(Free Translation: For reference only Original in Portuguese)

USINAS SIDERRGICAS DE MINAS GERAIS S.A. - USIMINAS

CNPJ/MF 60.894.730/0001-05
NIRE 313.000.1360-0
Publicly Traded Company

MANAGEMENTS PROPOSAL TO THE EXTRAORDINARY SHAREHOLDERS

MEETING OF JULY 19th, 2016 HOMOLOGATION OF THE CAPITAL INCREASE
AND AMENDMENT TO THE COMPANYS BYLAWS (ARTICLE 11 OF CVM
INSTRUCTION N 481/2009)
Usinas Siderrgicas de Minas Gerais S.A. USIMINAS (Usiminas or Company), in
the view of the Extraordinary Shareholders Meeting called for July 19th, 2016, pursuant
to the Call Notice released on June 17th, 2016, and pursuant to article 11 of CVM
Instruction n 481/2016, hereby presents information on the subjects of the agenda for
the mentioned meeting:
1 Homologation of the capital increase approved at the Extraordinary Shareholders
Meeting of April 18th, 2016, in the total amount of R$ 1,000,000,000.00, with the
consequent issuance of 200,000,000 common shares, identical to the other shares of
its kind already existing, all registered and with no par value, at the issuance price of
R$ 5.00 per share;
2 Amendment of the Heading of article 5 of the Company Bylaws regarding the
capital stock and the and the number of shares in which it is divided, as a result (i) of
the capital increase referred to in item 1 of the Agenda; and (ii) of the capital increase
carried out within the limits of the authorized capital, which was approved by the Board
of Directors on March 11th, 2016, and partially homologated on June 3rd, 2016, with the
issuance and subscription of 39,292,918 class A preferred shares, identical to the
shares of its kind already existing, at the issuance price of R$ 1.28 per share, in the
total amount of R$ 50,294,935.04; and
3 Amendment of the first paragraph of Article 5 of the Company Bylaws, in order to
reflect the deduction, on the amount of shares corresponding to the authorized capital
of the Company, of 39,292,918 class A preferred shares issued in the capital increase
approved by the Board of Directors on March 11th, 2016 and partially homologated on
June 3rd, 2016.

(Free Translation: For reference only Original in Portuguese)

1 Homologation of the Capital Increase Approved at the Extraordinary

Shareholders Meeting, in April 18th, 2016
On April 18th, 2016, an Extraordinary Shareholders Meeting of the Company was held,
on which all present shareholders, representing 82% of Usiminas voting capital,
approved the capital increase in the amount of R$ 1,000,000,000.00, through the
issuance of 200,000,000 new common shares, at the issuance price of R$ 5.00 per
share (Capital Increase ON).
As informed in the calling for the Extraordinary Shareholders Meeting of April 18th,
2016, the capital increase consisted of one of the measures set forth in the Companys
strategic plan for 2016, as disclosed on Note 1 to the Financial Statements for the
financial year ended on December 31st, 2015, in order to reinforce the Companys cash
account and strengthen its capital structure, ensuring that the Company has conditions
to face the current adverse economic scenario, especially for steel and mining sectors.
At a meeting held on March 11th, 2016, the Board of Directors unanimously recognized
the need to capitalize the Company through the private issuance of shares. During the
same meeting were approved, by the majority of the Board members, the basic
characteristics of the capital increase now proposed for homologation, including the
amount of R$ 1,000,000,000.00, which was demanded by the Companys financial
creditors as the minimum required for them to agree with the execution of a standstill
agreement, which effectively occurred on March 17th, 2016.
At a meeting also held on March 11th, 2016, the Board of Auditors unanimously issued
an opinion that the proposal for the Capital Increase was in compliance with the legal
requirements and was also in the Companys interest.
The Companys shareholders had a 30 (thirty) days period to exercise their preemptive
rights to subscribe for the new common shares, according to the Notice to
Shareholders released on April 18th, 2016. Additionally, as informed in the Notice to
Shareholders released by the Company on June 2nd, 2016, the leftover shares which
were not subscribed during the period for the exercise of the preemptive right were
apportioned among the shareholders that have included, in the subscription bulletin,
the request for reservation of unsubscribed shares (1st Round of Leftovers). During
the period for the exercise of preemptive rights and the 1st Round of Leftovers it were

(Free Translation: For reference only Original in Portuguese)

subscribed 168,319,189 shares, corresponding to 84.16% of the shares issued as per

the Capital Increase ON, totaling R$ 841,595,945.00.
As stated in the Notice to Shareholders released by the Company on June 16th, 2016,
since after the 1st Round of Leftovers still remained unsubscribed shares, the shares
not subscribed during the 1st Round of Leftovers will be divided among the
shareholders that participated in the 1st Round of Leftovers and requested reservation
of leftovers in their respective subscription bulletins.
In order to expedite the proceedings for the conclusion of the capital increase,
considering its importance to the Company, the Extraordinary Shareholders Meeting to
deliberate on the homologation of the Capital Increase ON is being called before the
end of the period for the subscription of the leftover shares. In any case, as the
possibility of partial homologation of the Capital Increase ON was not provided, the
Extraordinary Shareholders Meeting will only deliberate on the homologation of the
Capital Increase ON if, until the date of such meeting, the Company has received the
confirmation of the effective subscription of the totality of 200,000,000 new common
shares issued.
In such sense, it is worth noting that, as informed in the Notice to Shareholders of
March 18th, 2016, the NSSMC Group, member of the Companys controlling group,
committed itself to subscribe the common shares arising both from its preemptive right
as to occasional leftovers, up to R$ 1,000,000,000.00. Such commitment is conditioned
to the execution, of the definitive documents with the Companys main financial
creditors, providing, among other conditions, the rollover of the debt and the granting of
a grace period. The NSSMC Group subscribed the shares to which it had preemptive
right within the deadline, as well as required, in its respective subscription bulletin, the
reservation of unsubscribed shares. In addition, entities related to the Ternium/Techint
Group, which are also part of the Company's control group, exercised its preemptive
right to subscribe for shares issued as per the Capital Increase ON and expressed their
interest in subscribing any leftover shares.
As per the above, and considering the importance of the conclusion of the Capital
Increase ON to the Company, the Administration of Usiminas recommends the
shareholders to approve its homologation at the Extraordinary Shareholders Meeting
called to July 19th, 2016.

