PHAROL, SGPS, S.A.

Board/Management Information • Jul 8, 2016

Announcement | Lisbon | 8 July 2016

Announcement by Oi, S.A. – Request for call of general meeting of shareholders of Oi, S.A. to replace directors

PHAROL, SGPS S.A. ("PHAROL") had knowledge and communicated to the market the relevant information yesterday disclosed by Oi, S.A. – In Judicial Recovery ("Oi" or "Company") pursuant to which it informed that shareholders holding approximately 6,6% of the share capital have requested the board of directors of Oi to call an extraordinary general meeting of shareholders to resolve on the replacement of the directors of the Company, among other matters. The announcement of Oi further informed that the board of directors of the Company will analyse the request in order to express an opinion on the request in due time.

As a shareholder, PHAROL has been acting in accordance with the interests of Oi and is of the opinion that the board of directors of the Company has been implementing the necessary actions to protect the assets of Oi and to overcome the economic and financial crisis that the Company is facing. The recent judicial recovery request by Oi is part of this strategy: the search for an organized process of restructuring its debt and the legal protection of all stakeholders of the Company.

PHAROL is persuaded that all members of the board of directors of Oi are compliant and will comply with their fiduciary duties and will act in the best interests of the Company, will resort to the governance measures set out in Oi's by-laws and the voting rights of shareholders, as legally established, in order to proceed with the existing strategy and plans, with the sole purpose of enabling its financial recovery.

In addition, PHAROL expects that the members of the board of directors of Oi remain alert to the possible appearance of investors – on the side of equity or on the side of the creditors – focused on the opportunistic return of their investments and who may act in order to obtain an advantageous negotiating position at the expense of the interests of companies going through financial difficulties. As a consequence, any measures that create unsteadiness, in breach of Oi's by-laws and interests may cause major material damage to Oi and to its image and should therefore be avoided by all shareholders.

PHAROL, SGPS S.A.

Public company Share capital Euro 26,895,375 Registered in the Commercial Registry Office of Lisbon and Corporation no. 503 215 058 PHAROL is listed on the Euronext (PHR). Information may be accessed on Bloomberg under the symbol PHR PL.

Luis Sousa de Macedo Investor Relations Director ir@pharol.pt Tel.: +351 212 697 698 Fax: +351 212 697 949