Oi : Notice to the Market - Response to the CVM/BM&FBovespa Official Letter

Rio de Janeiro, February 22, 2017

Brazilian Securities and Exchange Commission

(Comissão de Valores Mobiliários-CVM)

Attn.: Mr. Fernando Soares Vieira

Superintendent of Corporate Relations

Mr. Guilherme Rocha Lopes

Director of Corporate Monitoring- 2

c/c to

emissores@bvmf.com.br
ccarajoinas@bvmf.com.br
apereira@bvmf.com.br
nortega@bvmf.com.br

Re.: Official Letter No. 78/2017/CVM/SEP/GEA-2

Request for clarification on news published by the media

Dear Sirs,

We refer to Official Letter No. 78/2017/CVM/SEP/GEA-2 ('Official Letter'), copy attached hereto, which requests that Oi S.A. - In Judicial Reorganization ('Oi' or 'Company') clarify the information in the news published on the website Globo Online on February 20, 2017, with the title 'Judge orders Oi to take a position on the Moelis proposal in five days,' to explain the following.

Oi clarifies that the creditor Goldentree Distressed Fund and other creditors belonging to the group of bondholders served by Moelis & Company ('Moelis') presented an objection to the judicial reorganization plan presented by the Company on September 5, 2016, since they had submitted a proposal of an alternative plan, as previously disclosed by the Company in a Notice to the Market dated December 19, 2016.

Oi further clarifies that, pursuant to the terms of the dispatch from the 7th Corporate Court of Rio de Janeiro on February 14, 2017, it will make a statement, in the normal course of the judicial reorganization process, about the presentation of the proposal of the alternative plan by Moelis, which, however, will not represent a formal position from the Company with respect to the content of the alternative plan, nor will it represent any decision with respect to any change in the reorganization plan presented by the Company.

Oi reiterates once again that it continues to meet regularly with creditors and other stakeholders with the intention of gathering impressions and comments about the plan and that it believes that the results of these discussions will be reflected in a final proposal of the judicial reorganization plan, to be brought up for approval by a creditors' meeting in the manner prescribed by law, which guarantees the Company's operational viability and sustainability and that serves creditors, shareholders and other interested parties, allowing the Company to grow stronger at the end of this process.

Sincerely,

Oi S.A. - In Judicial Reorganization

Ricardo Malavazi Martins

Chief Financial Officer and Investor Relations Officer

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