Minutes of 30.08.2013 №186

MINUTES No. 186

OF THE MEETING OF THE BOARD OF DIRECTORS


Date and time of the meeting of the Board of Directors (date and time of summing-up the voting results):

August 30, 2013, 4:00 p.m.

(Moscow time).

Date of drawing up the Minutes:

August 30, 2013

Form of meeting:

Absentee voting.

Place of vote counting:

7 Malaya Dmitrovka St., Moscow

JSC RusHydro

Number of elected members of the Board of Directors:

13 persons

Members of the Board of Directors

who participated in the meeting:



B.I. Ayuev


Dr. K.A. Berndt


A.E. Bugrov

M.S. Bystrov


V.I. Danilov-Daniliyan


E.V. Dod


V.M. Zimin


S.N. Ivanov


D.S. Morozov


M.I. Poluboyarinov


V.M. Stolyarenko

According to the Federal Law On Joint-Stock Companies and the Company's Articles of Association, the quorum for the meeting of the Board of Directors is present.


AGENDA OF THE MEETING:


1. On approval of the Company’s transactions .

2. On preliminary approval of transactions with stakes and shares held by RusHydro.

3. On approval of the report on implementation of priority projects implemented by the Company within the Innovative Development Program of JSC RusHydro, and cooperation with scientific organizations and educational institutions in the 1H 2013.

4. On execution of the Board of Directors’ commissions.

5. On amendments and additions to the Company’s Charitable and Sponsor Activities Plan for 2013.

6. On execution of key performance indicators of JSC RusHydro in the 2Q 2013.

7. On interim results of RusHydro’s business-plan execution in the first half of 2013 (including report on implementation of investment program, comprising report on implementation of generating facilities modernization program in the first half of 2013).


RESULTS OF VOTING ON THE AGENDA ITEMS:


Item 1: On approval of the Company’s transactions


1.1. On approval of addendum to the agreement between the Company and Iberdrola Ingeniería y Construcción, S.A.U., qualified as transaction denominated in foreign currency (conditioned by changes in the foreign currency exchange rate).


Resolution:


In accordance with p. 4.5.5 of the Credit Policy Regulations of JSC RusHydro, to approve the addendum to the agreement between RusHydro and Iberdrola Ingeniería y Construcción, S.A.U., qualified as transaction denominated in foreign currency (conditioned by changes in the foreign currency exchange rate), under the following terms and conditions:


Parties to the Supplementary Agreement:


Party 1 (Customer) – Open Joint-Stock Company Federal Hydrogeneration Company – RusHydro (JSC RusHydro).


Party 2 (Contractor) – Iberdrola Ingeniería y Construcción, S.A.U.


Subject matter of the Supplementary Agreement:


Delivery of a set of equipment of the reactor switch VL 500 kW “Emelino” and additional services in relation to comprehensive reconstruction of the 500 kW switchgear (revision of the Technical project, implementation of the Working project on the basis of the revised Technical project, coordination of the project with interested parties, performance of the state expertise of the project, construction, delivery of equipment, assembly, checkout and commissioning of the buildings, equipment and communication lines) for an affiliate of JSC RusHydro – Votkinskaya HPP.


Limit price of the Supplementary Agreement


A limit price of the Addendum to the Agreement shall make up an aggregate sum in the amount of (not more than) Twelve million eight hundred thirty-nine thousand eight hundred and thirty (12,839,830) rubles 16 kopecks, including VAT in the amount of One million nine hundred fifty-eight thousand six hundred and eighteen (1,958,618) rubles 16 kopecks, and


Two million five hundred fourty-six thousand four hundred and fourty (2,546,440) euro 00 cents, including VAT in the amount of Three hundred eighty-eight thousand four hundred and fourty (388,440) euro 00 cents.


