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Competence of the Board of Directors

The Company's Board of Directors exercises overall management of the Company's activities, with the exception of issues that fall within the competence of the general meeting of shareholders.

The competence of the Company's Board of Directors includes handling issues of general management of the Company's activities, with the exception of issues that fall within the competence of the general meeting of shareholders.

Issues pertaining to the competence of the Company's Board of Directors shall include:

  1. determining priorities in the Company's activities;
  2. convening annual and extraordinary general meetings of shareholders, with the exception of instances set out in paragraph 18.7, Article 18 of these Articles of Association;
  3. approving the agenda of the general meeting of shareholders;
  4. determining the date for compiling the list of persons entitled to take part in the general meeting of shareholders, and other issues that fall within the competence of the Company's Board of Directors regarding preparing for and holding the general meeting of shareholders;
  5. placement of bonds and other issuable securities by the Company;
  6. appraising the value (monetary valuation) of property, determining the price of placement and redemption of issuable securities;
  7. purchasing shares, bonds and other securities issued by the Company in cases laid down in the Federal Law 'On joint-stock companies';
  8. electing the Director General of the Company and early termination of his/her powers.
  9. determining the number and the term of service of the Board members;
  10. setting the size of renumeration and compensation to be paid to the Director General and the board members, approving the terms and conditions in the employment agreements made with them;
  11. appointing the members of the Board and approving the candidates for Deputy Directors General proposed by the Director General, as well as early termination of their powers;
  12. developing recommendations for the size of remuneration and compensation to be paid to the members of the Company's Revision Commission and members of the Board of Directors, as well as determining the remuneration for auditor services;
  13. developing recommendations for the size of share dividends and the payout procedure;
  14. using the Reserve Fund and other funds of the Company;
  15. approving the Company's internal documents, with the exception of those that fall within the competence of the general meeting of shareholders, as well as other Company's internal documents whose approval falls within the competence of the company's executive bodies in accordance with the Company's Articles of Association;
  16. creating branches, opening Company representative offices and terminating their activity;
  17. introducing amendments to the Company's Articles of Association related to the opening of Company's branches and representative offices and their liquidation.
  18. taking the decision to establish subsidiaries and decisions regarding the Company's participation in other organisations, with the exception of instances set out in Subparagraph 13, Paragraph 16.8 of these Articles of Association.
  19. approving large value deals (including loans, credits, collateral, surety) or several linked deals, the object of which is property appraised at 25 (twenty five) to 50 (fifty) per cent of the Company's book value, in accordance with the procedure set out in Article 79 of the Federal Law 'On joint-stock companies', as well as deals for purchasing aircraft, long-term lease-to-own aircraft, aircraft rental (lease), or using aircraft as collateral in the financing and refinancing of loans;
  20. approving deals provided for by Chapter XI of the Federal Law 'On joint-stock companies';
  21. approving a deal, series of deals or several linked deals (including loans, credits, collateral, surety) related to the purchase, disposal or disposal option by the Company, directly or indirectly, of assets with a value from 15,000,000 (fifteen million) US dollars (or equivalent sum at the deal approval date) to 25 per cent of the Company's book value at the time the deal is approved;
  22. approving the Company's special registrar and terms and conditions of his/her employment contract, as well as termination of the contract;
  23. approving the production, commercial, financial and economic activity plan, budget, including the Company's capital investment costs.
  24. approving the Company's organisational structure;
  25. other matters provided for in the Federal Law 'On Joint Stock Companies' and the Company's Articles of Association.

Issues within the competence of the Company's Board of Directors may not be handed over to the Company's executive bodies for consideration.

The Company's Board of Directors members, eleven (11) in number, shall be elected by the general meeting of shareholders in accordance with the procedure provided for in the Federal Law 'On Joint Stock Companies' and the Company's Articles of Association for the term until the next annual general meeting of shareholders.