“Only Love Builds for Eternity”\ (Getulio Vargas)\

As we conclude our fourth year in office, we can affirm that the administrative austerity policy implemented upon our arrival has been successful. We have rescued Flamengo from insolvency and restored the institution's credibility.

When we took over, the club didn't even have a checkbook.

We achieved fiscal realignment through Timemania, a definitive solution to a R$180 million liability, and obtained two major legal victories, one against ISL in Switzerland and another against Pelé Sports, freeing the club from paying almost R$150 million.

We're the only club in Rio that's up to date with its labor liabilities. We've paid off approximately R$50 million in debt from previous administrations.

The seriousness with which we approach Flamengo's affairs is already resulting in sporting success. We've been champions in soccer, rowing, and basketball.

We won the Rio de Janeiro Football Championship in all categories, Juniors (three times), Youth (two times), Children and Professional, and we qualified for the Copa Libertadores in 2007 and 2008.

We performed remarkably well across all Olympic sports, with four coaches and 4 athletes competing in the Pan American Games across a wide range of disciplines. We won three gold medals, three silver medals, and four bronze medals, placing the club 23th among the countries that competed in the Pan American Games.

Flamengo fans broke all attendance and revenue records for the Brazilian Championship, reaching nearly 1.4 million paying spectators for matches at Maracanã alone. We put on a show in the stands, with dazzling performances, which prompted Mayor César Maia to declare Flamengo fans a Cultural Heritage of the City of Rio de Janeiro.

Our administrative efforts have been particularly focused on our members. We've renovated several Gávea facilities, including the locker rooms, the Flapel field, the Olympic gymnastics gymnasium, the gardens, the swimming pools, and the tennis courts. We've implemented a field trip program. We've built the new São Judas Tadeu chapel. We've created a choir and encouraged social movements, such as the Senior Citizens' Choir and Fla-Mulher.

We need to continue our sanitation policy and promote major institutional reform, modernizing our bylaws, implementing a shared management model, and creating a business association for football. This is the administrative tool necessary for raising new funds for our business.

Finally, our restored credibility has led to important partners approaching us, such as the CBF and the world's most powerful stadium management companies. Maracanã will truly be ours.

And, crucially, Flamengo's participation in the Maracanã project will be compatible with the Gávea Revitalization Program, our priority, consolidating the club's social and sports center.

We're making progress every day. In the next two years, the President George Helal Training Center, Ninho do Urubu, will be completed, as will the Rowing Center of Excellence.

With seriousness, determination, perseverance, professionalism, and transparency, we have overcome all obstacles, and the future looks even brighter.

MERRY CHRISTMAS AND A HAPPY NEW YEAR!

Marcio Baroukel de Souza Braga\ PRESIDENT\

Rio, December 2007