Information for the company’s insiders
Ladies and Gentlemen:
As a publicly traded company whose securities are listed on Russian and international stock exchanges, Public Joint Stock Company ROSSETI (“Company”) gives special attention to handling any insider information that can have a material effect on the value of its financial instruments (“insider information”). The Company uses the world’s best practices in this area to provide all stock market participants with equal conditions, working to combat insider information misuse.
In order to ensure compliance with Federal Law No. 224-FZ of July 27, 2010, “On Combating Insider Information Misuse and Market Manipulation” (“Federal Law No. 224”), the Board of Directors of the Company approved the Regulations for Insider Information of ROSSETI (Minutes of the Meeting No. 162 of August 25, 2014). The regulations unambiguously define the terms “insider” and “insider information,” specify the procedure for providing access to insider information, and lay down the rules for keeping it confidential and checking whether the requirements set forth in Federal Law No. 224 and the legal regulations adopted thereunder are fulfilled.
The Company maintains and updates the insider list applying to the persons subject to the special procedure for transactions involving the Company’s financial instruments, along with the list of insider information. Please note that the Company’s insider information includes other undisclosed information concerning the Company and its subsidiaries and dependent companies (“SDCs”) that, if improperly disclosed, will affect the value of the Company’s and SDCs’ securities.
If any person is included on the Company’s insider list, he or sheis notified thereof and is subject to the restrictions and requirements set forth in Article 6 of Federal Law No. 224 and Annexes 4 and 5.
To comply with the requirements specified above:
- the Company’s employees on the Company’s insider list should sign addenda to employment contracts in relation to insider information confidentiality;
- the Company’s counterparties on the Company’s insider list should sign addenda to civil law contracts in relation to insider information confidentiality;
- any persons on the Company’s insider list other than the Company’s employees or counterparties should sign insider information confidentiality agreements with the Company.
Any persons on the Company’s insider list are prohibited from:
- Using1 the Company’s and SDCs’ insider information to conduct transactions involving the Company’s and SDCs’ financial instruments for their own account or for the account of any third party if such information affects the value of such financial instruments.
- Making insider information available to any other person.2
- Recommending, obliging, or otherwise inducing any third parties to buy or sell the Company’s and SDCs’ financial instruments.
- Doing any acts that qualify as market manipulation under Article 5 of Federal Law No. 224.
In their transactions involving securities, insiders should comply with:
1. Federal Law No. 224 and the legal regulations adopted thereunder.
2. The rules for insider trading in the Company’s and SDCs’ securities
contained in the Regulations for Insider Information, including the following requirements:
- The Company’s insiders shall refrain from any transactions related to insider trading in financial instruments of the Company during close periods:
- in the case of announced annual financial results, from the last date of the financial year to the announcement of annual financial results;
- in the case of announced financial results for the six months of the year, from the last date of the financial period to the announcement of results for the six months of the year;
- in the case of announced quarterly financial results, within 30 days after the announcement of results for the previous quarter.
- During close periods, the following restrictions shall also apply to transactions of the Company’s insiders in relation to the Company’s financial instruments subject to insider trading:
- the Company’s insiders are prohibited from repo transactions and from purchasing or selling on credit the Company’s financial instruments subject to insider trading;
- it is recommended that the Company’s insiders refrain from option transactions and derivatives in relation to financial instruments subject to insider trading.
- If the Company receives any insider information of SDCs (e.g. in the form of draft resolutions of the general meetings of shareholders of SDCs), regardless of whether such information is deemed to be insider information of the Company, then any person provided with access to insider information of SDCs on behalf of the Company shall take all necessary measures to prevent the Company from conducting any transactions involving financial instruments of SDCs during the close period prescribed by such SDCs’ internal documents that govern the procedure for the handling of such insider information in SDCs.
For this purpose, any person provided with access to insider information of SDCs on behalf of the Company shall notify the relevant division responsible for holding and trading in financial instruments of SDCs accordingly.
- The Company’s financial instruments subject to insider trading may be purchased only for the purposes of long-term investment and shall not be purchased for any other purposes, such as short-term deals. This means that the Company’s employees that are insiders shall hold (directly or through other persons acting on their instructions) any financial instruments of the Company for a period of at least six (6) months before their sale.
- If insider trading in financial instruments of the Company is conducted by any third party for the benefit of an insider, then the insider shall ensure compliance with the restrictions and/or prohibitions contained in the regulations in trading in such instruments unless, under the contract with the third party for trading in financial instruments, the insider is not able to influence the third party’s trading decisions.
- The Company’s insiders shall notify3 the Company in accordance with the prescribed form of their trading in financial instruments of the Company and SDCs within ten (10) business days after the transaction date.
- The Company’s insiders shall, within 30 calendar days after the end of the reporting quarter, provide3 the Company in accordance with the prescribed form with the confirmation of the quantity of insider-owned securities of the Company and SDCs as of the last date of the reporting quarter and insiders’ transactions completed in the reporting quarter.
Notices may be sent by mail, by hand delivery, or by electronic mail transmission or delivered in person to the Company’s officer responsible for the ROSSETI insider list: Alexander Batalov, telephone:+7 (495) 995-53-33 ext. 54-44, Batalov-AG@rosseti.ru. Notices of completed transactions should also be sent to the Bank of Russia Financial Markets Service within ten (10) business days after the transaction date at: Russia, 119991, GSP-1, Moscow, Leninsky prospekt, 9
Please note that failure to comply with the laws oncombating insider information misuse will result in civil,administrative, and criminal liability under Article 15.21 of the Code of Administrative Offences of the Russian Federationand under Articles 185.3 and 185.6 of the Criminal Code of the Russian Federation.
Very truly yours,
Address for correspondence: Russia, 121353, Moscow, ul. Belovezhskaya, 4
Telephone: +7 (495) 995-53-33 ext. 54-44
1 Except for any transactions related to the performance of an obligation to buy or sell the Company’s financial instruments whose maturity date has come, provided that such obligation arises out of a transaction completed before a person becomes aware of insider information.
2 Except where insider information is transferred to a person included on the Company’s insider list due to the performance of the obligations provided for in federal laws or due to the performance of employment duties or due to the performance of a contract.
3 When completed and signed by the Company’s insiders, notices in accordance with the forms of Annexes 6, 7, and 8 shall be sent to the Company by mail or by electronic mail transmission at Batalov-AG@rosseti.ru or delivered by hand.