Appendix

Appendix № 6. Information on Compliance with the Corporate Code of Conduct

Provision of the Corporate Code of Conduct Compliance Status Notе
General Meeting of Shareholders
1. Shareholders are informed of the general shareholders meeting at least 30 days prior to its date regardless of matters on the agenda, unless the law requires a longer notice period Not applicable Peculiarities of the decision making process are due to the Company having a sole shareholder
2. Shareholders are given an opportunity to review the list of persons entitled to participate in the general shareholders meeting from the date of the notice of the general shareholders meeting and until closing of the general shareholders meeting „in praesentia”, or in the event of a general meeting in the form of ballot voting — until the last day of acceptance of the voting ballots Not applicable Peculiarities of the decision making process are due to the Company having a sole shareholder
3. Shareholders are given an opportunity to review the information (materials) to be disclosed in connection with the preparation to the general shareholders meeting, by electronic means, including through the Internet Complied with
4. Shareholders are given an opportunity to propose a matter to be included in the agenda of the general shareholders meeting or ask for the general shareholders meeting to be convened without having to submit a share register extract, if the rights of the shareholder are recorded in the share register, and if the shareholder’s rights are recorded on the custody account — a custody account statement will be sufficient to exercise such rights Complied with
5. The Charter or internal regulations of the Joint Stock Company contain a provision that requires the Director General, members of the executive board, members of the Board of Directors, members of the Audit comission and the auditor to attend the general shareholders meeting Not applicable Peculiarities of the decision making process are due to the Company having a sole shareholder
6. Nominees are required to be present at the general shareholders meeting when the shareholders consider election of the Board members, the Director General, members of the executive board, members of the Audit commission, and approval of the Company’s auditor Not applicable Peculiarities of the decision making process are due to the Company having a sole shareholder
7. The internal regulations of the Joint Stock Company contain procedures governing registration of the participants of the general shareholders meeting Not applicable Peculiarities of the decision making process are due to the Company having a sole shareholder
Board of Directors
8. The Charter of the Joint Stock Company authorised the Board of Directors to annually approve the financial and business plan of the Company Complied with Clause 13.2(23) of the Company’s Charter
9. The Company has a risk management procedure approved by the Board of Directors Not complied with The unified industry-wide risk management system is approved at the level of the State Atomic Energy Corporation ROSATOM and is implemented in the Company following the orders of the Director General
10. The Charter of the Joint Stock Company provides for the right of the Board of Directors to suspend the power of the Director General appointed by the general shareholders meeting Complied with Clause 13.2(20) of the Company’s Charter
11. The Charter of the Joint Stock Company provides for the right of the Board of Directors to establish requirements to qualification and remuneration of the Director General, executive board members, executives of the key business units of the Company Not complied with Not provided for by the Charter
12. The Charter of the Joint Stock Company provides for the right of the Board of Directors to approve the terms of agreements with the Director General and members of the executive board Not complied with Not provided for by the Charter
13. The Charter or internal regulations of the Joint Stock Company contain a provision pursuant to which the votes of the Board of Directors members (board members who serve as the Director General and executive board members) are not taken into account for the purposes of approval of the terms of the agreements with the Director General (management company, manager) Not complied with Not provided for by the Charter
14. The Board of Directors of the Joint Stock Company includes at least three independent directors who meet the requirements of the Corporate Code of Conduct Not complied with The composition of the Board of Directors is determined based on the Company’s sole shareholder decision
15. The Board of Directors of the Joint Stock Company does not include directors who were previously convicted of economic crimes or crimes against the state, the public service offenses or crimes against local government service or who were subject to administrative punishments for business-related offences or finance, fiscal or securities offences Complied with Observed in practice
16. The Board of Directors of the Joint Stock Company does not include any directors who are members, Directors general (managers), members of a management body or employees of a legal entity competing with the Joint Stock Company Complied with Observed in practice
17. The Charter of the Joint Stock Company requires that the Board of Directors be elected by cumulative voting Not applicable Due to the Company having sole shareholder
18. The internal regulations of the Joint Stock Company contain a provision which requires that the Board members abstain from any actions which will or may result in a conflict of interest between them and the Company, and in the event such conflict arises — to disclose such conflict to the Board of Directors Not complied with
