AGREEMENT

Table of Contents

Exhibit 4(j)

Huawei Agreement # 0000760501030A

AGREEMENT FOR

SUPPLY AND RENDERING OF SERVICES

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INDEX

AGREEMENT FOR SUPPLY AND RENDERING OF SERVICES		3
CLAUSE 1 - DEFINITIONS		4
CLAUSE 2 – SUBJECT-MATTER		4
CLAUSE 3 – PROJECT AND LOCAL CONDITIONS		4
CLAUSE 4 - CHANGES		5
CLAUSE 5 – GOVERNING LAW		6
CLAUSE 6 – DOCUMENTS INCLUDED		6
CLAUSE 7 - PRICE		7
CLAUSE 8 – PAYMENT TERMS		10
CLAUSE 9 – TAXES AND SOCIAL SECURITY CONTRIBUTIONS		12
CLAUSE 10 - DEADLINE		13
CLAUSE 11 – OBLIGATIONS OF THE CONTRACTED PARTIES		14
CLAUSE 12 – OBLIGATIONS OF THE CONTRACTING PARTY		17
CLAUSE 13 – INSPECTION OF PERFORMANCE OF THE AGREEMENT		18
CLAUSE 14 – PERFORMANCE TESTS AND ACCEPTANCE OF THE SERVICES		18
CLAUSE 15 – TRAINING AND ASSISTED OPERATION		20
CLAUSE 16- OPTIMIZATION		21
CLAUSE 17 - PENALTIES		21
CLAUSE 18 - RESPONSIBILITIES		24
CLAUSE 19 – FORTUITOUS EVENTS AND FORCE MAJEURE		25
CLAUSE 20 - WARRANTY		26
CLAUSE 21 – SOFTWARE LICENSES AND INTELLECTUAL PROPERTY RIGHTS		28
CLAUSE 22 - CONFIDENTIALITY		29
CLAUSE 23 – TITLE AND RISK OF LOSS		31
CLAUSE 24 - INSURANCE		31
CLAUSE 25 – PERFORMANCE BOND FOR OBLIGATIONS UNDERTAKEN		31
CLAUSE 26 – EQUIPAMENT AND SOFTWARE		32
CLAUSE 27 – PLANS, PROJECTS AND TECHNICAL SPECIFICATIONS		33
CLAUSE 28 – DECLARATIONS OF THE PARTIES		34
CLAUSE 29 – WAIVER OF RIGHTS		34
CLAUSE 30 – ASSIGNMENT AND SUBCONTRACTING		35
CLAUSE 31 - NOTICES		36
CLAUSE 32 - RESCISSION		37
CLAUSE 33 – COURT AND GOVERNING LAW		38

 

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AGREEMENT FOR SUPPLY AND RENDERING OF SERVICES

By this private agreement, on one hand:

TELEMIG CELULAR S.A. , federal tax roll number CNPJ/MF 02.320.739/0001 -06, headquartered at Rua Levindo Lopes, 258, 8º andar, Funcionários, Belo Horizonte, MG, Brazil, represented herein by the undersigned proxies, hereinafter referred to simply as CONTRACTING PARTY; and on the other hand,

HUAWEI DO BRASIL TELECOMUNICAÇÕES LTDA, federal tax roll number CNPJ/MF 02.975.504/0001 -52, headquartered at Praça Professor José Lannes, 40, 12º andar, Ed. Berrini 500, Brooklin Novo, Cep 04571-100, São Paulo, SP, represented herein by its undersigned legal representatives, hereinafter referred to simply as HUAWEI DO BRASIL; and HUAWEI SERVIÇOS DO BRASIL LTDA , federal tax roll number CNPJ/MF 06.126.425/0001 -28, headquartered at Avenida John Dalton, 140 – 2º andar, Cep 13069-330, Campinas, SP, represented herein by its undersigned legal representatives, hereinafter referred to simply as HUAWEI SERVIÇOS, and jointly with HUAWEI DO BRASIL, hereinafter referred to simply as CONTRACTED PARTIES and, both of them jointly with TELEMIG, hereinafter referred to simply as PARTIES.

