Exhibit
4.18


ANNOUNCEMENT OF COMMENCEMENT OF PUBLIC DISTRIBUTION OF
NON-CONVERTIBLE UNSECURED DEBENTURES





Unibanco (União de Bancos
Brasileiros S.A.) as Lead Manager hereby announces the commencement of
distribution for public subscription of the 1st Issue, in a Single Series, of
23,042 (twenty three thousand and forty two) debentures not convertible into
shares, without guarantee, being nominal and of the book-entry type, with
nominal unit value of R$ 10,871.6048 (ten thousand, eight hundred and
seventy one point six zero four eight Reais) (“the Offering” or “the Issue”,
and “the Debentures”), issued by





Listed company


CNPJ n° 
06.981.180/0001-16


Avenida
Barbacena, 1200, A1 Wing, 17th Floor,


30190-131 Belo Horizonte, Minas Gerais, Brazil.


ISIN: BRCMGDDBS009


In the amount of:


R$
250,503,517.80


RISK
RATINGS




	
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I               INFORMATION ON THE
ISSUER AND DISTRIBUTION OF THE DEBENTURES


1.             Full name and
principal place of business


CEMIG
Distribuição S.A. (“the Issuer”), a corporation with head office in the
jurisdiction of the city of Belo Horizonte, Minas Gerais State, Brazil, at
Avenida Barbacena 1200, 17th Floor, A1 Wing, registered in the CNPJ/MF under
number 06.981.180/0001-16, with its Articles of Association filed at the
Commercial Board of the State of Minas Gerais, under NIRE No. 31300020568.











2.                      Decision and Deed of the Issue


2.1.          Corporate decisions: The
Offering was approved at the meeting of the Board of Directors of the Issuer
held on January 25, 2006, the minutes of which were ratified by the meeting of
the Board of Directors of the Issuer held on June 29, 2006, and of CEMIG, held
on January 25, 2006.


2.2           Issue Deed: The
terms and conditions of the Debentures are contained in the “Private Deed of
the 1st Public Issue of Debentures Not Convertible Into Shares in a Single
Series Without Guarantee of Cemig Distribuição S.A.”, entered into on August
24, 2006 (“the Issue Deed”). The Issue Deed
was filed at the Commercial Board of the State of Minas Gerais on September 1,
2006, under No. ED000033-7/000.


3.             Characteristics of
the Debentures


3.1.                             Total
amount of the Issue: R$ 250,503,517.80
(two hundred and fifty million, five hundred and three thousand, five hundred
and seventeen Reais and eighty centavos)


3.2         Issue Date:  June 1, 2006.


3.3         Nominal unit value:
R$ 10,871.6048 (ten thousand, eight hundred and seventy one point six zero
four eight Reais), on the Issue Date.


3.4         Series number: The
Issue is effected in a Single Series.


3.5         Number
of Debentures: 23.042 23,042
(twenty three thousand and forty two) Debentures.


3.6         Supplementary Lot
Option: The Issuer has not given the Lead Manager the option to increase
the number of Debentures to be distributed through a Supplementary Lot, as
provided for by Article 24 of CVM Instruction 400.


3.7         Form: The
Debentures are of the simple, non-convertible, nominal, book-entry type,
without issue of deposits or certificates.


3.8         Type: The
Debentures are without guarantee or preference (unsecured).  The Debentures of this Issue have a corporate
guarantee issued by CEMIG in accordance with item 8 below.


3.9         Use of proceeds:
By reason of the Obligatory Exchange, the Issuer will not receive the net
proceeds of this Offering, since the Debentures will be paid up by the
Debentures issued under the “Private Deed of the 3rd Public Issue of
Non-Convertible Simple Debentures Without Guarantee or Preference in a Single
Series of Companhia Energética de Minas Gerais – CEMIG” (“the 3rd CEMIG Issue”).
The proceeds of the 3rd CEMIG Issue were allocated to amortization of the debts
of CEMIG contracted for the carrying out of investments in distribution of
electricity, which became due in 2004, as described in Clause 3.4 of the Issue
Deed.


3.10   Maturity: The period of
maturity of the Debentures of this Offering is 96 (ninety six) months from the
date of issue, with final maturity on the first business day of June 2014.