Limit price of the Contract, taking into account the Supplementary Agreement:


A limit price of the Agreement shall make up an aggregate sum in the amount of (not more than): Six hundred thirty-two million six hundred nineteen thousand nine hundred and fifty-nine (632,619,959) rubles 74 kopecks, including VAT in the amount of Ninety-six million five hundred one thousand three hundred and fourty-nine (96 501 349) rubles 79 kopecks, and


Twenty four million three hundred fourty-seven thousand eight hundred and twenty-six (24,347,826) euro 32 cents, including VAT in the amount of Three million seven hundred fourteen thousand seventy-five (3,714,075) euro 20 cents.


Term for performance of works under the Contract, taking into account the Supplementary Agreement:


Commencement date: July 01, 2011


Completion date: December 30, 2014.


Voting results:


“For” – 11 (B.I. Ayuev, Dr. K.A. Berndt, A.E. Bugrov, M.S. Bystrov, V.I. Danilov-Daniliyan, E.V. Dod, V.M. Zimin, S.N. Ivanov, D.S. Morozov, M.I. Poluboyarinov, V.M. Stolyarenko)

“Against” – 0

“Abstained” – 0


The resolution has been adopted.


1.2. On approval of the General Loan Agreement between the Company, Open Joint-Stock Company “Russian Aluminum” (OJSC RUSAL) and Closed Joint-Stock Company “Boguchany Aluminum Smelter”, as transaction incurring liabilities in foreign currency (conditioned by changes in the foreign currency exchange rate).


Resolution:


1. To approve the General Loan Agreement between JSC RusHydro, OJSC RUSAL and CJSC BoAZ (hereinafter referred to as the “Contract”) as transaction incurring liabilities in foreign currency (conditioned by changes in the foreign currency exchange rate), under the following terms and conditions:


Parties to the Contract:


The Lenders - JSC RusHydro (Lender 1), OJSC RUSAL (Lender 2)


The Borrower - CJSC BoAZ


Subject matter of the Contract:


Provision of funds by the Lenders to the Borrower in the form of loans to ensure fulfillment of the Borrower’s obligations under the Credit Agreement No. 110100/1167 dated December 03, 2010 (hereinafter referred to as the “Agreement”) concluded between the Borrower and the State Corporation Bank for Development and Foreign Economic Affairs (Vnesheconombank).


The grounds for provision of loans shall be as follows:


1. A written request of Vnesheconombank to the Borrower to ensure presence on the Borrower’s account opened with Vnesheconombank of an amount of money necessary and sufficient to ensure the DSCR coefficient at the level of 1.1 (one point one), calculated as follows:


- for 2015: as progressive total from the Q1 2015 to the Q4 2015,


- for the following periods from 2016 – for 12 months preceding the reporting date,


by raising the loans of the Lenders subordinated to the credit, in accordance with the terms of the Agreement, including p. 6.1.49, 6.1.51 of the Agreement;


2. A written request of Vnesheconombank to the Borrower to ensure presence on the Borrower’s account opened with Vnesheconombank of an amount of money not exceeding the amount of additional financing of capital expenses, defined as the need for additional funding for the quarter, in case of exceeding the actual cost of construction of the first series of Boguchany Aluminum Smelter with the capacity of 298 thousand tons (Project) over the planned cost of the Project in accordance with the quarterly report of the supervisory company (in case of excess for more than 30 million rubles), by raising loans of the Lenders subordinated to the credit in accordance with p.6.1.52 of the Agreement.


3. Other written requests of the Borrower to the Lenders deemed reasonable at the discretion of the Lenders.


Contract Price:


The aggregate borrowing limit in the amount of Sixteen billion eight hundred million (16,800,000,000.00) rubles is divided between the Lenders as follows:


- the maximum amount of funds to be provided by Lender 1 shall make up Eight billion four hundred million (8,400,000,000.00) rubles (hereinafter referred to as the “Lender 1 limit”),

- the maximum amount of funds to be provided by Lender 2 shall make up Eight billion four hundred million (8,400,000,000.00) rubles (hereinafter referred to as the “Lender 2 limit”).


Other terms and conditions of the Agreement:


Currency of payments

Russian ruble

Term for provision of loans

The loans shall be provided by separate tranches during the period from January 01, 2015 to December 20, 2027 (hereinafter each tranche shall be referred to as the “Loan Tranche”).