WHEREAS

- The CONTRACTING PARTY is the company that provides mobile telephone services in Brazil;

- The CONTRACTED PARTIES are companies, respectively, service supplier and provider for mobile telecommunication networks, with broad operations and experience in this field;

- The CONTRACTING PARTY requested from its suppliers proposals for implementation of CORE and ACCESS, which compose a telecommunications network of GSM (“GSM Networks”),for the imaginary triangle area formed by the State of Minas Gerais, by means of the “Request for Proposal” RFP no. CEL001-03 and attachments (“RFP”), dated December 7, 2004 (Attachment 1);

- The CONTRACTING PARTY opted for obtaining GSM Network ACCESS for the Region of Montes Claros, Minas Gerais, which have been granted as loan for use, by the CONTRACTED PARTIES to the CONTRACTING PARTY in 2004;

- The CONTRACTED PARTIES supplied, based on the RFP, a Proposal for the supply and rendering of services by a global, fixed and non-adjustable price (“PROPOSAL”) (Attachment lI);

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The PARTIES hereby agree to enter into this Supply and Rendering of Services Agreement (“AGREEMENT”), which shall be governed by the applicable regulations and by the following clauses and conditions:

CLAUSE 1 - DEFINITIONS

1.1 The definitions employed in this AGREEMENT are those included in the RFP (Attachment I), in governing laws (as defined in Clause 5), and those identified in Attachment III (“DEFINITIONS”). In the case of any disagreements as to the meaning of the definitions herein, the definitions established in the governing laws shall prevail.

CLAUSE 2 – SUBJECT-MATTER

2.1 The subject-matter of this AGREEMENT is the supply and implementation, by the CONTRACTED PARTIES , to the CONTRACTING PARTY , on a “turn-key lump sum” basis (i.e., a complete job for a single lump sum), of all the new equipment, computer programs, services and new material that make up: (i) GSM network ACCESS, for the region of imaginary triangle formed by the State of Minas Gerais (SYSTEM I); (ii) GSM Network ACCESS, for the region of Montes Carlos (SYSTEM II), and (iii) GSM Network CORE (SYSTEM III), as described in detail in the RFP (Attachment I) and in the PROPOSAL (Attachment II), including the rendering of training services, assisted operation, optimization and benchmarking, as described in detail in this AGREEMENT.

CLAUSE 3 – PROJECT AND LOCAL CONDITIONS

3.1 The CONTRACTED PARTIES expressly declare, for all purposes, that they are fully aware of the Basic Assumptions supplied by the CONTRACTING PARTY regarding the subject-matter of this Agreement, the places where the services shall be rendered, the adjoining areas, access roads, soil and subsoil and all the other factors and conditions that may influence cost and time required for carrying out the services described herein, and that they themselves shall be responsible for undertaking all the complementary investigations that they may deem necessary.

3.2 The preparation of the Executive Project is under the total and exclusive responsibility of the CONTRACTED PARTIES , which must use as a basis all the assumptions they regard as necessary for its preparation. Should the CONTRACTING PARTY have prepared the Executive Project, the CONTRACTED PARTIES shall undertake to review it and to make the required changes in it, as necessary, being responsible for the project totally and exclusively. Under both hypotheses, the corresponding cost, whether of preparation or of reviewing the Executive Project, has been budgeted and taken into account in the price established in item 7.2 herein.

3.3 Pursuant to the provisions of items 3.1 and 3.2, the CONTRACTED PARTIES shall have no right to any complaint, indemnification, claim for additional payment, or claim regarding the characterization of extraordinary service, including for the purpose of justifying delays or extensions of

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the deadlines agreed upon in the agreement, due to alleged project errors, resulting from difficulties or hindrances of any nature, concerning the conditions that prevail at the place where the services are to be rendered, notably the geologic, climactic or environmental conditions, and concerning the conditions set forth in the documents of the AGREEMENT.

CLAUSE 4 - CHANGES

4.1 The CONTRACTING PARTY may determine, in writing, changes affecting the basic assumptions supplied. Should the CONTRACTED PARTIES find out that the project changes determined by the CONTRACTING PARTY shall increase or decrease the AGREEMENT’s lump sum value, or adversely affect the capacity of the CONTRACTED PARTIES to meet scheduled deadlines, the PARTIES shall negotiate, in good faith, an adjustment of the AGREEMENT’s lump sum and/or of the scheduled deadlines, so as to reflect the changes fairly.

4.2 The CONTRACTED PARTIES may suggest changes regarding the Basic Assumptions that were supplied by the CONTRACTING PARTY , provided that these: (i) do not adversely affect the minimum conditions established in the RFP; (ii) do not reduce SYSTEM reliability, capacity, performance, quality and useful life; (ii) neither increase the value of the AGREEMENT nor generate any additional costs for the CONTRACTING PARTY ; (iii) do not cause the key dates described in the time schedule to be delayed; (iv) do not impair the Guarantees obtained and/or Insurance Policies taken out; (v) do not negatively affect the capacity of the CONTRACTED PARTIES to comply with the scheduled dates; and do not affect the CONTRACTING PARTY ’s Payment Schedule. The suggested changes may only be implemented once they have been discussed with and authorized by the CONTRACTING PARTY .