19. The internal regulations of the Joint Stock Company contain a provision which requires that the Board members notify the Board of Directors in writing of their intention to make a transaction with the securities of the Company or its subsidiaries (affiliates) and to disclose information on their transactions with such securities Not applicable Members of the Board of Directors do not own the shares of the Company and its subsidiaries or affiliates
20. The internal regulations of the Joint Stock Company contain a provision which requires that the Board meetings be conducted at least once every six weeks Not complied with
21. The Board meetings of the Joint Stock Company during the year for which the Company prepares the annual report must be conducted at least once every six weeks Not complied with
22. The internal regulations of the Joint Stock Company contain procedures governing the meetings of the Board of Directors Complied with Section 7 of the Regulations on the Board of Directors
23. The internal regulations of the Joint Stock Company contain a provision requiring approval by the Board of Directors of the transactions of the Joint Stock Company the amount of which represents 10 or more percent of the Company’s asset value, except for the transactions made in the normal course of business Not complied with Not provided for by the Charter
24. The internal regulations of the Joint Stock Company contain a provision authorising the members of the Board of Directors to receive from the executive bodies and managers of the main business units of the Company of information necessary to enable them to fulfill their functions, and a provision which sets forth liability for failure to provide such information Complied with Clause 3.1.1. of the Regulations on the Board of Directors
25. The Board of Directors has a strategic planning committee or another committee (except for audit committee and nominations and remuneration committee) performs the relevant functions Not complied with No Board committees currently exist
26. The Board of Directors has a committee (audit committee) that recommends the auditor to the Board of Directors and interacts with the auditor and the Company’s Audit Commission Not complied with No Board committees currently exist
27. The audit committee includes only independent and non-executive directors Not applicable No audit committee currently exists
28. The audit committee is managed by an independent director Not applicable No audit committee currently exists
29. The internal regulations of the Joint Stock Company provides for the right of all members of the audit committee to have access to any documents and information of the Joint Stock Company subject to their confidentiality undertaking Not applicable No audit committee currently exists
30. Creation of a board committee (nominations and remuneration committee) whose function is to identify selection criteria for candidates to the Board of Directors and to develop the remuneration policy of the Joint Stock Company Not complied with No Board committees currently exist
31. The nominations and remuneration committee is managed by an independent director Not applicable No nominations and remuneration committee currently exists
32. The nominations and remuneration committee does not have any officers of the Company serving on it Not applicable No nominations and remuneration committee currently exists
33. The Board of Directors has a risk committee or another committee (audit committee or nominations and remuneration committee) that performs the relevant functions Not complied with No Board committees currently exist
34. The Board of Directors has a corporate conflict resolution committee or another committee (audit committee or nominations and remuneration committee) which performs the relevant functions Not complied with No Board committees currently exist
35. The corporate conflict resolution committee does not have any officers of the Company serving on it Not applicable No corporate conflict settlement committee currently exists
36. The corporate conflict resolution committee is managed by an independent director Not applicable No corporate conflict settlement committee currently exists
37. The Company has internal regulations approved by the Board of Directors which govern the procedure of formation and operation of the board committee Not complied with No Board committees currently exist
38. The Charter of the Joint Stock Company sets forth the procedure to determine the quorum of the Board of Directors which allows to ensure mandatory participation of independent directors in the Board meetings Not complied with No independent directors serve on the Board
Executive Bodies
39 The Joint Stock Company has a collective executive body (executive board) Not complied with Clause 11.1 of the Company’s Charter provides for only the sole executive body — Director General
40. The Charter or internal regulations of the Joint Stock Company contain a provision requiring approval by the executive board of the real estate transactions, of obtaining loans by the Company, unless such transactions qualify as major transactions and unless they are made in the normal course of business Not applicable Clause 11.1 of the Company’s Charter provides for only the sole executive body — Director General
41. The internal regulations of the Joint Stock Company set forth the procedure of approval of operations which fall beyond the financial and business plan of the Joint Stock Company Not complied with
42. The executive bodies of the Joint Stock Company does not include any members that are members, directors general (managers), members of a management body or employees of a legal entity competing with the Joint Stock Company Complied with Observed in practice