Currency of loan obligations

U.S. dollar

The amount of each Loan Tranche shall be converted into U.S. dollars for the purpose of recording obligations, at the rate of the Central Bank of the Russian Federation as of the date of the Loan Tranche provision. If agreed by the Parties, Loan Tranches may be provided without conversion, which shall be expressly stated in the application.


Loan maturity

Not earlier than on December 21, 2027

Right for early repayment of loans

The Borrower may repay the Loan Tranches early, in full or in part, together with the interests accrued thereon, subject to approval of Vnesheconombank and preliminary notice sent to the Lenders not later that Three (3) business days prior to the proposed date of repayment of the loan and/or its part.

Interest rate

The fixed interest rate amounts to Eight point seventy-two (8.72 %) percent per year.

The interest rate under the Contract may be decreased at the discretion of the Lenders, subject to written notice to the Borrower and conclusion of a relevant supplementary agreement to the Contract. The interest rate is subject to revision in case of a change in the interest rate under the Agreement.

Equal obligations of the Lenders to provide loans

Each Loan Tranche shall consist of a Loan Tranche of Lender 1, the amount of which shall make Fifty (50) percent of the total amount of the Loan Tranche (hereinafter referred to as the “Loan Tranche of Lender 1”) and a Loan Tranche of Lender 2, the amount of which shall make Fifty (50) percent of the total amount of the Loan Tranche (hereinafter referred to as the “Loan Tranche of Lender 2”).

The aggregate amount of Loan Tranches of Lender 1 shall not exceed the Limit of Lender 1; The aggregate amount of Loan Tranches of Lender 2 shall not exceed the Limit of Lender 2.

Limitation of liability

Liability of Lender 1 shall be limited by the amount of its obligation to provide Loan Tranches of Lender 1, for each Loan Tranche to be provided within the Limit of Lender 1.

Liability of Lender 2 shall be limited by the amount of its obligation to provide Loan Tranches of Lender 2, for each Loan Tranche to be provided within the Limit of Lender 2.

2. To annul the resolution of the Board of Directors of JSC RusHydro dated November 30, 2012 (Minutes No. 168) adopted on item 2.1.


Voting results:


“For” – 10 (B.I. Ayuev, Dr. K.A. Berndt, A.E. Bugrov, M.S. Bystrov, V.I. Danilov-Daniliyan, E.V. Dod, V.M. Zimin, S.N. Ivanov, M.I. Poluboyarinov, V.M. Stolyarenko)

“Against” – 0

“Abstained” – 1 (D.S. Morozov)


The resolution has been adopted.


1.3. On approval of the agreement between JSC RusHydro and OJSC IC Allianz, qualified as an interested party transaction.


Resolution:


1. To determine the limit price (pecuniary valuation) of services rendered under Agreement for voluntary group health and accident insurance (including supplementary agreements thereto) between JSC RusHydro and OJSC IC Allianz, qualified as an interested party transaction, shall make up Three million five hundred seventy-six thousand nine hundred and eighty-seven (3,576,987) rubles 11 kopecks, not subject to VAT.


2. To approve the Contract for voluntary group health and accident insurance (including supplemental agreements thereto) (hereinafter referred to as the “Insurance Contract”), qualified as an interested party transaction, under the following terms and conditions:


Parties to the Contract:


The Policyholder – JSC RusHydro;


The Insurer – OJSC IC Allianz.


Subject matter of the Insurance Contract:


The Insurer shall, upon the occurrence of circumstances specified in the Contract, make an insurance payment to the Insured Person or the beneficiary specified in the Contract, regardless of the amounts owed to them under other insurance contracts, as well as under the compulsory social insurance policy, social security and indemnification arrangements.


Insured Persons:


The employees of the Policyholder included in the lists of insured persons submitted by the Policyholder to the Insurer.


Beneficiaries:


The insured persons and other persons named as Beneficiaries with written consent of the Insured Person, and in case of death of the Insured Person – his/her heirs entitled to receive insurance payments upon the occurrence of an insured event.


