OREANDA-NEWS. October 24, 2012. JSC RusHydro (ticker symbol: MICEX-RTS, LSE: HYDR; OTCQX: RSHYY) announces the results of the Board of Directors held in absentia on October 16, 2012.

Key highlights:

- BoD recommends issuance and placement of up to 110 bn new shares to the EGM on November 16, 2012;

- Shares of the new issues can be paid in cash and non-cash assets;

- Pricing parameters to be approved after independent appraisal;

- BoD amends the EGM agenda;

- BoD recommends amending guarantee agreement for Boguchanskaya hydropower project with Vnesheconombank.

The Board of Directors resolved to amend the agenda of the Extraordinary General Meeting of Shareholders of RusHydro to be held in absentia on November 16, 2012. The amended agenda includes the following items:

On increase of the Company’s share capital;

On approval of interested-party transactions with the State Corporation Vnesheconombank.

The Board of Directors recommended to the Extraordinary General Meeting of Shareholders (EGM) to approve amendments to the guarantee agreement signed by RusHydro in favor of the State Corporation Vnesheconombank (VEB), in respect of a RUR 28.1 bn loan issued by the latter to JSC Boguchanskaya HPP. The transaction is qualified as interested-party, and therefore subject to vote by the general meeting of shareholders. The amendments are made to accommodate delays with commissioning of the Boguchanskaya hydropower plant and beginning of power sales under electricity and capacity agreements from the plant. The delays were the result of force majeure factors, that could not be managed by investors of the project (RusHydro and RUSAL)[1]. The amended guarantee agreement provides for the start of power sales under electricity and capacity agreements from first three hydro-units of Boguchanskaya (a total of 1,000 MW) no later than March 1, 2013, as well as stipulates other conditions which may prompt the execution by RusHydro of its obligations.

The Board of Directors also resolved that the price of property under the guarantee agreement remains unchanged and equals the amount loaned to the debtor (the loan facility of RUR 28.1).

JSC Boguchanskaya HPP, JSC Boguchansky aluminium smelter signed loan agreements with VEB providing project financing for 3 GW hydropower project and aluminium smelter (the Boguchansky metals and energy complex) in the Krasnoyarsk region. In August 2011, RusHydro signed guarantee agreement for Boguchanskaya HPP in favour of the VEB for the total amount of loan facility of RUR 28.1 bn including accrued interest and penalties under the loan agreement.

The Board of Directors recommended shareholders to increase the share capital of RusHydro by means of issuance and placement through open subscription of 110,000,000,000 additional ordinary shares with a par value of RUR 1. The shares can be paid by cash or non-cash assets. Among the non-cash assets that can be used as means of payment are ordinary shares of the following companies:

- JSC Ust’-Srednekanskaya HPP;

- JSC RAO Energy Systems of the East;

- JSC Sakhalin energy company;

- JSC Irkutsk electronetwork company;

- JSC Irkutskenergo.

The valuation of these shares for placement purposes will be determined after independent appraisal.

The price of placement of new shares is subject to a Board of Directors approval after independent appraisal but prior to the start of the placement.

The Board of Directors approved the announcement of the amended agenda for the EGM to be held on November 16, 2012. The Board also determined that the announcement should be published in Rossiyskaya Gazeta and on the Company’s website no later than October 26, 2012.

As was communicated earlier, the meeting Board of Directors of RusHydro held on October 10, 2012, resolved to call the Extraordinary General Meeting of Shareholders (EGM). The EGM will be held on November 16, 2012. The record date for EGM participation is October 11, 2012.

[1] The commissioning and start of operation of the first hydro-units of the Boguchanskaya hydropower plant were scheduled for June 2012, but due to delayed start of reservoir filling, these terms have been changed.