4.3 The Parties promptly agree that in the event the Project related to the SYSTEM I provides for the sharing of Sites in percentages higher than the premise furnished by the CONTRACTING PARTY in RFP, i.e., forty per cent (40%) of Shared Sites, the global price of the AGREEMENT shall suffer a decrease of one hundred, fifty-six thousand Reais (R$156,000.00) by additional Shared Site, observing the proportion between equipment/ materials and services outlined in item 7.2.

4.3.1 In Attachment III – DEFINITIONS can be found for the expressions Shared Sites and New Sites , for the purposes of this AGREEMENT.

4.4 On the other hand, in the event the Project related to the SYSTEM I provides for an increase in the number of Sites in percentage equal or lower than five per cent (5%) of one hundred and ninety (190) estimated Sites, the amount of the AGREEMENT shall suffer an increase of two hundred, twenty-nine thousand and five hundred Reais (R$229,500.00) by additional Site, observing the proportion between equipment/materials and services outlined in item 7.2. In the event the increase in the number of Sites is higher than five per cent (5%), the global price of the AGREEMENT shall not suffer any alteration, besides that provided for in this item.

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4.4.1 For the purposes of applying the provision of previous item, the CONTRACTED PARTIES shall submit to the CONTRACTING PARTY , the Project to be implemented, demonstrating the real need of increasing the number of Sites, and this number may be modified only with the express approval of the CONTRACTING PARTY .

4.5 In the event the SYSTEM I Project provides for a decrease in the number of Sites, according to estimate furnished by the CONTRACTED PARTIES , which is one hundred and ninety (190) Sites, the parties undertake to use them in the increase of coverage of the referred Project, pursuant to sites to be defined by the CONTRACTING PARTY .

CLAUSE 5 – GOVERNING LAW

5.1 In the execution and interpretation of this AGREEMENT, all the regulations that govern the Personal Mobile Service, whether they be laws, decrees, administrative acts, instructions, or resolutions, among others, shall be taken into account, complied with and applied by the CONTRACTED PARTIES , regardless of whether or not any reference is made to them herein and/or in the documents attached to this AGREEMENT.

5.2 Without prejudice to compliance with and fulfillment of the other rules issued by the National Telecommunications Agency – ANATEL ( Agência Nacional de Telecomunicações ), any unit of certified products that may come to be supplied by the CONTRACTED PARTIES to the CONTRACTING PARTY shall carry an identification plate in a visible spot, with the name of the manufacturer and the identification of the respective certificate. Referring to imported product, the sign shall also contain the name and the address of the supplier in this country. All certified products that use radio-electric frequency, in addition to the above requirement, shall bear the following message: “This product can only go into operation once its operating license, issued by the appropriate technical body of the Ministry of Communications, has been obtained.”

CLAUSE 6 – DOCUMENTS INCLUDED

6.1 For all legal purposes and effects, this AGREEMENT comprises the documents listed below, as if they were transcribed herein. These documents hereinafter shall be referred to as Included Documents.

		RFP, including the following attachments:
Attachment I		Additional Guarantees I;
		Additional Guarantees II; and
		Additional Guarantees III.
Attachment II		PROPOSAL

 

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Attachment III		DEFINITIONS
Attachment IV		LIST OF UNIT PRICES (“LUP”)

 

6.2 Should there be any discrepancy between this AGREEMENT and the documents that it comprises, the following order of prevalence shall apply:

(a)	AGREEMENT
(b)	RFP, including attachments (Attachment I)
(c)	PROPOSAL (Attachment II)
(d)	DEFINITIONS (Attachment III)
(e)	LIST OF UNIT PRICES (“LUP”) (Attachment IV)

CLAUSE 7 - PRICE

7.1 The system for executing the job that is the subject-matter of this AGREEMENT is the “turn-key lump sum” system.

7.2 The lump sum for supplying and implementing of this AGREEMENT shall be the sum of forty-three million six hundred and five thousand and forty-eight reais and two centavos (R$43,605,048.02), of which fifteen million, eight hundred, sixty-seven thousand, one hundred and seventy-one Reais and fourteen centavos (R$15,867,171.14) referring to services to be invoiced by HUAWEI SERVIÇOS and twenty-seven million, seven hundred and thirty-seven thousand, eight hundred, seventy-six Reais and eighty-eight centavos (R$27,737,876.88) referring to equipment and materials to be invoiced by HUAWEI DO BRASIL. The PARTIES have agreed upon that this shall be fixed and non-adjustable, except for the assumptions provided for in items 4.3 and 4.4.

