Softline Holding plc Proposed Tender Offer

Softline Holding plc began trading under the brand name Noventiq after divesting part of its business in October 2022.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

FOR IMMEDIATE RELEASE

14 APRIL 2022

Softline Holding PLC

Proposed Tender Offer

Softline Holding PLC (Softline, or the Company) today announces a Tender Offer at US$ 1.00 per Ordinary Share or GDR (each a Security).

SUMMARY

• Softline has announced a Tender Offer priced at $1.00 per Security.
• This is an opportunity for Softline Security Holders to exit their investment given low liquidity and trading volumes in Softline’s GDRs in the current volatile market conditions.
• The Tender Offer will be made on an equal basis to all Softline Security Holders (other than any Security Holders who may be excluded to the extent necessary to comply with applicable laws) (Eligible Softline Security Holders).
• The number of Securities being bought back pursuant to the Tender Offer is limited to 10 per cent. of Softline’s issued share capital, or 18,369,283 Securities.
• Tendered Securities will be transferred to Softline’s employee benefit trust and used to fund employee awards under Softline’s long-term management incentive plan, long-term employee partnership program and employee share purchase schemes.
• The Tender Offer will be open for 20 Business Days, expiring at 5.00 p.m. on 18 May 2022 (the Expiration Time).
• Proceeds are expected to be despatched to Security Holders as soon as practicable after the Expiration Time.

1.                BACKGROUND TO AND REASONS FOR THE TENDER OFFER

1.1             Background to the Tender Offer

The geopolitical uncertainty, growing inflationary pressure and the challenges in the semiconductor supply chain have led to a significant decline in the price of Softline’s listed GDRs in recent weeks, from an IPO price of $7.50 to an average of $1.22 for the five trading days immediately preceding this announcement.

Given this environment, there is also very low liquidity in the Company’s GDRs on the LSE. As a result, Softline is offering its eligible Security Holders the opportunity to exit their investment in the Company’s Securities by way of the Tender Offer. The Tendered Securities will be held in treasury by the Company and transferred to the Company’s employee benefit trust in order to increase the awards available to employees under the Company’s employee share schemes, as previously announced on 2 February 2022.

The offer price for the Securities (the Tender Offer Price) is US$ 1.00 per Ordinary Share or GDR tendered, representing a discount of 18 per cent. to the LSE closing price of US$ 1.22 per GDR on 13 April 2022, being the last trading day prior to the date of this announcement.

Softline’s Board firmly believes that the Company’s current GDR price is a reflection of the current volatile market conditions and is symptomatic of the wider challenges currently facing all companies that derive a material portion of their revenues from the Russian market because of the situation in Ukraine. The Board believes that the GDR price does not reflect Softline’s true value or global potential. This view is also shared by external analysts and is reflected by the longer-term performance of the GDRs on the LSE and MOEX since the Company’s IPO and prior to events in Ukraine.

No Security Holder is obliged to participate in the Tender Offer. However, in launching the Tender Offer, the Board has listened carefully to Security Holders who wish to exit their investment in Softline but would not otherwise have the opportunity to do so, given the low liquidity in the GDRs and volatile market conditions at present.

The Tender Offer will be funded from cash generated by Softline’s operations and financial investments. Softline will therefore continue to have a strong balance sheet following completion of the Tender Offer and the Tender Offer is not impact the Company’s investment strategy for the proceeds raised at the time of its IPO, which remain located outside Russia.

As such, the Board believes that commencing the Tender Offer is in the best interests of all Security Holders and an efficient use of capital in the current circumstances. Funding employee awards from Tendered Securities also minimises the dilution of Softline’s existing Security Holders and is consistent with Softline’s stated intention to attract and incentivise the best employees to its business through competitive employee share schemes. 

The Tender Offer will be conducted in accordance with the general authority to repurchase Securities granted by the Company's Board of Directors on 13 April 2022, and otherwise in accordance with applicable laws and regulations. Consequently the Tender Offer is not subject to specific shareholder approval. 

