term ofthe M onitorship, theM onitorshall
conductan initialreview and prepare an initialreport,follow ed by atleasttw o follow-up reviews
and reports asdescribed in Paragraphs 16-19 below . W ith respectto the initialreport, after
consultation w ith the Company and the Section,the M onitorshallprepare the firstw ritten w ork
W ith respectto each follow -up report,afterconsultation w ith the Com pany and the Section, the
M onitorshallprepare awritten work plan atleastsixty (60)calendardayspriortocommencing a
review,andtheCompany andtheSection shallprovidecommentswithin thirty(30)calendar
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daysafterreceiptofthe w ritten work plan. Any disputesbetween the Com pany and the M onitor
w ith respectto any w ritten w ork plan shallbe decided by the Section in itssole discretion.
Allw ritten w ork plans shallidentify with reasonable specificity the activitiesthe
M onitorplansto undertake in execution ofthe M andate, including aw ritten requestfor
docum ents. The M onitor's work plan forthe initialreview shallinclude such steps asare
reasonably necessary to conductan effective initialreview in accordance w ith the M andate,
including by developing an understanding, to theextentthe M onitordeem sappropriate, ofthe
factsand circum stancessurrounding any violations thatm ay have occurred before the date ofthe
Agreem ent. ln developing such understanding the M onitoristo rely to the extentpossible on
available inform ation and docum entsprovided by the Com pany. ltisnotintended thatthe
M onitorw illconducthisorherow n inquiry into the historicaleventsthatgave rise to the
A greem ent.
Theinitialreview shallcommenceno Iaterthanonehundred twenty (120)
calendardaysfrom thedattoftheengagementoftheM onitor(unlessotherwiseagreedby the
Company,theM onitor,andtheSecsion).TheMonitorshallissueawrittenreportwithinone
hundred twenty (120)calendardaysofcommencingtheinitialreview,setting forththeM onitor's
assessm entand,ifnecessary,m aking recom m endationsreasonably designed to im prove the
effectivenessofthe Com pany'sprogram forensuring com pliance w ith the anti-corruption laws.
The M onitorshould consultwith the Company concerning hisorherGndingsand
recom m endationson an ongoing basisand should considerthe Com pany'scom m entsand input
to the extentthe M onitordeem sappropriate. The M onitorm ay also chooseto share a draftofhis
orherreportsw ith the Com pany priorto finalizing them .The M onitor'sreportsneed notrecite
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ordescribe com prehensively the Com pany'shistory orcom pliancepolicies,procedures and
practices,butratherm ay focus on those areasw ith respectto which the M onitorw ishesto m ake
recom m endations,ifany,forim provem entorw hich the M onitorotherw ise concludesm erit
particularattention. The M onitorshallprovide the reportto the Board ofDirectors ofthe
Company and contem poraneously transm itcopiesto the FCPA Chief Fraud Section,Criminal
Division,U.S.Departm entofJustice, at1400 New York A venue N .W .,W ashington,D .C
20005. Afterconsultation with the Com pany, the M onitorm ay extend the tim e period for
issuance ofthe initialreportfora briefperiod oftim e w ith priorwritten approvalofthe Section.
W ithin ninety (90)calendardaysafterreceiving theM onitor'sinitialreport, the
Com pany shalladoptand im plem entallrecom m endations in thereport,
caltndardaysofreceiving the reporq the Com pany notifiesin w riting the M onitorand the
Section ofany recom m endationsthatthe Com pany considers unduly burdensom e, inconsistent
with applicable law orregulation, im practical,excessively expensive, orotherw ise inadvisable.
W ith respectto any such recom m endation, the Company need notadoptthatrecom m endation
withintheonehundred andtwenty (120)daysofreceivingthereportbutshallproposein writing
to the M onitorand the Section an alternative policy, procedure orsystem designed to achievethe
calendardaysafterthe Com pany servesthe written notice.
In the eventthe Com pany and the M onitorare unableto agree on an acceptable
alternative proposal,the Com pany shallprom ptly consultw ith the Section. The Section may
considerthe M onitor'srecom m endation and the Com pany's reasons fornotadopting the
recomm endation in determ ining whetherthe Com pany hasfully com plied w ith itsobligations
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undertht Agreem ent. Pending such determ ination, the Com pany shallnotbe required to
W ith respectto any recomm endation thatthe M onitordeterm inescannot
the report,the M onitorm ay extend the tim e period for im plemtntationw ithpriorwritten
approvalofthe Section.
Follow-up Reviews
A follow -up review shallcom mence no laterthan one hundred- ei
ghty (180)
calendardaysaftertheissuance oftheinitialreport(unlessotherwiseagreed by theComp
theMonitorandtheSection).TheM onitorshallissueawrittenfollow up reportwithin one
hundred-twenty(120)calendardaysofcommencingthefollow-upreview, setting forth the
M onitor'sassessm entand, ifnecessary,making recom m endationsin the sam e fashion as set
forth in Paragraph 12 w ith respectto the initialreview . Afterconsultation w ith the Com pany
the M onitorm ay extend the tim e period forissuance ofthe follow - up reportfora briefperiod of
tim e w ith priorwritten approvalofthe Section.