7.2.1 The price stated above includes, in addition to the CONTRACTED PARTIES ’ profit, all direct costs (materials, labor, administration, social charges, labor charges and taxes, among others) and indirect costs (charges, insurance, taxes, customs duties and expenses, operational transport expenses, the transport of materials, products and people and their respective insurance, packaging, bed and board, air fares, bus fares, local travel, equipment, tools, and consumable goods, among others) incurred or to be incurred by the CONTRACTED PARTIES in order to supply and implement this AGREEMENT, its being inadmissible, under any circumstances and regardless of the reason, that any additional amounts be charged by the CONTRACTED PARTIES , given that they are being hired for a lump sum.

7.2.2 The PARTIES acknowledge that the direct or indirect costs described above may undergo

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some fluctuation after this AGREEMENT has been signed and while it is being performed, due to foreseeable events such as inflation, fluctuation of the price of raw materials, exchange rate variation, the need to substitute materials or use of alternative means of production, project adjustments, or changes in taxation, among others, the CONTRACTED PARTIES undertaking to bear the risk for these fluctuations and the ensuing added costs, this being an essential prerequisite for this AGREEMENT to be entered into. So that no doubts may arise as to the foreseeability of certain events, the following are hereby classified as foreseeable, in addition to the aforementioned items:

(i)	strikes of the CONTRACTED PARTIES’ personnel or of companies subcontracted by them;
(ii)	acts of God and meteorological phenomena typical of the time or place where the services are being rendered, such as landslides, storms, and flooding, among others;
(iii)	delays in the obtainment of licenses or permits of any nature that may be required for executing the services; and
(iv)	delays in the importation of equipment and customs clearance.

7.3 The proposed lump sum price takes into account all of the activities (direct, indirect, accessory, alternative, and complementary, among others) , which are or may be necessary for the supply and implementation of the subject-matter of this AGREEMENT, regardless of these activities being expressly provided for in this AGREEMENT. Only in the assumption that the CONTRACTING PARTY requests in written, amendments to the subject-matter, pursuant to clause four, or in the event of new contracting, that the CONTRACTED PARTIES shall be entitled to the respective adjustment in price and term.

7.4 In the event of new contracting for materials, equipment and services related to the SYSTEM I and destined to the region of imaginary triangle formed by the State of Minas Gerais, the parties shall practice the prices included in the List of Unit Prices (“LUP”) (Attachment IV), which shall suffer a discount pursuant to the percentage indicated in the Totalizator Spreadsheet contained in the PROPOSAL (Attachment II), which shall be applied on a straight line basis, in all items included in LPU.

7.4.1 The CONTRACTED PARTIES ensure for a period of four (04) years, as from the execution of this AGREEMENT, that prices included in LPU shall be maintained as maximum amounts to be practiced for the CONTRACTING PARTY in these new supplies, except for the right of adjustment as provided for in items below. In the event of CONTRACTED PARTIES’ refusal in maintaining the maximum amounts agreed upon, the CONTRACTING PARTY shall be entitled to charge in court from the CONTRACTED PARTIES the double of amounts to be spent, and this AGREEMENT, jointly with the respective invoice, shall constitute an extrajudicial document valid for commencing an execution process.

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7.4.2 The Parties expressly agree that the amounts included in LPU attached to this AGREEMENT, as well as other provisions related to LPU, shall be applicable to the area of imaginary triangle formed by the State of Minas Gerais.

7.5 The base date for the unit prices shown on the LUP is the date on which this AGREEMENT shall be signed.

7.5.1 The relative price of the materials, equipment and domestic services expressed in the LUP in domestic currency (R$), for the purposes of the provisions described in item 7.4 above, shall be adjusted after one-year periods, the adjusted amount being valid for the one-year period subsequent to adjustment, by applying the following formula:

I = 0.90 X (I ₁ -I ₀ ) / I ₀

Where:

I= Sought adjustment index.

I ₀ = Initial index concerning the cost index corresponding to the date on which this AGREEMENT shall be signed.

I ₁ = Same index concerning the month immediately prior to the foreseen adjustment month, i.e., the 12 ^th , 24 ^th , and 36 ^th months after the month on which this AGREEMENT shall be signed, and so forth, pursuant to the duration of the AGREEMENT.

