SBS Companhia Sanea

COMPANHIA DE SANEAMENTO BÁSICO DO ESTADO DE SÃO PAULO – SABESP

Corporate Taxpayer ’ s ID (CNPJ): 43.776.517/0001-80

Company Registry (NIRE): 35.3000/1683-1

NOTICE TO THE MARKET

Companhia de Saneamento Básico do Estado de São Paulo – SABESP , a mixed capital company registered with the Brazilian Securities and Exchange Commission ( “ CVM ” ), headquartered at Rua Costa Carvalho, n.º 300, CEP 05429-900, in the city and state of São Paulo ( “ Company ” ), herein represented by its Chief Executive Officer, Mr. Jerson Kelman, hereby informs the CVM and the market in general that:

1-     The Company ’ s Board of Directors ’ Meeting held on September 30, 2016 ( “ BoD Meeting of 9/30/2016 ” ) accepted the resignation of Mr. Francisco Vidal Luna, member of the Company ’ s Board of Directors and Audit Committee, solely from the position of member of the Audit Committee; and

2-     Mr. Luis Eduardo Alves de Assis, member of the Company ’ s Board of Directors, was elected by the BoD Meeting of 9/30/2016 to replace Mr. Francisco Vidal Luna, taking office on the same date.

Mr. Luis Eduardo Assis has renowned experience in corporate accounting pursuant to corroborating documentation attached hereto, which will be filed at the Company ’ s headquarters.

São Paulo, October 11, 2016.

 Jerson Kelman

Chief Executive Officer

Acting as Chief Financial Officer and Investor Relations Officer

CV

Luis Eduardo Assis

Mr. Assis has been an independent member of our Board of Directors since April 2014. He holds a degree in Economics from the University of São Paulo (Universidade de São Paulo - USP), a Master's degree from the State University of Campinas (Universidade Estadual de Campinas – UNICAMP) and an MBA from Scuola Superiore Enrico Mattei in Milan, Italy.  He was director of Monetary Policy of the Brazil’s Central Bank and a professor in the Department of Economics at the Pontifical University of São Paulo (Pontifícia Universidade Católica de São Paulo - PUC-SP) and at the Getulio Vargas Foundation (Fundação Getulio Vargas - FGV-SP).  He has developed his long career in the financial market, having held the positions of Chief Economist and Investment Director at Citibank, Chief Executive Officer at HSBC Investment Bank Brasil, Chief Operating Officer at HSBC Bank Brasil, Senior Strategic Planning Executive at the HSBC Group in London and Local Director for Latin America at HSBC.  Currently, he serves as the President of Fator Seguradora and writes an opinion column for the newspaper O Estado de São Paulo. Over the last five years, he has not received criminal convictions or convictions in CVM administrative proceedings, even if not final and unappealable, and has not received any final and unappealable rulings at the administrative or judicial level that have suspended or disqualified him from practicing any professional or commercial activity.

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