3.11   Obligatory Exchange: The
present Offering is carried out for the purposes of the Obligatory Exchange of
the Debentures of the 3rd CEMIG Issue for the Debentures, with the consequent
cancellation of the Debentures of the 3rd CEMIG Issue. 


3.12   Programmed amortization:
The Debentures will not be the subject of programmed amortization before the
maturity date.


4.             Remuneration


The debentures shall
carry the right to the following Remuneration (“the Remuneration”):











4.1. Updating


The
Debentures shall have their nominal value updated, from the Issue Date, by the
IGP-M Inflation Index, calculated and published by the Getúlio Vargas
Foundation. This updating will be calculated pro rata temporis, on the basis of
business days, according to the following formula (“Updating of the Debentures”):








where:


	
   

  	
  VNa

  	
  is the updated nominal value calculated to 6
  (six) decimal places, without rounding;

  
	
   

  	
  VNe

  	
  is the nominal amount or remaining nominal
  balance calculated to 6 (six) decimal places, without rounding;

  
	
   

  	
  C

  	
  is the accumulated factor of the monthly
  variations of the indices used, calculated to 8 (eight) decimal places,
  without rounding;

  
	
   

  	
  NI0

  	
  is the index number of the month prior to the
  month of the beginning of updating;

  
	
   

  	
  NI1

  	
  is the amount of the index number of the month of
  start of updating;

  
	
   

  	
  NI2

  	
  is the amount of the index number of the month
  subsequent to the month of commencement of updating;

  
	
   

  	
  NIn

  	
  is the amount of the index number of the month
  prior to the month of updating up to the anniversary date. After the
  anniversary date, the amount of the index number of the month of updating;

  
	
   

  	
  NIn-1

  	
  is the amount of the index number of the month
  prior to month “n”;

  
	
   

  	
  dup

  	
  a whole number– is the number of business days
  between the previous base date and the date of updating; and

  
	
   

  	
  dut

  	
  a whole number – is the number of business days
  between the prior base date and the next base date.

  



 


The
month between two consecutive anniversary dates of the Debentures in question
shall be considered as a month of updating.


The
anniversary date is the date of the first business day of each month.


The
anniversary date is the date of the first business day of each month.


The
index number of the IGP-M shall be used based on an identical number of decimal
places to that used by the body responsible for its calculation.


The
IGP-M shall be applied annually, or in any shorter period permitted by the
legislation from time to time in force, in which case this shall be without the
need for adjustment to the Issue Deed or any other formality.


4.1.2.
If on the date of maturity of any of the Issuer’s pecuniary obligations the
IGP-M is not published, the last prior IGP-M index number published shall be
applied, calculated pro rata temporis, and no financial compensation shall be
due or payable between the Issuer and the holders of the Debentures upon the
subsequent publication of the IGP-M which would be applicable.


4.1.3. In the event of
the abolition, absence of calculation and/or publication of the IGP-M for more
than 10 (ten) consecutive days after the date expected for its calculation
and/or publication, or legal impossibility of application of the IGP-M to the
Debentures, the Fiduciary Agent shall, within 30 (thirty) calendar days from
the event, hold a General Meeting of Debenture Holders (subject to the
provisions of Clause VII of the Issue Deed), for decision, by common accord
with the Issuer, subject to the applicable regulations, on a new parameter for
the remuneration of the Debentures to be proposed by the Issuer. Up to the
decision on this parameter, the last IGP-M officially disclosed, plus
remuneratory interest (as defined below), up to the date of the decision of the
General Meeting of Debenture Holders, shall be used to calculate the updated
value of the Debentures.


4.1.4. If there is no
agreement on the new Remuneration between the Issuer and the Debenture Holders
representing, at least, 2/3 (two-thirds) of the total of the Debentures in
circulation (even if by reason of absence of quorum to decide on the matter),
the Issuer shall redeem the totality of the Debentures in circulation, within
30 (thirty) calendar days from the date of holding of the respective General
Meeting of Debenture Holders, for the amount of their nominal unit value, plus
the remuneration due up to the date of the actual redemption, calculated pro
rata temporis, from the Issue Date of the last prior date of payment of the
remunatory interest, as the case may be, using the last IGP-M officially
published. No premium of any nature shall be added to the redemption referred
to in this item.


