Centrais Eletricas Brasileiras : Market Announcement - New Managers.pdf

FAX PARA AS BOLSAS CENTRAIS ELETRICAS BRASILEIRAS S/A

CNPJ: 00.001.180/0001-26

Centrais Elétricas Brasileiras S/A ("Company" or "Eletrobras") hereby informs its shareholders and the market in general that, on this date, took office the new Board of Directors elected by the 165th Extraordinary General Meeting held on July 22, 2016, whose terms will end on the date of the Annual General Meeting to be held in 2017.

The board member Jailson José Medeiros Alves, elected by the Company's employees in a separate election, pursuant to article 17, V of the Company's Bylaws, resigned today, the position of Board member, being replaced by his deputy Carlos Eduardo Rodrigues Pereira, also elected by the employees of the Company. Mr. Carlos Eduardo Pereira Rodrigues also took office on this date and its mandate will be effective until a new election in separate by the Company's employees, what is suspended by decision of the court of the 3rd Civil Chamber of the Court of Justice of Rio de Janeiro.

Facing the events above mentioned and considering that remains in office the board member who had been elected at the 56th Annual General Meeting by minority shareholders in a separate election, according to Article 17, III of the Company's Bylaws, the Eletrobras Board of Directors is composed, from this date, by 9 (nine) members, as follows:

• José Luiz Alqueres - Chairman

• Vicente Falconi Campos

• Wilson Ferreira Junior

• Ana Paula Vitali Janes Vescovi

• Esteves Colnago Junior

• Elena Landau

• José Pais Rangel

• Mozart de Siqueira Campos Araújo

• Carlos Eduardo Rodrigues Pereira

The Company also reports that, in addition to the Market Announcement of July 15, 2016, the Board of Directors with its new composition, decided to segregate the activities of distribution and generation of electric energy, given that, as approved by 165th Extraordinary General Meeting of Eletrobras, held on July 22, 2016, the distribution companies subsidiaries of Eletrobras which had not approved the extension of their concessions, named Companhia Energéticas do Piauí - CEPISA; Companhia Energética de Alagoas - CEAL; Companhia de Eletricidade do Acre - ELETROACRE; Centrais Elétricas de Rondônia S.A - CERON; Boa Vista Energia S.A; and Amazonas Distribuidora de Energia S.A (denominated together "Distribution Companies") shall, if the consent of the Grantor, remain as responsible for the operation and maintenance of public distribution of energy services of their locations up to transfer their shareholdings controls under Provisional Measure 735/2016, what should occur until December 31, 2017.

During the period of the temporary concession of the distribution companies, as mentioned above, the distribution companies should receive adequate remuneration for providing distribution services, without any injection of funds by Eletrobras holding, as approved by the 165th Extraordinary General Meeting.

The Board of Directors also decided to extinguish the Regulatory Executive Board, which will become a Superintendence of Regulation, linked to the Presidency of the Company.

Finally, the Company informs that the Eletrobras Board of Directors, on this date, elected for a term of 3 (three) years, Mr. Wilson Ferreira Junior, as CEO, replacing Mr. José da Costa Carvalho Neto; Mr. Carlos Eduardo Gonzalez Baldi, as Chief Generation Officer; Mr. Luiz Henrique Hamann, as Chief Distribution Officer, both replacing Mr. Marco Aurélio Madureira da Silva, then Chief of Generation and Distribution Officer; Mr. José Antonio Muniz, as Chief Transmission Officer; Mr. Armando Casado de Araujo, as Chief Financial and Investor Relations Officer; Mr. Alexandre Vaghi de Arruda Aniz, as Chief Administration Officer.

Rio de Janeiro, July 25, 2016. Armando Casado de Araujo

CFO and Investor Relations Officer