Results of the Board of Directors Meeting on September 23, 2019
PJSC RusHydro (ticker symbol: MOEX, LSE: HYDR; OTCQX: RSHYY) announces that the Company's Board of Directors held a meeting in absentia on September 23, 2019.
Resolutions passed on Items of the agenda:
Item 1: Participation of the Company in other organizations.
- On the participation of the Company in JSC Sakhalin State District Power Station (GRES)-2.
The resolution adopted:
1. To approve the participation of the Company in the authorized capital of JSC Sakhalin GRES-2 by concluding an agreement(s) for the sale of shares (hereinafter referred to as the Transaction) on the following material conditions:
Parties to the Transaction:
Issuer: Sakhalin GRES-2 JSC;
Acquirer: RusHydro.
Subject of the Transaction:
The Issuer shall transfer to the Acquirer no more than 16,345,000,000 (Sixteen billion three hundred forty-five million) ordinary shares placed through private subscription (hereinafter referred to as the Shares).
The Acquirer undertakes to accept and pay for the Shares.
Price of the Transaction:
1 (One) ruble per 1 (One) share for a total amount of no more than 16,345,000,000 (Sixteen billion three hundred forty-five million) rubles.
Other terms and conditions of the Transaction:
The form of payment for the Shares is cash, with the possibility of payment by offsetting monetary claims against the Issuer.
2. To determine that, based on the results of the issue, the Company's participation share in the authorized capital of JSC Sakhalin GRES-2 will not change and amounts to 100 (One hundred) %, while the debt of Sakhalin GRES-2 owed to the Company in the amount of no less than 9,216,605,312 (Nine billion two hundred sixteen million six hundred five thousand three hundred and twelve) rubles shall be repaid following the acquisition of the additional shares.
3. Determine that the price of acquisition by the Company of additional ordinary shares of JSC Sakhalin GRES-2 corresponds to the nominal value and amounts to 1 (One) ruble per 1 (One) additional ordinary share for the total maximum amount of 16,345,000,000 (Sixteen billion three hundred forty-five million) rubles.
4. Consider this decision approval of the transaction in accordance with Lit. c), Subclause 24, Clause 12.1 of the Charter of the Company.
- On the participation of the Company in JSC TPP in Sovetskaya Gavan.
The resolution adopted:
1. To approve the participation of the Company in the authorized capital of JSC TPP in Sovetskaya Gavan by concluding an agreement(s) for the sale of shares (hereinafter referred to as the Transaction) on the following material conditions:
Parties to the Transaction:
Issuer: JSC TPP in Sovetskaya Gavan;
Acquirer: RusHydro.
Subject of the Transaction:
The Issuer shall transfer to the Acquirer no more than 18,456,000,000 (Eighteen billion four hundred fifty-six million) ordinary shares placed through private subscription (hereinafter referred to as the Shares).
The Acquirer undertakes to accept and pay for the Shares.
Price of the Transaction:
1 (One) ruble per 1 (One) share for a total amount of no more than 18,456,000,000 (Eighteen billion four hundred fifty-six million) rubles.
Other terms and conditions of the Transaction:
The form of payment for the Shares is cash, with the possibility of payment by offsetting monetary claims against the Issuer.
- Determine that, based on the results of the issue, the Company's participation share in the authorized capital of JSC TPP in Sovetskaya Gavan will not change and amounts to 100 (One Hundred) %, while the debt of JSC TPP in Sovetskaya Gavan to the Company in the amount of no less than 2,644,947,674 (Two billion six hundred forty-four million nine hundred forty-seven thousand six hundred seventy-four) rubles shall be repaid following the acquisition of the additional shares.
3. Determine that the price of acquisition by the Company of the additional ordinary shares of JSC TPP in Sovetskaya Gavan corresponds to the nominal value and amounts to 1 (One) ruble per 1 (One) additional ordinary share for the total maximum amount of 18,456,000,000 (Eighteen billion four hundred fifty-six million) rubles.
4. Consider this decision approval of the transaction in accordance with Lit. c), Subclause 24, Clause 12.1 of the Charter of the Company.
- On the participation of the Company in JSC "Yakutsk State District Power Station (GRES)-2".
The resolution adopted:
1.To approve the participation of the Company in the authorized capital of Yakutsk State District Power Station (GRES)-2 JSC by concluding an agreement(s) for the sale of shares (hereinafter referred to as the Transaction) on the following material conditions:
Parties to the Transaction:
Issuer: Yakutsk GRES-2 JSC;
Acquirer: RusHydro.
