Note 1. - Nature of the business

Atlantica Yield plc (“Atlantica” or the “Company”) was incorporated in England and Wales as a private limited company on December 17, 2013 under the name Abengoa Yield Limited. On March 19, 2014, the Company was re-registered as a public limited company, under the name Abengoa Yield plc. On May 13, 2016, the change of the Company´s registered name to Atlantica Yield plc was filed with the Registrar of Companies in the United Kingdom.

Atlantica is a sustainable total return infrastructure company that owns, manages and acquires renewable energy, efficient natural gas, electric transmission lines and water assets focused on North America (the United States and Mexico), South America (Peru, Chile and Uruguay) and EMEA (Spain, Algeria and South Africa).

Atlantica’s shares began trading on the NASDAQ Global Select Market under the symbol “ABY” on June 13, 2014. The symbol changed to “AY” on November 11, 2017.

On March 9, 2018 and on November 27, 2018, Algonquin Power & Utilities (“Algonquin”) announced that it completed the acquisition from Abengoa S.A, (“Abengoa”) of a 25% and 16.47% equity interest in Atlantica, respectively. Algonquin is the largest shareholder of the Company which currently owns a 41.47% stake in Atlantica Yield. Algonquin does not consolidate the Company in its consolidated financial statements.

During the year 2018, the Company completed the following acquisitions:

-	On February 28, 2018, the Company closed the acquisition of a 100% stake in a 4 MW hydroelectric power plant in Peru (“Mini-Hydro”) for approximately $9 million;

-	On December 11, 2018, the Company closed the acquisition of a 66kV transmission line in operation in Chile (“Chile TL3”) for approximately $6 million;

-	On October 10, 2018, the Company completed the acquisition of a 5% stake in a natural gas transportation in Mexico (Pemex Transportation System or “PTS”). Consideration for this 5% stake, which amounts to approximately $7 million, will be disbursed progressively as construction progresses;

-	On December 14, 2018, the Company closed the acquisition of a 100% stake in a 50 MW on-shore wind plant in Uruguay (“Melowind”) for approximately $45 million;

-	On December 28, 2018, the Company completed the acquisition of a transmission line, which is an extension of ATN (“ATN expansion 1”) for approximately $16 million.

On January 29, 2019, the Company entered into an agreement with Abengoa under the Right of First Offer (“ROFO”) Agreement for the acquisition of Befesa Agua Tenés, S.L.U., a holding company which in turn owns a 51% stake in Tenes, a water desalination plant in Algeria. Closing of the acquisition is subject to conditions precedent, including the approval by the Algerian administration. At this stage, the Company cannot guarantee it will obtain this approval nor the expected timing of such approval. The price agreed for the equity value is $24.5 million, of which $19.9 million were paid in January 2019 as an advance payment and the rest is expected to be paid once the conditions precedent are fulfilled. If all the conditions precedent are not fulfilled by September 30, 2019, the advance payment shall be progressively reimbursed by Abengoa through a full cash-sweep of all the dividends to be received and in any case no later than September 30, 2031, together with an annual 12% interest. These dividends would be guaranteed by a right of usufruct over the economic rights and certain political rights and a pledge over the shares of Befesa Agua Tenés, S.L.U., granted by Abengoa to the Company.

The following table provides an overview of the concessional assets the Company owned as of March 31, 2019:

Assets

Type

Ownership

Location

Currency⁽⁸⁾

Capacity

(Gross)

Counterparty

Credit Ratings⁽⁹⁾

COD*

Contract

Years

Left ⁽¹³⁾

Solana

Renewable

(Solar)

100%

Class B⁽¹⁾

Arizona (USA)

USD

280 MW

A-/A2/A-

2013

Mojave

Renewable

(Solar)

100%

California

(USA)

USD

280 MW

D/WR/WD

2014

Solaben 2 & 3

Renewable

(Solar)

70%⁽²⁾

Spain

Euro

2x50 MW

A-/Baa1/A-

2012

19/18

Solacor 1 & 2

Renewable

(Solar)

87%⁽³⁾

Spain

Euro

2x50 MW

A-/Baa1/A-

2012

18/18

PS10/PS20

Renewable

(Solar)

100%

Spain

Euro

31 MW

A-/Baa1/A-

2007&2009

13/15

Helioenergy 1 & 2

Renewable

(Solar)

100%

Spain

Euro

2x50 MW

A-/Baa1/A-

2011

18/18

Helios 1 & 2

Renewable

(Solar)