Insurance Object:


Property interests that do not contradict the legislation of the Russian Federation and are associated with causing harm to the life or health of citizens.


Event insured:


Events occurring suddenly, that are unforeseen and unintended for the Insured Person (insured risks), provided for in the Insurance Contract, the occurrence of which leads to the obligation of the Insurer to make an insurance payment to the Insured Person (Beneficiary).


Insured risks:


- death of the insured person as a result of an accident;

- death of the insured person as a result of natural causes;

- disability resulting from an accident (I, II and III disability groups);

- disability resulting from natural causes (I, II and III disability groups);

- temporary disability resulting from an accident and connected with injuries;

- hospitalization as a result of an accident;

- diagnosis of a critical disease or performance of a serious operation.


Insurance money:


In accordance with Annex 1 to the Minutes.


Limit price of insurance services:


Three million five hundred seventy-six thousand nine hundred and eighty-seven (3,576,987) rubles 11 kopecks, not subject to VAT.


Term of the Insurance Contract:


Commencement date – January 01, 2013, termination date – December 31, 2013.


Due to the fact that the Board members, as well as members of their families are insured persons (beneficiaries under the Contract), the voluntary health insurance contract concluded between JSC RusHydro and OJSC IC Allianz shall be deemed an interested party transaction in accordance with article 81 of the Federal Law On Joint-Stock Companies.


In accordance with paragraph 3 of article 83 of the Federal Law On Joint Stock Companies, the resolution on this issue shall be adopted by the Board of Directors by a majority vote of the independent directors who are not interested in the transaction.


While summing up voting results, the vote of the Board member of JSC RusHydro E.V. Dod shall not be taken into account, since he is the Chairman of the Board of JSC RusHydro, and therefore is recognized as an interested party in accordance with article 81 of the Federal Law On Joint Stock Companies.


Voting results:


“For” – 10 (B.I. Ayuev, Dr. K.A. Berndt, A.E. Bugrov, M.S. Bystrov, V.I. Danilov-Daniliyan, V.M. Zimin, S.N. Ivanov, D.S. Morozov, M.I. Poluboyarinov, V.M. Stolyarenko)

“Against” – 0

“Abstained” – 0


The resolution has been adopted.


Item 2: On preliminary approval of transactions with stakes and shares held by RusHydro


Resolution:


1. To approve performance by the Company of the transaction(s) aimed at acquisition by the Company of shares of OJSC Zagorskaya PSHP-2 under the following terms and conditions:


OJSC Zagorskaya PSHP-2 shall transfer the ownership to the Company, and the Company shall accept and pay for additional common shares placed by OJSC Zagorskaya PSHP-2 in the amount of not more than One hundred nine million two hundred sixty-four thousand (109,264,000) shares with par value of One (1) ruble each, at the placement price of One (1) ruble for 1 share.


The Company shall pay for the shares of OJSC Zagorskaya PSHP-2 by contributing property to the authorized capital of OJSC Zagorskaya PSHP-2 in accordance with Annex 2 to the Minutes.


The Company’s interest in the authorized capital of OJSC Zagorskaya PSHP-2 shall remain unchanged and amount to 100 %.


2. To consider the decision indicated in p. 1 as approval of the transaction for disposition by the Company of its property provided for in pp. 21 (b) of p. 12.1 of art.12 of the Company’s Articles of Association.


3. To authorize the Company’s representatives in management bodies of OJSC Zagorskaya PSHP-2 to vote “for” adoption of resolutions needed to open emissions of OJSC Zagorskaya PSHP-2 in 2013, including resolutions on authorized shares and increase of the authorized capital of OJSC Zagorskaya PSHP-2 for an amount corresponding to the amounts of transactions approved by the Board of Directors.


