================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------ FORM 10-Q (Mark One) |X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2001 OR |_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ------- --------------- ITSA LTD. (Exact name of Registrant as Specified in its Charter) COMMISSION FILE NUMBER: 0-31247 CAYMAN ISLANDS NOT APPLICABLE (State or Other Jurisdiction (I.R.S. Employer of Incorporation or Organization) Identification Number) C/O ITSA-INTERCONTINENTAL TELECOMUNICACOES LTDA. SCS, QUADRA 07- ED. TORRE PATIO BRASIL, SALA 601 70.307-901 BRASILIA-DF BRAZIL (Address, Including Zip Code, of Principal Executive Offices) 011-55-61-314-9904 (Registrant's Telephone Number, Including Area Code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.[ ] Yes [|X|] No* Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. [ ] Yes [|X|] No* * Registrant became subject to filing requirements pursuant to Rule 12g-3 under the Securities Exchange Act of 1934 on July 21, 2000, when it became the successor in interest to TV Filme, Inc., a Delaware corporation. Since July 21, 2000, Registrant has filed a Current Report on Form 8-K12G3, a Quarterly Report on Form 10-Q for the Period Ended June 30, 2000, a Quarterly Report on Form 10-Q for the Period Ended September 30, 2000 and an Annual Report on Form 10-K for the Period Ended December 31, 2000. Indicate the number of shares outstanding of each of the issuer's classes of Common Stock, as of the latest practicable date. CLASS OUTSTANDING ----- ------------ Ordinary Shares, par value $0.01 10,000,000 shares per share. as of May 15, 2001 ================================================================================ ITSA LTD. (SUCCESSOR TO TV FILME, INC.) INDEX PART I. FINANCIAL INFORMATION PAGE NO. -------------------------------- -------- ITEM 1. Financial Statements Consolidated Balance Sheets as of December 31, 2000 and March 31, 2001 (Unaudited).................................... 2 Unaudited Consolidated Statements of Operations for the Three Months Ended March 31, 2000, and the Three Months Ended March 31, 2001................................... 3 Unaudited Consolidated Statement of Changes in Stockholders' Equity for the Three Months ended March 31, 2001.............. 4 Unaudited Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2000, and the Three Months Ended March 31, 2001......................................... 5 Notes to Unaudited Consolidated Financial Statements.......... 6 ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations..................................... 9 ITEM 3. Quantitative and Qualitative Disclosures About Market Risk.... 12 PART II. OTHER INFORMATION ITEM 1. Legal Proceedings............................................. 12 ITEM 2. Changes in Securities and Use of Proceeds..................... 12 ITEM 3. Defaults Upon Senior Securities............................... 12 ITEM 4. Submission of Matters to a Vote of Security Holders........... 12 ITEM 5. Other Information............................................. 12 ITEM 6. Exhibits and Reports on Form 8-K.............................. 12 SIGNATURES............................................................. 14 ITSA LTD. (SUCCESSOR TO TV FILME, INC.) AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

2 ITSA LTD. (SUCCESSOR TO TV FILME, INC.) AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

See accompanying notes. 3 ITSA LTD. (SUCCESSOR TO TV FILME, INC.) AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (UNAUDITED) FOR THE THREE MONTHS ENDED MARCH 31, 2001 (IN THOUSANDS OF US DOLLARS, EXCEPT SHARE DATA)

See accompanying notes. 4 ITSA LTD. (SUCCESSOR TO TV FILME, INC.) AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) PREDECESSOR SUCCESSOR THREE MONTHS THREE MONTHS ENDED ENDED MARCH 31, MARCH 31, 2000 2001 ---------------------------- (IN THOUSANDS OF US DOLLARS) CASH FLOWS FROM OPERATING ACTIVITIES Net income (loss) $ (6,025) $ (9,274) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation and amortization 3,095 2,668 Allowance for doubtful accounts 236 508 Deferred installation fees (305) (51) Gain on disposal of property, plant and equipment - (15) Foreign exchange (gain) loss (2,169) (3,950) Changes in operating assets and liabilities: Accounts receivable 295 (654) Prepaid expenses and other current assets (121) 918 Other assets (1,771) 184 Accounts payable (498) 530 Payroll and other benefits payable 150 (79) Accrued interest payable 4,506 1,176 Accrued liabilities and taxes payable 1,537 (379) Sale of operating loss carryforwards - 264 -------- -------- Net cash used in operating activities (1,070) (254) -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property, plant and equipment (1,445) (903) Sales of property, plant and equipment - 166 -------- -------- Net cash used in investing activities (1,445) (737) -------- -------- Effect of exchange rate changes on cash 572 (298) -------- -------- Net change in cash and cash equivalents (1,943) (1,289) Cash and cash equivalents at beginning of period $ 42,175 $ 3,858 -------- -------- Cash and cash equivalents at end of period $ 40,232 $ 2,569 ======== ======== See accompanying notes. 