1.1. The Open Joint Stock Company «Mosenergo» (hereinafter referred to as the «Company») was established pursuant to Russian Federation Presidential Decrees No. 922 «On the Particulars of Transformation of State-owned Enterprises, Unions, and Organizations of the Fuel and Energy Complex into Joint Stock Companies,» dated 14 August 1992; No. 923 «On Organizing the Management of the Electric Power Complex of the Russian Federation During Privatization,» dated 15 August 1992; No. 1334 «On Implementation in the Electric Power Industry of Russian Federation Presidential Decree No. 922 «On the Particulars of Transformation of State-owned Enterprises, Unions, and Organizations of the Fuel and Energy Complex into Joint Stock Companies,» dated 05 November 1992.

1.2. The founder of the Company is Moscow Committee for Property Management.

1.3. The Company is the successor of the State Enterprise - the Order of Lenin and Order of the Patriotic War First Degree Moscow Energy Production and Electrification Enterprise «Mosenergo» (MEPEE Mosenergo).

1.4. The full firm name of the Company in Russian is Открытое акционерное общество энергетики и электрификации «Мосэнерго».

1.5. The abbreviated name of the Company in Russian is ОАО «Мосэнерго», and in English, OAO MOSENERGO.

1.6. The Company shall have the following address: 8 Raushskaya Naberezhnaya, Moscow.

The post address of the Company is as follows: 8 Raushskaya Naberezhnaya, Moscow, Russian Federation, 115035.

1.7. The Company shall have an indefinite term of existence.

Article 2. Legal Status of the Company

2.1. The legal status of the Company is defined by the Civil Code of the Russian Federation, the Federal Law «On Joint Stock Companies,» other regulatory legal acts of the Russian Federation, and this Charter.

2.2. The Company is a legal entity under the laws of the Russian Federation.

2.3. The Company shall own separate assets, which shall be recorded on its own balance sheet, and may, in its own name, acquire and exercise property and personal non-property rights, assume responsibilities, and appear as a claimant or a respondent in the courts.

2.4. The Company shall have the right to open bank accounts under the applicable procedure in and outside the Russian Federation.

2.5. The Company shall be liable for its obligations to the extent of all of its assets.

The Company shall not be liable for the obligations of the Russian Federation or its shareholders.

Shareholders in the Company shall not be liable for its obligations, except to the extent provided under legislation in effect in the Russian Federation.

The Company’s shareholders may dispose of their shares without the consent of the other shareholders or the Company.

The Company’s shareholders shall bear the risk of losses resulting from the Company’s activities to the extent of the value of their respective shares.

2.6. The Company shall have a round seal bearing its full official name in Russian and indicating its location.

The Company may have stamps and letterheads bearing its full firm name, and have its own logo, as well as a duly registered trademark and other means of visual identification.

2.7. The Company shall have the civil rights and assume the responsibilities necessary to engage in any kinds of activities not prohibited by federal laws.

2.8. The Company may establish branches and representative offices in and outside the Russian Federation.

The Company’s branches and representative offices are not legal entities and shall act on the basis of their respective regulations approved by the Company.

The Company’s branches and representative offices shall be assigned property by the Company, which is to be recorded both on their separate balance sheets and on the balance sheet of the Company.

The head of a branch or a representative office shall act on the basis of a power of attorney issued by the Company.

The Company shall be liable for the operations of its branches and representative offices.

The particulars regarding the Company’s branches and representative offices shall be set forth in a Schedule to this Charter.

2.9. The Company may have subsidiary and dependent companies with the rights of a legal entity in the Russian Federation, established in accordance with the Federal Law «On Joint Stock Companies,» other federal laws and this Charter, and, if outside the Russian Federation, in accordance with the laws of the foreign jurisdiction in which the subsidiary or dependent company is located, unless otherwise stipulated by an international agreement to which the Russian Federation is party.

Article 3. Objectives and Scope of Business

3.1. The primary objective of the Company is to generate a profit.

3.2. In order to generate a profit, the Company shall have the right to engage in any kinds of activity not prohibited by law, including the following activities:

to exercise the powers and authority of the executive bodies of joint stock companies and other business companies pursuant to the procedure set out by applicable laws and contracts concluded;
to engage in property trust management;
to provide consulting services;
to transact securities pursuant to the procedure defined by the applicable laws of the Russian Federation;
to engage in agency transactions;
to perform design and estimate, exploration and research and development as well as design engineering works;
to engage in foreign economic operations;
to provide forwarding services;
to engage in supplies (distribution) of electric and heat energy;
to obtain (purchase) electric and heat energy from the electric power (capacity) wholesale market;
to perform such work as may determine parallel work in accordance with the regimes of the Unified Energy System of Russia under contractual arrangements;
to operate power generating facilities other than those recorded on the Company’s books under contracts with the owners of such facilities;
to pursue activities associated with environmental protection;
to pursue activities bearing an impact on the environment and associated with environmental protection and use of natural resources, as well as utilization, storage and transferal of industrial waste;
to oversee the safe operation of electric and heat power-driven machinery of customers having access to the heat and electric power networks of the Company;
to pursue educational activities, including extended education;
to instruct on and hold examinations in safety engineering, occupational safety and industrial and fire safety rules and regulations;
to develop and implement programs for mobilization preparedness, civil defense, prevention and liquidation of emergency situations, and protection of information constituting state secrets in accordance with legislation in effect in the Russian Federation;
to engage in security activities solely for the purposes of the Company’s own security via the Security Service to be established within the Company, which shall be guided in its operations by the Russian Federation’s Law «On Detective and Security Activities in the Russian Federation» and other applicable Russian legislation;
to generate electric and heat energy;
to organize power saving regimes for equipment operated at electric power stations and to comply with power supplies regimes under applicable contractual arrangements;
to procure the workability of power generating equipment and keep same in a good and repaired condition in accordance with the applicable regulatory requirements and to procure high-quality and timely repair, technical modernization and reconstruction of power projects;
to supply power to consumers having access to the electric and heat power networks of the Company under applicable contractual arrangements;
to develop and introduce new equipment and technologies ensuring the efficiency, safety and environmentally-friendly operation of the Company’s power projects;
to operate heat supply networks;
to develop telecommunication facilities and render telecommunications services;
to engage in the storing of crude and refined oil;
to operate explosion-dangerous industrial facilities;
to operate fire-dangerous industrial facilities;
to operate and maintain the facilities of Gosgortechnadzor;
to operate buildings and structures;
to render metrology services to production facilities;
to engage in hazardous waste handling operations;
to operate gas distribution networks;
to engage in the repair of measuring devices; and
to pursue other activities.

3.3. The Company may only engage in certain types of activity, as listed by federal laws, on the basis of a special authorization/license.

The Company’s right to engage in any kind of licensed activity shall arise from the moment the Company obtains a license or at such term or terms as may be set forth therein and shall terminate upon the expiry of the effective term thereof, unless otherwise stipulated by law or other legal acts.

Article 4. Charter Capital of the Company

4.1. The charter capital of the Company shall comprise the nominal values of the Company’s shares acquired by its shareholders («outstanding shares»).

The Company shall have a charter capital of thirty nine billion seven hundred forty nine million three hundred fifty nine thousand seven hundred rubles (RUR 39,749,359,700).

4.2. The Company has placed three hundred fifty nine thousand seven hundred rubles (RUR 39,749,359,700) common registered shares having the par value of one ruble (RUR 1.00) each and making a total of three hundred fifty nine thousand seven hundred rubles (RUR 39,749,359,700).

4.3. The charter capital of the Company may be:

increased by increasing the nominal value of its shares or by placing additional shares;
decreased by decreasing the nominal value of shares or reducing their overall quantity, including by acquisition and redemption of a portion of outstanding shares in the Company in accordance with this Charter.

4.4. No increase of the Company’s charter capital shall be permitted unless and until the charter capital has been paid up in full.

No increase of the Company’s charter capital shall be permitted if such increase is intended solely for covering losses sustained by the Company or repaying overdue debts to the Company’s creditors.

4.5. A reduction in the Company’s charter capital shall be effected pursuant to the procedure set out by legislation in effect in the Russian Federation and this Charter.

The Company shall be obliged to reduce its charter capital in the instances set out by the Federal Law «On Joint Stock Companies.»

4.6. The Company may acquire shares it has issued upon a decision of its General Shareholders’ Meeting to reduce the Company charter capital by acquiring a portion of its outstanding shares in order to reduce their overall number.

The General Shareholders’ Meeting may not decide to decrease the charter capital of the Company by acquiring a portion of its outstanding shares in order to reduce their overall number if the nominal value of shares remaining in circulation falls below the minimum charter capital requirement as stipulated by the Federal Law «On Joint Stock Companies.»

Shares acquired by the Company under this Clause 4.6 shall be cancelled upon their acquisition.

Subject to a decision of the General Shareholders’ Meeting, shares acquired under this Clause 4.6 shall be paid for in cash and/or in kind.

Common registered shares authorized for placement by the Company shall confer upon their holders all of those rights set forth in Clause 6.2 below.

4.7. In addition to those shares already outstanding, the Company may place a further sixteen million four hundred seventy seven thousand nine hundred and sixty-one (16,477,961) common registered shares having the nominal value of one ruble (RUR 1.00) each and the total nominal value of sixteen million four hundred seventy seven thousand nine hundred and sixty-one rubles (RUR 16,477,961).

Common registered shares authorized for placement by the Company shall confer upon their holders all of those rights set forth in Clause 6.2 below.

Article 5. Shares, Bonds,
and Other Emissive Securities of the Company

5.1. The Company places common shares and may place one or more classes of preferred shares, bonds and other emissive securities pursuant to the procedure set out by the laws of the Russian Federation.

5.2. The Company may place additional shares and other emissive securities by placing them among its shareholders or by way of subion or conversion.

5.3. The placement by the Company of its shares and other securities convertible into shares shall be in accordance with the legal acts of the Russian Federation.

5.4. Common shares may not be converted into preferred shares, bonds or other securities.

5.5. Where the Federal Law «On Joint Stock Companies» so directs, the Company’s shareholders shall have the preemptive right to acquire additional shares and emissive securities convertible into shares, which are placed by subion, in a quantity proportional to that of the Company’s shares of the same category or class held by them.

5.6. Where it is impossible to obtain a whole number of shares while exercising the preemptive right to purchase additional shares or during the consolidation of shares, shares will be split into portions (fractional shares).

A fractional share shall grant its holder the same rights evidenced by a whole share in the corresponding class or category in proportion to that percentage of a whole share which is represented by the fractional share.

Fractional shares shall remain outstanding on a par with whole shares. If a person purchases two or more fractional shares in the same class or category, such shares shall form a single whole share and/or such fractional share as equals the sum total of such fractional shares.

5.7. Payment for additional shares being placed by way of subion may be made in cash, securities, other assets, property rights, or other rights lending themselves to monetary valuation.

The form of payment for additional shares shall be determined by the decision on their placement.

Other emissive securities may only be paid for in cash.

5.8. The Company shall have the right to acquire its outstanding shares upon a decision of its Board of Directors of the Company (in accordance with Article 72, Clause 2, of the Federal Law «On Joint Stock Companies»).

The Board of Directors may not decide on the acquisition of shares by the Company if the nominal value of the Company’s issued and outstanding shares comprises less than 90 percent of the Company’s charter capital.

Those shares acquired by the Company pursuant to the present clause shall not carry voting rights and shall not be taken into account during the counting of votes, and no dividends shall accrue on them. Subject to a decision of the Board of Directors, such shares shall be disposed of at their market value within one year of their acquisition date, or else the General Shareholders’ Meeting shall decide to decrease the Company charter capital through the cancellation of such shares.

Payment for those shares which are acquired pursuant to the present clause may upon decision of the Board of Directors be made in cash and/or other assets.

Article 6. Shareholder Rights

6.1. A shareholder of the Company is a person holding shares in the Company on grounds set out by legislation in effect in the Russian Federation and this Charter.

6.2. Each common share of the Company grants identical rights to its shareholder(s).

The shareholders of common registered shares in the Company shall have the following rights:

1) to attend the Company’s General Shareholders’ Meetings either in person or through their representatives, with the right to vote on all issues falling within the competence of the General Shareholders’ Meeting;

2) to make proposals for inclusion on the agenda of the General Shareholders’ Meeting pursuant to the procedure set out by legislation in effect in the Russian Federation and this Charter;

3) to have access to information on the Company’s business operations and the Company’s documents in accordance with Article 91 of the Federal Law «On Joint Stock Companies,» other regulatory legal acts and this Charter;

4) to receive dividends declared by the Company;

5) where Russian law so provides, to have the preemptive right to acquire additional shares and other emissive securities convertible into shares, which are placed by subion, in a quantity proportional to the quantity of common shares held by such shareholders;

6) to receive a portion of the Company’s assets in the event of its liquidation;

7) to exercise such other rights as may be stipulated by the applicable laws of the Russian Federation and this Charter.