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2 Amendment of the Heading of Article 5 of the Company Bylaws

In addition to the Capital Increase ON, the Board of Directors approved, on March 11th,
2016, a capital increase, within the authorized capital limits, up to the amount of
R$64,882,316.80, through issuance of up to 50,689,310 class A preferred shares, at
the issuance price of R$ 1.28 per share (Capital Increase PN), with the possibility of
partial homologation, in case, after the leftovers apportionment, are subscribed shares
which amounts at least R$ 32,441,158.50.
After the execution of all proceedings related to the Capital Increase PN, it was verified
the effective subscription of 39,292,918 class A preferred shares, at the issuance
price of R$ 1.28 per share, totaling R$ 50,294,935.04. In view of this, the Board of
Directors, at a meeting held on June 3rd, 2016, approved the partial homologation of
the Capital Increase PN, with the consequent attribution of the new subscribed shares
to the respective subscribers and the cancelation of the non-subscribed shares.
Therefore, as per both capital increases mentioned above, it will be necessary to
amend Article 5 of the Companys Bylaws, in order to reflect the new capital stock and
the new quantity of shares in which it is divided.
If the Capital Increase ON, object of the deliberation presented on item 1 of the
Extraordinary Shareholders Meeting Agenda, is approved, and considering the
homologation of the Capital Increase PN by the Board of Directors on June 3rd, 2016,
Article 5, caput, of the Companys Bylaws shall read as follows:
Article 5 - The Company's Capital is R$ 13,200,294,935.04 (thirteen billion, two
hundred million, two hundred ninety four thousand and nine hundred thirty five reais
and four cents), divided into 1,253,079,108 (one billion, two hundred fifty three million,
seventy nine thousand, and one hundred and eight) shares, where 705,260,684 (seven
hundred and five million, two hundred and sixty thousand and six hundred eighty four),
are common shares, 547,740,661 (five hundred and forty-seven million, seven hundred
and forty thousand, six hundred and sixty one) are class A preferred shares and 77,763
(seventy-seven thousand, seven hundred and sixty-three) preferred shares class B1,
all registered, with no par value.

The number of 77,763 preferred shares class B reflects the updated information
from the bookkeeper (agente escriturador) on the conversions of preferred shares

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On the other hand, if by any reason the homologation of the capital increase ON is not
approved in the Extraordinary Shareholders Meeting hereby called, the amending of
Article 5, caput, of the Companys Bylaws shall only reflect the partial homologation of
the Capital Increase PN by the Board of Directors, with the following wording:
Article 5 - The Company's Capital is R$12,200,294,935.04 (twelve billion, two
hundred million, two hundred ninety-four thousand and nine hundred thirty-five reais
and four cents), divided into 1,053,079,108 (one billion, fifty three million, seventy nine
thousand, one hundred and eight) shares, where 505,260,684 (five hundred and five
million, two hundred and sixty thousand and six hundred and eighty four), are common
shares, 547,740,661 (five hundred and forty-seven million, seven hundred and forty
thousand, six hundred and sixty one) are class A preferred shares and 77,763
(seventy-seven thousand, seven hundred and sixty-three) are class B2 preferred
shares, all registered, with no par value.
3 Amendment of First Paragraph of Article 5 of the Company Bylaws
In addition to the amending in caput of Article 5 of the Company's Bylaws, pursuant to
item 2 above, due to the partial homologation of the Capital Increase PN, it will be also
necessary to amend the first paragraph of Article 5 of the Company's Bylaws, in order
to reflect the reduction, on the amount of shares correspondent to the authorized
capital of the Company, of the 39,292,918 class A preferred shares issued in the
Capital Increase PN. Thus, the referred article shall have the following wording:
Article 5 ()
1st Paragraph The Company is authorized to increase its capital by Board of
Directors deliberation, notwithstanding any Bylaw changes, exclusively by issuance of
up to 11,396,392 (eleven million, three hundred and ninety-six thousand, three hundred
and ninety-two) preferred shares of existing class.

class B into preferred shares class A, done pursuant the 3rd paragraph of article 6th
of the Companys Bylaws.
2
The number of 77,763 preferred shares class B reflects the updated information
from the bookkeeper (agente escriturador) on the conversions of preferred shares
class B into preferred shares class A, done pursuant the 3rd paragraph of article 6th
of the Companys Bylaws.

(Free Translation: For reference only Original in Portuguese)

Attached to the present document is a copy of the Company Bylaws, highlighting the
amendments resulting from the capital increases mentioned above, as required by
article 11 of CVM Instruction No. 480/2009.
Belo Horizonte, June 17th, 2016.
Usinas Siderrgicas de Minas Gerais S.A. USIMINAS