43. The executive bodies of the Joint Stock Company do not have members who were earlier convicted of economic crimes or crimes against the state, the public service offenses or crimes against local government service or who were subject to administrative punishments for business related offences or finance, fiscal or securities offences . If the functions of the sole executive body are performed by a management company or a manager, the Director General and the executive board members of the management company or the manager must meet the requirements established for the Director General and the executive board members of the Joint Stock Company Complied with Observed in practice
44. The Charter or internal documents of the Joint Stock Company contain a provision that prohibits the management company (manager) to perform similar functions in a competing company, or to have any other interests in the Joint Stock Company other than in the capacity of a management company (manager) Not complied with
45. The internal regulations of the Joint Stock Company contain a provision which requires that the executive board members abstain from any actions which will or may result in a conflict of interest between them and the Company, and in the event such conflict arises — to disclose such conflict to the Board of Directors Not complied with
46. The Charter or internal regulations of the Joint Stock Company establishes the selection criteria of the management company (manager) Not complied with
47. Executive bodies of the Joint Stock Company submit monthly reports to the Board of Directors Not complied with
48. The agreements between the Joint Stock Company and the Director General (management company, manager) or the executive board members provide for liability for breach of confidentiality obligations or insider information rules Complied with
Corporate Secretary
49. The Joint Stock Company has a separate officer (corporate secretary) responsible for ensuring compliance by the bodies and officers of the Company with the procedural requirements which guarantee protection of rights and lawful interests of the Company’s shareholders Complied with There is a secretary of the Board of Directors in the Company
50. The Charter or internal regulations of the Joint Stock Company set forth the procedure of appointment (election) of the corporate secretary and the duties of the corporate secretary Complied with Clauses 13.2(27) of the Company’s Charter and clauses 4.1 and 4.2 of the Decree on the Board of Directors
51. The Charter of the Joint Stock Company contains requirements that a proposed corporate secretary must meet Not complied with Not provided for by the Charter
Material Corporate Actions
52. The Charter or internal regulations of the Joint Stock Company contains a provision which requires a prior approval of a major transaction Not complied with Not provided for by the Charter
53. Mandatory engagement of an independent appraiser to perform valuation of the property subject to a major transaction Not complied with Appraisal if performed pursuant to Articles 77-78 of the Federal Law „On Joint Stock Companies”
54. The Charter of the Joint Stock Company prohibits that any actions are taken in connection with acquisition of major equity stakes in the Joint Stock Company (takeover) aimed at protection of interests of the executive bodies (members of such bodies) and members of the Board of Directors of the Joint Stock Company or actions which negatively affect the position of the shareholders as compared to their existing position (in particular, the Board of Directors may not pass any resolutions before the end of the proposed period of acquisition on issuance of additional shares, on issuance of securities convertible into shares, or securities evidencing the right to purchase the Company’s shares, even if the Board has the relevant powers under the Charter) Not applicable The Company has a sole shareholder
55. The Charter of the Joint Stock Company contains a provision that requires engagement of an independent appraiser to perform a valuation of the fair market value of the shares and potential change of their fair market value as a result of takeover Not complied with
56. The Charter of the Joint Stock Company does not contain a provision which releases an acquirer from the duty to offer the shareholders to sell their common shares of the Company (securities convertible into common shares) in the event of a takeover Not complied with The Company has a sole shareholder
57. The Charter or internal regulations of the Joint Stock Company contain provisions require engagement of an independent appraiser to determine the share conversion ratio in the event of a reorganisation Not complied with
Information Disclosure
58. The Company has an internal regulation approved by the Board of Directors which sets forth the Company’s disclosure rules and guidelines (Disclosure Policy Regulation) Complied with Regulation on Mandatory Disclosure of JSC „TECHSNABEXPORT” (approved by the Board of Directors on 22 December 2009)
59. The internal regulations of the Joint Stock Company contain a provision which requires disclosure of information about the purposes of the proposed share placements, persons which are going to acquire the shares to be issued, including major stakes, and whether the senior executives of the Joint Stock Company are going to acquire the shares Not complied with Not provided for by the Charter and the Regulation on Mandatory Disclosure
