Attn. shareholders: information on payment of dividends

Dear shareholders,

In accordance with the procedure for payment and taxation of dividends established by the legislation of the Russian Federation, dividends on shares of RusHydro for 2021 will be paid within the following terms:

1. The term for payment of dividends to the nominee holder and a trustee who is a securities market professional registered in the shareholder register shall be no more than 10 business days (until July 22, 2022) from the date on which the persons entitled to dividends are determined.

The depository or a trustee responsible for the trust management of property on which dividends are paid shall be the tax agent in respect of income earned by shareholders (individuals, legal entities) whose right to securities is recorded in the depository.

2. The term for payment of dividends to the persons registered in the shareholder register and not specified in Clause 1 hereof shall be no more than 25 business days (until August 12, 2022) from the date on which the persons entitled to dividends are determined.

RusHydro shall be the tax agent in respect of income earned by shareholders (individuals, legal entities) whose right to securities is recorded in the shareholder register.

The shareholders specified in Clause 1 and entitled to a preferential tax rate shall submit documents confirming such right to the place where their right to RusHydro shares is recorded (the place where the shares they own are kept).

The shareholders specified in Clause 2 and entitled to a preferential tax rate shall submit the below documents to RusHydro no later than July 15, 2022 to the following address: 7 Malaya Dmitrovka St., Moscow, 127006.

If these documents are not submitted to the tax agent in a timely manner, then the latter shall have no grounds to apply the preferential tax conditions to income in the form of dividends. In such case, taxation will occur in accordance with the standard procedure established by law.

List of documents that must be submitted to the shareholder in order to receive tax credits when paying dividends on the Company's shares for 2021.

1. For shareholders – legal entities who are residents of the Russian Federation

The trustees of mutual funds must submit the following documents to the tax agent:

• copy of the license to perform mutual fund management activities;
• copy of the rules of mutual fund management, as well as amendments and supplements to the rules certified by the management company (the first and last page);
• report on owners of shares of the joint-stock investment fund and investment units of the mutual fund as of July 10, 2022;
• original extracts from the shareholder register as of July 10, 2022;
• statement on value of assets.

Trustees administering the funds in the form of amounts of income from investing pension savings formed in accordance with the legislation of the Russian Federation, received by organizations acting as insurers for compulsory pension insurance (subclause 31, clause 1 of Article 251 of the Tax Code of the Russian Federation (hereinafter, TC RF)) provide the following documents to the tax agent:

• copy of a license to pension provision and pension insurance activities;
• original extracts from the shareholder register as of July 10, 2022;
• copies of trustee agreements and supplementary agreements to such agreements certified by the management company;
• copies of specialized depository service agreements entered into between the National Pension Fund and the specialized depository, certified by the management company.

2. For shareholders – legal entities who are non-residents of the Russian Federation.

In order to apply the provisions of international agreements of the Russian Federation, foreign entities that are not tax residents of the Russian Federation must submit the following documents to the tax agent:

• confirmation that the foreign entity actually entitled to income has a permanent location in a country with which the Russian Federation has entered into an international taxation agreement, which must be certified by the competent authority of the respective foreign country. The confirmation must contain an indication that the foreign company is a tax resident of the relevant foreign state. The competent authority of the foreign state certifying the confirmation must meet the definition of the competent authority, which is established by the relevant agreement on avoiding double taxation. If such confirmation is made in a foreign language, its Russian translation should also be provided to the tax agent;
• confirmation that the foreign entity is actually entitled to the respective income. The actual right to income can be confirmed by any documents proving that:
  - the foreign company can independently dispose of the dividends received;
  - the foreign company must pay the tax on dividends in its country;
  - the recipient foreign company actually operates in the country of its residence
• an opportunity of granting a reduced rate is not inconsistent with the regulations of the Multilateral Instrument on implementation of the measures related to tax agreements in order to counteract dilution of the tax base and de-taxation (hereinafter referred as "MLI"), ratified by Federal Law No. 79-FZ dated May 1, 2019.

In addition, some international contracts stipulate application of a reduced tax rate with ownership of a certain number of shares of the company paying the dividends. In this case, the number of shares can be determined as a percentage of the authorized capital and in the amount for which the shares were purchased.

In such situations, in order to confirm the right to apply the appropriate reduced tax rates, the following documents are required in addition to the above confirmations:

• if application of a reduced tax rate is due to holding a certain number of Company’s shares as a percentage of the Company's authorized capital – calculation of the fraction of the Company's shares owned by the foreign entity. Such calculation must be accompanied by an original extract from the Company's register of shareholders or an original (notarized) copy of a statement of the nominee’s securities account, which allows to determine the number of shares owned by the foreign entity;
• if application of a reduced tax rate is due to the acquisition of the Company's shares for a certain amount:
• notarized copies of the share acquisition contracts for the amount specified in the relevant international agreement. Notarized copies of contracts with brokers and brokers’ transaction reports (in case shares were acquired through stock exchanges) can be submitted instead of contracts. The above documents must prove the acquisition of shares before the date of compiling the list of persons entitled to dividends for the relevant period. The dates of drawing up these documents must correlate with the dates of making entries in the register of shareholders.

To apply reduced rates under international contracts (agreements), it is necessary to additionally take into account the MLI provisions.

The MLI provides that provision of advantages by bilateral international contracts (agreements) will not apply if the main purpose (or one of the main ones) of the transaction is obtaining an advantage under bilateral international contracts (agreements).

The MLI provisions shall apply taking into account the ratified and effective position of the two countries.

The optional MLI provisions ratified by the Russian Federation, in particular:

• simplified provisions on limitation of benefits enabling application of the reduced rate only to qualified individuals and in some cases;
• setting an additional requirement in relation to the minimum period of holding a deposit (shares) - 365 days preceding the date of payment of dividends.

They apply if the second party to an international contract (agreement) has also ratified these provisions and extended their effect to the agreement with the Russian Federation.

Registration and publication of the MLI final provisions, ratified by each of the jurisdictions, shall be made by the Organization for Economic Cooperation and Development (OECD) as Depositary of the Instrument.

The MLI has applied since January 1, 2021 with regards to the bilateral international contracts (agreements) of partner states to which the Russian Federation has sent a notification on completion of domestic procedures.