4.1.5. The
updating of the Debentures shall be paid by the Issuer jointly with the nominal
unit value of the Debentures, on the respective maturity date.











4.2. Remuneratory
Interest of the Debentures


Interest at 10.5% (ten
point five per cent) per year, calculated per business day, based on a year of
252 (two hundred and fifty two) days shall apply to the nominal unit value plus
the updating of the Debentures, starting from the Issue Date (“the Remuneratory
Interest”). The Remuneratory Interest shall be calculated according to the
following formula:








where:


J                                                   is
the amount of interest payable at the end of each capitalization period (as
defined below), calculated to 6 (six) decimal places, without rounding;


VNa                                 is the nominal unit
value or balance of the nominal value updated, calculated to 6 (six) decimal
places, without rounding;


Fj                                              factor
calculated to 9 decimal places with rounding;


Rate                                equal to 10.5;


N                                                 equal
to 252;


n                                                   a
whole number, being the number of business days between the date of the next
payment of interest and the date of the prior payment of interest;


DT                                         a whole
number, being the number of business days between the date of the next payment
of interest and the date of the prior payment of interest; and


DP                                         a whole
number, being the number of business days between the prior and present dates
of payment of interest.


4.2.1. The Remuneratory Interest shall be paid by the
Issuer annually, the first payment to be made 12 (twelve) months after the
Issue Date, that is to say, on the first business day of June 2007, and the
other payments on the first business day of June of the subsequent years up to
the maturity date, calculated in a regime of capitalization made up, pro rata temporis, of business days.


4.3. -        Limit of the Issue


The Issue complies with the limit specified in Article
60 of the Corporate Law, since the registered capital of the Issuer, on the
Issue Date, was R$ 2,061,997,787.64 (two billion, two hundred and sixty
one million, nine hundred and ninety seven thousand, seven hundred and eighty
seven Reais and sixty four centavos).


4.4.-         Right of preference


There shall be no right of preference for the present
stockholders of the Issuer for subscription of the Debentures.


5.             Conditions
of subscription and paying up


5.1. Subscription price: The price of
subscription of the Debentures shall be their nominal unit value, plus the
remuneration, calculated pro rata temporis
from the Issue Date up to the date of paying up, in accordance with item 4
above.


5.2. Manner of paying up: The Debentures shall
be paid up at sight, by exchange for the Debentures of the 3rd CEMIG issue, under the 











terms of the Obligatory Exchange, and each Debenture
of the 3rd CEMIG Issue shall correspond to 1 (one)
Debenture of this Issue.


5.2.1. Due to the allocation to the Issuer of the
rights and obligations arising from the Debentures of the 3rd CEMIG Issue, as provided for in the Private
Instrument of Assignment of Rights, the Debentures of the 3rd CEMIG Issue received by the Issuer in
paying-up of the Debentures shall be cancelled.


5.3. Place of payment: The payments to which
the Debentures are entitled shall be made using, as the case may be: (i) the
procedures adopted by CBLC, for the Debentures registered in the BOVESPAFIX
System, administered by the Bovespa (São Paulo Stock Exchange) (“the BOVESPAFIX
system”); or (ii) the procedures adopted by CETIP (Custody and Settlement
Chamber) for the Debentures registered in the SND (National Debentures System);
or (iii) for the holders of Debentures of this Issue who are not linked to these
systems, through the Mandated Bank and Clerk of the Issue.


5.4. Immunity of Debenture Holders: If any
Debenture Holder has any type of tax immunity or exemption, such holder must
deliver to the Mandated Bank and Clerk of the Issue within 10 (ten) business
days prior to the date set for receipt of amounts relating to the Debentures,
documentation of proof of this tax immunity or exemption.


5.5. Extension of maturity periods: The periods
relating to the payment of any obligation by any of the parties, including the
Debenture Holders, in relation to the payment of the subscription price, shall
be considered extended up to the first subsequent business day if the maturity
coincides with a day on which there is not a commercial or banking business day
in the cities of São Paulo and/or Belo Horizonte, in the States of São Paulo
and Minas Gerais respectively, without any addition to the amounts to be paid,
with the exception of cases whose payments are to be realized by the CETIP or
by the CBLC, in which event there shall only be postponement when the date of
payment is a national holiday, a Saturday or a Sunday.