(i) The adjustment established in this item shall only apply to payments of amounts that concern new purchases made as from the first day immediately following the end of the twelfth (12 ^th ) month after the signing of this AGREEMENT.

(ii) The index to be adopted shall be the Economic Index / IGP-DI (General Price Index - Internal Availability), column 2, published by the Conjuntura Econômica magazine of Fundação Getúlio Vargas or, in its absence, any similar index that may come to replace it.

(iii) The coefficient calculated through the adjustment formula shall be worked out up to the third decimal, the other ones being disregarded.

(iv) Should the law come to allow a reduction in the frequency of adjustment, the PARTIES may negotiate a new adjustment period, to be considered for the purposes of this AGREEMENT.

7.5.2 The price in reais of the materials and equipment expressed in the LUP in foreign currency (U.S. dollars – USD), for the purposes of what has been described in item 7.4 above, only shall be adjusted for new acquisitions occurring after twelve (12) months of execution of the AGREEMENT and only on the occasion where the variation between the U.S. dollar exchange rate and the exchange rate of the

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date prior to the new contracting, published by SISBACEN PTAX 800 Option 5, is higher than ten per cent (10%). For the purposes of evaluating this variation, the U.S. dollar exchange rate shall be considered in the amount of two reais and seventy centavos (R$2.70).

CLAUSE 8 – PAYMENT TERMS

8.1 Payments shall only be made once the CONTRACTING PARTY has accepted that the events to which they refer have indeed occurred, according to the following Timetable:

Event		Physical Event		Financial Event
1		Issuance  of Statement of  Physical Acceptance of and Commissioning, per Site , of SYSTEM I, II and III, pursuant to definition included in Attachment III.		Forty per cent (40%) of the global amount of the AGREEMENT, pursuant to item 7.2, which shall be paid to the CONTRACTED PARTIES on a pro rata basis, per Site , pursuant to the table referred to in item 8.1.1.
2		Issuance of the Statement of Initial Acceptance of SYSTEM I, pursuant to the clause fifteen.		Twenty per cent (20%) of the total value of this   AGREEMENT, as per item 7.2.
3		Issuance of the Statement of Partial Acceptance of SYSTEM  I, pursuant to clause fifteen.		Thirty per cent (30%) of the total value of the   AGREEMENT, as per item 7.2.
4		Issuance of Statement of Final Acceptance of SYSTEM I,   pursuant to the clause fifteen.		Ten per cent (10%) of the total value of the AGREEMENT,   as per item 7.2.

8.1.1 The CONTRACTED PARTIES shall contain table with the apportionment of amount equivalent to forty per cent (40%) of the price provided for in item 7.2, so that to have an amount per Site, to be paid after issuing its respective Instrument of Physical Acceptance and Commissioning. This table shall be sent for the approval of the CONTRACTING PARTY, within 30 days after the signature of this AGREEMENT. The apportioned amounts, per Site, shall totalize forty per cent (40%) of the price provided for in item 7.2.

8.2 The payments shall be made in accordance with the payment timetable above either on the sixtieth (60 ^th ) day following acceptance of the corresponding physical event or on the sixtieth (60 ^th ) day following submission to the CONTRACTING PARTY of the invoice, in two copies of like tenor, the latest of the two dates being the prevailing payment date, subject to the provisions of Clause 10.

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8.3 The payments shall be subject to discharging all obligations undertaken and/or resulting from this AGREEMENT, the CONTRACTING PARTY being required to deposit the amount owed directly into the bank accounts indicated by the CONTRACTED PARTIES , the respective payment slips being valid as payment receipts.

8.4. Amongst the conditions for payment, the CONTRACTING PARTY , shall contract the financing offered by the CONTRACTED PARTIES in their PROPOSAL (Attachment II).

(i) If upon the payment provided for in this clause, the CONTRACTING PARTY and the Bank appointed by the CONTRACTED PARTIES have not entered into a financing agreement, on an unconditional, irrevocable and irreversible basis, under the terms indicated in the PROPOSAL, by fact attributable to the CONTRACTING PARTY , the CONTRACTED PARTIES agree to extend the date of the first payment for one hundred and eighty (180) days, without being entitled to any upgrade, adjustment or compensation during the period extended, so that the CONTRACTING PARTY may seek in the market financing for this AGREEMENT.

