Material Information

On November 26, 2013, the board agreed unanimously to distribute the sum of Ch$37,000,158,529 against the earnings for 2013, as an interim dividend.

The company’s interim dividend No.57 therefore amounts to Ch$6.0468 per share, payable from January 14, 2014.

On October 30, 2013, the board of Aguas Andinas unanimously agreed to obtain financing of up to a maximum of UF 6,000,000 (six million Unidades de Fomento), authorizing the management to determine the financing mechanisms to be used for this purpose.

In this way, the company could obtain this financing, considering the maximum limit indicated, by means of one or more bank loans and/or the registration of one or more lines of bonds and their respective issues and placements, as the case may be. With respect to the latter, the board unanimously agreed to register in the Securities Register of the Superintendence two lines of bonds whose principal characteristics are the following:

1. Maximum amount of each line of bonds: UF 6,000,000 (six million Unidades de Fomento), to be registered in pesos or Unidades de Fomento.
2. Maximum term of each line of binds: 30 years from the date of registration in the Securities Register of the Superintendence, during which the payment obligations of the different issues of bonds made against the lines should mature.
3. Collateral: They shall be unsecured.
4. Use of the funds: Refinancing of liabilities and financing of the company’s investments, as determined in each of the complementary indentures.
5. Other general conditions: The bonds may be placed on the market in general, be dematerialized, to bearer, not convertible into shares of the company and be payable in pesos.

It was expressly noted that, despite the maximum amounts of each of the lines, bonds may only be placed and/or have bonds outstanding against these, up to a maximum total of UF 6,000,000 (six million Unidades de Fomento), considering both the bonds placed and outstanding issued against the lines mentioned.

The board also agreed, among other agreements pertinent to this matter, to authorize its managers to carry out the contracting of the bank loans referred to and/or make the registration, issuance and placement of bonds against the lines on the terms determined at the time, as the case may be.

On August 29, 2013, the eighteenth extraordinary shareholders’ meeting of the company was held, which agreed the following matters:

1. Incorporate in the bylaws the amendments introduced to the Corporations Law and its Regulations, the Securities Market Law 18.777, and the General Sanitation Services Law.
2. Amend the objects of the company, adapting them to the provisions of the General Sanitation Services Law.
3. Modify the term of the company’s board of director from 2 to 3 years.
4. Modify the transitory provision relating to the form in which the corporate capital is paid in, noting that the capital was then fully subscribed and paid.
5. Repeal the transitory provisions that have lost their reason to be.
6. Establish a new rewritten text of the company’s bylaws incorporating the above agreed amendments. Renew the board of the company, with the election of the following persons:

The board also agreed unanimously that the members of the company’s directors’ committee be Rodrigo Manubens Moltedo, Gonzalo Rojas Vildósola and Josep Bagué Prats, and their respective alternates.

The same board meeting received the resignation of Jesús García as the company’s chief executive officer, although he would continue to be linked to the same business group with new responsibilities. The board then unanimously agreed to appoint Jordi Valls Riera as the company’s chief executive officer from that date.

On July 23, 2013, the board of the company agreed unanimously to call an extraordinary shareholders’ meeting for August 29, 2013, at 10 a.m., in order discuss the following matters:

1. Pronounce on a proposal to amend the corporate bylaws in order to: (a) incorporate the last amendments introduced to Law 18.046, the new Corporations Regulations, the Securities Market Law 18.045 and Law 19.888; (b) increase the term of the company’s board of directors from 2 to 3 years; (c) repeal from the bylaws the transitory provisions that have lost their reason to be; and (d) approve the new rewritten text of the bylaws incorporating the above amendments.
2. Renew the board of the company.

On April 18, 2013, as part of the collective mediation process initiated by the National Consumer Service (SERNAC) with respect to the interruptions to supplies resulting from events of force majeure that occurred last summer, and which interrupted the water supply to a large number of inhabitants of the Metropolitan Region on January 22 and February 9 and 10, Aguas Andinas S.A. proposed to SERNAC, by letter of April 15, a system of compensation to its users, which was accepted by SERNAC, by letter 06830 received by the company on April 17, 2013.

Specifically, Aguas Andinas would compensate customers whose water service was restricted or interrupted, over and above the limits reported in the company’s various communications. The total number of customers who would benefit from this compensation was 821,860, corresponding to all those affected by differences between information given by the company and the time that the cut or restoration of their supply effectively occurred.

The total cost of the compensation would be Ch$2,580,503,928. Depending on the type of information time lag suffered by the customers, the amount of compensation would be calculated to be Ch$4,020 or Ch$2,412, as appropriate, and according the map of cuts and restorations held by the company. The payment of the compensations would be made by credits to the water billings for May 2013.

It should be remembered that Aguas Andinas chose to compensate the customers affected by information problems, despite the fact that the water cuts last summer responded to events of force majeure, as a result of high-altitude rains that caused floods in the lower mountains and an unforeseeable increase in the cloudiness of the waters of the river Maipo. This obliged the company to temporarily close the Las Vizcachas, La Florida and Padre Hurtado water treatment plants in order to avoid silting up of mud in the sanitary installations and thus normalize the water service in the shortest possible time.

Following those events, the company reviewed all its processes and information protocols in order to avoid similar situations repeating themselves.