5 ITSA LTD. (SUCCESSOR TO TV FILME, INC.) AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (IN THOUSANDS OF US DOLLARS, EXCEPT SHARE DATA) (UNAUDITED) 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. COMPANY BACKGROUND On July 21, 2000, ITSA Ltd., a Cayman Islands company, became the successor to TV Filme, Inc., a Delaware corporation, following the successful completion of a debt restructuring pursuant to a plan of reorganization of TV Filme, Inc. under Chapter 11 of the United States Bankruptcy Code. Unless otherwise indicated, ITSA Ltd., the successor company to TV Filme, Inc., and its subsidiaries will hereinafter be referred to as the "Company," and TV Filme, Inc., the predecessor company to ITSA Ltd., will hereinafter be referred to as "TV Filme." As of July 21, 2000, the Company adopted fresh-start reporting (see Note 3). Following financial difficulties in the years 1998 and 1999, TV Filme selected a financial advisor to assist in evaluating strategic alternatives for the restructuring of its long term debt, represented by the 12-7/8% Senior Notes due 2004 (the "12-7/8% Senior Notes"). On August 13, 1999, TV Filme reached an agreement in principle with a committee representing holders of TV Filme's outstanding 12-7/8% Senior Notes. On January 26, 2000, TV Filme filed a voluntary petition under Chapter 11 of the United States Bankruptcy Code, together with a pre-negotiated Plan of Reorganization and the Disclosure Statement relating to such Plan, with the U.S. Bankruptcy Court for the District of Delaware. The court approved the Disclosure Statement on March 1, 2000. Following approval of the Disclosure Statement, ballots respecting the Plan were circulated to those parties entitled to vote on the Plan, and the Plan was confirmed at a hearing by the court on April 10, 2000. Effectuation of the Plan was completed on July 21, 2000, following approval of ANATEL (the Brazilian Telecommunications Agency) and the Central Bank of Brazil. In accordance with the terms of the plan of reorganization, the 12-7/8% Senior Noteholders received a $25 million cash payment and their existing notes were converted into (i) Secured Notes in the aggregate principal amount of $35 million, due 2004, at an interest rate of 12% per annum, and (ii) 80% of the new common equity of the reorganized Company. Current management received 15% of the new common equity, and the existing common stockholders of TV Filme received 5% of the new common equity of the reorganized Company. Shares granted to current management have been expensed in the financial statements of the succcessor based on the fair value at that date. They have been expensed in the period as there are no contractual requirements in connection with the issuance of these shares. TV Filme's stock option plan and outstanding stock options under the plan were cancelled. ITSA Ltd. (the reorganized Company) is a newly-formed Cayman Islands holding company and is the successor issuer to TV Filme. The 12-7/8% Senior Notes were cancelled upon surrender. The 12% Senior Secured Notes were issued by ITSA-Intercontinental Telecommunicacoes Ltda., a wholly-owned subsidiary of the Company. The Company develops, owns and operates broadband wireless telecommunications systems in markets in Brazil, offering video, high-speed Internet and data communications services. Through its subsidiaries, the Company has licenses in the cities of Brasilia, Goiania, Belem, Campina Grande, Caruaru, Porto Velho, Presidente Prudente, Bauru, Franca, Uberaba, Belo Horizonte and Vitoria, covering over 3 million households and approximately 13 million people. The Company offers a pre-paid subscription video service, called MAISTV, which is comprised of a self-install kit available in retail stores in most of the cities where the Company has operations. ITSA was also the first company in Brazil to launch a high-speed Internet access system using the technology of high-speed modems. The system, called LINKEXPRESS, has been available on a commercial basis in the city of Brasilia since 1998. 6 Although the economic situation in Brazil has remained relatively stable in recent years, a return to higher levels of inflation, and currency fluctuations could adversely affect the Company's operations. The devaluation of the Brazilian REAL in relation to the U.S. dollar has had significant effects on the Company's financial statements. The exchange rate of the Brazilian REAL ("R$") to the U.S. dollar was R$1.2087:US$1.00 at December 31, 1998, R$1.7890:US$1.00 at December 31, 1999 and R$1.9554:US$1.00 at December 31, 2000. At March 31, 2001 the exchange rate was R$2.1616:US$1.00. The Company has projected cash operating deficiencies for the year 2001. Its ability to continue operating is based on a commitment for a $10,000 secured revolving credit facility on the terms and subject to the conditions set forth in the credit agreement. ITSA Ltd. (the parent company) has no material assets of its own other than the investment in its subsidiaries. All assets of the subsidiaries are restricted. B. METHOD OF PRESENTATION The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three-month period ended March 31, 2001 are not necessarily indicative of the results that may be expected for the year ended December 31, 2001. The balance sheet at December 31, 2000 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by the accounting principles generally accepted in the United States for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in ITSA Ltd.'s annual report on Form 10-K for the year ended December 31, 2000. 