The risks of it being impossible to conclude an agreement under terms and conditions acceptable for
employees is assessed by the Issuer as insignificant in the medium term. The risk of it being impossible to select
qualified managerial personnel is minimized by the Issuer 's measures on creation of a candidate pool and training of
newcomers in specialized professions. In this respect a number of partner agreements with specialized universities
have been concluded.
5. Covenants in credit agreements.
In accordance with the terms and conditions of certain credit agreements, the Issuer is obliged to execute
imposed financial and other conditions limiting its ability, among other things, to pledge property or create other
encumbrance, acquire assets, or invest, sell, transfer, or otherwise dispose of its assets or accounts receivable, carry
out a merger or acquisition, or insert amendments to its business or dividend payment policy. The terms and
conditions of credit agreements require that the Issuer achieve certain financial ratios. The necessity to adhere to
financial ratios and other restrictions may prevent the Issuer from executing its business strategies. Moreover, any
restriction violation indicated in credit agreements by the Issuer may cause a default of such obligation and,
correspondingly, immediate debt repayment. The consequence thereof may be a significant adverse effect on
business, income, financial standing, performance of the Issuer and its ability to fulfil obligations, as well as pay
dividends.
The Issuer has formalized a control process concerning covenant observance (the relevant local normative act
is in force); when management decisions are made, these risks are assessed on a permanent basis., The Issuer
considers these risks to be insignificant.
6. Observance of terms and conditions of credit agreements with SC Vnesheconombank.
On their part RUSAL and PJSC RusHydro control observance of established projected timetables, they also
monitor observance of indicators stipulated by credit agreements.
7. Health and safety.
Powers, responsibilities, and accountability in the health, safety, and security management system at facilities
are distributed from the site manager to employees in accordance with administrative and functional subordination
under local administrative and regulatory documents of the facilities (orders, regulations, procedures).
At PJSC RusHydro strict observance of occupational safety standard are of all employees performing work at
the Issuer's facilities are carried out.
Monitoring of compliance with safety standards in PJSC RusHydro is entrusted to occupational safety and
health divisionand production supervision, monitoring of compliance with safety standards in the production of
specific activities is entrusted to the responsible supervisors.
Facilities have the full, necessary regulatory technical and legal base, and local normative documents
(occupational safety regulations) for all professions and types of work have been elaborated.
Blue-collar employees have monthly briefings on 3–4 health and safety matters as a whole and also on
profession and types of performed work in particular.
Blue-collar employees pass an annual test of their knowledge of health and safety standards.
Management of all levels involved in production is also briefed and their knowledge are tested.
Workplace employment conditions compliance certification is carried out at all facilities of the Issuer.
The special assessment of working conditions (certification of workplaces) involves independent specialized
organizations.
Specialized medical institutions are engaged for mandatory periodic medical professional examination.
Independent specialized organisations are engaged to assess safety of hydraulic structures and equipment.
PJSC RusHydro has an effective alert system which immediately inform about all undesirable events
(incidents).
Each and every incident is subject to investigation.
Hazardous production facilities of the Issuer are operated in accordance with the legislation pertaining to
production safety: a system is used for industrial control over compliance with the industrial safety requirements, the
necessary authorization documents are available on operation of hazardous production (hereinafter HPF) facilities,
risk of civil liability during operation of hazardous production facilities is insured, and the personnel of the Issuer
facilities is certified in the area of production safety.
Fire safety declarations have been drawn up Activities in the field of fire safety in the Issuer's production
facilities is carried out strictly in accordance with the requirements in the field of fire safety legislation.
In all of the Issuer's facilities are designed and maintained to date the declaration of safety of hydraulic
structures.
The Issuer's action plan for management of these risks:
- Tightening of control over activity of the Issuer's contractors and subcontractors at facilities;
- Insuring the power plant equipment against damage by third-party operations
- Granting work permits only to qualified personnel
- Claim administration works with contractors who have violated works performance timeframes as regards
payment of discharge for default under a contract
- Monitoring progress of works performance at the plants on a monthly basis
This section covers only risks which the Issuer deems to be insignificant. Other risks not covered by this
section are also possible. Any other risks unknown to or insignificant for the Issuer at the moment potentially may
also negatively affect the Issuer’s business activities and fulfilment of its obligations, as well as dividend payments.
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