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Due to the need for staffing provision for commissioning capacity of major new construction projects in
the framework of the investment program of the Issuer and the implementation of key objectives of the Issuer's
production plan, such as maintenance of reliable and uninterrupted operation of facilities and increase in
operating performance, mitigation of human factor risks by means of better professional training and staff
accountability at all levels, in September 2010, E. V. Dod, Chairman of the PJSC “RusHydro” Management
Board, approved the Human Resources Priority Development Concept within the campaign From New School to
Work Area and Program of its Implementation. The primary objective of the Program is to develop technical
education and increase the prestige of technical professions creating conditions to satisfy the needs of PJSC
“RusHydro” in professionals educated in a quality manner, who are expected to operate the Company’s
capacities, both current and planned for commissioning, and to maintain their reliable and uninterrupted
operation.
The risk 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 Company'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 restrictions limiting its ability, among other things, to pledge property or 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. Therefore,
the Issuer considers these risks to be insignificant.
6. Observance of terms and conditions of credit agreements with SC Vnesheconombank.
RUSAL and PJSC “RusHydro” control progress and 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 facility (orders, regulations,
procedures).
At PJSC “RusHydro” strict observance of occupational safety standard are of all employees performing
work at the Issuer's facilities.
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 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.