The maximum number of Securities that can be bought back in connection with the Tender Offer remains up to 10 per cent. of Softline’s issued share capital (i.e. no more than 18,369,283 Securities, or the Authorised Maximum) and Softline cannot own such Securities for more than two years.

1.2             Benefits of the Tender Offer for Security Holders

The benefits of the Tender Offer for Security Holders as a whole are that:

• it is available to all Eligible Softline Security Holders regardless of the size of their holdings;
• it provides Eligible Softline Security Holders who wish to reduce their holdings of Securities with an opportunity to do so at a market-driven price, when considering the low liquidity and trading volumes in the current market; and
• it permits Eligible Softline Security Holders who wish to retain their current investment in Softline and their GDRs or Ordinary Shares to do so and no Security Holder is required to participate in the Tender Offer.

1.3             Trading Update

Consistent with the update on business and operations given on 11 March 2022, Softline continues to expect no material impact on operations in the international business outside of Russia, which represents nearly 50 per cent. of overall turnover. The Company is proactively navigating the changing environment in Russia, and focusing on supporting customers with all of their technology needs. There continues to be demand for services, and for good skills, where Softline is well-positioned. Softline has a strong balance sheet, and we remain focused on the safety and liquidity of cash, where we continue to have the necessary requirements for operations in each country.

1.4             No recommendation; Eligible Softline Security Holders are recommended to consult with independent advisers

Although the Board has approved the Tender Offer, the Board is not making a recommendation to Eligible Softline Security Holders in relation to participation in the Tender Offer itself.

Whether or not Eligible Softline Security Holders tender all or any of their Securities will depend, among other things, on their view of the Company’s business, prospects and fundamental value and their own individual circumstances, including their tax position. Eligible Softline Security Holders should make their own decision in respect of participation in the Tender Offer and are recommended to consult their duly authorised independent advisers.

1.5             Action to be taken

Further details of the procedures for tendering are set out in paragraph 4 of this announcement. Eligible Softline Security Holders who do not wish to tender their Securities under the Tender Offer should not take any action in relation to the Tender Form and should not submit a relevant Clearing System instruction or return an executed letter of transmittal (as applicable).

1.6             Further information

The expected timetable of principal events for the Tender Offer is set out in paragraph 2 of this announcement.

If you are an LSE GDR holder and require assistance on the mechanics of participating in the Tender Offer, please e-mail the LSE GDR Tender Agent at DRProjectLark@bnymellon.com, or contact your financial adviser or broker. The LSE GDR Tender Agent cannot provide advice on the merits of the Tender Offer nor give any financial, tax or legal advice.

If you are a MOEX GDR holder, please contact your broker or financial adviser for assistance on participating in the Tender Offer.

If you hold Ordinary Shares and require assistance in completing the Tender Form, please call the Company on +44 (20) 4577 1222. Calls to the Company from the United Kingdom are charged at your service provider’s standard network rates. Calls to the Company from outside the United Kingdom are charged at applicable international rates. The Company cannot provide advice to individual Eligible Softline Security Holders on the merits of the Tender Offer, nor give any financial, tax or legal advice.

2.                EXPECTED TIMETABLE

	Date
Publication of this announcement	7.00 a.m. on 14 April 2022
Commencement of Tender Offer Period	7.00 a.m. on 14 April 2022
Latest time and date for receipt of tenders (the Expiration Time)	5.00 p.m. on 18 May 2022*
Announcement of results of the Tender Offer	19 May 2022
Despatch of payments for GDRs and Ordinary Shares tendered under the Tender Offer	As soon as practicable after the Expiration Time

*Please note that Clearing Systems, their respective participants and the brokers or other financial intermediaries through which Eligible Softline Security Holders hold GDRs will establish their own cut-off dates and times for the tender of the GDRs, which will be earlier than the Expiration Time.

Future times and dates are indicative only and are subject to change by the Company. If the expected timetable of events changes materially from the above, the Company will release an announcement to this effect.

References to time in this announcement are to London time.

