a a a







      Consolidated
      Guarantees 2009 2008
Local Currency              
Banco do Nordeste: financing subject to pre-fixed interest of 10% p.a. and a 15% and 25% bonus on charges, for payment upon maturity. The average cost of this financing is 10.47% p.a., considering its origination cost. This financing is the subject matter of a swap operation for hedging purposes, which changes its cost into a % of the Interbank Deposit Certificate (CDI) daily rate of 76.90%.   Bank surety 40,950 56,830
                 
Banco do Nordeste: financing subject to pre-fixed interest of 10% p.a. and a 15% and 25% bonus on charges, for payment upon maturity. The average cost of the BNB (TNE04) credit line is 10.23% p.a. and of the BNB (TNE05) credit line is 10.34%, considering their origination cost. This financing is the subject matter of a swap operation for hedging purposes, which changes its cost into a % of the Interbank Deposit Certificate (CDI) daily rate, varying between 75.75% to 69.80%.   Bank surety and Guarantee of TIM Participações 54,861 71,603
                 
Banco do Nordeste: financing subject to pre-fixed interest of 10% p.a. and a 15% and 25% bonus on charges, for payment upon maturity. The average cost of this financing is 8.98% p.a., considering its origination cost.   Bank surety and Guarantee of TIM Participações 68,063 45,287
                 
BNDES (Banco Nacional de Desenvolvimento Econômico e Social): an average cost of some 10.23% p.a., considering the TJLP (long-term interest rate) informed by the Central Bank of Brazil. Part of this TJLP-based financing was subject to a swap for 91.43% of the Interbank Deposit Certificate (CDI) daily rate.   Guarantee of TIM Participações and part of service revenue earmarked to the loan debit balance 802,310 1,019,898
                 
BNDES (Banco Nacional de Desenvolvimento Econômico e Social): an average cost of some 8.13% p.a., considering the TJLP (long-term interest rate) announced by the Central Bank of Brazil, is levied on 76% of part of "incentive" amounts, and an average cost of 10.23% p.a., including IPCA, is levied on 24% of "non-incentive" amounts.   Guarantee of TIM Participações and part of service revenue earmarked to the loan debit balance 657,727 270,496
                 
BNDES (Banco Nacional de Desenvolvimento Econômico e Social): this financing is subject to an average cost of 9% p.a., considering the TJLP (long-term interest rate) announced by the Central Bank of Brazil. Part of this TJLP-based financing was subject to a swap for 81.80% of the Interbank Deposit Certificate (CDI) daily rate.   Bank surety 23,252 35,892
                 
BNDES (Banco Nacional de Desenvolvimento Econômico e Social): this financing is subject to an average cost of 10.82% p.a., considering the TJLP (long-term interest rate) announced by the Central Bank of Brazil.   Guarantee of TIM Participações and part of service revenue earmarked to the loan debit balance 407,373 -
                 
Syndicated Loan: the debit balance is restated based on the CDI rate variation plus its related applicable margin of 1.80% and 2,75% of the CDI p.a. The average cost is 12.36% p.a., considering its origination cost.   Guarantee of TIM Participações 590,440 628,747
                 
CCB – Working Capital: Bank financing in local currency for meeting working capital requirements. Its restated cost varies between 109.6% and 110% of the CDI daily rate. Its average cost, considering the CDI, is 10.97% p.a.   N.A. 203,750 205,634
                 
Foreign currency              
                 
BEI: The debit balance is adjusted based on the 6-month Libor + spread; for being a foreign currency denominated loan, it is subject to a swap operation for hedging purposes covering 100% of the foreign exchange exposure, which changes its cost into a % of the daily rate of the Interbank Deposit Certificates (CDI) of 96.46%, representing an average cost of debt of 9.63% p.a. for 2009.   Bank surety and Guarantee of TIM Participações 422,276 -
                 
Resolution 2770 (Compror): Bank financing for payment of suppliers of goods and services. The average cost of this debt is 12.96% p.a. in foreign currency and 10.78% p.a. in local currency. The foreign and national currency-denominated financing agreements are segregated as follows: 34% are denominated in U.S. dollars, 37% are denominated in Yen and 29% are denominated in Brazilian reais. All of the foreign currency-denominated agreements are subject to swap operations which change their costs to 122.92% of the CDI daily rate.   N.A. 516,157 1,214,832
                 
Banco BNP Paribas: The debit balance is adjusted based on the 6-month Libor + spread. 80% of the risk underlying this foreign currency-denominated debt is guaranteed by insurer "SACE S.p.A". This operation is subject to swap operations for hedging purposes covering 100% of the foreign exchange exposure, which changes its cost into a % of the daily rate of the Interbank Deposit Certificates (CDI) of 95.01%, representing an average cost of debt of 9.48% p.a. for 2009.   Guarantee of TIM Participações 254,397 -
                 
Banco Morgan Stanley: Debt in the amount of USD 68,000,000   Guarantee of TIM Nordeste, marged into TIM Celular 118,402 -
                 
Total       4,159,958 3,549,219
                 
Current portion       (1,417,363) (1,482,705)
Long-term portion       2,742,595 2,066,514


The syndicated loan obtained by subsidiary TIM Celular includes restrictive covenants subject to compliance with certain financial ratios calculated on a half-yearly basis. The following financial institutions are part of these loan agreement: HSBC Bank Brasil S.A. – Banco Múltiplo, Banco BNP Paribas Brasil S.A., Banco Bradesco S.A., Banco do Brasil S.A., Banco Itaú BBA S.A., Banco Santander Brasil S.A., Banco Société Générale Brasil S.A.and Banco Votorantim S.A. In August 2008, TIM Celular negotiated and replaced the guarantee provided by TIM Brasil Serviços with a guarantee provided by TIM Participações and postponed the maturity of Tranche "A", in the amount of R$300,000, to August 2010. Tranche "B", in the amount of R$268,750, which is part of the operation, also matures in August 2010.

The CCB (Bank Credit Schedules) for Working Capital also have the same restrictive clauses as the syndicated loan, all of which have been complied with by TIM Celular. These loans have been taken from ABN AMRO Real S.A, now denominated Banco Santander Brasil S.A.

The BNDES loan to TIM Celular for financing the mobile telephone network has restrictive clauses concerning certain financial indices, calculated on a half-yearly basis. The subsidiary is in compliance with the contractual provisions.

The remaining balance of the loan obtained by Intelig from Arafura Investments, amounting to USD68,000,000 is recorded as Loans and Financing. On December 30, 2009, by means of the "Assignment and Assumption Agreement", Arafura Investments agreed with former shareholders of Intelig to assign and transfer these credits to Morgan Stanley Senior Fund.

The subsidiaries entered into swap operations to protect themselves against devaluation of the Brazilian currency ("Real") in relation to foreign currencies and changes in the fair value of financing indexed to fixed interest rates and TJLP.

The long-term portions of loans and financing at December 31, 2009 mature as follows:

    Consolidated
2011 859,213
2012 568,791
2013 310,034
2014 160,050
2015 onwards 844,507
    2,742,595