Minutes of 28.11.2008 №68

MINUTES No. 68

OF THE BOARD OF DIRECTORS MEETING


Date and time of the Board of Directors Meeting
(date and time of vote counting):                                      November 28, 2008, 6:00 p.m.

                                                                                    (Moscow time)

Minutes Dated:                                                                December 1, 2008

Site of vote counting:                                                      Mosсow, Arkhitektora Vlasova Str., 51

Number of elected members of the Board of Directors          13

Members of the Board of Directors present at meeting:          V. Yu. Sinyugin

                                                                                      D. S. Akhanov

                                                                                      B. I. Ayuev

                                                                                      D. V. Ponomarev

                                                                                      A. N. Rappoport

                                                                                      Seppo Remes

                                                                                      Yu. A. Udaltsov

                                                                                      Ya. M. Urinson

                                                                                      R. Z. Khamitov

                                                                                      A. V. Sharonov


In compliance with the Federal Law on Joint-Stock Companies and the company's Articles of Association the quorum for conducting the Board of Directors Meeting is present.


AGENDA OF THE BOARD OF DIRECTORS MEETING:


Review of propositions made by the company's shareholders for nominees to the company's Board of Directors.

Issues related to convening, preparation and running of an extraordinary general shareholders' meeting to be held on 27.12.2008.

International activity strategy of the company.

Approving the Provision on insider information as amended.

Concerning the company's participation in other companies.

Approving the company's transactions:

6.1. Approval of interested-party transactions with JSC FGC UES.

6.2. Approval of a interested party transactions with JSC GVC Energetiki.

6.3. Approval of an interested-party transaction with JSC Mosenergo.

On determination of company's (company's representatives) opinion regarding the issues put on agenda of the Board of Directors' Meetings as well as General Meetings of the company's subsidiaries and affiliates (SA).

7.1. Determination of the agenda issues for the general stockholders' meetings of the company's SA.


RESULTS OF VOTING ON AGENDA:


Matter 1: Review of propositions made by the company's shareholders for nominees to the company's Board of Directors.


Decision:

Include the following candidates on the list of candidates to vote for election to the company's Board of Directors at the Extraordinary General Shareholders' Meeting on 27.12.2008:


No.

A candidate proposed by a shareholder (-s) to be included on the list of candidates to be voted for to elect the Board of Directors of the company

Position, occupation of a candidate proposed by a shareholder (-s) to be included on the list of candidates to be voted for to elect the Board of Directors of the company

Name of a shareholder (-s) that proposed a candidate to be included on the list of candidates to be voted for to elect the Board of Directors of the company

Quantity of the company's voting shares owned by a shareholder
(-s), per cent

1.

Anatoly Borisovich Ballo

Deputy Chairman of the Management Board, JSC Vnesheconombank












Federal Agency for State Property Management











60,3747

2.

Sergey Sergeevich Beloborodov

General Director, Corporation Gazenergoprom Limited

3.

Boris Feliksovich Vainzikher

Member of the Board of Directors, JSC FGC UES

4.

Eduard Petrovich Volkov

Executive Director, JSC G.M Krzhizhanovsky Institute of Energy

5.

Viktor Ivanovich Danilov-Danilyan

Director, Institute of Water Problems attached to the RAS

6.

Vasily Aleksandrovich Zubakin

Acting Chairman of the Management Board of JSC RusHydro

7.

Sergey Vladimirovich Maslov

President, JSC St Petersburg International Commodity Exchange

8.

Sergey Vladimirovich Serebryannikov

Professor, GOUVPO Moscow Power Engineering Institute (Technical University)

9.

Vladimir Vitalyevich Tatsy

First Vice President, JSC Gasprombank

10.

Mikhail Petrovich Fedorov

Rector, Saint Petersburg State Polytechnic University

11.

Rustem Zakievich Khamitov

Head of the Federal Agency for Water Resources

12.

Andrey Vladimirovich Sharonov

Chairman of the Board of Directors, CJSC IC Troyka Dialog

13.

Sergey Ivanovich Shmatko

Minister of Energy of the Russian Federation

14.

Vadim Stanislavovich Belyaev

General Director, LLC FC OTKRITIE

Limited Liability Company OTKRITIE UES CAPITAL PARTNERS FUND PLC

(OTKRITIE UES CAPITAL PARTNERS FUND PLC)

2,7071

15.

