Oi : Material Fact - Approval at the Shareholders’ Meeting of Oi of the Terms and Conditions of the Exchange and Call Option Agreements

Oi S.A.
Corporate Taxpayers' Registry (CNPJ/MF) No. 76.535.764/0001-43
Board of Trade (NIRE) No. 33.300.29520-8
Public-Held Company

MATERIAL FACT
Approval at the Shareholders' Meeting of Oi of the Terms and Conditions of the Exchange and Call Option Agreements

Oi S.A. ("Oi" or the "Company", Bovespa: OIBR3, OIBR4; NYSE: OIBR and OIBR.C), pursuant to art. 157, paragraph 4 of Law No. 6,404/76 ("Brazilian Corporate Law") and Instruction No. 358/02 of the Brazilian Securities and Exchange Commission (Comissão de Valores Mobiliários - CVM), hereby informs its shareholders and the market in general that, at the Extraordinary Shareholders' Meeting held on this date, the terms and conditions of the exchange and call option agreements entered into between Oi, Portugal Telecom International Finance B.V., PT Portugal, SGPS, S.A., Telemar Participações S.A. and Portugal Telecom, SGPS, S.A. ("PT SGPS") on September 8, 2014 were approved by 98.91% of the valid votes.

With the approval at the Company's Extraordinary Shareholders' Meeting, the condition set by the Board of the CVM for the granting of the waivers requested by the Company to carry out these transactions was fulfilled. Therefore, the condition precedent has been met for the conclusion of the exchange between Oi and PT SGPS, which is required to be completed by March 31, 2015.

Oi will keep its shareholders and the market informed of any material subsequent events related to the matters described in this Material Fact.

Rio de Janeiro, March 26, 2015.

Oi S.A.

Bayard De Paoli Gontijo

Chief Executive Officer, Chief Financial Officer and Investor Relations Officer

To see the full version of the Material Fact, click here.

(¹) This translation is still subject to the auditors review