100%

Spain

Euro

2x50 MW

A-/Baa1/A-

2012

19/19

Solnova 1, 3 & 4

Renewable

(Solar)

100%

Spain

Euro

3x50 MW

A-/Baa1/A-

2010

16/16/17

Solaben 1 & 6

Renewable

(Solar)

100%

Spain

Euro

2x50 MW

A-/Baa1/A-

2013

20/20

Kaxu

Renewable

(Solar)

51%⁽⁴⁾

South Africa

Rand

100 MW

BB/Baa3/

BB+⁽¹⁰⁾

2015

Palmatir

Renewable

(Wind)

100%

Uruguay

USD

50 MW

BBB/Baa2/BBB-⁽¹¹⁾

2014

Cadonal

Renewable

(Wind)

100%

Uruguay

USD

50 MW

BBB/Baa2/BBB-⁽¹¹⁾

2014

Melowind

Renewable

(Wind)

100%

Uruguay

USD

50MW

BBB/Baa2/BBB-

2015

Mini-Hydro

Renewable

(Hydraulic)

100%

Peru

USD

4 MW

BBB+/A3/ BBB+

2012

ACT

Efficient natural gas

100%

Mexico

USD

300 MW

BBB+/ Baa3/BBB-

2013

ATN ⁽¹²⁾

Transmission

line

100%

Peru

USD

365 miles

BBB+/A3/BBB+

2011

ATS

Transmission

line

100

Peru

USD

569 miles

BBB+/A3/BBB+

2014

ATN 2

Transmission

line

100

Peru

USD

81 miles

Not rated

2015

Quadra 1

Transmission

line

100%

Chile

USD

49 miles

Not rated

2014

Quadra 2

Transmission

line

100%

Chile

USD

32 miles

Not rated

2014

Palmucho

Transmission

line

100%

Chile

USD

6 miles

BBB+/Baa1/

BBB+

2007

Chile TL3

Transmission

line

100%

Chile

USD

50 miles

A+/A1/A+

1993

Regulated

Skikda

Water

34.2%⁽⁵⁾

Algeria

USD

3.5 M

ft3/day

Not rated

2009

Honaine

Water

25.5%⁽⁶⁾

Algeria

USD

7 M ft3/

day

Not rated

2012

Seville PV

Renewable

(Solar)

80%⁽⁷⁾

Spain

Euro

1 MW

A-/Baa1/A-

2006

(1)	On September 30, 2013, Liberty Interactive Corporation agreed to invest $300 million in Class A shares of ASO Holdings Company LLC, the holding company of Solana, in exchange for a share of the dividends and the taxable losses generated by Solana.

(2)	Itochu Corporation, a Japanese trading company, holds 30% of the shares in each of Solaben 2 and Solaben 3.

(3)	JGC, a Japanese engineering company, holds 13% of the shares in each of Solacor 1 and Solacor 2.

(4)	Kaxu is owned by the Company (51%), Industrial Development Corporation of South Africa (29%) and Kaxu Community Trust (20%).

(5)	Algerian Energy Company, SPA owns 49% of Skikda and Sacyr Agua, S.L. owns the remaining 16.83%.

(6)	Algerian Energy Company, SPA owns 49% of Honaine and Sacyr Agua, S.L. owns the remaining 25.5%.

(7)	Instituto para la Diversificación y Ahorro de la Energía (“Idae”), a Spanish state owned company, holds 20% of the shares in Seville PV.

(8)	Certain contracts denominated in U.S. dollars are payable in local currency.

(9)	Reflects the counterparty’s credit ratings issued by Standard & Poor’s Ratings Services, or S&P, Moody’s Investors Service Inc., or Moody’s, and Fitch Ratings Ltd, or Fitch.

(10)	Refers to the credit rating of the Republic of South Africa. The offtaker is Eskom, which is a state-owned utility company in South Africa.

(11)	Refers to the credit rating of Uruguay, as UTE (Administración Nacional de Usinas y Transmisoras Eléctricas) is unrated.

(12)	Including the acquisition of ATN expansion 1.

(13)	As of December 31, 2018.

(*) Commercial Operation Date.

The project financing arrangement of Kaxu contains cross-default provisions related to Abengoa such that debt defaults by Abengoa, subject to certain threshold amounts and/or a restructuring process, could trigger a default under the Kaxu project financing arrangement. In March 2017, Atlantica obtained a waiver in its Kaxu project financing arrangement which waives any potential cross-defaults with Abengoa up to that date, but it does not cover potential future cross-default events. As of March 31, 2019, there are no cross-default events with Abengoa.