Subject of the Transaction:
The Issuer shall transfer to the Acquirer no more than 5,912,000,000 (Five billion nine hundred and twelve million) ordinary shares placed through private subscription (hereinafter referred to as the Shares).
The Acquirer undertakes to accept and pay for the Shares.
Price of the Transaction:
1 (One) ruble per 1 (One) share for a total amount of not more than 5,912,000,000 (Five billion nine hundred and twelve million) rubles.
Other terms and conditions of the Transaction:
The form of payment for the Shares is cash, with the possibility of payment by offsetting monetary claims against the Issuer.
2. To determine that, based on the results of the issue, the Company's participation share in the authorized capital of JSC Yakutsk GRES-2 will not change and amounts to 100 (One hundred) %, while the debt of JSC Yakutsk GRES-2 owed to the Company in the amount of no less than 5,911,757,990 (Five billion nine hundred eleven million seven hundred fifty-seven thousand nine hundred and ninety) rubles shall be repaid to the Company after the acquisition of the additional shares.
3. Determine that the price of acquisition by the Company of additional ordinary shares of Yakutsk GRES-2 JSC corresponds to the nominal value and amounts to 1 (One) ruble per 1 (One) additional ordinary share for the total maximum amount of 5,912,000,000 (Five billion nine hundred and twelve million) rubles.
4. Consider this decision approval of the transaction in accordance with Lit. c), Subclause 24, Clause 12.1 of the Charter of the Company.
Item 2: Approval of the report on the fulfillment of the Annual Comprehensive Procurement Program of RusHydro for 6 months of 2019.
The resolution adopted:
To approve the report on the fulfillment of RusHydro's Annual Comprehensive Procurement Program for 6 months of 2019 (Appendix 1 hereto).
Item 3: On consent to conclude an agreement on the provision of comprehensive transport services, as well as on the leasing with crew and leasing of vehicles without crew and additional agreements thereto between PJSC RusHydro and JSC RusHydro TC as related-party transactions.
The resolution adopted:
- Determine the maximum price of the contract for the provision of comprehensive transport services, as well as the provision of leasing with crew and leasing of vehicles without crew between the Company and JSC RusHydro TC (hereinafter referred to as the Agreement) and its additional agreements, which are related-party transactions:
4,880,824,790 (Four billion eight hundred eighty million eight hundred twenty-four thousand seven hundred ninety) rubles 04 kopecks, excluding VAT.
- Give consent to the conclusion by the Company of the Agreement
and the subsequent conclusion of additional agreements thereto as interested-party transactions, on the following material conditions:
Parties to the Agreement and additional agreements:
Party 1: PJSC RusHydro (the Company);
Party 2: TC RusHydro JSC.
Subject of the Agreement:
The provision by Party 2 to Party 1 of a comprehensive transport service, as well as the provision of leasing with crew and leasing without crew of vehicles and equipment (including, but not limited to: ships and floating objects of inland water transport, and/or hovercraft, and/or special equipment, and/or fire fighting equipment, and/or railway transport and equipment, and/or automobile freight vehicles, and/or automobile passenger vehicles, and/or buses, and/or minibuses, and/or trams, and/or lifting facilities.
Subject of Additional Agreements:
- changing the list of transport vehicles and equipment (including, but not limited to: ships and floating objects of inland water transport, and/or hovercraft, and/or special equipment, and/or fire fighting equipment, and/or railway transport and equipment, and/or automobile freight vehicles, and/or automobile passenger vehicles, and/or buses, and/or minibuses, and/or trams, and/or lifting facilities for leasing and rendering comprehensive transportation services to the executive office and 18 branches of PJSC RusHydro;
- a change in the price of the Agreement, including price components, within the limit price;
- change of schedules and/or interchangeability of the provision of vehicles and equipment within the term for the provision of services and leases under the Agreement.
The maximum price of the Agreement (including Additional Agreements):
4,880,824,790 (Four billion eight hundred eighty million eight hundred twenty-four thousand seven hundred ninety) rubles 04 kopecks, excluding VAT.
The period for the provision of services and leases under the Agreement:
from September 1, 2019 to August 31, 2022.
Period of validity of the Agreement:
The Agreement enters into force upon its signing by the Parties and remains in effect until the Parties perform their obligations in full. In accordance with Clause 2 of Article 425 of the Civil Code of the Russian Federation, the terms of the Agreement apply to relations between the Parties that arose since September 1, 2019.