5.6. Arrears fine and charges: Without
prejudice to item 11 below, in the event of non-punctuality in the payment of
any amount owed to the holders of the Debentures, the debits in arrears shall
be added to the respective remuneration applicable to the Debentures, and shall
also be subject to an arrears penalty payment of 2% (two per cent) on the
amount owed and arrears interest calculated from the date of non-compliance, up
to the date of actual payment, at the rate of 1% (one per cent) per month, on
the amount owed, independently of notice, advice or Court or extrajudicial
action of any sort, as well as the expenses incurred for collection.


5.7. Expiry of the right to increases: Without
prejudice to the terms of the previous item, non-appearance by the Debenture
Holder to receive the amount corresponding to any of the pecuniary obligations
of the Issuer, on the dates specified in the Issue Deed, or in a notice
published by the Issuer, shall not give it the right to receive Remuneration
Interest and/or arrears charges in the period corresponding to the date on
which the funds were made available for payment and the actual date of
appearance of the Debenture Holder for their receipt, but in any event acquired
rights shall be guaranteed up to the date of the respective maturity.


6.             Distribution placement and procedure


6.1. The Obligatory Exchange of the Debentures shall
commence only after concession by the CVM of registry of the Offering, after
the Final Prospectus of the Offering has been placed at the disposal of the
investors and after publication of this Announcement of Commencement, and the
maximum period for realization of the Obligatory Exchange of the Debentures
shall be 5 (five) business days, from the date of publication of this
Announcement of Commencement.


6.2. Best Efforts: The Debentures shall be the
subject of public distribution, under the best efforts distribution regime,
with intermediation of financial institutions that are part of the Securities
Distribution System, through the SDT (Securities Distribution System),
administered by CETIP, based on policies and guidelines fixed by ANDIMA (the
National Association of Financial Market Institutions), and through the
BOVESPAFIX System, with settlement and custody at the CBLC, and target public
of this present Issue shall be the holders of the Debentures of the 3rd CEMIG
Issue, as specified in item 5.2. above.


6.3. The mechanism of Obligatory Exchange shall be
carried out as provided for by Clause VII of the Issue Deed of the 3rd CEMIG Issue, and the paying-up of the
Debentures shall be at sight, by exchange for the Debentures of the 3rd CEMIG Issue, in the terms of the Obligatory
Exchange, and each Debenture of the 3rd CEMIG Issue shall correspond to 1 (one)
Debenture of this Issue.


6.4. Secondary market: The
Debentures shall be registered for trading in the secondary market: (i) through
the SND, managed by the CETIP, based on the policies and guidelines set by
ANDIMA, the Debentures with settlement and custody at the CETIP; and (ii)
through the BOVESPAFIX system, with settlement and custody at the CBLC.


7.             Renegotiation


The Debentures of this Issue shall not be subject to
programmed renegotiation.











8.             Guarantee


The Debentures of this Issue, and the obligations
assumed by the Issuer under the Issue Deed, are guaranteed by means of a
guarantee given by Companhia Energética de Minas Gerais — CEMIG (“the Guarantee”)
which assumes the condition of and undertakes to be joint debtor and principal
payer of all the obligations arising from the Issue Deed, up to its final
settlement, with express waiver of the benefits provided by Articles 366, 827,
834, 835, 837, 838 and 839 of Law 10406 of January 10, 2002, as amended (“the
Civil Code”), and Articles 77 and 595 of Law 5869 of January 11, 1973, as
amended (“the Code of Civil Procedure”) for the obligations assumed in the
Issue Deed.


9.             Optional
acquisition


The Issuer may, at any time, acquire the Debentures in
circulation in the market, for a price not greater than their nominal value
plus the remuneration, subject to Article 55 of the Corporate Law. The
Debentures that are the subject of such acquisition may be cancelled, remain in
the Issuer’s Treasury, or be placed once again in the market.