(ii) In the assumption of the financing offered by the CONTRACTED PARTIES , in their proposal, is not entered into in view of fact not attributable to the CONTRACTING PARTY and in view that the terms and conditions of financing offered by the CONTRACTED PARTIES constituted premise for the realization of this contracting, the CONTRACTED PARTIES undertake to seek a new financing for the CONTRACTING PARTY , under same conditions and terms offered in the PROPOSAL, and the payments shall remain suspended until the respective effective financing, without the CONTRACTED PARTIES being entitled to any upgrade, adjustment and/or compensation while endures the suspension of payments due thereby for the compliance with the events. In the event the CONTRACTED PARTIES have not success in obtaining financing under similar conditions, the CONTRACTED PARTIES undertake to reimburse the CONTRACTING PARTY the amounts this may disburse as remuneration of financing.

8.5 Payments shall be made on working Mondays, Wednesdays or Fridays. Payments falling due on other days of the week shall be paid on the immediately subsequent working Tuesday or Friday, as appropriate, at no extra cost to the CONTRACTING PARTY .

8.6 The CONTRACTED PARTIES shall, when issuing receipts or invoices, ensure these documents are correctly filled in. They shall mandatorily include the number of the AGREEMENT, the identification of the portion to be paid, the rates of applicable taxes and their respective amounts, a detailed list of the materials and equipment supplied and the registration code(s) for the equipment at BNDES/FINAME, as applicable.

8.7 The CONTRACTING PARTY , should there be any credits in its favor resulting from fines or damages caused by the CONTRACTED PARTIES in connection with this AGREEMENT, may at its discretion deduct these amounts from the payments disbursed to the CONTRACTED PARTIES , as of the issuance of the Statement of Partial Acceptance and/or of the Statement of Final Acceptance, as

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appropriate, subject to prior notice in writing to the CONTRACTED PARTIES .

8.8 The CONTRACTING PARTY is entitled, by means of written notice to the CONTRACTED PARTIES , to suspend the payment of all and any amount due to the CONTRACTED PARTIES by force of this present instrument, while there are liabilities not complied with by the CONTRACTED PARTIES, without being entitled to interest, monetary restatement or compensation, under any title, under the terms of the Article 476 of the New Brazilian Civil Code.

8.9 The CONTRACTED PARTIES reserve themselves the right to suspend activities resulting from this AGREEMENT, thirty (30) days after the CONTRACTING PARTY receives an extrajudicial or judicial notice from the former, in the case of unjustified delays in payment in excess of thirty (30) days. This hypothesis applies neither to the cases mentioned in items 8.4, 8.7 and 8.8 above, nor to those cases described in this AGREEMENT in which failure of the CONTRACTING PARTY to pay is expressly authorized and justified.

8.10 Concerning past-due payments, where the AGREEMENT or the law lack provisions justifying non-payment, the CONTRACTING PARTY shall have the right to charge interest on overdue payment from the CONTRACTING PARTY , at the rate of one per cent (1%) per month, plus monetary indexation based on the IGP-DI general price index up to the date on which payment actually occurs, other than in those cases stipulated herein that expressly eliminate the incidence of monetary indexation.

8.11 The CONTRACTED PARTIES may neither assign nor pledge to third parties the amounts to which they are entitled under this AGREEMENT without prior authorization to do so from the CONTRACTING PARTY .

CLAUSE 9 – TAXES AND SOCIAL SECURITY CONTRIBUTIONS

9.1 Regarding the National Social Security Institute – INSS, the CONTRACTING PARTY shall comply with Law 9.711/98 and regulatory instruction 100/2003, as well as with the amendments introduced by IN105/2004. It is mandatory to specify the Social Security payments, as well as to inform the INSS Specific Registration number (CEI – Cadastro Específico do INSS ) and the address of the location in the invoice or receipt for services rendered under the responsibility of the CONTRACTED PARTIES .

9.2 All taxes must also be broken out in each invoice submitted, together with an indication of the tax rate applied or inclusion of the exemption text, as determined by current laws. The amounts concerning supplies of materials and/or of equipment of their own or of third parties indispensable for the CONTRACTED PARTIES to carry out their services shall be indicated in each invoice submitted, under penalty of taxes due being withheld for the full amount of the fiscal document.

9.3 The CONTRACTED PARTIES shall be responsible for the opening and write-off of CEI records, for the SYSTEM I, and also shall inform to the CONTRACTING PARTY , the number of the referred

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record on the cover of each Invoice for the purposes of payment of INSS.

9.3.1 The CONTRACTED PARTIES shall submit to the CONTRACTING PARTY , BOOK CEI, with the respective certificate of filing with INSS, containing a copy of necessary documents submitted to INSS for the opening and write-off of CEI record, within no later than fifteen (15) days after the conclusion of the work.