W ithin ninety(90)calendardaysafterreceiving theM onitor'sfollow-up report,
the Com pany shalladoptand im plem entallrecomm endationsin the report unless,within thirty
(30)calendardaysafterreceiving thereport,the Company notifiesinwriting theM onitorandthe
Section concerning any recom mendationsthatthe Com pany considersunduly burdensom e
inconsistentw ith applicable law orregulation, im practical,excessively expensive, orotherw ise
inadvisable. W ith respectto any such recom m endation, the Com pany need notadoptthat
recommendation withintheninety (90)calendardaysofreceiving thereportbutshallproposein
writing to the M onitorand the Section an alternative policy, procedure,orsystem designed to
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the M onitordo notagree, such partiesshallattem ptin good faith to reach an agreem entw ithin
ln the eventthe Com pany and the M onitorare unable to agree on an acceptable
alternative proposal, the Company shallpromptly consultw ith the Section. The Section may
considerthe M onitor'srecom m endation and the Com pany'sreasons fornotadopting the
recom m endation in determ ining whetherthe Com pany hasfully com plied w ith itsobligations
underthe Agreem ent. Pending such determ ination, the Com pany shallnotbe required to
implementanycontestedrecommendationts).W ithrespecttoanyrecolnmendationthatthe
receiving the report, the M onitorm ay extend the tim e period forim plem entation with prior
written approvalofthe Section.
TheM onitorshallundertake a second follow -up review pursuantto the sam e
proceduresdescribed in Paragraphs 16-18. Follow ing the second follow -up review , the M onitor
shallcertify w hetherthe Com pany'scom pliance program , including itspolicies and procedures
isreasonably designed and im plem ented to preventand detectviolationsofthe anti- corruption
Iaw s, The finalfollow-up review and reportshallbe com pleted and delivered to the Section no
laterthan thirty (30)daysbeforetheendoftheTerm .
Exceptassetforthbelow insub-paragraphs(b)and(c), should the
M onitordiscoverduring the course ofhisorherengagem entthat:
im properpaym entsoranything else ofvalue may have been offered,
prom ised,m ade,orauthorized by any entity orperson w ithin the
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Com pany orany entity orperson w orking, directly orindirectly fororon
behalfofthe Com pany;or
the Com pany m ay have m aintained false books, recordsoraccounts;or
(collectively,:tpotentialM isconduct''),theM onitorshallimmediattly reportthePotential
M isconductto the Com pany'sGeneralCounsel, ChiefCom pliance O fficer and/orA udit
Com m ittee forfurtheraction, unlessthe PotentialM isconductw asalready so disclosed. The
M onitoralso m ay reportPotentialM isconductto the Section atany tim e, and shallreport
PotentialM isconductto the Section when itrequeststhe inform ation.
may constituteacrim inalorregulatory violation (ûW ctualM isconduct''), the M onitorshall
im m ediately reportthe ActualM isconductto the Section. W hen the M onitordiscoversActual
M isconduct,the M onitorshalldisclose the ActualM isconductsolely to the Section, and,in such
cases,disclosureofthe A ctualM isconductto theG eneralCounsel, Chief Com pliance O fficer,
and/orthe AuditCom m ittet ofthe Com pany should occurasthe Section and the M onitordeem
appropriate underthe circum stances.
The M onitorshalladdress in hisorherreportstheappropriatenessofthe
Com pany'sresponse to disclosed PotentialM isconductorA ctualM isconduct, w hether
previously disclosed to the Section ornot. Further, ifthe Com pany orany entity orperson
working directly orindirectly fororon behalfofthe Com pany w ithholds inform ation necessary
fortheperform ance ofthe M onitor'sresponsibilitiesand the M onitorbelievesthatsuch
Section and addressthe Com pany'sfailure to disclose the necessaty infonmation in hisorher
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TheCompany noranyoneacting on itsbehalfshalltakeany action to
retaliate againstthe M onitorforany such disclosures orforany other reason.
MeetingsDuringPendency ofMonitorshlp
TheM onitorshallmeetwiththeSectionwithinthirty(30)calendardaysafter
providing each reportto the Section to discussthereport, to befollowed by ameeting between
the Section,the M onitor, and the Com pany.
Atleastannually, and more frequently ifappropriate, representativesfrom the
Com pany and the Section w illm eettogetherto discussthe m onitorship and any suggestions,
com m ents,orim provem entsthe Com pany m ay w ish to discussw ith orpropose to the Section,
including with respectto the scope orcostsofthe m onitorship.
y ofMonitor'
The reports willlikely include proprietary, financial,confidential and com petitive
business inform ation. M oreover, public disclosure ofthereportscould discourage cooperation
orim pede pending orpotentialgovernm entinvestigationsand thusunderm ineth
the m onitorship. Forthese reasons, am ong others,the reportsand the contentsthereofare
intended to rem ain and shallrem ain non-public, exceptasotherw ise agreed to by the partiesin
w riting,orexceptto the extentthatthe Section determ ines in itssole discretion thatdisclosure
would be in furtherance ofthe Section'sdischarge ofitsduties and responsibilitiesoris
otherwise required by law.
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