Pharol SGPS : Notice to the Market disclosed by Oi - Judicial Decision - Suspension of the Shareholders’ Meetings

PHAROL, SGPS S.A. hereby informs on the Notice to the Market disclosed by Oi, S.A., according to the company's announcement attached hereto.

Public company

Share capital Euro 26,895,375 Registered in the Commercial Registry Office ofLisbon

and Corporation no. 503 215058

PHAROL is listed on the Euronext (PHR). Information may be accessed on Bloomberg under the symbol PHRPL.

Luis Sousa de Macedo Investor Relations Director ir@pharol.pt

Tel.: +351 212 697 698

Fax: +351 212 697 949

pharol.pt

Corporate Taxpayers'Registry (CNPJ/MF) No. 76.535.764/0001-43 Board of Trade (NIRE) No. 33.3.0029520-8

Publicly-Held Company NOTICE TO THE MARKET

Judicial Decision

Oi S.A.-In Judicial Reorganization("Company"), in continuity with the Material Facts disclosed on September 2, 5 and 6, 2016regarding the Extraordinary General Shareholders' Meetings called for September 8, 2016 (the"Meetings"), communicates to its shareholders and the market in general that, on this date, the 7th Corporate Court of the Judicial District of the City and State of Rio de Janeiro granted the Motion for Clarification of Judgment filed by Bratel B.V., on the following terms: "That being said, I receive the Motion, which is timely, and grant the request to remedy the omission in the operative part of the decision in question, which will read as follows: 'a) to suspend, as a precautionary measure, in accordance with the opinion, the call of the Extraordinary General Shareholders' Meetings to resolve upon the dismissal of members of the Board of Directors, as well as the adoption of measures to commence a lawsuit against certain managers of the company'".

Therefore, the Company reiterates the suspension of the Meetings called to be held on September 8, 2016 and that they will only take place subject to a future decision by the Court.

Rio de Janeiro, September 8, 2016.

Chief Financial Officer and Investor Relations Officer