Article 7. Dividends

7.1. The Company shall have the right, based on the results of the first quarter, half-year and nine months of its fiscal year and/or the results of the fiscal year as a whole to decide on (declare) dividends to be paid on outstanding shares. Decisions on the payment of dividends based on the results of the first quarter, half-year and nine months of its fiscal year may be taken within three months after the expiry of the corresponding period.

The Company shall be obliged to pay dividends declared for each class or category of shares.

7.2. Decisions on the declaration and payment of dividends, including decisions on the dividend size and the form of its payment for shares in each category and class, shall be taken by the General Shareholders’ Meeting of the Company.

The size of dividends may not be larger than that recommended by the Company’s Board of Directors.

The General Shareholders’ Meeting of the Company may decide not to pay dividends on common shares.

7.3. Where the laws of the Russian Federation so direct, the Company shall have no right to decide/declare to pay dividends on shares, nor may it pay any dividends on shares already declared.

7.4. Dividends shall be paid solely from the Company’s profits after taxes (net profits). The Company’s net profits shall be determined on the basis of it accounting books and records.

7.5. The General Shareholders’ Meeting of the Company shall decide when to pay dividends, provided that the deadline shall occur no later than sixty (60) days after the decision to pay such dividends.

Article 8. Company Funds

8.1. The Company shall establish a reserve fund equal to five percent (5%) of its charter capital.

The rate of annual deductions from the Company’s net profits contributed to the reserve fund shall be five percent (5%) of the Company’s net profits until such time as the full amount required under this Charter is fully accumulated.

8.2. The Company’s reserve fund is intended for covering its losses, as well as for redeeming the Company’s bonds and repurchasing its shares in the absence of other resources.

The reserve fund may not be used for other purposes.

8.3. The Company shall have the right to establish other funds pursuant to the requirements of applicable Russian law to back up its financial and economic operations of a business entity.

Article 9. Governance Structure and Governing

9.1. The following shall be the Company’s governing bodies:

General Shareholders’ Meeting;
Board of Directors;
Management Board; and
General Director.

9.2. The Audit Committee shall be a body overseeing the Company’s financial and business operations.

Article 10. General Shareholders’ Meeting

10.1. The General Shareholders’ Meeting shall be the supreme governing authority of the Company.

10.2. The General Shareholders’ Meeting shall be competent to decide on the following matters:

1) to make amendments and supplements to the Company charter or approve a restated version of the Company charter;

2)мto reorganize the Company, including through approval of merger (accession) agreements;

3) to liquidate the Company, appoint a liquidation commission, and approve the interim and final liquidation balance sheets;

4) to determine the number, nominal value, class (category) of authorized shares, and rights evidenced by such shares;

5) to increase the Company’s charter capital by raising the nominal value of its shares or by placing additional shares;

6) to decrease the Company charter capital by decreasing the nominal value of its shares, through the Company’s purchase of a portion of its shares in order to reduce their overall number, or by canceling those shares purchased or repurchased by the Company;

7) to split and consolidate shares of the Company;

8) to decide on the placement by the Company of bonds convertible into shares and other emissive securities convertible into shares;

9) to elect members of the Board of Directors and early terminate their authority;

10) to elect members of the Audit Committee and early terminate their authority;

11) to approve the Company’s External Auditor;

12) to decide to transfer the powers and authority of the single-member executive body of the Company to a management company (manager) and early terminate the powers and authority of such management company (manager);

13) to approve the Company’s annual reports and annual financial statements, including profit-and-loss statements or accounts, as well as profit distributions, including dividend declarations/payments but excluding those profits distributed as dividends based on the results of the first quarter, half-year and nine months of its fiscal year, and loss allocations upon the results of each fiscal year;

14) to declare/pay dividends based on the results of the first quarter, half-year and nine months of each fiscal year;

15) to decide on the procedure for the conducting of General Shareholders’ Meetings;

16) to approve transactions in cases stipulated by Article 83 of the Federal Law «On Joint Stock Companies»;

17) to approve major transactions in cases stipulated by Article 79 of the Federal Law «On Joint Stock Companies»;

18) to decide on the Company’s equity participation in financial and industrial groups, associations, and other unions of commercial organizations;

19) to approve those internal documents of the Company which regulate the activities of its governing bodies;

20) to decide to pay compensation and/or expense reimbursement due to members of the Audit Committee;

21) to decide to pay compensation and/or expense reimbursement due to members of the Company’s Board of Directors;

22) to decide such other issues as may have been stipulated by the Federal Law «On Joint Stock Companies.»

10.3. Those issues falling within the competence of the General Shareholders’ Meeting may not be delegated for decision-making to the Board of Directors, the Management Board or the General Director of the Company.

The General Shareholders’ Meeting shall not have the right to consider and take decisions on issues which are not expressly referred to its competence by the Federal Law «On Joint Stock Companies.»

10.4. The General Shareholders’ Meeting shall decide matters put to the vote by a majority vote of voting shareholders participating in such meeting, unless a different decision-making procedure is set out by the Federal Law «On Joint Stock Companies.»

10.5. The General Shareholders’ Meeting shall decide the following matters upon a vote of three-fourths of its voting shareholders taking part in the General Shareholders’ Meeting:

to amend this Charter or approve its restated version;
to reorganize the Company, including through approval of merger (accession) agreements;
to liquidate the Company, appoint a liquidation commission, and approve interim and final liquidation balance sheets;
to determine the number; nominal value, class (category) of authorized shares, and rights evidenced by such shares;
to place shares (the Company’s emissive securities convertible into shares) by closed subion upon a decision of the General Shareholders’ Meeting to increase the charter capital of the Company by placing additional shares (the Company’s emissive securities convertible into shares);
to place, by open subion, common shares representing more than twenty-five percent (25%) of the earlier placed common shares;
to place, by open subion, emissive securities convertible into common shares, which may be converted into common shares representing more than twenty-five percent (25%) of the earlier placed common shares;
to approve major transactions involving assets representing more than fifty percent (50%) of the Company’s book asset value;
to decrease the Company charter capital by decreasing the nominal value of its shares; and
to decide other matters in cases stipulated by the Federal Law «On Joint Stock Companies.»

A decision to approve a transaction in which there exists an interest in accordance with Article 81 the Federal Law «On Joint Stock Companies» shall be taken by the General Shareholders’ Meeting pursuant to Article 83 of the Federal Law «On Joint Stock Companies.»

10.6. Decisions on those issues listed in paragraphs 2, 5, 7, 8, 12-21, Clause 10.2, Article 10 hereof, shall be made by the General Shareholders’ Meeting at all times upon a proposal from the Board of Directors.

10.7. The General Shareholders’ Meeting may not take decisions on issues not included on its agenda, nor may it change the agenda.

10.8. Voting at a General Shareholders’ Meeting shall be carried out according to the principle «one voting share - one vote,» unless the meeting votes by cumulative voting to elect members of the Board of Directors.

In the case of cumulative voting, the number of votes held by each shareholder shall be multiplied by the number of persons to be elected to the Company’s Board of Directors, and the shareholder may give all of the resulting votes for one candidate or divide such votes between two or more candidates.

10.9. Candidates collecting the highest number of votes are deemed elected to the Board of Directors.

10.10. A General Shareholders’ Meeting of the Company may be held where the Company is located in the city of Moscow or in the town of Dzerzhinsk, Moscow Region.

10.11. The particular address for the General Shareholders’ Meeting to be convened at shall be defined by the Board of Directors when deciding matters associated with preparations for the convocation and conducting of the General Shareholders’ Meeting.

10.12. The Chairman of the Board of Directors shall preside at each General Shareholders’ Meeting.

10.13. Where the Chairman of the Board of Directors is absent, such General Shareholders’ Meeting shall be chaired by the Deputy Chairman of the Board of Directors.

10.14. Where both the Chairman of the Board of Directors and the Deputy Chairman are absent, such General Shareholders’ Meeting may be chaired by any member of the Board of Directors elected by those members of the Board of Directors in attendance at such General Shareholders’ Meeting.

Article 11. General Shareholders’ Meeting in the Form of the Joint Presence of Shareholders in Person

11.1. The Company shall hold an annual General Shareholders’ Meeting every year no sooner than two months and no later than six months after the end of each fiscal year.

An annual General Shareholders’ Meeting shall at all times decide on the issue relating to the elections of the Company’s Board of Directors and Audit Committee, approval of the Company’s External Auditor, as well as the approval of the Company’s annual report and annual financial statements presented by the Board of Directors, including profit-and-loss statements or accounts, as well as profit distributions, including dividend declarations/payments but excluding those profits distributed as dividends based on the results of the first quarter, half-year and nine months of its fiscal year, and loss allocations upon the results of each fiscal year.

The following parties shall have the right to attend a General Shareholders’ Meeting of the Company: the General Director, members of the Management Board, members of the Board of Directors, members of the Audit Committee, and the External Auditor of the Company.

11.2. A General Shareholders’ Meeting is convened in the form of the joint presence in person of shareholders (and/or their authorized representatives) in order to discuss issues on the agenda and decide those issues put to the vote.

A decision of a General Shareholders’ Meeting may be taken by means of mail-in ballot papers (by a polling arrangement) in accordance with Article 12 of the present Charter.

A General Shareholders’ Meeting whose agenda includes issues relating to the election of the Company’s Board of Directors and Audit Committee, the approval of the Company’s external auditor, or any of the issues specified by Article 10, Clause 10.2, Paragraph 13, of this Charter may not be held other than in the form of shareholders’ joint presence in person.

11.3. The functions of the Counting Commission at the General Shareholders’ Meeting shall be performed by a professional participant in the securities market, who is the holder of the Company’s shareholders’ register (the Company’s registrar).

11.4. A list of parties entitled to participate in a General Shareholders’ Meeting shall be recorded on the basis of data to be found in the Company’s shareholders’ register.

The date established for recording the list of parties entitled to participate in the General Shareholders’ Meeting may not be earlier than the date of the decision to call the General Shareholders’ Meeting or more than fifty (50) days prior to the date of the General Shareholders’ Meeting, except where otherwise provided for under Clause 14.9 below.

11.5. Notification of a General Shareholders’ Meeting shall be sent (or delivered by hand) to each party included on the list of parties eligible for participation in the General Shareholders’ Meeting and also shall be published by the Company in the newspaper Izvestia and placed the Company’s website in the Internet no later than thirty (30) days prior to the date of such meeting.

If a party on record in the shareholders’ register of the Company is a nominee holder, notice of a General Shareholders’ Meeting shall be sent to the address of such nominee shareholder unless the list of parties entitled to participate in the General Shareholders’ Meeting contains a different post address to which such notification must be given.

11.6. Ballot papers for voting on issues included on the agenda shall be sent by registered mail to each address included on the list of parties entitled to participate in the General Shareholders’ Meeting or delivered by hand against receipt to each party recorded on the list of parties eligible for participation in a General Shareholders’ Meeting at least twenty (20) days prior to the date of such meeting.

Each party recorded on the list of parties eligible for participation in the General Shareholders’ Meeting shall be provided with a single ballot paper for voting on all issues or a copy of each of two or more ballot papers for voting on different issues.

11.7. That information (material) which is relevant to the agenda of a General Shareholders’ Meeting shall be available to parties entitled to participate in such General Shareholders’ Meeting twenty (20) days or, in the event of a General Shareholders’ Meeting with an agenda including the Company’s reorganisation, thirty (30) days prior to the meeting for reviewing in the office of the Company’s executive body or at such other locations the addresses of which were indicated in the notice of such General Shareholders’ Meeting. Such information (material) also shall be placed the Company’s website in the Internet no later than ten (10) days prior to the date of such General Shareholders’ Meeting. Such information (material) shall be accessible during the General Shareholders’ Meeting to those parties taking part therein.

The procedure for accessing information or material relevant to the agenda of the General Shareholders’ Meeting by parties eligible for participating in the General Shareholders’ Meeting, as well as the list of such information (material), shall be determined by a decision of the Board of Directors.

11.8. The right to attend a General Shareholders’ Meeting shall be exercised by a shareholder in person or through a representative.