60. The internal regulations of the Joint Stock Company contain a list of information, documents and materials to be provided to the shareholders for the purposes of passing resolutions on matters put for consideration at the general shareholders meeting Not complied with The Company has a sole shareholder
61. The Joint Stock Company has a web-site where the Company regularly discloses information Complied with www.tenex.ru
62. The internal regulations of the Joint Stock Company contain a provision which requires a disclosure by the Company of its transactions with the persons who are pursuant to the Charter its senior officers and of the transactions with entities in which the Company’s senior officers directly or indirectly own 20 or more percent of the Charter capital or which such officers may otherwise substantially influence Not complied with Not provided for by the Charter and the Regulation on Mandatory Disclosure
63. The internal regulations of the Joint Stock Company contain a provision which requires that the Company disclose all price-sensitive information (i.e. information about the transactions that may influence the market price of the Company’s shares) Not complied with Not provided for by the Company’s Charter and the Regulation on Mandatory Disclosure
64. The Company has an internal regulation approved by the Board of Directors governing the use of material information about the Company’s business, shares and other securities of the Company and transactions therewith, which is not public and which if disclosed may substantially affect the market price of the shares and other securities of the Joint Stock Company Not complied with
Control Over Financial and Business Activities
65. The Company has internal control procedures over its financial and business activities approved by the Board of Directors Not complied with
66. The Company has a special unit responsible for ensuring compliance with the internal control procedures (an internal control and audit service) Complied with The Company has a special unit — Internal control and audit department
67. The Company has internal regulations which contain a provision requiring the Board of Directors to determine the structure and composition of the internal control and audit service Not complied with
68. The internal control and audit service does not have members who were earlier convicted of economic crimes or crimes against the state, the public service or local government service, or who were subject to administrative punishments for business related offences or finance, fiscal or securities offences Complied with Observed in practice
69. The internal control and audit service does not include any members being members of the executive bodies of the Company or persons being members, directors general (managers), members of a management body or employees of a legal entity competing with the Joint Stock Company Complied with Observed in practice
70. The internal regulations of the Joint Stock Company provide for the timeline of submission to the internal control and audit service of documents and materials required to assess a financial or a business transaction and for liability of officers and employees of the Company for failure to submit the same within the established period Not complied with All documents are provided within a reasonable period of time or the period established by the Control and Audit Service
71. The internal regulations of the Joint Stock Company provide for the duty of the internal control and audit service to inform the audit committee of the violations identified and if there is not audit committee — the Board of Directors of the Joint Stock Company Not complied with
72. The Charter of the Joint Stock Company contains a provision which requires that the internal control and audit service assess whether operations which are not provided for under the financial and business plan of the Company (non-conventional operations) are appropriate Not complied with Not provided for by the Charter
73. The internal regulations of the Joint Stock Company set forth the procedure of approval of a non-conventional operation by the Board of Directors Not complied with
74. The Company has an internal regulation approved by the Board of Directors which sets forth the procedure of audits of the financial and business activities by the Company’s audit commission Not complied with The procedure of audits of financial and business activities of the Company by the Audit Commission is determined by the Regulation on the Audit Commission (approved by the sole shareholder resolution dated 22 December 2009)
75. The audit committee reviews the Auditor’s Report before the same is presented to the shareholders at the general shareholders meeting Not applicable The Company does not have Board committees
Dividends
76. The Company has an internal regulation approved by the Board of Directors which the Board members comply with for the purposes of making recommendation on the size of dividends (Dividend Policy Regulation) Not complied with
77. The Dividend Policy Regulation provides for the procedure of determination of the minimum percentage of the net profit of the Joint Stock Company to be paid as dividends and conditions which if met allow the Company not to pay or to pay the dividends on its preferred stock in the amount which is less than the one established in the Charter of the Joint Stock Company Not applicable The Company does not have an approved dividend policy
78. The Company publishes information on its dividend policy and amendment thereof in a periodical publication specified in the Company’s Charter as the publication in which the Company publishes announcements of its general shareholders meetings, and posts such information on its web-site Not applicable The Company does not have an approved dividend policy