2. LONG-TERM DEBT The Company's 12% Senior Secured Notes ($39,200 outstanding at December 31, 2000) are U.S. dollar denominated and are due on December 20, 2004. Interest payments are due on June 20 and December 20 of each year until maturity. Interest is payable in kind at the Company's option through its first four payment dates. The Company exercised its option at December 31, 2000 and issued additional notes for the $4,200 interest accrued to that date. The 12% Senior Secured Notes are secured by all of the assets of the Company. In the event of a default on the Senior Secured Notes, 25% of the lenders thereunder may declare the unpaid principal of, and any accrued interest on, all the Senior Secured Notes to be due and payable immediately. In the event the Company becomes subject to a voluntary or involuntary insolvency proceeding, the 12% Senior Secured Notes become immediately due and payable. As of March 31, 2001, the Company had $39.2 million of 12% Senior Secured Notes. 3. FRESH START REPORTING AND REORGANIZATION As of July 21, 2000, the Company adopted fresh-start reporting in accordance with AICPA Statement of Position 90-7, "Financial Reporting by Entities in Reorganization under the Bankruptcy Code." Fresh-start reporting resulted in material changes to the consolidated balance sheet based upon the appraised reorganization value of the Company. TV Filme's reorganization value of $76,184 was based on a valuation performed by an independent firm using 10 year forecasted discounted cash flows and other economic measures. The value resulted in a greater value than the carrying value of the net assets. As such, the difference of $31,413 was recorded as reorganization value in excess of amounts allocable to identifiable assets. 7 The effect of the plan of reorganization and adoption of fresh start reporting was as follows:

8 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS This Form 10-Q contains forward-looking statements, including pro forma information, which involve risks and uncertainties. The Company's actual results may differ significantly from the results discussed in these forward-looking statements. The following discussion should be read in conjunction with the Consolidated Financial Statements, including the notes thereto, included elsewhere in this Form 10-Q. RESULTS OF OPERATIONS Although the Company's financial statements are presented in U.S. dollars and pursuant to accounting principles generally accepted in the United States, the Company's transactions are consummated in both REAIS and U.S. dollars. Inflation and devaluation in Brazil have had substantial effects on the Company's results of operations and financial condition. See "-- Inflation and Exchange Rates." As a result of the changes in exchange rates during the periods presented, the period-to-period comparisons of the Company's results of operations are not necessarily meaningful and should not be relied upon as an indication of future performance of the Company. Effective July 21, 2000, the Company emerged from Chapter 11 bankruptcy proceedings and implemented "fresh start reporting". Accordingly, all assets and liabilities were restated to reflect their respective fair values. The consolidated financial statements after that date are those of a new reporting entity and are not comparable to the Pre-Confirmation periods. Differences between periods due to fresh start accounting are explained when necessary. The following table is included solely for use in comparative analysis of results of operations, and to complement management's discussions and analysis:

(a) EBITDA is defined as operating loss plus depreciation and amortization. While EBITDA should not be construed as a substitute for operating loss or a better measure of liquidity than cash flow from operating activities, which are determined in accordance with U.S. GAAP, it is included herein to provide additional information regarding the ability of the Company to meet its capital expenditures, working capital requirements and debt service. EBITDA, however, is not necessarily a measure of the Company's ability to fund its cash needs. 9 NET LOSS. For the three months ended March 31, 2001 compared to the three months ended March 31, 2000, net loss was $9,274,000 versus $6,025,000, primarily due to the devaluation of the REAL between the periods. REVENUES. For the three months ended March 31, 2001 compared to the three months ended March 31, 2000, revenues increased by 8%, primarily due to an increase in the number of subscribers. SYSTEM OPERATING EXPENSES. For the three months ended March 31, 2001 compared to the three months ended March 31, 2000, system operating expenses increased by 41%, primarily due to the programming costs and Soccer Championship transmission rights in Belem. SELLING, GENERAL AND ADMINISTRATIVE ("SG&A") EXPENSES. For the three months ended March 31, 2001 compared to the three months ended March 31, 2000, SG&A expenses increased 8%, primarily due to the increase in bad debt and expenses in new systems launched in year 2000. DEPRECIATION AND AMORTIZATION. For the three months ended March 31, 2001 compared to the three months ended March 31, 2000, depreciation and amortization decreased by 14%, primarily due to assets becoming fully depreciated. INTEREST AND OTHER EXPENSE. For the three months ended March 31, 2001 compared to the three months ended March 31, 2000, interest and other expense decreased by 78%, primarily due to a decrease in liability positions associated with TV Filme's restructuring process. INTEREST AND OTHER INCOME. For the three months ended March 31, 2001 compared to the three months ended March 31, 2000, interest and other income decreased by 87%, primarily due to a decrease in average cash balance between the two periods. FOREIGN