9.3.2 Should the CONTRACTED PARTIES fail to submit the aforementioned documentation by the established deadline, the CONTRACTING PARTY shall hereby be authorized to withhold fifty per cent (50%) of the value of the subsequent payment due according to the agreement, regardless of any warning or notices, which percentage shall only be released by the CONTRACTING PARTY once the requested documents have been properly submitted.

9.3.3 The CONTRACTED PARTIES are fully responsible for any burden or damages arising from the opening and/or write-off of CEI record, including payment of eventual fines applied by inspection to the CONTRACTING PARTY.

9.4 Regarding the Tax on Services of Any Nature (ISSQN – Imposto Sobre Serviços de Qualquer Natureza ), the CONTRACTING PARTY shall comply with the municipal laws of the places where the services are actually rendered, regardless of what is stated in the laws of the municipality in which the service provider is headquartered.

9.5 The CONTRACTING PARTY , when it is the withholding party, shall pay the taxes mandated by the laws currently in force and is hereby authorized to discount these amounts from the amounts it shall owe the CONTRACTED PARTIES by force of this AGREEMENT.

9.6 Not withstanding the payment terms agreed to in their specific clause, all fiscal documents concerning services rendered by the CONTRACTED PARTIES shall be issued and delivered to the facilities of the CONTRACTING PARTY by the twentieth (20 ^th ) day of the month in which the respective invoice or receipt is issued, so as to allow the CONTRACTING PARTY to pay the appropriate taxes within the timeframe established by law.

CLAUSE 10 - DEADLINE

10.1 The PARTIES agree that the total deadline for supply and implementation of the subject-matter hereof is three hundred and ninety (390) days, as of the date on which this AGREEMENT is signed, in compliance with the deadlines and the terms of the Implementation Schedule of the contracted systems included in the PROPOSAL (Attachment II) and the hypotheses of survival of the clauses expressly described in this AGREEMENT.

10.2 The deadlines stipulated in this clause may only be extended subject to an Agreement Addendum and in the following cases:

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a) temporary suspension of the service by direct order of the CONTRACTING PARTY , in writing, for reasons that cannot be imputed to the CONTRACTED PARTIES , pursuant to Clause 13.

b) fortuitous events or force majeure, duly evidenced by the CONTRACTED PARTIES , pursuant to the provisions of Clause 19.

10.3 The potential extension granted in the cases mentioned in item 10.2 above shall correspond to the number of days of delay that actually occur and shall only be applied to the services that are proven to have been hindered by the delay.

10.4 The following shall not justify falling behind schedule in the performance of any of the services: the fact that the CONTRACTING PARTY may totally or partially reject any of the services and/or materials executed and/or employed if they do not correspond to the requirements, obligations and conditions of this AGREEMENT. Similarly, eventual suspension of services determined by the CONTRACTING PARTY ’s inspectors in the case of irregularities being identified, as per Clause 13, shall not be accepted as justification for falling behind schedule.

CLAUSE 11 – OBLIGATIONS OF THE CONTRACTED PARTIES

11.1 In addition to the other obligations described herein, the CONTRACTED PARTIES shall:

(a) Fulfill the Implementation Schedule that is part of the PROPOSAL (Attachment II) for the totality of subject-matter contracted and the other obligations included herein and in the other Attachments;

(b) Prepare and deliver to the CONTRACTING PARTY , for each system, subject-matter hereof, by the end of each month, or whenever the CONTRACTING PARTY , at its exclusive discretion deems necessary, under the penalty of suspension of payments possibly due to the CONTRACTED PARTIES by the CONTRACTING PARTY , and the application of fine provided for in item 17.1 (ii), “DATA BOOK”, containing a copy of the following documents:

(i) Tax Payment Form for the Tax on Services (ISS – Imposto sobre Serviços ), paid in the municipality in which the services are rendered, other than in the cases in which Municipal Law transfers to the CONTRACTING PARTY the obligation of withholding the Tax on Services at source and consequently of paying it;

(ii) Tax Payment Form for Income Tax Withheld at Source, when it occurs;

(iii) Payment Form for Social Security Contributions;

(iv) Payment Form for the Contributions to the Severance Indemnity Fund for Employees (FGTS – Fundo de Garantia de Tempo de Serviço );

(v) Payment Forms for the Union, Assistance and Confederative Contributions - General Registry of Unemployed People (CAGED – Cadastro Geral de Desempregados );

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(vi) Proof of delivery of Individual Protection Equipment (EPI – Equipamentos de Proteção Individual ), to be supplied to the staff of the CONTRACTING PARTY and of its subcontractors;