10.          Obligatory
early acquisition


The issuer shall be obliged to acquire the Debentures
in circulation, as defined in item 7.2.2 of the Issue Deed, at the option of
those Debenture Holders who do not agree to remain as holders of the Issue
after a change in stockholding control, in the event that there is a change in
the direct or indirect stockholding control, or the stockholding control of
CEMIG. The Debenture Holders shall be advised of the purchase offer by a
specific notice published within 15 (fifteen) calendar days from the actual
date of change of stockholding control, with a period not less than 60 (sixty)
days for the Debenture Holders interested to state their position, counted from
the date of publication of the notice and in the terms of the procedures
described in this advice. The acquisition of the Debentures by the Issuer must
take place on the 30th (thirtieth) calendar day from the last day of
the period for making of statement of position by the Debenture Holders, at the
nominal value, plus the Remuneration, as provided in Clause 4 above. For the
purposes of this item, the following events shall be considered to be “change
in stockholding control”: (i) if the present direct controlling stockholder of
the Issuer, CEMIG, directly or indirectly ceases to hold the equivalent to at
least 50% (fifty per cent) plus one share of the total of the shares
representing the voting capital of the Issuer; (ii) if the present indirect
controlling stockholder of the Issuer, the Government of the State of Minas
Gerais, ceases directly or indirectly to hold the equivalent of at least 50%
(fifty per cent) plus one share of the total of the shares representing the
voting capital of CEMIG; or (iii) if the present controlling stockholder of
CEMIG, the Government of the State of Minas Gerais, directly or indirectly
ceases to hold the equivalent of at least 50% (fifty per cent) plus one of the
total of the shares in the voting capital of the Issuer.


11.          Early
maturity


Subject to items 11.1, 11.1.1 and 11.2 below, the
fiduciary agent shall declare all the obligations relating to the Debenture to
become due for payment immediately and demand immediate repayment by the Issuer
of the debtor balance of the nominal unit value of the Debentures, plus the
Remuneration, due up to the date of actual payment, calculated pro rata temporis, and other charges, independently of
advice, contestation or notification within or outside the Courts, in any of
the following events:


(a) application for
judicial or extra-judicial recovery, or application for bankruptcy made by the
Issuer, by CEMIG, or by any of its subsidiaries or affiliated companies;


(b) extinction,
liquidation, dissolution or declaration of the bankruptcy of the Issuer, of
CEMIG, or of any of its subsidiaries or limited companies;


(c) absence of
fulfillment by the Issuer or by CEMIG of any pecuniary obligation related to
the Debentures;


(d) early maturity of any
debt of the company, or CEMIG, or of any of its subsidiaries or affiliated
companies, in an amount of R$ 50,000,000.00 (fifty million Reais), or
more, due to any non-compliance, contractual or otherwise;


(e) termination, for any
reason, of any of the concession contracts to which the Issuer is a party
representing separately or jointly an amount equal to 30% (thirty per cent) or
more of the net operational revenue of the Issuer as stated in its last prior
financial statements;


(f) termination, for any
reason, of any of the concession contracts to which CEMIG is a party
representing separately or jointly an amount of 30% (thirty per cent) or more
of the consolidated net operational revenue of CEMIG as shown in its last prior
financial statements at the time;











(g) legitimate protest of
securities against the Issuer, or CEMIG, or any of their subsidiaries or
affiliated companies, in an amount exceeding R$ 50,000,000.00 (fifty
million Reais), unless made in error or bad faith of a third party validly
proven by the Issuer, by CEMIG or by any of its subsidiaries or affiliated
companies as the case may be, or unless suspended or cancelled, or unless a
guarantee for the security(ies) be given in Court, under any circumstances,
within a maximum of 30 (thirty) calendar days from the date on which the
written notice sent by the Fiduciary Agent is received;


(h) absence of compliance
by the Issuer or by CEMIG with any non-pecuniary obligations specified in the
Issue Date, not cured in 30 (thirty) calendar days from the date on which the
written notice sent by the Fiduciary Agent is received;


(i) if the Issuer, or
CEMIG, or any of their subsidiaries or affiliated companies omits to pay on the
maturity date, or does not take the legal or judicial measures required for
non-payment in relation to, any debt or any other obligation payable by the
Issuer, by CEMIG, or by any of their subsidiaries or affiliated companies,
under any agreement or contract to which it is a party as a lender, borrower,
or guarantor, involving an amount of R$ 50,000,000.00 (fifty million
Reais) or more; and/or


(j) privatization, merger, liquidation, dissolution,
extinction, split and/or any form of stockholding reorganization which results
in reduction of the registered capital of the Issuer and/or of CEMIG.