Other material terms of the Agreement or the procedure for their determination:
The provision of services under the Agreement is carried out within the borders of the Russian Federation.
Specific routes (points of departure and destination), cargo parameters (weight, quantity, volume, dimensions and nature (type, names) and others), moto-watches, periods, service schedules, transportation schedules, shift work of vehicles, schedules of means of transport, the place of supply of vehicles, the procedure for the supply and use of vehicles, the nature of the vehicle, the consignor, the consignee may be determined (subject to the limits specified in this decision) in the Agreement and/or applications of Party 1 to Party 2 for the provision of transport or transportation services.
Persons with an interest in the transaction by the Company:
member of the Management Board of the Company S. A. Kirov, who is a brother of A. A. Kirov, who holds a position in the management bodies (general director, member of the Board of Directors) of a party to the Agreement - JSC TC RusHydro.
- Determine that the present decision is valid until August 31, 2022.
Item 4: Considering matters of significance to the Company:
4.1. On the status of the implementation of priority projects for the construction of 2 facilities in the Far East (TPP in Sovetskaya Gavan, Sakhalin GRES-2 (stage 1)).
The resolution adopted:
To take note of information on the progress of the priority projects of construction of two facilities in the Far East (TPP in Sovetskaya Gavan, Sakhalin GRES-2 (stage 1)) as of June 30, 2019 (Appendix 2 hereto).
4.2. On approval of amendments to the Methodology for the Calculation and Evaluation of the Annual KPIs of RusHydro Management Board Members.
The resolution adopted:
To approve amendments to the Methodology for the Calculation and Evaluation of the Annual KPIs of RusHydro Management Board Members (Appendix No. 3 to the Minutes).
4.3. On participation of the Company in the authorized capital of JSC DGK.
The resolution adopted:
To approve participation of the Company in the authorized capital of JSC DGK for the purpose of capitalization of the latter's debt to RusHydro under loans issued (including payment of interest), by way of concluding an agreement to purchase additional shares of JSC DGK (hereinafter, the "Agreement"), as part of a procedure for increasing the authorized capital of JSC DGK by private subscription in favor of the sole entity, RusHydro, on the following material terms and conditions:
Parties to the Agreement:
Issuer: JSC DGK;
Acquirer: RusHydro.
Subject of the Agreement:
The Issuer shall transfer to the Acquirer ownership of ordinary registered shares of JSC DGK for a maximum amount of forty billion five hundred million rubles (RUB 40,500,000,000), and the Acquirer shall accept and pay for them at the price determined by the Board of Directors of JSC DGK on the basis of an independent appraiser's report, which shall not be less than the par value of one ordinary share, with the possibility of paying for them by way of offset of the Company's monetary claims under the extended loans (including payment of interest).
The shareholding of the Company and its controlled entities in the authorized capital of JSC DGK after the acquisition of the additional shares of JSC DGK will not change and will remain 100%.
4.4. Confidential.
The resolution adopted: Confidential.
The Board of Directors approved the asset swap between PJSC RusHydro and PJSC DEK's key minority shareholders on the Luchegorsky coal mine and Primorskaya GRES, technologically linked with the coal-mine for the key minority shareholders' stake in PJSC DEK.
4.5. Confidential.
The resolution adopted: Confidential.
About RusHydro
RusHydro Group is the leading producer of renewable energy in Russia. It is Russia's largest generating company and is the fourth in the world with over 400 generating facilities in Russia and Armenia. The Group's total electricity generation capacity including Boguchanskaya HPP is 39.7 GW.
Russian Federation owns 61.20% in RusHydro, the rest is held by other institutional and individual shareholders (over 360,000). The company's stock is traded on the Moscow Stock Exchange. Company's GDRs in the IOB section of LSE, ADRs - in OTCQX.
For more information:
Investor Relations Department
Tel. +7 (495) 122 0555 ext. 1607, 1319, 1304
ir@rushydro.ru
The information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of RusHydro. You can identify forward looking statements by terms such as "expect," "believe," "anticipate," "estimate," "intend," "will," "could," "may" or "might," the negative of such terms or other similar expressions. We wish to caution you that these statements are only predictions and that actual events or results may differ materially from these statements. We do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in our projections or forward-looking statements, including, among others, general economic conditions, our competitive environment, risks associated with operating in Russia, rapid technological and market change in our industries, as well as many other risks specifically related to RusHydro and its operations.
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