Igor Petrovich Klochko

Deputy General Director, Head of The Fuel and Energy Complex, JSC GMK Norilsk Nickel


Open Joint-Stock Company Intergeneratsiya



2,1053

16.

Oleg Vyacheslavovich Surikov

Director of the Corporate Department, JSC GMK Norilsk Nickel


Voting results:

"For" - 10 (V. Yu. Sinyugin, D. S. Akhanov, B. I. Ayuev, D. V. Ponomarev, A. N. Rappoport, Seppo Remes, Yu. A. Udaltsov, Ya. M. Urinson, R. Z. Khamitov, A. V. Sharonov)

"Against" - 0

"Abstained" - 0

Decision made.




Matter 2: Issues related to convening, preparation and running of an extraordinary general shareholders' meeting to be held on 27.12.2008.


Decision:

Approve the form and the text of voting ballots at the Annual General Shareholders' Meeting (Appendix 1).


Voting results:

"For" - 9 (V. Yu. Sinyugin, D. S. Akhanov, B. I. Ayuev, A. N. Rappoport, Seppo Remes, Yu. A. Udaltsov, Ya. M. Urinson, R. Z. Khamitov, A. V. Sharonov)

"Against" - 0

"Abstained" - 1 (D. V. Ponomarev)

Decision made.




Matter 3: International activity strategy of the company.


Decision:

Defer consideration of the issue to a later date.


Voting results:

"For" - 10 (V. Yu. Sinyugin, D. S. Akhanov, B. I. Ayuev, D. V. Ponomarev, A. N. Rappoport, Seppo Remes, Yu. A. Udaltsov, Ya. M. Urinson, R. Z. Khamitov, A. V. Sharonov)

"Against" - 0

"Abstained" - 0

Decision made.




Matter 4: Approving the Provision on insider information as amended.


Decision:

Approve the Provision on insider information of JSC RusHydro as amended (Appendix 2).


Voting results:

"For" - 10 (V. Yu. Sinyugin, D. S. Akhanov, B. I. Ayuev, D. V. Ponomarev, A. N. Rappoport, Seppo Remes, Yu. A. Udaltsov, Ya. M. Urinson, R. Z. Khamitov, A. V. Sharonov)

"Against" - 0

"Abstained" - 0

Decision made.




Matter 5: Concerning the company's participation in other companies.


Decision:

Approve participation of JSC RusHydro in JSC B. E. Vedeneev VNIIG by way of acquiring additional shares of JSC B. E. Vedeneev VNIIG, on the following conditions:

- category, type, nominal value; ordinary registered shares with the nominal value of 100 (one hundred) ruble per share;

- number of acquired shares: 983 (nine-hundred and eighty-three) shares; JSC RusHydro is entitled to purchase less shares of JSC B. E. Vedeneev VNIIG, in this case JSC B. E. Vedeneev VNIIG transfers into ownership of JSC RusHydro a corresponding number of the paid shares;

- share acquisition price: at the offering price of additional shares of JSC B. E. Vedeneev VNIIG, which is 35,576 (thirty five thousand and five hundred and seventy six) rubles 16 kopecks (sixteen) per 1 (one) additional ordinary registered share to the total amount not exceeding 35,000,000 (thirty five million) rubles;

- method of share payment - monetary assets;

- JSC RusHydro's share in the authorised capital of JSC B. E. Vedeneev VNIIG prior to purchasing shares of additional issue - 100 per cent; JSC RusHydro's share in the authorised capital of JSC B. E. Vedeneev VNIIG after purchasing of additional shares - 100 per cent (remains unchanged).


Voting results:

"For" - 9 (V. Yu. Sinyugin, D. S. Akhanov, B. I. Ayuev, A. N. Rappoport, Seppo Remes, Yu. A. Udaltsov, Ya. M. Urinson, R. Z. Khamitov, A. V. Sharonov)

"Against" - 0

"Abstained" - 1 (D. V. Ponomarev)

Decision made.