EXCHANGE LOSS. Due to its net dollar-denominated liability position, the Company generates monetary gain and losses in any reporting period in which the value of the REAL depreciates or appreciates in relation to the value of the U.S. dollar. In the three months ended March 31, 2001, the Company generated a monetary loss of $4.0 million, compared to a monetary gain of $2.2 million in the three months ended March 31, 2000. LIQUIDITY AND CAPITAL RESOURCES The telecommunications business is capital intensive. From 1993 through the first part of 1996, TV Filme raised an aggregate of approximately $16.8 million through a series of private equity placements to Tevecap and Warburg, Pincus Investors, L.P. In August 1996, TV Filme completed an initial public offering with net proceeds to TV Filme of $24.4 million and in December 1996 TV Filme completed the sale of the 12-7/8% Senior Notes with net proceeds to the Company of approximately $134.0 million. In the past, working capital requirements have been primarily met by (i) venture capital financings, (ii) capital markets financings, (iii) vendor financing which generally requires payment within 420 days of shipment, some of which had been supported by irrevocable letters of credit guaranteed by Abril and certain of its affiliates and (iv) borrowings from Abril and certain affiliates. As of June 30, 2000, TV Filme had no outstanding borrowings from Abril and its affiliates and the Company does not expect to borrow from Abril or its affiliates in the future. In previous years, TV Filme made a substantial amount of import purchases of equipment with the use of letters of credit provided by banks in Brazil. As of March 31, 2001, the Company had no amounts outstanding under letters of credit. Pursuant to the terms of a commitment letter executed by various proposed lenders (including certain shareholders of the Company) on July 20, 2000, the Company is able to borrow, on a secured basis, $10,000,000 of additional capital for use in its operations. While the Company believes that lines of credit, additional vendor financing and other credit facilities are available, the terms and conditions of such financing vehicles are uncertain and may not be available on terms acceptable to the Company. Net cash used in operating activities for the three months ended March 31, 2001 was $0.3 million. Common shares of the Company are currently tradable in the over-the-counter market and are listed on the OTC Bulletin Board. The effects of shares trading in the over-the-counter market, as opposed to being listed on a 10 National Exchange, include, without limitation, the limited release of market prices of the ordinary shares, limited news coverage of the Company, and restriction of investors' interest in the Company, and may have a material adverse effect on the trading market and prices for the ordinary shares, thereby affecting the Company's ability to issue additional securities or secure additional financing. In addition, because the ordinary shares are deemed penny stock under the Securities Enforcement Penny Stock Reform Act of 1990, additional disclosure is required in connection with trading in the ordinary shares, including delivery of a disclosure schedule explaining the nature and risk of the penny stock market. Such requirements could limit the liquidity of the common shares. The Company has developed a business strategy to invest in its wireless network on a nationwide basis in order to be able to offer video, high-speed Internet and data communications services. Considering the demand for telecommunications services in Brazil and the lack of infrastructure in many markets, the Company believes it has the opportunity to offer efficient services gaining rapid market share. In the area of video delivery, the Company intends to upgrade its system and use digital compression technology to offer as many as 100 digital video channels to its subscribers in the major markets. All transmission systems already in place are capable of offering digital video channels, but substantial capital investment will be needed to upgrade customers' set-top decoders and equipment. The Company estimates that, in order to offer the digital video services, it will have to invest approximately $2.0 million over the next two years, for each of the major markets where this service will be available. Additionally, the Company's strategy involves extending LinkExpress, its high-speed Internet and data service, to all other major markets. The Company will focus primarily on developing its high-speed Internet and data communications services, serving both the residential and the corporate market. In order to offer the high-speed and data services, the Company will have to invest on average approximately $1.5 million over the next two years, for each of the major markets where this service will be available. The Company made capital expenditures of approximately $0.9 million during the three months ended March 31, 2001. Such capital expenditures were financed with available cash. As of March 31, 2001, of the Company's approximately $2.6 million in cash and cash equivalents, approximately $0.6 million (23%) was invested in U.S. dollar denominated securities. In the long term, the Company's funding needs are subject to a variety of factors, including, the number and size of new system launches or acquisitions, the implementation of alternative transmission technologies and the offering of additional telecommunications services. Accordingly, there