(vii) List of the people who worked in the month to which the report applies, under the responsibility of the CONTRACTED PARTIES and of its subcontractors;

(viii) Employee Registration Card (FRE – Ficha de Registro de Empregados ), admittance and periodical examination of the employees hired by the CONTRACTED PARTIES and by its subcontractors during and for the execution of the services that are the subject-matter of this AGREEMENT;

(ix) Employee Contract Rescission Statement and dismissal examination; and

(x) Monthly report showing the number of employees of the CONTRACTED PARTIES and its subcontractors by number of hours worked, number of accidents with and without leave of absence, with a copy of the Occupational Accident Communication (CAT – Comunicação de Acidente do Trabalho ) and proof of payment of the Occupational Accident Insurance (SAT –Seguro de Acidente do Trabalho).

(c) Deliver to the CONTRACTING PARTY a copy of all the original documentation that makes up the aforementioned DATA BOOK at the end of this AGREEMENT;

(d) Only subcontract the services covered by this AGREEMENT with approval of the CONTRACTING PARTY, pursuant to Clause 30. In this case, the aforementioned documents (DATA BOOK) should be supplied by the subcontracted company, the CONTRACTED PARTIES continuing to be the sole parties responsible for supplying to the CONTRACTING PARTY all elements covered by this AGREEMENT;

(e) Ensure that all its employees and the employees of the subcontractors are duly registered, in accordance with the laws currently in effect, undertaking, furthermore, to keep all legal obligations pertaining to the activities carried out by their employees up to date, including those of a labor nature and related to social security;

(f) Ensure that appropriate security measures are taken to avoid accidents and that all the work carried out is executed in accordance with the appropriate occupational safety and health laws, regardless of whether the work is being carried out by the CONTRACTED PARTIES themselves or subcontracted by them;

(g) Replace their employees, at any time, should the CONTRACTING PARTY so request, provided there is evidence of inadequate employee performance, the CONTRACTED PARTIES being held responsible, furthermore, for all costs resulting from the replacement.

(h) Adequately protect the assets of the CONTRACTING PARTY and of third parties, ensuring the conservation and maintenance of its facilities, equipment and materials. During the process of

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supplying and installing the equipment hereby agreed to, the CONTRACTED PARTIES and its employees or third parties under their responsibility shall also comply with the standards that concern the use and conservation of the CONTRACTING PARTY ’s facilities under penalty of payment for damages caused.

(i) Be responsible for obtaining all the licenses or authorizations required in order to supply, implement and operate the subject-matter hereof, including environmental licenses, and, furthermore, bear all costs necessary for obtaining them;

(j) To maintain in Brazil, throughout the period of validity of this AGREEMENT, a Replacement Center, which shall contain a minimum inventory for the replacement of defective parts, so as to ensure that all the parts sent for repairs by the CONTRACTING PARTY be returned by the CONTRACTED PARTIES within sixty (60) days at most;

(k) Furnish the subject-matter hereof in compliance with the rules currently published, as well as that to be edited by the Ministry of Communications, by ANATEL and by other public administration offices, including, but not limiting themselves to, those that concern the Personal Mobile System (SMP – Sistema Móvel Pessoal), bearing all the costs inherent and resulting from this.

(l) Inform the CONTRACTING PARTY , on a weekly basis, of the progress of the services under contract, in accordance with the Implementation Schedule, showing how events are progressing, an analysis of possible deviations from the schedule and measures taken to recover lost time, including with regard to services carried out by third parties, as applicable. In this regard, the CONTRACTING PARTY shall define, within no later than thirty (30) days as from the execution of this AGREEMENT, the reports to be supplied by the CONTRACTED PARTIES to the CONTRACTING PARTY , in addition to the content of each report;

(m) Provide, at any time, the information required by the CONTRACTING PARTY on the process of supplying the subject-matter of this Agreement and on the Implementation Schedule established in the PROPOSAL (Attachment II), containing the details necessary for keeping track of timing well and reliably.

(n) Provide the CONTRACTING PARTY with a copy of the insurance policies taken out in the name of the CONTRACTED PARTIES , pursuant to Clause 24, as well as the proof of payment of their respective premiums;

(o) Appoint a Project Manager to interact with the Project Manager appointed by the CONTRACTING PARTY , fully managing the obligations of the CONTRACTED PARTIES and of the subcontracted parties. The Project Manager shall: a) have full knowledge of the entire context of the Projects; and b) have the authority to make day-to-day decisions concerning the Project and the respective staff;

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(p) Fulfill, observe, re