 

Matter 6: Approving the company's transactions:


6.1. Approval of interested-party transactions with JSC FGC UES.


Decision:

Determine that the amount of payment to be effected by the company under the contract concluded between JSC RusHydro and Open Joint Stock Company Federal Grid Company of Unified Energy System (JSC FGC UES) is 35,029,872.32 (thirty five million twenty nine thousand eight hundred and seventy two rubles and 32 kopecks), including 18 per cent VAT - 5,343,539.85 (five million three hundred and forty three thousand five hundred and thirty nine rubles 85 kopecks).

The amount of expenses incurred by JSC FGC UES is 34,979,872.32 (thirty four million nine hundred seventy nine thousand eight hundred and seventy two rubles 32 kopecks), including VAT 18 per cent to the sum of 5,335,912.73 (five million three hundred and thirty five-thousand nine hundred and twelve rubles 73 kopecks).

The fee for engineering services rendered by JSC FGC UES is 50,000.00 (fifty thousand rubles 00 kopecks) including VAT 18 per cent - 7,627.12 (seven thousand six hundred and twenty seven rubles 12 kopecks).

To approve conclusion of an Agreement between JSC RusHydro and Open Joint Stock Company Federal Grid Company of Unified Energy System representing an interested party transaction on the following essential terms:

Agreement Parties:

Executor - Open Joint-Stock Company Federal Grid Company of Unified Energy System;

Customer - JSC RusHydro.

Subject of the Agreement:

Pursuant to this Agreement the Executor undertakes to upgrade the Facility - OSG (outdoor switchgear) 330 HPP-2 - protection of L-33-03 lines (substation Mashuk - HPP-2) owned by the Customer by the right of ownership and the Customer undertakes to compensate the Executor all expenses incurred in the course of works and pay a fee for engineering services subject to conditions specified in the Agreement.

Content (scope) of work:

Technical upgrading of the Facility including: Procurement, transportation and delivery of equipment to the work site. Demounting old equipment. New equipment installation according to design documentation. Commissioning Works: Disposal of old equipment with taking to pieces, cutting and preparation to deliver to a waste metal site. Disposal of all waste and garbage except ferrous and non-ferrous metals that may accumulate in the course of work. Putting the facility into industrial operation with commissioning of shutdown protections.

Work site: The Karachaevo-Cherkessian Republic, Udarny, OSG-330, HPP-2.

Place of equipment installation and adjustment: The Karachaevo-Cherkessian Republic, Udarny, OSG-330, HPP-2.

Agreement Price:

The total cost of this Agreement amounts to 35,029,872.32 (thirty five million twenty nine thousand eight hundred and seventy two rubles 32 kopecks) rubles including VAT 18 per cent - 5,343,539.85 (five million three hundred and forty three thousand five hundred and thirty nine rubles 85 kopecks) rubles:

The amount of expenses incurred by the Executor is 34,979,872.32 (thirty four million nine hundred seventy nine thousand eight hundred and seventy two rubles 32 kopecks), including VAT 18 per cent in the amount of 5,335,912.73 (five million three hundred and thirty five thousand nine hundred and twelve rubles 73 kopecks) rubles;

The amount of a fee for engineering services rendered by the Executor is 50,000.00 (fifty thousand rubles 00 kopecks) including VAT 18 per cent - 7,627.12 (seven thousand six hundred and twenty seven rubles 12 kopecks).

The present cost of the Agreement remains fixed.

Works Completion Period:

Actual start of work execution: December 20, 2008.


Completion of work: March 31, 2009.

Agreement Validity Term:

The present Agreement comes into force from the moment of its signing by the Parties and shall be valid until the full execution of obligations by the Parties.


Voting results:

"For" - 4 (D. S. Akhanov, Yu. A. Udaltsov, Ya. M. Urinson, R. Z. Khamitov)

"Against" - 0

"Abstained" - 1 (D. V. Ponomarev)

Decision made.

Yu. M. Medvedev, B. I. Ayuev, Seppo Remes, V. B. Khristenko, A. V. Sharonov, A. N. Rappoport recognised as transaction interested parties, did not take part in voting. A Chairman of the Board of Directors of JSC RusHydro, V. Y. Sinyugin, who was the Chairman of JSC RusHydro's Management Board within a year preceding a decision and who is not recognized as an independent director, did not take part in voting.