In the event that a share in the Company is co-owned by several persons, they shall be provided with a single ballot paper for voting on all issues or a copy of each of two or more ballot papers for voting on different issues and their right to vote at a General Shareholders’ Meeting shall be exercised at such persons’ discretion by one of the co-owners or by their common representative.

The authority of each of the aforementioned persons must be evidenced in the relevant documentary form.

11.9. Where a General Shareholders’ Meeting is convened in the form of the joint presence of shareholders, each party included on the list of parties eligible for participation in the General Shareholders’ Meeting or its authorized representative shall have the right to attend such meeting in person or send its completed ballot papers to the Company.

11.10. A General Shareholders’ Meeting shall be deemed validly convened (to have a quorum) if the shareholders participating therein hold, in aggregate, more than one-half of the Company’s outstanding voting shares.

Those shareholders who registered for participation in a General Shareholders’ Meeting and those shareholders’ whose ballot papers were received at least two days prior to the date of such meeting shall be deemed to have participated in the meeting.

Should the agenda of a General Shareholders’ Meeting include any issues to be voted on by different compositions of voters, the determination of whether a quorum is present for the purposes of decision-making on such issues shall be made separately.

The absence of a quorum for decision-making on issues to be voted by one composition of voters shall not prevent decision-making on those issues to be voted on by a different composition of voters, provided that a quorum in the latter case is present.

11.11. In the absence of a quorum for an annual General Shareholders’ Meeting, an adjourned General Shareholders’ Meeting with the same agenda shall be held. In the absence of a quorum for an extraordinary General Shareholders’ Meeting, an adjourned General Shareholders’ Meeting may be held with the same agenda.

A decision to convene an adjourned General Shareholders’ Meeting shall be taken by the Board of Directors.

An adjourned General Shareholders’ Meeting convened in lieu of the unsuccessful one shall be deemed validly convened if shareholders together holding at least 30 percent of the Company’s outstanding voting shares participate therein.

Should an adjourned General Shareholders’ Meeting be held less than forty (40) days after the unsuccessful General Shareholders’ Meeting, those parties entitled to participate in the adjourned meeting shall be determined in accordance with the list of parties who were entitled to participate in the unsuccessful meeting.

11.12. The minutes of a General Shareholders’ Meeting shall be drawn up in duplicate no later than fifteen (15) days after the close of such meeting. Both copies shall be signed by the Chairman of the General Shareholders’ Meeting and the Corporate Secretary of the General Shareholders’ Meeting.

11.13. Voting results and decisions made by a General Shareholders’ Meeting may be announced at the General Shareholders’ Meeting.

In the event that voting results and decisions made by the General Shareholders’ Meeting were not announced thereat, decisions made by the General Shareholders’ Meeting and voting results shall, within ten (10) days of execution of the minutes on the results of the voting, be published by the Company in the newspaper Izvestia in the form of a report on voting results.

Article 12. General Shareholders’ Meeting Held by Mail-in Ballots

12.1. A decision of a General Shareholders’ Meeting may be taken by means of mail-in ballot papers (by a polling arrangement) - without the meeting being actually convened (without the joint presence of shareholders’ in person so as to discuss issues on the agenda and decide those issues put on the vote).

Voting on issues included on the agenda of a General Shareholders’ Meeting held entirely by mail-in ballots may not be carried out other than by ballot papers.

12.2. The General Shareholders’ Meeting with an agenda including issues relating to the election of the Company’s Board of Directors and Audit Committee, the approval of the Company’s External Auditor, or any of the issues specified by Paragraph 13, Clause 10.2, Article 10, of this Charter may not be held by means of mail-in ballot papers.

No adjourned General Shareholders’ Meeting may be held entirely by mail-in ballots (by a polling arrangement) if it is held instead of an unsuccessful General Shareholders’ Meeting which should have been held in the form of the joint presence of shareholders in person.

12.3. A list of parties eligible for participation in the voting on issues included on the agenda of a General Shareholders’ Meeting, where such voting is by mail-in ballots, shall be compiled on the basis of data from the Company’s shareholders’ register.

The date established for recording the list of parties eligible for participation in the voting on issues included on the agenda of a General Shareholders’ Meeting, where such voting is by mail-in ballots, may not be earlier than the date of the decision to call the General Shareholders’ Meeting or more than fifty (50) days before the date of the General Shareholders’ Meeting.

12.4. Notification of a General Shareholders’ Meeting to be held entirely by mail-in ballots shall be sent (or delivered by hand) to each party included on the list of parties eligible for participation in the General Shareholders’ Meeting and shall also be published in the newspaper Izvestia and placed the Company’s website in the Internet at least thirty (30) days prior to the expiration date of the period during which the Company accepts completed ballot papers.

12.5. Ballot papers for voting on issues included on the agenda shall be sent by registered mail to each address included on the list of parties entitled to participate in the General Shareholders’ Meeting or delivered by hand against receipt to each party recorded on the list of parties eligible for participation in a General Shareholders’ Meeting at least twenty (20) days prior to the expiration date of the period during which the Company accepts completed ballot papers.

Each party recorded on the list of parties eligible for participation in a General Shareholders’ Meeting shall be provided with a single ballot paper for voting on all issues or a copy of each of two or more ballot papers for voting on different issues.

The procedure for accessing information (material) relevant to the agenda of the General Shareholders’ Meeting by parties eligible for participating in the General Shareholders’ Meeting, as well as the list of such information or material, shall be determined by a decision of the Board of Directors.

12.6. A General Shareholders’ Meeting held by mail-in ballots shall be deemed validly convened (to have a quorum) if the shareholders participating therein hold, in aggregate, more than one-half of the Company’s outstanding voting shares.

Those shareholders whose ballot papers were received before the expiration date of the period during which the Company accepts completed ballot papers shall be deemed to have participated in a General Shareholders’ Meeting held by means of mail-in ballot papers.

12.7. The minutes on the results of the voting shall be drawn up in duplicate and signed by the Company’s registrar no later than fifteen (15) days after the expiration date of the period during which the Company accepted completed ballot papers.

The minutes of the General Shareholders’ Meeting shall be drawn up in duplicate no later than fifteen (15) days after the expiration date of the period during which the Company accepted completed ballot papers. Both copies shall be signed by the Chairman of the General Shareholders’ Meeting and the Corporate Secretary of the Company.

12.8. Decisions made by the General Shareholders’ Meeting and voting results shall be published in the newspaper Izvestia in the form of a report on the results of the voting no later than ten (10) days after execution of the voting return.

Article 13. Proposals for Inclusion on Agenda of Annual General Shareholders’ Meeting

13.1. Shareholder(s) of the Company representing, in aggregate, at least two percent (2%) of the Company’s voting shares may propose issues for inclusion on the agenda of the annual General Shareholders’ Meeting and nominate candidates for the Company’s Board of Directors and Audit Committee, provided that the number of such nominees does not exceed the size of the corresponding body. Such proposals shall be delivered to the Company no later than sixty (60) days after expiration of the fiscal year.

13.2. Proposals for issues to be included on the agenda of the General Shareholders’ Meeting and proposals for nominations of candidates shall be made in writing and shall identify the submitting shareholder(s), indicate the number of shares/categories of shares held thereby, and shall be signed by such shareholder(s).

13.3. A proposal for inclusion on the agenda of the General Shareholders’ Meeting shall include the wording of each issue proposed and a proposal for nomination of candidates shall provide the following information: the name and identity card (passport) details of each of the candidates’ (including the serial number/number of the document, the place and date of issuance, the name of the issuing authority), and shall name the body for which the candidate is being nominated.

13.4. The Company’s Board of Directors shall consider the proposals received and decide to include or to refuse the inclusion of the corresponding issues on the agenda of the General Shareholders’ Meeting within five (5) days of the expiry of the period set forth in Clause 13.1 of the present Article.

13.5. The Board of Directors is entitled to refuse the inclusion of the issues proposed or candidates nominated by the shareholder(s) on the agenda or the list of candidates to be elected to the corresponding body on grounds set out by the Federal Law «On Joint Stock Companies» and other legal and regulatory acts of the Russian Federation.

13.6. A substantiated decision by the Board of Directors to refuse the inclusion of a proposed issue on the agenda of the General Shareholders’ Meeting or a nominated candidate on a list of candidates for elections to the Company’s corresponding body shall be sent to the shareholder(s) who submitted such proposal or nomination within three (3) days of the date of such decision.

13.7. The Board of Directors may not alter the wording of issues proposed for inclusion on the agenda of a General Shareholders’ Meeting or, where applicable, the wording of the draft resolutions proposed to be made on such issues.

In addition to those issues proposed for inclusion on the agenda of the General Shareholders’ Meeting, as well as in the event of absence of such proposals or nominations or the number of candidates nominated by shareholders for the corresponding body is insufficient, the Board of Directors may itself include issues on the General Shareholders’ Meeting’s agenda or candidates on the list of candidates at its own discretion.

Article 14. Calling Extraordinary General Shareholders’ Meeting of the Company

14.1. Any General Shareholders’ Meeting other than the annual General Shareholders’ Meeting shall be deemed extraordinary.

14.2. An extraordinary General Shareholders’ Meeting shall be held by a decision taken by the Company’s Board of Directors on its own initiative, or at the request of the Company’s Audit Committee, External Auditor, or a shareholder(s) representing, in aggregate, at least ten percent (10%) of the Company’s voting shares on the date of such request.

14.3. An extraordinary General Shareholders’ Meeting requested by the Company’s Audit Committee, External Auditor, or a shareholder(s) representing, in aggregate, at least ten percent (10%) of the Company’s voting shares shall be convened by its Board of Directors.

Such General Shareholders’ Meeting shall be held within forty (40) days of the submission of the request for such meeting, except where otherwise provided for by Clause 14.9 of this Article 14 of the present Charter.

14.4. A request for an extraordinary General Shareholders’ Meeting shall contain the wordings of those issues which are to be included on the meeting’s agenda.

The party/parties requesting an extraordinary General Shareholders’ Meeting shall have the right to propose draft resolutions to be adopted by such extraordinary General Shareholders’ Meeting or the form in which such extraordinary General Shareholders’ Meeting shall be conducted. If a request for an extraordinary General Shareholders’ Meeting also nominates candidates, such request shall be subject to those provisions set out in Article 13 of this Charter.

The Board of Directors of the Company may not alter the wordings of issues proposed for inclusion on the agenda, the wordings of draft resolutions proposed on such issues, or the form proposed for an extraordinary General Shareholders’ Meeting being convened at the request of the Company’s Audit Committee, External Auditor, or a shareholder(s) representing at least ten percent (10%) of the Company’s voting shares.

14.5. If a request for an extraordinary General Shareholders’ Meeting is made by a shareholder(s), such request shall identify the requesting shareholder(s) (family name, first name, patronymic or, where applicable, corporate name) and indicate the numbers and categories (class) of the Company’s shares in the latter’s ownership.

A request for an extraordinary General Shareholders’ Meeting shall be signed by the requesting party or parties.

14.6. Within five (5) days of the date of a request submitted by the Company’s Audit Committee, External Auditor, or a shareholder(s) representing at least ten percent (10%) of the Company’s voting shares for an extraordinary General Shareholders’ Meeting, the Board of Directors of the Company shall decide the convocation of or to refuse the convocation of such meeting.

14.7. A decision by the Board of Directors of the Company to convene an extraordinary General Shareholders’ Meeting or a substantiated decision to refuse the convocation of the same shall be sent to the parties requesting such meeting within three (3) days of the corresponding decision.

14.8. In the event that the Board of Directors of the Company failed to decide to convene an extraordinary General Shareholders’ Meeting within the period set out by Clause 14.6 of Article 14 hereof or decided to refuse the convocation of such meeting, an extraordinary General Shareholders’ Meeting may be convened by the authorities or parties requesting the same.

In any such case, those authorities or parties convening the extraordinary General Shareholders’ Meeting shall be vested with those powers stipulated by the Federal Law «On Joint Stock Companies» and this Charter which are required in order to convene and hold a General Shareholders’ Meeting.

14.9. If the proposed agenda of an extraordinary General Shareholders’ Meeting includes elections to the Company’s Board of Directors:

14.9.1. A shareholder(s) representing, in aggregate, at least two percent (2%) of the Company’s voting shares shall have the right to nominate candidates for the Company’s Board of Directors, provided that the number of such nominees does not exceed the size of the Company’s Board of Directors.

Such proposals shall reach the Company at least thirty (30) days prior to the proposed date of an extraordinary General Shareholders’ Meeting.