3.                TERMS AND CONDITIONS OF THE TENDER OFFER

3.1             Tenders

(a)              All Eligible Softline Security Holders who hold Securities on a date during the Tender Offer Period may tender Securities (up to the number of Securities held by them on such date) for purchase by the Company on the terms and subject to the conditions set out in this announcement and (for holders of certificated Ordinary Shares) the Tender Form (which together, constitute the Tender Offer). Eligible Softline Security Holders are not obliged to tender any Securities.

(b)             The Tender Offer is made at the Tender Offer Price. Tendering Eligible Softline Security Holders may be obliged to pay brokerage fees, commissions, dealing charges or transfer taxes or stamp duty in the UK on the purchase by the Company of Securities pursuant to the Tender Offer.

(c)              The consideration for each tendered Security acquired by the Company pursuant to the Tender Offer will be paid in accordance with the settlement procedures set out in paragraph 5 of this announcement.

(d)             Upon the Tender Offer becoming unconditional and unless the Tender Offer cannot be completed or has been terminated in accordance with the provisions of sub-paragraph 3.2(b) or paragraph 8 of this announcement, the Company will accept tenders of Eligible Softline Security Holders validly made in accordance with this announcement, subject as mentioned below, and each Security Holder will be entitled to sell to the Company the number of Securities described in paragraph 3.1(a) above.

(e)              The Tender Offer will expire at the Expiration Time. No tenders received after that time will be accepted unless the Company extends the period for tendering under the Tender Offer in which case a new expiration time will be announced (as described below). The Company reserves the right, subject to applicable legal and regulatory requirements, to amend the expected timetable announced by it, which includes extending the period for tendering under the Tender Offer. Any material change to the expected timetable will be notified to Security Holders by way of an announcement through a regulatory information service. Any such changes will comply with all applicable legal and regulatory requirements, including, but not limited to, the duration of any extensions.

(f)              Tender Forms which have been, or are deemed to be, validly and properly completed and submitted to the Company (in the case of certificated Ordinary Shares) and relevant Clearing System instructions that have been received by the LSE GDR Tender Agent (in the case of LSE GDRs) will become irrevocable and cannot be withdrawn after the Expiration Time.

(g)             All questions as to whether a Security Holder is an Eligible Softline Security Holder, or as to the validity and eligibility of tenders (including time of receipt and the number of Securities tendered) will be determined by the Company, in its sole discretion, whose determination will be final and binding (except as otherwise required under applicable law). The Company reserves the absolute right to reject any or all tenders it determines not to be in proper form or the acceptance of payment for which may, in the opinion of the Company, be unlawful. None of the Company, the LSE GDR Tender Agent, the Depositary, or any other person is or will be obliged to give notice of any defects or irregularities and none of them will incur any liability for failure to give such notice. Without prejudice to the foregoing, the Company shall use reasonable endeavours to return share certificate(s) or other document(s) of title to Shareholders whose tenders of Ordinary Shares are rejected. The Company reserves the absolute right to waive any of the terms or conditions of the Tender Offer (other than the Conditions). The Company reserves the absolute right to waive any defect or irregularity in the tender of any Securities, including any Tender Form (in whole or in part), which is not entirely in order or which is not accompanied by the appropriate Ordinary Share certificate(s) and/or other document(s) of title or any indemnity acceptable to the Company in lieu thereof. In that event, for Ordinary Shares held in certificated form, however, the consideration under the Tender Offer will only be despatched when the Tender Form is entirely in order and the Ordinary Share certificate(s) or other document(s) of title or indemnities in lieu thereof satisfactory to the Company has/have been received.

(h)             The failure of any person to receive a copy of this announcement or the Tender Form shall not invalidate any aspect of the Tender Offer. Neither the Company nor the Depositary nor any other person will incur liability in respect of any person failing to receive this announcement and/or for a person who holds their Ordinary Shares in certificated form, the Tender Form.

(i)               The total number of Securities that can be purchased under the Tender Offer is the Authorised Maximum. If the number of Securities validly tendered by Eligible Softline Security Holders exceeds the Authorised Maximum, the tendered Securities will be purchased on a pro rata, or proportional, basis according to the number of Securities validly tendered by the tendering Security Holders (with  adjustments where necessary to avoid the purchase of fractional Securities).