6.2. Approval of a interested party transactions with JSC GVC Energetiki.


Decision:

6.2.1. Determine that the cost of a licensed software purchased by the company under a supplementary agreement to the Supply Contract concluded between the company and JSC GVC Energetiki amounts to 5,098,489.50 (five million ninety eight thousand four hundred and eighty nine rubles) rubles and 50 kopecks including VAT 18 per cent - 777,735.69 (seven hundred seventy seven thousand seven hundred and thirty five) rubles 69 kopecks.

6.2.2. Approve conclusion of an supplementary agreement to the Supply Contract between JSC RusHydro and JSC GVC Energetiki, which is an interested-party transaction subject to the following essential conditions:

Parties to the Supplementary Agreement:

Executor - is JSC GVC Energetiki (Supplier).

Customer - JSC RusHydro (Buyer).

Subject of the Supplementary Agreement:

According to the contract the Supplier undertakes to arrange licensed software delivery developed by Microsoft Ireland Operations Limited (hereinafter referred to as licensed software) in accordance with the Specification (Appendix No. 1 to Supplementary Agreement), while the Buyer undertakes to accept and arrange payment for this licensed software with the procedure and terms established by the contract.

Content (Scope) of Delivery:

Pro Dsktp Listed Lic/SA Pack MVL - 100 licenses;

Exchange Svr Ent Listed Languages Lic/SA Pack MVL - 3 licenses;

ISA Server Ent Edtn Listed Langs Lic/SA Pk MVL 1 Proc Lic - 3 licenses;

SQL Svr Standard Edtn Win32 Listed Lic/SA Pack MVL 1 Processor License - 3 licenses;

Windows Svr Std Listed Lic/SA Pack MVL - 13 licenses;

Sys Mgmt Svr Ent Ed Listed Languages Lic/SA Pack MVL - 4 licenses;

Ops Mgr Ent Ops Mgmt Lic Listed Lic/SA Pack MVL - 4 licenses;

Ops Mgr Server Listed Lic/SA Pack MVL - 4 licenses.

Supplementary Agreement Price:

The total cost of this licensed software under a Supplementary Agreement to the Supply Contract amounts to 5,098,489.50 (five million ninety eight thousand four hundred and eighty nine) rubles and 50 kopecks including VAT 18 per cent - 777,735.69 (seven hundred seventy seven thousand seven hundred and thirty five) rubles 69 kopecks. The present cost of this licensed software under the Supplementary Agreements shall remain fixed during the whole contract validity period.

Delivery Completion Period:

Start of work execution: December 1, 2008.

Completion of work: August 31, 2009.

Effective Period of Supplementary Agreement:

The Supplementary Agreement to the Supply Contract comes into effect from the date of its signing by the Parties and is valid until a complete fulfillment of the Parties' obligations.


Voting results:

"For" - 8 (D. S. Akhanov, B. I. Ayuev, A. N. Rappoport, Seppo Remes, Yu. A. Udaltsov, Ya. M. Urinson, R. Z. Khamitov, A. V. Sharonov)

"Against" - 0

"Abstained" - 1 (D. V. Ponomarev)

Decision made.

A member of the Board of Directors of JSC RusHydro, V. Yu. Sinyugin, who was RusHydro's Board Chairman within a year preceding a decision and who is not recognised as an independent director, did not take part in voting.


Decision:

6.2.2. Approve conclusion of supplementary agreements to the Supply Contracts between JSC RusHydro and JSC GVC Energetiki, which is an interested-party transaction subject to the following essential conditions:

Parties to the Supplementary Agreement:

Executor - is JSC GVC Energetiki (Supplier).

Customer - JSC RusHydro (Buyer).

Subject of the Supplementary Agreement:

Under the Supplementary Agreements to the Supply Contracts the Buyer undertakes to make the final payment for licensed software developed by Microsoft Ireland Operations Limited to 12 (twelve) months after signing an Enterprise Agreement with Microsoft Ireland Operations Limited.

Supplementary Agreement Price:

The total cost of licensed software under the Supply contracts for licensed software developed by Microsoft Ireland Operations Limited shall remain fixed.

Works Completion Period:

Start of work execution: December 1, 2008.

Completion of work: Mach 31, 2009.

Effective Period of Supplementary Agreement:

The Supplementary Agreements to the Supply Contract come into effect from the date of its signing by the Parties and is valid until a complete fulfillment of the Parties' obligations.