The Company’s Board of Directors shall be obliged to consider the proposals so received and decide to include or refuse the inclusion them on the agenda of the proposed extraordinary General Shareholders’ Meeting no later than five (5) days after the expiration of the deadline set forth in paragraph 2 of this Clause 14.9.

14.9.2. Notification of an extraordinary General Shareholders’ Meeting shall be given at least seventy (70) days prior to the date of such meeting.

Article 15. Board of Directors

15.1. The Board of Directors shall exercise overall management of the Company’s operations, with the exception of issues referred by the Federal Law «On Joint Stock Companies» to the competence of the General Shareholders’ Meeting.

The Board of Directors shall be competent to decide the following matters:

1) to set core business lines of the Company’s activity;

2) to call annual and extraordinary General Shareholders’ Meetings, with the exception of those instances stipulated by Clause 14.8, Article 14, of this Charter, and to announce the date of an adjourned General Shareholders’ Meeting to be held instead of an unsuccessful meeting that failed due to the lack of a quorum thereat;

3) to approve the agenda of a General Shareholders’ Meeting;

4) to elect and dismiss the Company’s Corporate Secretary and members of the Board of Directors Secretariat and approve the regulation and budget of the Board of Directors Secretariat necessary for financing the Board of Directors Secretariat’s activity and for paying compensations to its employees;

5) to set a record date for a list of parties entitled to participate in a General Shareholders’ Meeting to approve the budget for conduct of the General Shareholders’ Meeting and to decide on those other matters which are related to the preparation and conducting of the General Shareholders’ Meeting;

6) to submit those issues listed in paragraphs 2, 5, 7, 8, 12-21 of Clause 10.2, Article 10, of this Charter to the General Shareholders’ Meeting for decision-making, and to decrease the charter capital of the Company by decreasing the nominal value of its shares;

7) to decide on the Company’s placement of bonds and other emissive securities except for the cases where the Federal Law «On Joint Stock Companies» and this Charter otherwise provide;

8) to approve a decision to issue securities, the prospectus and the report on the results of the issue of securities, reports on the results of the acquisition of shares from Company shareholders, reports on the results of the redemption of shares, reports on the results of submitting demands on repurchase of shares by Company’s shareholders and reports on the results of repurchase of shares from Company’s shareholders, and to approve quarterly reports by the issuer of emissive securities;

9) to determine the price (monetary value) of assets or the placing or repurchase price of emissive securities in those instances where the Federal Law «On Joint Stock Companies» so provides and in deciding those issues which are stipulated by Paragraphs 10, 11, 28, 29, 37, and 38, Clause 15.1, Article 15, of this Charter;

10) to decide on the acquisition of Company’s outstanding shares, bonds and other securities in the instances where the Federal Law «On Joint Stock Companies» so provides;

11) to sell or otherwise transfer the Company’s shares, which are at the disposal of the Company as a result of acquisition or repurchase thereof from the Company’s shareholders, as well in other instances where the Federal Law «On Joint Stock Companies» so provides;

12) to elect the General Director and terminate the powers of the General Director before the expiration of his term of office and to define the terms and conditions of an employment agreement with the General Director and decide on early termination of such employment agreement with the General Director;

13) to determine the number of members to sit on the Company’s Management Board, elect members of the Management Board, early terminate their powers and authority, including by way of terminating their employment contracts;

14) to approve the terms and conditions of employment contracts with the General Director, members of the Management Board, the management company/manager (including those related to their respective term of office and the amount of compensation and expense reimbursement payable thereto) and to amend such employment contracts;

15) to recommend to the General Shareholders’ Meeting the amount of compensation and expense reimbursement payable to members of the Company’s Audit Committee and to determine the amount of payment due for the External Auditor’s services;

16) to recommend the amount of dividends payable on shares and to approve a regulation on the policy regarding dividend payments;

17) to approve the Company’s internal documents defining the procedure for making up and using Company’s funds;

18) to decide on how to use Company’s funds and to approve budget estimates for special purpose funds and to consider the performance results of budget estimates for special purpose funds;

19) to approve the Company’s internal documents other than the internal documents the approval of which is referred to the competence of the General Shareholders’ Meeting, as well as other internal documents the approval of which is referred to the competence of the Company’s executive authorities;

20) to spell out the Company’s purchasing policy, including the approval of the Regulation on the Procedure for the Conduct of Regulated Purchases of Goods, Work, and Services, and to approve the head and members of the Company’s Central Purchasing Authority and approve the Company’s annual purchasing program and adopt other decisions in accordance with the Company’s internal documents regulating its purchasing function and procurement activities;

21) to approve the Company’s Standards in the field of business planning;

22) to approve the Company’s business plan (adjusted business plan), including the technical modernization, reconstruction and development program, the investment program and the report on the results of implementation thereof, and to approve/amend the list and value of performance benchmarks for the Company’s cash flows, and to review adjustments of the Company’s cash flows as adopted by the Company’s Management Board;

23) to approve target values (adjusted target values) of key performance indicators (KPI) of the Company and reports on implementation thereof;

24) to review target values of the Company’s key performance indicators (KPI) adopted by the Company’s Management Board in relation to the Company’s subdivisions/officials and the General Director’s reports on implementation thereof;

25) to establish and liquidate the Company’s branches and representative offices and to amend the Company’s Charter in connection with the establishment and liquidation of branches and representative offices (including amendments relevant to the name and location of such branches and representative offices) and to approve regulations on the Company’s branches and representative offices;

26) to preliminary approve transactions (including a series of related transactions) involving property, work and/or services the value (monetary valuation) of which amounts to 2 percent or more of the Company’s book asset value, as determined on the basis of its financial statement as of the latest reporting date (unless the Board of Directors decides to establish a different percentage for or value of the transaction), with the exception of transactions executed in the ordinary course of business by the Company, transactions involving placing or disposal of the Company’s common shares by way of subion and transactions involving placing or disposal of the Company’s emissive securities convertible into the Company’s common shares, subject to Paragraphs 27-38 of Clause 15.1 hereof;

27) to preliminary approve transactions involving the Company’s real property, including land plots and unfinished construction projects, in such instances as may have been separately determined by the Company’s Board of Directors (for example, by determining the extent and/or list of such transactions) and any of the aforesaid transactions involving the Company’s real property, including land plots and unfinished construction projects, where no such instances (or such extent or list) have been determined;

28) to preliminary approve decisions on the Company’s execution of transactions (including several interrelated transactions) involving lease or transfer into lease of the property comprising fixed assets, intangible assets and construction in progress projects, which is used for the generation, transmission and/or distribution of electric and/or heat power and for the provisions of service of operational and technological management (dispatching) services in the electric power industry, including amendment and termination of such transactions, in such instances as may have been separately determined by the Company’s Board of Directors (for example, by determining the extent and/or list of such transactions), and to approve any of the aforesaid transactions where no such instances (or such extent or list) have been determined;

29) to preliminary approve decisions on the Company’s on execution of transactions (including several interrelated transactions) involving the Company’s property comprising fixed assets, intangible assets and construction in progress projects, which is used for the generation, transmission and/or distribution of electric and/or heat power and for operational and technological management (dispatching) services in the electric power industry, including amendment and termination of such transactions, in such instances as may have been separately determined by the Company’s Board of Directors (for example, by determining the extent and/or list of such transactions), and to approve any of the aforesaid transactions where no such instances (or such extent or list) have been determined;

30) to preliminary approve transactions under which the Company is to give subsidiary and dependent companies’ shares/participatory interests on trust, as well as transactions that may give rise to the Company’s rights and/or obligations under bonds or bills of exchange (including transactions involving the acquisition and sale of bonds or assignment of rights under bonds; transactions involving the acquisition, acceptance, including acceptance by way of mediation, endorsement, settlement of, and avalization of a bill of exchange), in such instances as may have been separately determined by the Company’s Board of Directors (for example, by determining the extent and/or list of such transactions), and any of the aforesaid transactions where no such instances (or such extent or list) have been determined (subject to the provisions of Paragraph 33, Clause 15.1, Article 15 of this Charter);

31) to preliminary approve transactions (including several interrelated transactions) involving repayment by installments or deferred payment under civil law obligations which are shared by the Company and which have been in arrears for more than three (3) months, or conclusion of an accord and satisfaction agreement or an agreement on novation of such obligations, or assignment of rights (claims) and transfer of debt under such obligations. Such transactions shall be approved to the extent that the (debt) obligation amounts to 2 percent or more of the Company’s book asset value, as determined on the basis of its financial statements as of the latest reporting date (unless the Board of Directors decides to establish a different percentage for or value of the transaction);

32) to preliminary approve transactions involving gratuitous transfer of the Company’s assets or proprietary rights (rights of claim against the Company or third parties), exempting the Company or third parties from proprietary commitments to the Company, and gratuitous provision of services/performance of work by the Company to/for third parties in the instances and to the extent separately determined by the Company’s Board of Directors, and to decide on the Company’s execution of such transactions where no such instances or such extent as aforesaid have been determined;

33) to determine the Company’s lending policy in relation to the provision of loans by the Company and the Company’s entering into facility agreements and loan agreements, issuing guarantees, assuming obligations under debt securities (issuing promissory notes and bills of exchange), pledging/mortgaging properties/real properties, and to decide whether the Company shall enter into any transactions like those referred to above if the procedure for decision-making in relation thereto has not been defined by the Company’s lending policy, and to decide, pursuant to the procedure set out by the Company’s lending policy, as to how to reconcile the Company’s debt position with those limits and restrictions established by the Company’s lending policy;

34) to preliminary approve transactions likely to give rise to obligations expressed in a foreign currency (or those obligations the value of which is in any way attached to a foreign currency) in the instances and to the extent separately determined by the Company’s Board of Directors, as well as where no such instances or such extent have been determined by the Board of Directors;

35) to approve major transactions in the instances set out by Chapter X of the Federal Law «On Joint Stock Companies»;

36) to approve those transactions which are set out by Chapter XI of the Federal Law «On Joint Stock Companies»;

37) to decide on the Company’s equity participation in other organizations (the Company’s accession to an existing organization or establishment of a new organization, including the approval of its foundation documents) and, subject to the provisions of Paragraph 38, Clause 15.1, Article 15, of this Charter, to decide on the acquisition, disposal and encumbrance of shares or participatory interests in the charter capital of organizations in which the Company has vested interests, and to alter the Company’s participatory interest in the corresponding organization or terminate the Company’s equity participation in other organizations;

38) to decide to enter into a transaction or several interrelated transactions under which the Company shall dispose of, pledge or otherwise encumber any shares or participatory interests in Subsidiary and Dependent Companies other than those engaged in the generation, transmission, dispatching, distribution and sales of electric and heat power, provided that the market value of such shares or participatory interests making the subject matter of the transaction, as determined on the basis of an opinion produced by an independent appraiser, is in excess of 30 million rubles, as well as in such other instances (and to such extent) as may be determined by separate decisions of the Company’s Board of Directors;

39) to adopt decisions on the Company’s nomination of candidates to be elected as a sole executive body, other governing bodies, supervision bodies and a candidate of the external auditor of organizations in which the Company participates;

40) to approve the Company’s registrar and the terms and conditions of a contract therewith and to terminate such contract;

41) to elect and dismiss the Chairman of the Company’s Board of Directors;

42) to elect and dismiss the Deputy Chairman of the Company’s Board of Directors;

43) to decide the suspend the powers and authority of the management company (manager);

44) to decide to appoint an acting General Director and to bring him to disciplinary liability;

45) to apply disciplinary penalties to or use incentives in respect of the General Director and members of the Management Board in accordance with the labor legislation of the Russian Federation;

46) to review the General Director’s reports regarding the Company’s activity (including the proper discharge by the General Director of his official duties and responsibilities) and on compliance with the decisions adopted by the General Shareholders’ Meeting and the Board of Directors of the Company;

47) to approve the procedure for the Company’s cooperation with those organizations in which the Company participates;

48) to work-out the position of the Company (or the Company’s representatives) in relation to those matters which are included on the agenda of the general shareholders’/participants’ meetings (except to the extent that the functions of the general shareholders’/participants’ meetings of the Company’s subsidiary and dependent companies (hereinafter, «SDC») are discharged by the Company’s Board of Directors) and meetings of SDCs’ boards of directors (with the exception of approval of the agenda of the SDCs’ general shareholders’ meetings where the functions of such SDCs’ general shareholders’ meetings are discharged by the Company’s Board of Directors), and including the Company’s position on whether to instruct them to participate in the voting on issues included on the agenda and vote for or against the proposed resolutions or abstain from voting on matters including the following:

(a) Spelling out of the agenda of the SDCs’ general shareholders’/participants’ meeting;

(b) SDC reorganization or liquidation;

(c) Determination of the number of directors, nomination and election of directors to serve on the SDCs’ boards of directors and early termination of their term of office;

(d) Determination of the quantity, nominal value and categories (classes) of SDCs’ authorized shares, and of the scope of rights provided by such shares;

(e) Decisions on whether to increase the SDCs’ charter capital by raising the nominal value of their shares or by placing additional shares;

(f) Decisions regarding place of securities convertible into common shares by SDCs;

(g) Decisions on whether to split or consolidate SDCs’ shares;

(h) Approval of major transactions to be entered into by SDCs;

(i) Decisions on SDCs’ participation in other organizations, whether by way of accession to an existing organization or incorporation of a new one, and on the acquisition, disposal or encumbrance of shares or participatory interests in the charter capital of those organizations in which such SDCs do participate, and on changing the share in the charter capital of the corresponding organization;

(j) Decisions on whether SDCs shall enter into a transaction (several interrelated transactions) in connection with disposal or possible disposal of property comprising fixed assets, intangible assets and construction in progress projects which is used to generate, transmit, dispatch and distribute electric and heat power in cases (and to the extent) determined pursuant to the procedure for the Company’s cooperation with organizations in which the Company participates, as approved by the Company’s Board of Directors;

(k) Decisions on whether to make amendments and supplements to the SDC foundation documents;

(l) Determination of the procedure for paying compensations to members of a SDCs’ Board of Directors and Audit Committee;

(m) Approval of target values of SDCs’ key performance indicators (adjusted target values of key performance indicators) and approval of the report on the achievement of the planned values of SDCs’ annual and quarterly key performance indicators;

(n) Approval of the SDCs’ business plan (adjusted business plan) and approval (review) of the report on the fulfillment of the SDCs’ business plan;

(o) Approval of SDCs’ profit and loss allocations depending on the results of the financial year;

(p) Recommendations regarding the size of dividends payable on SDCs’ shares and the procedure for payment thereof;

(q) Payment/declaration of dividends based on the results of the first quarter, six months, nine months of the SDCs’ financial year, as well as the results of the SDCs’ financial year as a whole;

(r) Approval (adjustment) of the SDCs’ investment program and approval (review) of the report on the fulfillment of the SDCs’ investment program;

(s) Approval of the Regulation on procurement of insurance coverage of SDC, approval of SDCs’ insurers (approval of the results of selecting SDCs’ insurers) and approval of the insurance broker selecting SDCs’ insurers;

(t) Approval of the SDCs’ Insurance coverage program and any amendments and supplements thereto;

(u) Review the report on procurement of SDCs’ insurance coverage prepared by the sole executive body;

49) to work-out the position of the Company (or the Company’s representatives) on the following matters which are included on the agenda of meetings of SDCs’ boards of directors (including the Company’s position on whether to instruct them to participate in the voting on issues included on the agenda and vote for or against the proposed resolutions or abstain from voting on matters including the following):

(a) Working out the position of SDCs’ representatives on the matters included on the agenda of general shareholders’/participants’ meetings and meetings of the boards of directors of SDCs in relation to the approval of or performance under transactions (including several interrelated transactions) involving the disposal or possible disposal of that property comprising fixed assets, intangible assets and construction in progress projects which is used for the generation, transmission, dispatching and distribution of electric and heat power in the instances (to the extent) determined by the procedure for the Company’s cooperation with organizations in which the Company participates, as approved by the Company’s Board of Directors;

(b) Working out the position of SDCs’ representatives on matters included on the agenda of general shareholders’/participants’ meetings and meetings of the boards of directors of companies which are subsidiaries and dependants in relation to SDCs and which are engaged in the generation, transmission, dispatching, distribution and sales of electric and heat power, and in reorganization or liquidation of such companies or in increasing the charter capital thereof by increasing the nominal value of their shares or by placing additional shares or securities convertible into common shares;

50) to approve candidates nominated for certain executive positions within the Company as determined by the Company’s Board of Directors;

51) to approve the general organizational structure of the Company’s administrative staff and amend such structure;

52) to determine main terms and guidelines for the Company’s insurance coverage, including approval of the Company’s insurers;

53) to establish Committees of the Board of Directors and appoint and dismiss members of Committees of the Board of Directors;

54) to approve the Regulations on Committees of the Board of Directors;

55) to determine procedures for election and approval of the candidate(s) nominated for the position of an independent appraiser(s) engaged in order to determine the value of shares, property and other assets of the Company in the instances set out by the Federal Law «On Joint Stock Companies,» this Charter and separate decisions of the Company’s Board of Directors;

56) to adopt decisions, in accordance with this Charter, on matters pertaining to the preparation for and conducting of General Shareholders’ Meetings of companies established as a result of the Company’s reorganization by split-up or spin-off;

57) to decide to recommend the General Director for conferral of state awards thereupon for an impeccable service record with the Company;

58) to preliminary approve the collective bargaining agreement and other agreements entered into by the Company as part of its drive to manage social and labor relationships;

59) to approve the candidate nominated for the position of the financial consultant engaged in accordance with the Federal Law «On the Securities Market,» as well as candidates to be appointed as securities underwriters and advisers on transactions directly related to the raising of funds in the form of public borrowing;

60) to approve the Company’s internal document defining the format, structure and content of the Company’s annual report;

61) to decide on recognition of lawsuits filed against the Company with courts and conclusion by the Company of a claim settlement agreement in respect of such lawsuits or waiver of claims by the plaintiff where such lawsuits and claims exceed 2 percent of the Company’s book asset value, as determined on the basis of its financial statement as of the latest reporting date (unless the Board of Directors decides to establish a different percentage for or value of the claim);

62) to elaborate recommendations on selection of the Company’s External Auditor to audit the Company’s financial operations in accordance with the International Financial Reporting Standards, approve the terms and conditions of a contract therewith and monitor the auditing of the Company’s financial statements prepared in accordance with the International Financial Reporting Standards;

63) to approve the document defining the rules and approaches to disclosure of information regarding the Company; the document on the use of information about the Company’s operations, securities and transactions therewith, which is not accessible to the general public and which, if disclosed, may bear a strong impact on the market value of the Company’s securities; and the document defining the procedures for internal control over the Company’s financial and business operations;

64) to preliminary approve decisions on the Company’s execution of transactions (including several interrelated transactions) involving the disposal or possible disposal of that property comprising fixed assets, intangible assets and construction in progress projects which is not used for the generation, transmission, dispatching and distribution of electric and heat power in the instances (and to the extent) separately determined by the Company’s Board of Directors by way of approving the register of such property; and

65) to proceed with other issues referred to the competence of the Board of Directors by the Federal Law «On Joint Stock Companies.»

15.2. Matters falling within the scope of authority of the Board of Directors may not be delegated for decision-making to the Company’s General Director or Management Board.

15.3. Members of the Company’s Board of Directors shall, in exercising their rights and performing their duties, act in the Company’s best interests and exercise their rights and perform their duties with respect to the Company in a conscientious and reasonable manner.

15.4. Members of the Company’s Board of Directors shall be liable to the Company for any losses incurred thereby as a result of their culpable actions or inaction unless the federal law provides for other grounds and amount of such liability.

At the same time, those members of the Company’s Board of Directors who voted against a decision which caused losses to the Company or who did not take part in such vote shall be exempted from any liability to the Company.

Article 16. Election of the Board of Directors

16.1. The number of directors to serve on the Company’s Board of Directors shall be thirteen (13).

16.2. Members of the Board of Directors shall be elected by the General Shareholders’ Meeting pursuant to the procedure set out by Clause 10.8, Article 10, of this Charter to serve until the next annual General Shareholders’ Meeting.

In the event that the Board of Directors is elected at an extraordinary General Shareholders’ Meeting, members of the Board of Directors shall be deemed elected for a term to last until the date of the next annual General Shareholders’ Meeting.

If the annual General Shareholders’ Meeting was not held at the time set out by Clause 11.1, Article 11, hereof, the powers of the Board of Directors shall be terminated, with the exception of those powers involved in preparing, convening, and holding an annual General Shareholders’ Meeting.

16.3. Only individual may be a member of the Board of Directors.

16.4. Those individuals elected to the Board of Directors may be reelected an unlimited number of times.

16.5. The General Shareholders’ Meeting may at any time decide on the early termination of authority of the Company’s Board of Directors.

Article 17. Chairman of the Board of Directors

17.1. The Chairman of the Company’s Board of Directors shall be elected by directors from among their own number by a majority vote.

The Board of Directors may at any time to re-elect its Chairman by a majority vote.

17.2. The Chairman of the Board of Directors shall organize its work, call and preside over Board of Directors meetings, arrange for processing of minutes at Board of Directors meetings, and preside at General Shareholders’ Meetings.

17.3. In the absence of the Chairman of the Board of Directors, the latter’s duties shall be performed by the Deputy Chairman of the Board of Directors elected by the members of the Board of Directors from among their own number by a majority of the total number of votes held thereby.

Article 18. Meetings of the Board of Directors

18.1. The procedure for the convocation and conducting of the Board of Directors’ meetings shall be defined by the relevant internal document approved by the General Shareholders’ Meeting of the Company.

18.2. The Board of Directors shall meet as often as necessary, but in any way no less than once every six weeks.

A meeting of the Company’s Board of Directors shall be called by the Chairman of the Board of Directors of the Company (or the Deputy Chairman of the Board of Directors where Clause 17.3, Article 17, of this Charter so provides) on his initiative or at the written request of a member of the Board of Directors, the Audit Committee, the General Director, a member of the Management Board, the External Auditor, or a shareholder(s) having, in aggregate, at least five percent (5%) of the Company’s voting shares.

18.3. The first meeting of a newly-elected Board of Directors shall at all times proceed with the issue pertaining to the election of the Chairman of the Board of Directors, the Deputy Chairman of the Board of Directors, and the Corporate Secretary of the Company.

The said meeting of the Board of Directors shall be called by any member of the Board of Directors pursuant to the internal document governing the procedure for convocation and conducting of the Company’s Board of Directors meetings.

18.4. A decision of the Board of Directors may be taken by mail-in ballot papers (by a polling arrangement). Where voting is held by a polling arrangement, each member of the Board of Directors shall be provided with material regarding matters included on the agenda of the meeting and a mail-in ballot paper for voting, with an indication of the deadline by which the completed mail-in ballot signed by the relevant member of the Board of Directors shall be presented to the Company’s Board of Directors.

18.5. A director who is not present in person at an actually convened meeting of the Board of Directors may produce their written opinion on matters included on the meeting’s agenda pursuant to the procedure set out by the internal document governing the procedure for convocation and conducting of Company’s Board of Directors meetings.

18.6. Transfer of votes by a member of the Board of Directors to any other party, including another member of the Board of Directors, shall be prohibited.

18.7. The Board of Directors shall take decisions at any of its meetings by a majority vote of those directors who are in attendance, except where otherwise provided by the laws of the Russian Federation and this Charter.

Where a transaction is to be approved on several grounds simultaneously (as established by this Charter and Chapter X or Chapter XI of the Federal Law «On Joint Stock Companies»), its approval shall be subject to the provisions of the Federal Law «On Joint Stock Companies.»

18.8. Decisions on matters pertaining to the approval of a major transaction shall require a unanimous vote of all members of the Board of Directors.

The Board’s of Directors decisions on the following matters shall require a three-fourths majority vote of all elected directors to be passed:

suspension of the powers and authority of the management company/manager and appointment of an Acting General Director of the Company;
calling an extraordinary General Shareholders’ Meeting of the Company in those cases where Clauses 21.8 and 21.9, Article 21, of this Charter so provide.

Where the Board of Directors decides on matters set forth in the present Clause, the votes held by former members of the Board of Directors shall not be taken into account.

Former members of the Board of Directors shall be understood to mean those members of the Board of Directors who are no longer serving thereon for reasons of their death or if they have been recognized by a court as being legally incapable or being declared as missing.

18.9. The Board of Directors’ decisions on the following matters shall require a three-fourths majority vote of those directors who are in attendance at the meeting:

to decide on the Company’s equity participation in other organizations (including the approval of their foundation documents), change of the share of such equity participation (the number of shares, the size of holdings or participatory interests), encumbrance of shares or participatory interests or termination of the Company’s equity participation in other organizations whose main line of business is to generate and/or transmit electric and heat power;
to establish Committees of the Board of Directors and elect and dismiss their members.