(j)               The number of Securities that will be purchased from each Eligible Softline Security Holder that has validly tendered Securities prior to the Expiration Time, will be calculated as follows:

Y = Z × K

where

Y represents the total number of Securities that will be purchased from the Eligible Softline Security Holder, which will be adjusted downwards where necessary to avoid the purchase of fractional Securities, provided that Y shall never be greater than X;

Z represents the number of Securities validly tendered by such Eligible Softline Security Holder prior to the Expiration Time; and

K represents the pro-ration rate calculated pursuant to the below formula:

where

K represents the pro-ration rate (rounded to ten decimal places); and

X represents the total amount of Securities validly tendered prior to the Expiration Time.

(k)             The Company, LSE GDR Tender Agent and the Clearing Systems and participants in those systems will make appropriate adjustments to the number of Securities accepted for purchase in the Tender Offer (rounding up or down, as appropriate) so as to avoid the acceptance of fractional Securities for purchase in the Tender Offer.

(l)               Pro-ration will not apply to the Securities which are validly tendered pursuant to this Tender Offer prior to the Expiration Time unless the number of Securities validly tendered by Eligible Softline Security Holders exceeds the Authorised Maximum.

(m)            The results of the Tender Offer are expected to be announced one Business Day after the Expiration Time.

3.2             Conditions

The Tender Offer is conditional on the following conditions (together the Conditions) being satisfied:

(a)              the Company having available to it sufficient distributable profits (in accordance with the Cyprus Companies Law) to effect the purchase of the Securities to be purchased by the Company at the relevant time; and

(b)             the Tender Offer not having been terminated in accordance with paragraph 8 of this announcement prior to the fulfilment of the Conditions referred to above.

The purchase by the Company of Securities pursuant to the Tender Offer will occur only if the applicable Conditions have been satisfied. If any of the applicable Conditions are not satisfied by 7.00 a.m. on the date upon which the relevant Securities are to be purchased by the Company under the Tender Offer (or such later time and date as the Company may decide), the Tender Offer will not proceed.

3.3             Compliance with “Short Tendering” Rule 

Rule 14e-4 promulgated under the Exchange Act makes it unlawful for any person acting alone or in concert with others, directly or indirectly, to tender GDRs or Ordinary Shares for such person’s own account unless at the time of tender and at the Expiration Time such person has a “net long position” in a number of GDRs or Ordinary Shares that is equal to or greater than the amount tendered and will deliver or cause to be delivered such GDRs or Ordinary Shares for the purpose of tendering to us within the period specified in this Tender Offer. Rule 14e-4 also provides a similar restriction applicable to the tender or guarantee of a tender on behalf of another person. A tender of GDRs or Ordinary Shares made pursuant to any method of delivery set forth in this Tender Offer will constitute the tendering Security Holder’s acceptance of the terms and conditions of this Tender Offer, as well as the tendering Security Holder’s representation and warranty to the Company that (i) such Security Holder has a “net long position” in a number of GDRs or Ordinary at least equal to the GDRs or Ordinary Shares being tendered within the meaning of Rule 14e-4, and (ii) such tender of GDRs or Ordinary Shares complies with Rule 14e-4. The Company’s acceptance for purchase of GDRs or Ordinary Shares tendered pursuant to this Tender Offer will constitute a binding agreement between the tendering Security Holder and the Company upon the terms and subject to the conditions of this Tender Offer, including the participating Security Holder’s representation that the Security Holder has a net long position in the GDRs or Ordinary Shares, as the case may be, being tendered for purchase within the meaning of Rule 14e-4 and that the request to tender such GDRs or Ordinary Shares complies with Rule 14e-4.

4.                PROCEDURE FOR TENDERING SECURITIES

There are different procedures for tendering Securities depending on whether they are LSE GDRs, MOEX GDRs or Ordinary Shares.

If you hold GDRs, you or the direct participant of the relevant Clearing System holding on your behalf must tender such GDRs by instructing the relevant Clearing System, or returning an executed letter of transmittal, in accordance with the procedure set out in sub-paragraph 4.1 of this announcement.