11.1. The occurrence of any of the events indicated in
sub-items (a) to (d) above shall result in automatic early maturity of the
Debentures, independently of any consultation of the Debenture Holders.


11.1.1. In any of the events in sub-items (e) to (j)
above, the Fiduciary Agent shall call, within 48 (forty eight) hours of the
date on which it becomes aware of such event, a meeting of Debenture Holders to
decide on declaration of early maturity of the Debentures, subject to the
procedure for convocation specified in Clause VII of the Issue Deed and the
specific quorum established in item 11.2 below.


11.2. After the General Meeting of Debenture Holders
mentioned in  item 11.1.1 above has been
held, the Fiduciary Agent shall declare early maturity of all the obligations
arising from the Debentures and demand immediate payment by the Issuer of the
Nominal Unit value of the Debentures, plus the Remuneration and charges up to
the date of actual payment, in accordance with item 11 above, unless Debenture
Holders representing at least 2/3 (two-thirds) of the Debentures in circulation
of the Issue opt not to declare early maturity of the obligations arising from
the Debentures.


11.2.1. If the Debenture Holders of the present Issue
opt not to declare early maturity of the obligations arising from the
Debentures, under item 11.2 above, the Debentures held by the Debenture Holders
who do not agree with that decision shall be redeemed by the Issuer o the
earlier of the two following dates: (i) within a maximum of 30 (thirty)
calendar days from the date of the holding of the meeting of Debenture Holders;
or (ii) in the same period in which the Debentures issued under the “Private
Deed of the 1st Public Issue of Non-Convertible Debentures in
Two Series Without Guarantee nor Preference of Companhia Energética de Minas
Gerais – CEMIG” entered into on October 4, 2001, as amended (“the 1st CEMIG Debenture Issue”), or the Debentures
which come to substitute the said debt for a reason similar to that provided
for the redemption of the Debentures as established in item 11.2.1, are in fact
redeemed. The Debentures shall be redeemed for their nominal unit value plus
the remuneration owed, calculated pro rata temporis.


12.          Optional
early maturity


The Issuer shall not have any option for early
redemption of this Issue.


13.          Investor
target public of the Offering


This present Issue may only have, as target public,
the holders of the Debentures of the 3rd CEMIG Issue.


14.          Inappropriateness
of investment in the Debentures


The Debentures that are the subject of the present
Offering are not appropriate for
investors who need considerable liquidity in relation to the securities
acquired, since trading of Debentures in the Brazilian secondary market is
restricted.


Investors should read the “Risk Factors”
section of the Final Prospectus, which is available to investors as stated in
item VII below.











15.          Additional obligations
of the Issuer


15.1. Subject to the other obligations specified in
the Issue Deed the Issuer also undertakes as follows:


15.1.1.                            To supply to the Fiduciary
Agent:


(a)                                  within
a maximum of 45 (forty five) days after termination of its first half business
year a copy of its complete financial statements in relation to that period;


(b)                                 within
a maximum of 90 (ninety) days after the end of each business year, a copy of
its complete financial statements in relation to that business year accompanied
by an opinion of the independent auditors, and a copy of any communication made
by the independent auditors to the Issuer, or to its management, and the
respective answers, with reference to the system of accounting, management or
the accounts of the Issuer;


(c)                                  a
copy of the periodic and occasional information demanded by CVM Instruction 202
of December 6, 1993 (as amended), within the period therein specified and,
within a maximum of 45 (forty five) days after termination of the quarters of a
year completed on March 31, June 30 and September 30 of each year, a copy of
its Quarterly Information (ITRs), accompanied by an opinion of the independent
auditors;


(d)                                 notice
of the convocation of any General Meeting, with minimum prior notice of 3
(three) business days, and promptly to supply copies of all the minutes of all
the General Meetings, and also the date and agenda of the General Meeting to be
held and of all the meetings of the Board of Directors, the Executive Board and
the Audit Board;