18.10. The Board of Directos’ decisions on matters set out by Paragraphs 28, 29, 33, 38, and 47-49 of Clause 15.1, Article 15 of this Charter shall require a two-thirds majority vote of those directors who are in attendance at the meeting.

18.11. A decision to approve an interested-party transaction shall be passed by the Company’s Board of Directors in accordance with Article 83 of the Federal Law «On Joint Stock Companies.»

18.12. When deciding issues at the Board of Directors meetings, each member of the Board of Directors shall have one vote. In the event of a tie, the Chairman of the Board of Directors shall have the casting vote.

18.13. A meeting of the Board of Directors shall be deemed to have a quorum if no less than one half of all of its elected members are in attendance thereat.

In the event that the number of directors becomes less than the minim number required for the presence of a quorum, the Board of Directors shall be obliged to decide to call an extraordinary General Shareholders’ Meeting in order to elect a new Board of Directors. Those directors still serving shall have no right to decide any issues other than the convocation of such extraordinary General Shareholders’ Meeting. In any such case, the quorum will be deemed present if the Board’s of Directors meeting is attended by at least one-half of those directors still elected.

18.14. Minutes of the meeting shall be kept at each meeting of the Board of Directors and such minutes shall be drafted and signed, no later than three (3) days after the close of the meeting, by the individual who presided at the meeting and the Corporate Secretary of the Company, of whom both shall be liable for the accuracy of the minutes. All materials that are relevant to the issues included on the agenda of the meeting, as well as documents approved by the Board of Directors, shall be attached to the minutes.

Whenever the Board of Directors decides on the issue by mail-in ballots, all ballot papers signed by members of the Board of Directors shall be attached to the minutes.

Article 19. Corporate Secretary

19.1. In order for the Company to be able to comply with the applicable procedure for convening and conducting the General Shareholders’ Meeting and for the Board of Directors to be able to proceed comfortably with its activity, the Board of Directors shall elect the Corporate Secretary of the Company.

In order for the Corporate Secretary to be able to operate in an efficient manner, the Company may, upon a decision of the Board of Directors, establish the Board of Directors’ Secretariat whose employees shall be full-time employees of the Company. The Corporate Secretary shall manage the work of the Secretariat of the Board of Directors.

19.2. The Chairman of the Board of Directors or a person authorized by the Board of Directors shall execute a contract with the Corporate Secretary on behalf of the Company.

19.3. The terms and conditions of the contract with the Corporate Secretary of the Company shall be determined by the Board of Directors or a person authorized thereby.

19.4. The Corporate Secretary of the Company shall participate in preparations for the convocation and conducting of the General Shareholders’ Meeting within the limits of his/her competence in accordance with the requirements of legislation, this Charter and other internal documents of the Company.

19.5. The Corporate Secretary of the Company shall participate in organizing proper notification of parties eligible for participation in the General Shareholders’ Meeting of the fact that such meeting is scheduled to be convened and shall participate in preparing and sending (delivering) ballot papers for voting to them.

19.6. The Corporate Secretary of the Company shall prepare and file material to be submitted to the General Shareholders’ Meeting and shall provide copies of documents to the extent requested by those parties that are eligible for participation in the General Shareholders’ Meeting.

19.7. The Corporate Secretary of the Company shall procure the collection of completed ballot papers for voting sent to the Company and their delivery to the registrar in a timely manner.

19.8. The Corporate Secretary of the Company shall procure compliance by participants in the General Shareholders’ Meeting with the applicable registration procedures and organize the keeping of minutes at each General Shareholders’ Meeting.

19.9. The Corporate Secretary of the Company shall answer questions asked by participants in the General Shareholders’ Meeting in connection with the procedure for preparations for the convocation and conducting of the General Shareholders’ Meeting.

19.10. The Corporate Secretary of the Company shall organize preparations for the convocation and conducting of meetings of the Board of Directors in accordance with the requirements of legislation of the Russian Federation, this Charter and internal documents of the Company.

19.11. The Corporate Secretary of the Company shall notify all members of the Company’s Board of Directors of the Board’s meetings, have, where necessary, ballot papers for voting sent (delivered) to them, collects completed ballot papers and written opinions of those members of the Board of Directors who were absent from the meeting and hands them over to the Chairman of the Board of Directors.

19.12. The Corporate Secretary of the Company shall keep minutes at each meeting of the Board of Directors.

19.13. The Corporate Secretary of the Company shall render assistance to members of the Board of Directors in obtaining such information as they may need for discharging their functions in a proper manner.

19.14. The Corporate Secretary of the Company shall provide explanations to members of the Board of Directors regarding the requirements of applicable legislation of the Russian Federation, this Charter and the internal documents of the Company relevant to procedural matters associated with preparations for the convocation and conducting of the General Shareholders’ Meeting and meetings of the Board of Directors, as well as disclosure (provision) of information about the Company.

19.15. The Corporate Secretary shall discharge other functions set out by applicable legislation of the Russian Federation, this Charter and the internal documents of the Company.

19.16. The Company’s governing bodies and officials shall assist the Corporate Secretary of the Company in discharging his/her functions.

19.17. As soon as practicable, the Corporate Secretary of the Company shall report to the Chairman of the Company’s Board of Directors about all facts preventing compliance with the procedures for which the Corporate Secretary is responsible (including acts or omissions by the Company’s governing bodies and officials, as well as the registrar, and other facts in breach of the procedure for preparations for the convocation and conducting of the General Shareholders’ Meeting and meetings of the Board of Directors, as well as disclosure (provision) of information about the Company).

Article 20. Committees of the Board of Directors

20.1. Committees of the Board of Directors shall be established each by a decision of the Board of Directors.

20.2. Committees of the Board of Directors shall be established in order to address thoroughly the issues referred to the competence of the Board of Directors or reviewed by the Board of Directors while overseeing the performance of the Company’s executive authorities and to draft recommendations thereon, which are to be given to the Company’s Board of Directors.

20.3. The Company’s Board of Directors shall have the following committees:

20.3.1. Audit Committee;

20.3.2. Strategy, Development, Investment and Reforming Committee;

20.3.3. Budget and Finance Committee;

20.3.4. Corporate Governance Committee; and

20.3.5. Human Resources and Awards Committee.

20.4. In addition to the aforesaid, the Company’s Board of Directors may decide to establish other Committees of the Board of Directors.

20.5. The Audit Committee shall prepare recommendations regarding the nomination of candidates for the position of the Company’s External Auditor, review the External Auditor’s opinions and the efficiency of the Company’s internal control procedures and shall prepare proposals on improvement thereof.

20.6. The Strategy, Development, Investment and Reforming Committee shall play a major role in defining the strategic objectives of the Company, developing guidelines for the Company’s business operations, reviewing the Company’s efficiency in a long-term perspective, and preparing recommendations for the Board of Directors regarding adjustments in the Company’s existing development strategy.

20.7. The Budget and Finance Committee shall prepare recommendations regarding the formation, implementation and adjustment of the Company’s financial and economic plan (business plan, budget), procures for control by the Board of Directors over the Company’s financial and economic operations, formation and implementation of the Company’s financial and economic plan, and the efficiency of the Company’s risk management system.

20.8. The Corporate Governance Committee shall prepare recommendations regarding organization of the corporate governance system, including the procedure for cooperation with SDC.

20.9. The Human Resources and Awards Committee shall foster the involvement of qualified staff in the management of the Company’s operations and offer incentives for their fruitful work.

20.10. The Committees of the Board of Directors shall each tentatively consider issues falling within their scope of competence, which have been included on the agenda of a meeting of the Board of Directors, and prepare recommendations regarding such issues. In deciding issues included on the agenda of its meeting, the Board of Directors shall take into account the relevant recommendations regarding such issues prepared by the Committees of the Board of Directors.

20.11. The Committees of the Board of Directors shall each have at least one (1) member representing shareholders holding, in aggregate, not less than twenty-five percent (25%) of the Company’s voting shares.

20.12. The rules and procedures, procedure for establishment, competence and term of powers of the Committees of the Board of Directors shall be in each case separately determined by the Board of Directors.

Article 21. The Company’s Executive Authorities

21.1. The Company’s day-to-day affairs shall be managed by its single-member executive authority, the General Director, and the collective executive authority, the Management Board.

21.2. The General Director and the Management Board shall be accountable to the General Shareholders’ Meeting and the Board of Directors.

21.3. By a decision of the General Shareholders’ Meeting, the powers of the Company’s single-member executive authority may be delegated under contract to a management company or manager.

The rights and obligations of a management company (manager) in running the Company’s day-to-day affairs shall be determined by the applicable laws of the Russian Federation and a contract concluded by such management company (manager) with the Company.

Such contract with such management company (manager) shall be executed on behalf of the Company by the Chairman of the Board of Directors or a person authorized thereby.

The terms and conditions of the contract with a management company (manager), particularly as to the term of its powers, shall be determined by the Board of Directors of the Company.

21.4. The establishment of the Company’s executive authorities and early termination of their powers and authority shall be upon a decision of the Company’s Board of Directors, unless otherwise provided by federal legislation and this Charter.

21.5. The rights and duties of the General Director and members of the Management Board relevant to running the Company’s day-to-day operations are defined by the laws of the Russian Federation, this Charter and the employment contract to be executed by and between each such individual and the Company.

The Chairman of the Board of Directors or a person authorized by the Board of Directors shall execute the employment contract on behalf of the Company.

The Company’s Board of Directors shall define the terms and conditions of the employment contract, including the term of office.

The rights and duties of the Company as the employer of the General Director and members of the Management Board shall be exercised/discharged on behalf of the Company by the Chairman of the Board of Directors or a person authorized by the Board of Directors.

21.6. Neither the General Director, nor any member of the Management Board may hold positions on the governing bodies of other organizations or hold other offices of profit with other organizations, unless the Board of Directors officially consents thereto.

21.7. The Board of Directors may at any time decide to terminate the powers of the General Director and members of the Management Board and establish new executive authorities.

Termination of powers of the General Director and members of the Management Board shall be on grounds set out by the laws of the Russian Federation and the employment contract concluded by and between each such individual and the Company.

21.8. The General Shareholders’ Meeting may at any time early terminate the powers of the management company (manager).

The Board of Directors may decide to suspend the powers of the Company’s management company or manager. Simultaneously with such suspension, the Board of Directors shall decide to appoint the Company’s acting General Director and to convene an extraordinary General Shareholders’ Meeting in order to early terminate the powers of the management company (manager) and, unless otherwise decided by the Board of Directors, to delegate the powers of its single-member executive authority to a different management company (manager).

21.9. Should the management company (manager) be unable to discharge its duties and responsibilities, the Board of Directors shall decide to appoint the Company’s acting General Director and to convene an extraordinary General Shareholders’ Meeting in order to early terminate the powers of the management company (manager) and, unless otherwise decided by the Board of Directors, to delegate the powers of its single-member executive authority to a different management company or manager.

21.10. The acting General Director shall run the day-to-day operations of the Company within the scope of the competence of the General Director, unless the Board of Directors decides otherwise.

21.11. The General Director, members of the Management Board, acting General Director, as well as the management company or manager, shall, in exercising their rights and discharging their duties, act in the Company’s best interests and exercise their rights and discharge their duties with respect to the Company in a conscientious and reasonable manner.

21.12. The General Director, members of the Management Board, acting General Director, as well as the management company or manager, shall be liable to the Company for any losses incurred thereby as a result of their culpable actions or inaction, unless other grounds for and extent of liability are established by the federal laws.

At the same time, those members of the Company’s Management Board who voted against a decision which caused losses to the Company or who did not take part in such vote shall be relieved of such liability to the Company.

Article 22. Management Board

22.1. The Company’s Management Board shall act on the basis of this Charter, as well as the Regulation on the Management Board to be approved by the General Shareholders’ Meeting, which shall define the timeframes and procedures for the convocation and holding of Management Board meetings, as well as the procedure for making decisions thereat.