If you hold Ordinary Shares in certificated form, you may only tender such Ordinary Shares by completing and returning the Tender Form in accordance with the procedure set out in sub-paragraphs 4.1. Tender Forms are available from the Company by contacting them on the details below.

If you are in any doubt as to how to complete the Tender Form or as to the procedure for tendering Securities, please contact:

(i)               in respect of LSE GDRs, the LSE GDR Tender Agent via email at DRProjectLark@bnymellon.com or your financial adviser or broker;  

(ii)             in respect of MOEX GDRs, your financial adviser or broker; or

(iii)           in respect of Ordinary Shares, the Company on +44 (20) 4577 1222.

For legal reasons, the LSE GDR Tender Agent and the Company will not be able to give advice on the merits of the Tender Offer or provide legal, financial or personal taxation advice and, accordingly, for such advice you should consult your stockbroker, solicitor, accountant, bank manager or other independent professional adviser.

4.1             Procedure for LSE GDRs

LSE GDR holders who desire to tender LSE GDRs that are held through a broker, dealer, commercial bank, trust company or other securities intermediary must contact that firm to effect a tender on their behalf (and any such firm may have established an earlier deadline for tendering LSE GDR Holders to act to instruct it to accept the Tender Offer on their behalf). Tendering LSE GDR Holders will not be obligated to pay brokerage commissions in connection with their tender of LSE GDRs, but they may be charged a fee by a brokerage firm or similar nominee for processing the tender(s) on their behalf.

Tendering LSE GDRs

If you wish to tender LSE GDRs, you must instruct, or you must cause the broker or other securities intermediary through which you hold the LSE GDRs to instruct, Euroclear or Clearstream to block the number of LSE GDRs tendered in its participant account.

The LSE GDR Tender Agent must receive notice of the blocking through Euroclear or Clearstream, as applicable, prior to the Expiration Time.

4.2             Procedure for MOEX GDRs

At the date of this announcement, the linked securities accounts of the Russian NSD in Euroclear and Clearstream remain blocked and there are restrictions on the settlement of MOEX GDRs. Eligible Security Holders who hold MOEX GDRs may therefore be unable to participate in the Tender Offer. As these restrictions may change at short notice, Eligible Softline Security Holders who hold MOEX GDRs are advised to contact their broker or financial adviser for more information on the options available (if any) to participate in the Tender Offer.

4.3             Procedure for Ordinary Shares

To tender your Ordinary Shares held in certificated form you must complete, sign and have witnessed the Tender Form.

The completed, signed and witnessed Tender Form should be sent either (i) by post to the Company’s UK office, 26-28 Hammersmith Grove, London W6 7HA, United Kingdom, along with the relevant Ordinary Share certificate(s) or other document(s) of title; or (ii) by hand during normal business hours only to the Company’s UK office, 26-28 Hammersmith Grove, London W6 7HA, United Kingdom, as soon as possible and, in any event, so as to be received by no later than the Expiration Time. The Company shall be entitled (in its sole discretion) to accept late Tender Forms. No acknowledgement of receipt of documents will be given.

The completed, signed and witnessed Tender Form should be accompanied by the relevant Ordinary Share certificate(s) or other document(s) of title.

If your Ordinary Share certificate(s) or other document(s) of title are not readily available (for example, if they are with your stockbroker, bank or other agent) or are lost, the Tender Form should nevertheless be completed, signed, witnessed and returned as described above so as to be received by the Company by no later than the Expiration Time together with any Ordinary Share certificate(s) or other document(s) of title you may have available, accompanied by a letter of explanation stating that, if not lost, the (remaining) Ordinary Share certificate(s) or other document(s) of title will be forwarded as soon as possible thereafter and, in any event, by no later than the Expiration Time.

The Company will effect such procedures as are required to transfer your Ordinary Shares to the Company under the Tender Offer. If you have lost your Ordinary Share certificate(s) or other document(s) of title, you should write to the Company at the address above requesting a letter of indemnity in respect of the lost Ordinary Share certificate(s) which, when completed in accordance with the instructions given, should be returned to the Company at the address above so as to be received by no later than the Expiration Time.