Voting results:


“For” – 11 (B.I. Ayuev, Dr. K.A. Berndt, A.E. Bugrov, M.S. Bystrov, V.I. Danilov-Daniliyan, E.V. Dod, V.M. Zimin, S.N. Ivanov, D.S. Morozov, M.I. Poluboyarinov, V.M. Stolyarenko)

“Against” – 0

“Abstained” – 0


The resolution has been adopted.


Item 3: On approval of the report on implementation of priority projects being implemented by the Company within the Program of RusHydro Innovative Development, as well as on cooperation with scientific organizations and educational institutions over the H1 2013


Resolution:


To approve the report on implementation of priority projects within the Innovative Development Program of RusHydro and cooperation with scientific and educational institutions in the first half of 2013. (Annex 3 to the Minutes).


Voting results:


“For” – 10 (B.I. Ayuev, Dr. K.A. Berndt, A.E. Bugrov, M.S. Bystrov, V.I. Danilov-Daniliyan, E.V. Dod, V.M. Zimin, S.N. Ivanov, M.I. Poluboyarinov, V.M. Stolyarenko)

“Against” – 0

“Abstained” – 1 (D.S. Morozov)


The resolution has been adopted.


Item 4: On execution of the Board of Directors’ commissions


Resolution:


To agree upon postponement of the terms of execution of instructions of the Company’s Board of Directors (Annex 4 to the Minutes).


Voting results:


“For” – 10 (B.I. Ayuev, Dr. K.A. Berndt, A.E. Bugrov, M.S. Bystrov, V.I. Danilov-Daniliyan, E.V. Dod, V.M. Zimin, S.N. Ivanov, M.I. Poluboyarinov, V.M. Stolyarenko)

“Against” – 0

“Abstained” – 1 (D.S. Morozov)


The resolution has been adopted.


Item 5: On introduction of amendments and additions to the Company’s Charitable and Sponsor Activities Plan for 2013


Resolution:


1. To include the assistance program to people suffered from flood in the Far East into the Company’s Charitable and Sponsor Activities Plan for 2013.

2. To approve a new edition of the Program of the Company’s Charitable and Sponsor Activities for 2013 (Annex 5 to these Minutes).


Voting results:


“For” – 11 (B.I. Ayuev, Dr. K.A. Berndt, A.E. Bugrov, M.S. Bystrov, V.I. Danilov-Daniliyan, E.V. Dod, V.M. Zimin, S.N. Ivanov, D.S. Morozov, M.I. Poluboyarinov, V.M. Stolyarenko)

“Against” – 0

“Abstained” – 0


The resolution has been adopted.


Item 6: On execution of key performance indicators of JSC RusHydro in the 2Q 2013


Resolution:


To approve the report on execution of key performance indicators of JSC RusHydro over the 2Q 2013 (Annex 6 to the Minutes).


Voting results:


“For” – 10 (B.I. Ayuev, Dr. K.A. Berndt, A.E. Bugrov, M.S. Bystrov, V.I. Danilov-Daniliyan, E.V. Dod, V.M. Zimin, S.N. Ivanov, M.I. Poluboyarinov, V.M. Stolyarenko)

“Against” – 0

“Abstained” – 1 (D.S. Morozov)


The resolution has been adopted.


Item 7: On interim results of the Company’s business-plan execution in the first half of 2013 (including report on implementation of investment program, comprising report on implementation of generating facilities modernization program in the first half of 2013).


Resolution:


To approve the report on interim results of the Company’s business plan execution in the 1H 2013 (including the report on implementation of investment program, comprising report on implementation of generating facilities modernization program in the first half of 2013) (Annex 7 to the Minutes).


Voting results:


“For” – 10 (B.I. Ayuev, Dr. K.A. Berndt, A.E. Bugrov, M.S. Bystrov, V.I. Danilov-Daniliyan, E.V. Dod, V.M. Zimin, S.N. Ivanov, M.I. Poluboyarinov, V.M. Stolyarenko)

“Against” – 0

“Abstained” – 1 (D.S. Morozov)


The resolution has been adopted.


Chairman of

the Board of Directors                                                                         M.I. Poluboyarinov


Corporate Secretary                                                                            M.V. Zavalko
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