can be no assurance that the Company will be able to meet its future funding needs. INFLATION AND EXCHANGE RATES Inflation and exchange rate variations have had, and are expected to continue to have for the foreseeable future, substantial effects on the Company's results of operations and financial condition. In periods of inflation, many of the Company's expenses will tend to increase. Generally, in periods of inflation, a company is able to raise its prices to offset the rise of its expenses and may set its prices without governmental regulation. However, under a Brazilian law designed to reduce inflation, the prices which the Company may charge to a particular subscriber may not be increased until the next anniversary of the subscriber's initial subscription date and may only be increased by a percentage no greater than the percentage of the increase in the general inflation rate which occurred during the subscriber's contract year. Thus, the Company is less able to offset expense increases with revenue increases. Accordingly, inflation may have a material adverse effect on the Company's results of operations and financial condition. Generally, inflation in Brazil has been accompanied by devaluation of the Brazilian currency relative to the U.S. dollar. The Company collects substantially all of its revenues in REAIS, but pays certain of its expenses, including a significant portion of its equipment costs, substantially all interest expense and most of its programming costs, in U.S. dollars. To the extent the REAL depreciates at a rate greater than the rate at which the Company is able to raise prices, the value of the Company's revenues (as expressed in U.S. dollars) is adversely affected. This effect on the Company's revenues also negatively impacts the Company's ability to fund U.S. dollar-based expenditures. As of January 1, 1998, the Company's financial statements reflect foreign exchange gains and losses associated with monetary assets and liabilities denominated in currencies other than the REAL. As a result, the 11 devaluation of the REAL against the U.S. dollar has caused, and is expected to cause, for the foreseeable future, the Company to record a loss associated with its U.S. dollar monetary liabilities and a gain associated with its U.S. dollar monetary assets. Given that the Company has a net U.S. dollar monetary liability position, the net effect of the devaluation of the REAL against the U.S. dollar is to generate losses in the Company's financial statements. In order to protect against a possible further devaluation of the REAL, the Company may from time to time enter into certain foreign exchange contracts. RECENT ECONOMIC EVENTS In August of 2000, the Brazilian Congress passed and approved a new law #9998 - August 17th, which establishes a new tax to be paid monthly by every telecommunications operator in the country. This tax, called FUST -- Fundo de Universalizacao dos Servicos de Telecommunicacoes (Fund for the Universalization of Telecommunications Services) -- will be calculated based on 1% (one percent) of the total gross income of every operation, and became effective in January 2001. This tax will adversely affect the Company's results of operations. In November of 2000, the Brazilian Congress passed and approved a new law # 10052 - November 28th, which establishes a new tax to be paid monthly by every telecommunications operator in the country. This tax, called FUNTTEL - Fundo para o desenvolvimento Tecnologico das Telecomunicacoes (Fund for the Technological Development of Telecommunicatons) - - will be calculated based on 0.5 % (half percent) of the total gross income of every operation, and become effective on April 2001. This tax will adversely affect the Company's results of operations. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. The Company's primary market risk exposure is foreign currency exchange rate risk between the U.S. dollar and the Brazilian REAL. This is due to the fact that the Company has all of its operations based in Brazil, and most of its revenues and some of its expenses are denominated in REAIS while substantially all of its debt and many of its expenses and capital equipment needs are denominated in dollars. In addition, for operating purposes, the Company holds a significant portion of its available cash in REAIS. PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS. No material legal proceedings in which the Company or any of its subsidiaries is a party, or of which any of their property is subject, are currently pending, nor have any such proceedings been terminated during the first quarter of 2001. ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS. None. ITEM 3. DEFAULTS UPON SENIOR SECURITIES. None. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. None. ITEM 5. OTHER INFORMATION. None. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits 12 None. (b) Reports on Form 8-K None. 13 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. DATED: May 15, 2001 ITSA LTD. ----------------------------------------------- (Registrant) /s/ Hermano Studart Lins de Albuquerque ----------------------------------------------- Hermano Studart Lins de Albuquerque Chief Executive Officer (Principal Executive Officer) /s/ Carlos Andre Studart Lins de Albuquerque ----------------------------------------------- Carlos Andre Studart Lins de Albuquerque Acting Chief Financial Officer (Principal Financial and Accounting Officer) 14

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