By signing the Tender Form, Shareholders will be deemed to have instructed that the cash consideration will be remitted in accordance with the instructions set out in the Tender Form.

4.4             Validity of Tender Form

Notwithstanding the powers in sub-paragraph 3.1(g) of this Announcement, the Company reserves the right to treat as valid only Tender Forms which are received entirely in order by the Expiration Time and which are accompanied by the relevant Ordinary Share certificate(s) or other document(s) of title or a satisfactory indemnity in lieu thereof, in respect of the entire number of Ordinary Shares tendered.

Notwithstanding the completion of a valid Tender Form, the Tender Offer may be suspended, terminated or lapse in accordance with the terms and conditions set out in this announcement.

The Company shall be entitled to accept Tender Forms which are received after the Expiration Time in its sole discretion. The decision of the Company as to which Ordinary Shares have been validly tendered shall be conclusive and binding on all Shareholders.

5.               SETTLEMENT

Settlement of the consideration to which any Security Holder is entitled pursuant to valid tenders accepted by the Company (which will be rounded down to the nearest whole cent) will be effected by the crediting of relevant Clearing System accounts or the despatch of cheques (as applicable). The Settlement process will depend on whether the Security Holder is tendering LSE GDRs, MOEX GDRs or Ordinary Shares.

5.1             LSE GDRs

Where an accepted tender related to LSE GDRs, payment for the LSE GDRs will be made by depositing the aggregate Tender Offer Price to be paid for the LSE GDRs validly tendered and accepted for purchase with the LSE GDR Tender Agent, who will make payment to the custodian for Euroclear or Clearstream, in the cases of the LSE GDR Holders tendering LSE GDRs via Euroclear or Clearstream.

The LSE GDR Tender Agent will, provided that it has received the aggregate Tender Offer Price in US Dollars from the Company, remit the aggregate Tender Offer Price to the Clearing Systems for further distribution to the tendering LSE GDR Holders pro rata to the number of the LSE GDRs validly tendered by the relevant tendering LSE GDR Holder net of any taxes and other governmental charges. The Tender Offer Price, subject to taxes and other governmental charges, shall be paid to tendering LSE GDR Holders through the procedures of the relevant Clearing System as of the date of payment. Those who tender LSE GDRs will not receive interest or any other form of compensation during this period of time or in the event of a delay in the delivery of the Tender Offer Price to the tendering LSE GDR Holder.

Neither the LSE GDR Tender Agent, the Depositary nor any person acting on behalf of either of them accept any liability for any default on the part of the Company to pay tendering LSE GDR Holders for the accepted GDRs.

5.2             MOEX GDRs

At the date of this announcement, the linked securities accounts of the Russian NSD in Euroclear and Clearstream remain blocked and there are restrictions on the settlement of MOEX GDRs. Eligible Security Holders who hold MOEX GDRs may therefore be unable to participate in the Tender Offer and be treated differently to other Security Holders. As these restrictions may change at short notice, Eligible Softline Security Holders who hold MOEX GDRs are advised to contact their broker or financial adviser for more information on the options available (if any) to participate in the Tender Offer and for the most up-to-date information on the settlement of MOEX GDRs.

5.3             Ordinary Shares

Where an accepted tender relates to Ordinary Shares held in certificated form, payment for the consideration due will be despatched by the date notified by the Company to Ordinary Shareholders in accordance with this announcement either by bank transfer or by cheque by first class post to the person or agent whose name and address is set out on the Tender Form or, in the case of joint holders, the address of the first named.

If only part of a holding of Securities is sold pursuant to the Tender Offer, or no holding of Securities is sold pursuant to the Tender Offer:

(a)              where GDRs are held, the unsold GDRs will need to be dealt with in accordance with instructions provided by the Depositary, to ensure that the GDR Holder receives the Ordinary Shares which they will be entitled to upon termination of the Deposit Agreements; or

(b)             where the Ordinary Shares are held in certificated form, the Shareholder will be entitled to receive a certificate in respect of the balance of the remaining Ordinary Shares.