(e)                                  the
notices to the Debenture Holders, material announcements and minutes of General
Meetings which in any way involve the interests of the Debenture Holders, on
the same date as they are published;


(f)                                    immediately,
any information relevant to the Issue which may be requested from it at any
time;


(g)                                 a
copy of any correspondence or Court or extrajudicial notification received by
the Issuer in relation to the Debentures or the Issue Deed, immediately after
its receipt;


(h)                                 the
proofs of compliance with its obligations in relation to the Debenture Holders
in a period of up to 5 (five) calendar days from the respective date of their
maturities;


(i)                                     information
on the occurrence of any of the events indicated in item 11 above, as rapidly
as possible, within the earlier of the following time limits: (i) a maximum of
10 (ten) calendar days from the date on which it becomes aware of the event’s
occurrence, or (ii) the same period in which CEMIG informs the Fiduciary Agent
of the 1st CEMIG Debenture Issue of the occurrence of any
of the events leading to early maturity in relation to that issue, or to the
issue of Debentures which come to substitute it. This information should be
accompanied by a report of the Issuer containing the description of the occurrence
and of the measures which the Issuer intends to take in relation to such event.
If this information arises from an event, act or fact which gives rise to
publication of a material announcement by the Issuer, under CVM Instruction
358, of January 3, 2002 (“CVM Instruction 358”), the disclosure of such event,
act or fact to the Fiduciary Agent should take place concomitantly with its
disclosure to the market, in accordance with the said CVM Instruction 358,
subject to the maximum period here specified.


15.1.2.                                    To
give adequate publicity to the economic-financial data, in the terms demanded
by the Corporate Law, and publishing its annual financial statements.


15.1.3.                                    To
keep its accounts up to date and make the respective registries in accordance
with accounting principles generally accepted in Brazil, and allow
representatives of the Fiduciary Agent (or of an independent auditor contracted
by the Fiduciary Agent, at the Issuer’s expense) to have unrestricted access to
the books and other accounting records of the Issuer.


15.1.4.                                    To
call, in accordance with item 7.1 of the Issue Deed, a General Meeting of
Debenture Holders to decide on any of the matters which directly or indirectly
are related to the present Issue if the Fiduciary Agent does not do so.


15.1.5.                                    To
comply with all orders issuing from the CVM, with sending of documents, and
providing all the information requested of it.











15.1.6.                                  To
submit, in accordance with the law, its accounts and financial statements to
examination by an independent auditing company registered with the CVM.


15.1.7.                                    To
keep the listed company registry updated at the CVM, and to supply to its
Debenture Holders the financial statements prepared and approved, specified in
Article 176 of the Corporate Law, when requested.


15.1.8.                                  To
keep an organized body or department in appropriate working conditions to deal
efficiently with the Debenture Holders, or to contract financial institutions
authorized for the provision of this service.


15.1.9.                                  Not
to carry out operations outside its objects as declared in its By-laws, subject
to the provisions of the By-laws, laws and regulations in force.


15.1.10.                           To
notify the Fiduciary Agent about any act or fact which could cause interruption
or suspension of the activities of the Issuer, within a maximum period of 30
(thirty) days from the occurrence of the even.


15.1.11.                           To
maintain its assets appropriately insured, in accordance with current
practices.


15.1.12.                           Not to
carry out any acts that are contrary to the By-laws and the Issue Deed,
especially those which could directly or indirectly compromise punctual and
full compliance with the obligations assumed by the Issuer in relation to the
community of Debenture Holders.


15.1.13.                             To
keep all the operating licenses, licenses, authorizations, concessions or
approvals necessary for the regular functioning of the company in a valid
status, making all and every payment necessary for this purpose.


15.1.14.                           To pay
on time all the taxes payable to the federal, state or municipal tax authorities.


15.1.15.                             To
maintain, conserve and preserve all its assets (tangible and intangible) such
as are necessary or useful for the due conduct of its activities in good order
and functioning condition, with the exception of normal wear and tear.


15.1.16.                           Not to
make any material alteration, while the Debentures exist, in the nature of its
business, as conducted on the present date, and not to make any alteration in
the legal form of its businesses, as they may exist on the present date, except
when and if demanded by the legislation in force or by the regulations issued
by the Concession-Granting Power.