Voting results:

"For" - 8 (D. S. Akhanov, B. I. Ayuev, A. N. Rappoport, Seppo Remes, Yu. A. Udaltsov, Ya. M. Urinson, R. Z Khamitov, A. V. Sharonov)

"Against" - 0

"Abstained" - 1 (D. V. Ponomarev)

Decision made.

A member of the Board of Directors of JSC RusHydro, V. Yu. Sinyugin, who was RusHydro's Board Chairman within a year preceding a decision and who is not recognised as an independent director, did not take part in voting.


6.3. Approval of an interested-party transaction with JSC Mosenergo.


Decision:

6.3.1. Specify that monthly rental value under Contract for non-residential premises rent between JSC RusHydro and JSC Mosenergo equals 248,196 (two hundred forty eight thousand one hundred and ninety six) rubles 48 kopecks including VAT 18 per cent - 37,860 (thirty seven thousand eight hundred and sixty) rubles 48 kopecks.

6.3.2. Approve a Contract between JSC RusHydro and JSC Mosenergo as an interested party transaction under the following essential conditions:

Parties to Contract:

Lessee is JSC Mosenergo

Lessor - JSC RusHydro

Subject of Contract:


The Lessor shall provide the building of a transport shop for temporary use to the Lessee including the following premises: repair workshops with total area 509.5 m2 (let. 26B), garage building with total area 503.4 m2 (let.26B), service building with total area of 339.9 m2 (let. 26G, 26g, 26g1, 26g2); garage: repair bay building No.4 with total area of 455.7 m2 (let. 26E); transport workshop with an area of 3,200 m2 (let. 26A); located at the following address: Russia, Moscow region, Sergievo-Posadsky district, Bogorodskoye, sector of the Zagorskaya PSHPP construction base and first floor rooms of the SPC (service and production complex) of the Zagorskaya PSHPP: fitter's shops and a storage room with total area of 168.5 m² (let. 4B) according to the list of facilities to be leased (Appendix No. 1) to the Contract and floor plan (explication) being an integral part of the Contract.

Contract rental payment value:

Monthly rental value under Contract for non-residential premises rent between JSC RusHydro and JSC Mosenergo equals 248,196 (two hundred forty eight thousand and one hundred and ninety six) rubles 48 kopecks including VAT 18 per cent - 37,860 (thirty seven thousand eight hundred and sixty) rubles 48 kopecks.

Effective Period of Contract:

The Contract comes into force from the date of its signing by the Parties and is valid until August 31, 2009. The Contract terms apply to the parties' relations initiated before its conclusion from 02.10.2008.


Voting results:

"For" - 7 (D. S. Akhanov, B. I. Ayuev, A. N. Rappoport, Seppo Remes, Ya. M. Urinson, R. Z. Khamitov, A. V. Sharonov)

"Against" - 0

"Abstained" - 1 (D. V. Ponomarev)

Decision made.

Yu. A. Udaltsov, member of the Board of Directors of JSC RusHydro recognized as transaction interested party, as well as V. Yu. Sinyugin, the Chairman of the Board of Directors of JSC RusHydro, who was the Chairman of JSC RusHydro's Management Board within a year preceding a decision and who is not recognized as an independent director, did not take part in voting.




Matter 7: On determination of company's (company's representatives) opinion regarding the issues put on agenda of the Board of Directors' Meetings as well as General Meetings of the company's subsidiaries and affiliates (SA).


7.1. Determination of the agenda issues for the general stockholders' meetings of the company's SA.


Decision:

Instruct the company's representatives in the Board of Directors of JSC Malaya Mezenskaya TPP and JSC Energy Sales Company RusHydro to vote "FOR" inclusion of the following matters into the agenda of the annual General Shareholders' Meetings:

- Transfer of powers to a controlling organisation to function as the company sole executive body.


Voting results:

"For" - 9 (V. Yu. Sinyugin, D. S. Akhanov, B. I. Ayuev, A. N. Rappoport, Seppo Remes, Yu. A. Udaltsov, Ya. M. Urinson, R. Z. Khamitov, A. V. Sharonov)

"Against" - 0

"Abstained" - 1 (D. V. Ponomarev)

Decision made.

 

Questionnaires of the members of the Board of Directors are attached.





Chairman of the Board of Directors                                                                V. Yu. Sinyugin


Secretary of the Board of Directors                                                               M. M. Davydov

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