22.2. The following matters shall be referred to the competence of the Company’s Management Board:

1) to draft long-term development plans aimed at realizing the Company’s core business lines of activity and present such plans to the Board of Directors for review;

2) to approve (adjust) target values of key performance indicators (KPI) for the Company’s subdivisions (officials);

3) to draft the Company’s business plan (adjusted business plan) and report on the implementation thereof and to approve/adjust the Company’s cash flow in accordance with the list and values of control indicators for the Company’s cash flow (to be subsequently forwarded at all times to the Company’s Board of Directors);

4) to prepare the investment program and the report on the results of implementation thereof to the Board of Directors;

5) to review particular investment projects of the Company with a value in excess of two million rubles (RUR 2,000,000) and approve implementation reports of Company officials and subdivisions;

6) to prepare the Company’s technical modernization, reconstruction and development program;

7) to approve the Company’s quarterly and monthly financial plans and reports on the implementation thereof;

8) to prepare the Company’s annual purchasing program, approve the Company’s quarterly purchasing programs within the framework of the annual purchasing program and prepare reports on fulfillment of the Company’s annual and quarterly purchasing programs;

9) to prepare a report on the Company’s financial and business operations and on compliance by the Management Board with the decisions of the General Shareholders’ Meeting and the Board of Directors of the Company;

10) to decide on whether the Company shall enter into transactions (including several interrelated transactions) involving property, work and/or services the value (monetary valuation) of which exceeds 1 percent of the book value of the Company’s assets as determined on the basis of its financial statement as of the latest reporting date (or, if the Board of Directors has established a different percentage for or value of the transaction in accordance with Paragraph 26, Clause 15.1, Article 15, of this Charter, – in excess of ½ of such newly-established percentage or value), with the exception of transactions the conclusion of which is referred by this Charter to the competence of the Company’s Board of Directors;

11) to decide on whether the Company shall enter into transactions (including several interrelated transactions) involving repayment by installments or payment deferral under civil law obligations which are shared by the Company and which have been in arrears for more than three (3) months, or conclusion of an accord and satisfaction agreement or an agreement on novation of such obligations, or assignment of rights (claims) or transfer of debt under such obligations. Such transactions shall be approved to the extent that the amount of (debt) obligation exceeds 1 percent of the Company’s book asset value, as determined on the basis of its financial statement as of the latest reporting date (or, if the Board of Directors has established a different percentage for or value of the transaction in accordance with Paragraph 31, Clause 15.1, Article 15, of this Charter, – in excess of ½ of such newly-established percentage or value);

12) to approve transactions involving real property if the value of such transaction, as determined on the basis of an opinion produced by an independent appraiser, is in excess of 30 million rubles and such transactions are out of the ordinary course of business of the Company, or to tentatively approve aforesaid transactions where the decision to enter into such transactions is referred to the competence of the General Shareholders’ Meeting or the Board of Directors of the Company;

13) to decide on recognition of lawsuits filed against the Company with courts or on rejection by the Company of demands of relief claimed by the plaintiff where such lawsuits and claims exceed 1 percent of the Company’s book asset value, as determined on the basis of its financial statement as of the latest reporting date (or, if the Board of Directors has established a different percentage for or value of the claim in accordance with Paragraph 61, Clause 15.1, Article 15, of this Charter, – in excess of ½ of such newly-established percentage or value);

14) to tentatively consider and provide appropriate recommendations to the Company’s Board of Directors on issues referred to the Board of Directors for review pursuant to the procedure set out by the internal document of the Company defining the rules and procedures of the Management Board of the Company;

15) to approve plans and events pertaining to the training and upgrading the skills of the Company’s employees;

16) to appoint the heads of the Company’s branches and/or representative offices;

17) to establish social benefits and guarantees for Company employees;

18) to adopt decisions on matters referred to the competence of the supreme governing authorities of companies which are wholly-owned by the Company (subject to the provisions of Paragraph 48, Clause 15.1, Article 15, of this Charter);

19) to review progress reports by the General Director’s deputies and the heads of the Company’s structural divisions pertaining to the implementation of the earlier approved plans, programs and directives, and to review reports, documents and other information pertaining to the operations of the Company and its subsidiary and dependent companies;

20) to decide other matters pertaining to the management of the Company’s day-to-day operations in accordance with the decisions of the Company’s General Shareholders’ Meeting and Board of Directors, as well as matters referred to the Management Board by the General Director of the Company.

22.3. Members of the Management Board shall be elected by the Company’s Board of Directors upon a motion from the General Director in such number as may be determined by the Board of Directors.

The Company’s Management Board shall consist of at least three individuals.

In the event that the Board of Directors rejects candidates nominated by the General Director for election to the Management Board of the Company, the Board of Directors may elect candidates nominated for election to the Management Board by one or more members of the Board of Directors of the Company.

22.4. A meeting of the Management Board shall be deemed validly convened (to have a quorum) if at least half of the incumbent members of the Management Board are in attendance thereat in person or have sent in their ballot papers in case voting is held by mail-in ballots on the basis of a polling arrangement.

The Management Board shall proceed with the issue by a simple majority vote of those Board members who are in attendance at the meeting (or take part in voting held by mail-in ballots on the basis of a polling arrangement).

Transfer of votes by a member of the Management Board to any other party, including another member of the Management Board, shall be prohibited.

Article 23. General Director

23.1. The General Director shall manage the Company’s day-to-day operations pursuant to the decisions of the Company’s General Shareholders’ Meeting, Board of Directors and Management Board passed within the scope of their competence.

23.2. The Company’s General Director shall be competent to decide any matters pertaining to the management of the Company’s day-to-day operations, except those matters which are referred to the competence of the General Shareholders’ Meeting, the Board of Directors or the Management Board of the Company.

23.3. The General Director shall act on behalf of the Company without a power of attorney and, subject to limitations set out by the applicable laws of the Russian Federation, this Charter and decisions of the Board of Directors, shall:

1) procure the implementation of the Company’s operational plans necessary for achieving its purposes and objectives;

2) elaborate and submit to the Management Board for approval target values of key performance indicators (KPI) for the Company’s subdivisions (officials) and be liable for implementation thereof;

3) provide to the Board of Directors information regarding target values of key performance indicators (KPI) for the Company’s subdivisions (officials) as approved by the Management Board, as well as reports on the results of the implementation thereof;

4) organize the maintenance of the Company’s books and records;

5) dispose of the Company’s property, enter into transactions on behalf of the Company, issue powers of attorney, and open current accounts and other accounts of the Company in banks and other lending institutions (and, when so directed by the laws of the Russian Federation, with those organizations having the status of professional participants in the securities market);

6) issue orders, approve/accept manuals, local regulatory acts and other internal documents of the Company falling within the scope of his authority, and issue orders and instructions binding on all Company employees;

7) approve the staffing structure and official salaries of Company employees in accordance with the organizational structure of the Company’s executive authorities;

8) exercise the rights and discharge the duties and responsibilities of an employer in respect of Company employees as set out by the applicable labor laws;

9) perform the functions of the Chairman of the Management Board;

10) allocate duties and responsibilities among the General Director’s deputies;

11) submit to the Board of Directors for the latter’s review reports on the financial and business operations of subsidiary and dependent companies whose shares or participatory interests are held by the Company, together with information on other organizations in which the Company has vested interests;

12) no later than forty-five (45) days prior to the date of each annual General Shareholders’ Meeting, submit the Company’s annual report, balance sheet, profit-and-loss statement, and the allocation of the Company’s profits and losses to the Board of Directors for review;

13) deal with any other matters pertaining to the Company’s day-to-day operations other than those matters which are referred to the competence of the General Shareholders’ Meeting, the Board of Directors or the Management Board of the Company.

23.4. The General Director shall be elected by the Board of Directors acting by a majority vote of those directors who are participate in the meeting.

The nomination of candidates for election by the Company’s Board of Directors to the office of the General Director of the Company shall be pursuant to the procedure determined by the internal document governing the procedure for calling and holding meetings of the Company’s Board of Directors.

Article 24. Audit Committee and External Auditor

24.1. Control over the Company’s financial and business activities shall be exercised by its Audit Committee elected by the General Shareholders’ Meeting for a period lasting until the next annual General Shareholders’ Meeting.

If elected at an extraordinary General Shareholders’ Meeting, members of the Audit Committee shall be deemed to be elected for a period until the next annual General Shareholders’ Meeting.

The Audit Committee shall consist of five (5) members.

24.2. By a decision of the General Shareholders’ Meeting, the powers and authority of any or all members of the Audit Committee may be early terminated.

24.3. The Audit Committee shall be competent to decide the following matters:

1) to verify the accuracy of data included in the Company’s annual report, balance sheet and profit and loss statement/account;

2) to review the Company’s financial standing, identify reserves for improving the Company’s financial situation and provide recommendations to the Company’s governing bodies;

3) to organize and carry out a review/audit of the Company’s financial and business activity, and in particular:

4) to review/audit the Company’s financial, accounting, payment and other documentation used for the conduct of the Company’s financial and business activity in order to check whether it complies with the requirements of applicable Russian laws, this Charter, internal and other documents of the Company;

5) to check whether the Company’s fixed assets are kept and used in a proper and efficient manner;

6) to check whether bad debts are written off as the Company’s losses pursuant to the established procedure;

7) to check whether the Company’s monetary funds are expended in accordance with the approved business plan and budget of the Company;

8) to check whether the reserve fund and other special funds of the Company are established and used in the manner as designated;

9) to check whether dividends on shares, interest on bonds and income on other securities are accrued and paid in a proper and timely manner;

10) to check whether the earlier given instructions to remedy breaches and shortcomings discovered during the previous reviews/audits have been duly complied with;

11) to take other actions/measures in connection with reviewing the finances and business of the Company.

24.4. Decisions on issues referred to the competence of the Audit Committee shall be taken by a simple majority vote of all of its members.

24.5. The Audit Committee may and, upon discovery of serious breaches of the Company’s finances and business operations, must require that an extraordinary General Shareholders’ Meeting be convened.

24.6. The rules and procedures of the Audit Committee shall be determined by the relevant internal document approved by the General Shareholders’ Meeting of the Company.

The Audit Committee shall have the right, in accordance with a decision to have a review/audit, to retain specialists in the corresponding areas of law, economics, finance, accounting, management, economic security, etc., including specialized organizations, in order to carry out such review/audit.

24.7. The Audit Committee may review (audit) the Company’s finances and business at any time on its own initiative, by a decision of the General Shareholders’ Meeting or the Board of Directors, or at the request of a shareholder(s) representing, in aggregate, at least ten percent (10%) of the Company’s voting shares.

24.8. In order to review and confirm the Company’s annual financial statements, the General Shareholders’ Meeting shall each year approve the Company’s External Auditor.

24.9. The amount of remuneration payable for the services of the External Auditor shall be determined by the Board of Directors.

24.10. The Company’s External Auditor shall audit the Company’s finances and business operations in accordance with the requirements of the applicable laws of the Russian Federation and on the basis of a contract concluded therewith.

24.11. Based upon the results of its audit of the Company’s finances and business operations, each of the Audit Committee and External Auditor shall produce an opinion reflecting the following:

The accuracy of data contained in the financial statements and other financial documents of the Company;
Information on breaches by the Company of the procedures established by the legal acts of the Russian Federation for maintaining accounting books and records and submitting financial statements, as well as breaches by the Company of the requirements of the legal acts of the Russian Federation in its pursuit of its economic and business activity.

The procedure and deadline for presenting an opinion based on the results of a review of the Company’s financial and business operations shall be determined by the applicable laws of the Russian Federation and the Company’s internal documents.

Article 25. Bookkeeping and Financial Reporting Procedures

25.1. The Company shall maintain its books and records and submit financial statements pursuant to the procedure established by the applicable laws of the Russian Federation and this Charter.

25.2. The Company’s General Director shall be responsible, in accordance with the applicable laws of the Russian Federation and this Charter, for the organization, maintenance, and accuracy of the Company’s books, and for the timely provision of the annual report and other financial statements to the appropriate governmental authorities, as well as of information on Company activities to shareholders, creditors, and the mass media.

25.3. The accuracy of data contained in the Company’s annual report and annual financial statements shall be verified by its Audit Committee and External Auditor.

25.4. The annual report, balance sheet, profit and loss statement or account, and the allocation of the Company’s profits and losses shall be tentatively approved by the Company’s Board of Directors at least thirty (30) days prior to the date of the annual General Shareholders’ Meeting.