15.1.17.                           To
comply, in all aspects, with all the applicable laws, rules, regulations and
orders, in any jurisdiction in which it carries out business or owns goods.


15.1.18.                           To cause
the respective risk rating agency or agencies to maintain updated ratings of
this present public offering during the period of validity of the Debentures,
supplying the Fiduciary Agent with a copy of annual reviews of ratings within 5
(five) business days after their disclosure.


II.            THE COMPANY


CEMIG Distribuição S.A.


Avenida Barbacena 1200, 17th Floor, A1 Wing,


30190-131 Belo Horizonte, MG, Brazil.


Tel: (31) 3299-4903


Fax: (31) 3299-3832


Internet: www.cemig.com.br


III-           THE LEAD MANAGER


UNIBANCO – União de Bancos
Brasileiros S.A.


Office of the Capital Markets Director


Att: Rogério Assaf Freire


Avenida Eusébio Matoso 891,


05423-180 São Paulo, SP, Brazil


Tel: (11) 3097-4396


Fax: (11) 3097-4127











E-mail:
rogerio.freire@unibanco.com.br


Internet: www.unibanco.com.br


IV.           MANDATED BANK AND CLERK OF THE ISSUE


Banco Itaú S.A.


Av. Eng Armando de Arruda Pereira
707, 9th Floor,


São Paulo, SP, Brazil.


CEP: 04344-902


Att. Luiz Loureiro


Tel: (11) 5029-1905


Fax: (11) 5029-1917


E-mail: luiz.loureiro@itau.com.br


V.            FIDUCIARY
AGENT


Pavarini Distribuidora de
Títulos e Valores Mobiliários Ltda.


Rua Sete de Setembro 99, 24th Floor,


20050-050 Rio de Janeiro, RJ,
Brazil.


CEP: 20050-050


Att. Mr. Carlos Alberto Bacha /
Mr. Rinaldo Rabello Ferreira


Tel: (21) 2507-1949


Fax: (21) 2507-1773


E-mail: pavarini@pavarini.com.br


Internet: www.pavarini.com.br


VI.           REGISTRY
OF THE OFFERING WITH THE CVM


THIS OFFER WAS REGISTERED WITH THE BRAZILIAN
SECURITIES COMMISSION (CVM) UNDER NUMBER CVM/SRE/DEB/2006/041, ON OCTOBER 26, 2006.


VII.         DATE
OF COMMENCEMENT OF PUBLIC DISTRIBUTION


The date of commencement of public distribution is
November 1o, 2006.


VIII.        PROSPECTUS,
ADDITIONAL INFORMATION AND SERVICE TO THE DEBENTURE HOLDERS


The Final Prospectus of the present Offering is available
in the offices and on the websites of the Lead Manager and the Issuer of this
Issue, and of the Brazilian Securities Commission (CVM), and also at the CETIP.


More information may be obtained from the Lead Manager
of this Offering or at the CVM.


As well as the addresses of the Lead Manager, and the
Mandated Bank and Clerk of the Issue, the following are other relevant
addresses:


	
  CBLC – Companhia Brasileira
  de Liquidação e 

  	
   

  	
  CETIP –
  Câmara de Custódia e de Liquidação

  
	
  Custódia

  	
   

  	
  Rua Líbero
  Badaró 425, 24th Floor,

  
	
  Rua XV de
  Novembro 275,

  	
   

  	
  01009-00 São
  Paulo, SP, Brazil.

  
	
  01013-001 São
  Paulo, SP, Brazil.

  	
   

  	
  Tel: (11)
  3111-1596

  
	
  Att. Charles
  Mann de Toledo

  	
   

  	
  Fax: (11)
  3115-1564

  
	
  Tel: (11)
  3233-2720

  	
   

  	
  E-mail: gr.debentures@cetip.com.br

  
	
  Fax: (11)
  3233-2051

  	
   

  	
   

  
	
  E-mail: ctoledo@bovespa.com.br

  	
   

  	
   

  



 


BOVESPAFIX – BOVESPA











Rua XV de Novembro 275,


São Paulo, SP, Brazil


www.bovespa.com.br