Article 26. Keeping of Documents and Provision of Information by the Company

26.1. The Company shall be obliged to keep the following documents:

1) decision on the Company’s incorporation;

2) this Charter, along with all duly registered amendments and supplements thereto, and the Company’s certificate of registration with the appropriate governmental authorities;

3) documents confirming the Company’s rights to assets recorded on its balance sheet;

4) the Company’s internal documents approved by its governing bodies;

5) by-laws of the Company’s branches and representative offices;

6) annual financial statements;

7) issue prospectus, quarterly reports submitted by the Company as an issuer of securities, and such other documents as may contain information subject to publication or other disclosure pursuant to the applicable federal laws;

8) accounting records;

9) financial statements;

10) minutes of General Shareholders’ Meetings (duly recorded decisions by the sole shareholder of all voting shares in the Company) and minutes of meetings of the Board of Directors, Audit Committee and Management Board of the Company;

11) ballot papers and powers of attorney (or copies thereof) issued for the purposes of attending General Shareholders’ Meetings;

12) reports by independent appraisers;

13) lists of the Company’s affiliates;

14) lists of parties entitled to participate in General Shareholders’ Meetings, lists of parties entitled to receive dividends, and such other lists as are recorded by the Company for the purposes of its shareholders exercising their rights in accordance with the requirements of the Federal Law «On Joint Stock Companies»;

15) reports by the Company’s Audit Committee, External Auditor, and those by governmental and municipal agencies for financial oversight; and

16) such other documents as may be provided for by the applicable laws of the Russian Federation, this Charter, internal documents of the Company, and decisions of its governing bodies.

26.2. The Company shall keep those documents listed in Paragraph 26.1 above at the location of its executive authority pursuant to such procedure and during such times as may be required by the federal executive authority in charge of the securities market.

26.3. In the event of the Company’s reorganization, all of the aforesaid documents shall be handed over to a successor company pursuant to the applicable procedure.

26.4. In the event of the Company’s liquidation, the Company shall transfer all documents intended for permanent keeping which have scientific and historical value to the Russian Federal Archive Service for state storage and shall transfer all documents relating to personnel matters (including executive orders, personal files, registration cards, personal account details, etc.) to the corresponding archives of the constituent entity of the Russian Federation where the Company is located.

The Company shall sort out and transfer these documents in accordance with the requirements of the archive authorities.

Information on the Company shall be provided to the aforesaid authorities in accordance with the requirements of the applicable laws of the Russian Federation.

26.5. The Company shall ensure that its shareholders have access to the documents provided under Clause 26.1 above, subject to limitations imposed by the applicable laws of the Russian Federation.

The right of access to accounting records and minutes of meetings of the Management Board shall belong to a shareholder(s) representing, in aggregate, at least twenty-five percent (25%) of the Company’s voting shares.

The documents specified in Paragraphs 1, 2, 5-7, and 13, Clause 26.1, of this Article 26, as well as minutes of the Company’s General Shareholders’ Meetings and internal documents pertaining to the operations of the Company’s governing bodies, shall be placed on the Company’s website in the Internet no later than 15 days after adoption or amendment thereof, unless otherwise set out by applicable laws.

26.6. The documents specified in Clause 26.1 of this Article 26 shall be provided by the Company within seven (7) days after the submission day of the corresponding request for inspection in the premises of the Company’s executive body.

The Company shall be obliged at the request of the parties entitled to have access to such documents as are specified in 26.1 of this Article 26 to provide such parties with copies of such documents.

The fee collected by the Company for the provision of such copies shall be determined by the General Director of the Company but may not exceed their production costs.

The Company shall ensure that its shareholders and employees have access to information subject to compliance with the requirements of applicable Russian laws on nondisclosure of state secrets.

Article 27. Reorganization and Liquidation

27.1. The Company may be reorganized voluntarily by merger accession, split-up, spin-off, or transformation, as well as on such other grounds and pursuant to such procedures as may be provided for by the Civil Code of the Russian Federation and the federal laws.

27.2. The Company may be liquidated by a court decision or voluntarily pursuant to the procedure set out by the Civil Code of the Russian Federation, the Federal Law «On Joint Stock Companies,» and this Charter.

27.3. In the event that the Company is reorganized or liquidated or terminates work based on the use of information constituting state secrets, the Company shall be obliged to ensure the safekeeping of such information and relevant media by way of developing and enforcing a confidentiality regime, protecting information and taking security and fire-safety precautions.

27.3.1. The Company’s Board of Directors shall decide matters associated with preparations for the convocation and conducting of the general shareholders’ meetings of companies established as a result of the Company’s reorganization by spin-off or split-up (hereinafter referred to as the «newly-established companies»), including the following maters:

1) to determine the format, place, date, and time of the general shareholders’ meeting of a newly-established company and the post address to which completed ballot papers are to be sent;

2) to determine the agenda of the general shareholders’ meeting of a newly-established company;

3) to determine the date of recording the list of parties entitled to participate in the general shareholders’ meeting of a newly-established company;

4) to determine the procedure for notifying shareholders of the convocation and conducting of the general shareholders’ meeting of a newly-established company;

5) to determine the scope of information (material) to be provided to shareholders’ while preparing for the convocation and conducting of the general shareholders’ meeting of a newly-established company, as well as procedure for providing of such information;

6) to review proposals made by the shareholders’ of newly-established companies regarding inclusion of candidates nominated thereby on the list of parties eligible to vote while electing the governing bodies of each of the newly-established companies. The procedure for making such proposals and the procedure for review thereof by the Company’s Board of Directors shall be formulated in the resolution on the Company’s reorganization adopted by the General Shareholders’ Meeting of the Company;

7) to submit the draft charter of each of the newly-established companies to the general shareholders’ meeting of each of such companies for consideration and review;

8) to approve the format and text of the ballot paper for voting in the event that voting is by ballot papers;

9) to establish the working bodies of the general shareholders’ meeting of the newly-established company;

10) to determine the time of commencement of registration of parties attending the general shareholders’ meeting of the newly-established company held in the form the joint presence of shareholders;

27.3.2. In the absence of a quorum for a general shareholders’ meeting of the newly-established company, an adjourned general shareholders’ meeting of the newly-established company with the same agenda shall be held no later than 40 days after the unsuccessful general shareholders’ meeting of the newly-established company. An adjourned general shareholders’ meeting of any of the newly-established companies convened in lieu of the unsuccessful one shall be deemed validly convened (to have a quorum) if the newly-established company’s shareholders together holding at least 30 percent of the company’s outstanding voting shares participate therein.

27.3.3. Should an adjourned general shareholders’ meeting of the newly-established company be held after the unsuccessful general shareholders’ meeting of the newly-established company, the parties entitled to participate in the adjourned general shareholders’ meeting of the newly-established company shall be determined in accordance with the list of parties who were entitled to participate in the unsuccessful general shareholders’ meeting of the newly-established company.

27.3.4. Notifications of an adjourned general shareholders’ meeting of each newly-established company shall be made and ballot papers for voting shall be sent by registered mail to the shareholders of each newly-established company at least thirty (30) days prior to the date of such adjourned meeting. Such notifications shall also be published in the press organ designated by the Company’s Charter for the publication of notifications of the Company’s General Shareholders’ Meetings.

Should the general shareholders’ meeting of any newly-established company fail to take a decision on one or more issues included on its agenda, an adjourned general shareholders’ meeting of such newly-established company shall be held no later than 40 days after the general shareholders’ meeting of the newly-established company, which failed to take a decision on one or more issues included on its agenda. No issues other than those on which decisions were not taken at the original meeting may be included on the agenda of an adjourned general shareholders’ meeting of the newly-established company. When holding such adjourned general shareholders’ meeting of the newly-established company, the parties eligible for participation therein shall be determined on the basis of the list of parties eligible for participation in the original general shareholders’ meeting of the newly-established company, which failed to decide any matter included on its agenda.

27.3.5. Notification of an adjourned general shareholders’ meeting of each newly-established company shall be made and ballot papers for voting shall be sent by registered mail to the shareholders of each newly-established company at least thirty (30) days prior to the date of such adjourned meeting. Such notification shall also be published in the press organ designated by the Company’s Charter for the publication of notifications of the Company’s General Shareholders’ Meetings.

27.3.6. The duties and responsibilities associated with preparations for the convocation and conducting of adjourned general shareholders’ meetings of each newly-established company shall be discharged by the Company’s Board of Directors.

27.3.7. Other matters in connection with preparations for the convocation and conducting of general shareholders’ meetings of newly-established companies shall be decided by the General Shareholders’ Meeting of the Company when resolving to reorganize the Company by spin-off or split-up.

27.4. The procedure for preparations for the convocation and conducting of a general shareholders’ meeting to be held jointly with the Company by companies participating, together with the Company, in an accession, as well as the procedure for preparations for the convocation and conducting of a general shareholders’ meeting to be held jointly with the Company by companies participating, together with the Company, in a merger, as well as voting procedures at such jointly held general shareholders’ meetings shall be determined by the accession agreement or merger agreement, respectively.

The aforesaid agreements shall be subject to approval by the General Shareholders’ Meeting of the Company in accordance with applicable legislation.

Schedule № 1
to the Charter of
Open Joint Stock Company
of Energy and Electrification
«MOSENERGO»

BRANCHES AND REPRESENTATIVE OFFICES of OJSC «MOSENERGO»

№ п/п	Name	Location
1.	Enterprise for Production and Technologic Completing Units of Plant	8, Raushskaya embankment, Moscow 115035
2.	Hydroelectric Power Plant No. 1 named after P.G. Smidovich	11, Sadovnicheskaya str., Moscow 115035
3.	State District Power Plant No. 3 named after R.E. Klasson	State District Power Plant No. 3, Elektrogorsk, Moscow Region 142530
4.	Combined Heat and Power Plant No. 6	9, Moiseenko str., Orekhovo-Zuyevo, Moscow Region 142600
5.	Combined Heat and Power Plant No. 8	1, Ostapovsky passage, Moscow 109316
6.	Combined Heat and Power Plant No. 9	12, Building 1, Avtozavodkaya str., Moscow 115280
7.	Combined Heat and Power Plant No. 11 named after M.Ya. Ufayev	32, Entuziastov road, Moscow 111024
8.	Combined Heat and Power Plant No. 12	16, Berezhkovskaya embankment, Moscow 123995
9.	Combined Heat and Power Plant No. 16	14, Tretiya Khoroshevskaya str., Moscow 123298
10.	Combined Heat and Power Plant No. 17	19, Frunze str., Stupino, Moscow Region 142800
11.	Combined Heat and Power Plant No. 20	13, Vavilova str., Moscow 117312
12.	Combined Heat and Power Plant No. 21	9, Izhorskaya str., Moscow 125412
13.	Combined Heat and Power Plant No. 22	5, Energetikov str., Dzerzhinsky, Moscow Region 140091
14.	Combined Heat and Power Plant No. 23	1/4, Montazhnaya str., Moscow 107497
15.	Combined Heat and Power Plant No. 25	16, Generala Dorokhova str., Moscow 119530
16.	Combined Heat and Power Plant No. 26	Houseownership 10, Vostryakovsky passage, Moscow 117403
17.	Combined Heat and Power Plant No. 27	P/O Chelobitiyevo, Mytischi District, Moscow Region 141031
18.	Combined Heat and Power Plant No. 28	13, Izhorskaya str., Moscow 125412
19.	Energosvyaz	15/2, Sadovnicheskaya str., Moscow 115035
20.	Central Repair and Engineering Works	10, Ryazansky avenue, Moscow 109428
21.	Pilot Plant for the Manufacture of Automation Medium and Instruments	15, Bolotnaya embankment, Moscow 119072
22.	Special Design Technology Office for High-voltage and Cryogenic Engineering	29, Building 2, Vtoroy Kozhukhovsky passage, Moscow 115432
23.	Data-Processing Computer Centre	16, Berezhkovskaya embankment, Moscow 123995
24.	Mosenergonaladka	29, Building 2, Structure 16,Vtoroy Kozhukhovsky passage, Moscow 115432
25.	Mosenergospetsremont	5, Building 9, Goliyanovskaya str., Moscow 105094
26.	Moselektroremenergo	10, Ryazansky avenue, Moscow 109428
27.	Teplosbyt	14, Building 4, Aptekarsky side street, Moscow 105005
28.	Avtokhozyaystvo	18, Berezhkovskaya embankment, Moscow 121059
29.	Moscow Institute for Designing Power Generating Projects	13, Building 11, Sadovnicheskaya str., Moscow 115035
30.	Trading and Manufacturing Enterprise for Supplies to Workers (Energotorg)	29, Building 6, Vtoroy Kozhukhovsky passage, Moscow 115432
31.	Shatursky Agro-Industrial Company (AIC Shatursky)	2, Village Petrovskoye, Shatura District, Moscow Region 140700
32.	Heat Networks	8, Raushskaya embankment, Moscow 115035
33.	Medsanchast	11, Building 2, Sadovnicheskaya str., Moscow 115035