6.                GDR TENDERS THROUGH THE CLEARING SYSTEMS

Each GDR Holder by whom, or on whose behalf, a tender through a Clearing System or an executed letter of transmittal is made in respect of GDRs hereby irrevocably undertakes, represents, warrants and agrees to and with the Company (so as to bind him, his personal representatives, heirs, successors and assigns) that:

(a)              the input of the relevant Clearing System instruction shall constitute an offer to sell to the Company such number of GDRs as is specified in the Clearing System instruction on and subject to the terms and conditions set out or referred to in this announcement and that once the Clearing System instruction has been made, such tender shall be irrevocable;

(b)             such GDR Holder has full power and authority to tender, sell, assign or transfer the GDRs in respect of which such offer is accepted (together with all rights attaching thereto) and, when the same are purchased by the Company, the Company will acquire such GDRs with full title guarantee, fully paid and free from all liens, charges, encumbrances, equitable interests, rights of pre-emption or other third party rights of any nature and together with all rights attaching thereto on or after the Expiration Time including the right to receive all dividends and other distributions declared, paid or made after that date and that such representation shall be deemed repeated at the time the Company purchases such GDRs;

(c)              the input of the relevant Clearing System instruction will, subject to the Tender Offer becoming unconditional, in respect of the GDRs, constitute the irrevocable appointment of the LSE GDR Tender Agent and any director or officer of the Company as an attorney and/or agent as may be necessary or expedient for the purposes of, or in connection with, the Tender Offer (each an agent) and an irrevocable instruction and authority to the agent (i) to complete and execute the transfer to itself through the Clearing System and then to transfer to the Company (or to such person or persons as the Company may direct) through the Clearing System all of the Relevant GDRs (as defined below) (but not exceeding the number of GDRs which have been tendered pursuant to the Tender Offer); and (ii) if the Tender Offer lapses or is terminated, or there are GDRs which have not been successfully tendered under the Tender Offer, to give instructions to the relevant Clearing System, as promptly as practicable after the lapsing or termination of the Tender Offer, to transfer the Relevant GDRs to the original available balances from which those GDRs came. For the purposes of this sub-paragraph 6(c), Relevant GDRs means GDRs in respect of which a transfer or transfers has or have been effected pursuant to the procedures described in this announcement;

(d)             such GDR Holder will ratify and confirm each and every act or thing which may be done or effected by the Company or any of its directors, officers or any person nominated by the Company or the LSE GDR Tender Agent in the proper exercise of its or his or her respective powers and/or authorities hereunder (including its appointed agent);

(e)              such GDR Holder shall do all such acts and things as shall be necessary or expedient and execute any additional documents deemed by the Company to be desirable, in each case to complete the purchase of the Relevant GDRs (as defined in sub-paragraph 6(c) above) and/or to perfect any of the authorities expressed to be given hereunder;

(f)              if such GDR Holder is an Overseas Security Holder, (i) it is not resident or located in any territory in which it is unlawful to make or accept the Tender Offer, (ii) it has fully observed any applicable legal and regulatory requirements of the territory in which such Overseas Security Holder  is resident or located and (iii) the invitation under the Tender Offer may be made to such Overseas Security Holder under the laws of the relevant jurisdiction;

(g)             the payment by the LSE GDR Tender Agent in accordance with the relevant Clearing System’s payment arrangements as referred to in paragraph 5 of this announcement will, to the extent of the obligations so created, discharge fully any obligation of the Company to pay to such GDR Holder the cash consideration to which he is entitled under the Tender Offer;

(h)             the input of the relevant Clearing System instruction constitutes such GDR Holder's submission to the exclusive jurisdiction of the courts of England and Wales in relation to all matters arising out of or in connection with the Tender Offer;

(i)               if the appointment of an agent provision under sub-paragraph 6(c) of this announcement shall be unenforceable or invalid or shall not operate so as to afford any director or officer of the Company or the LSE GDR Tender Agent the benefit or authority expressed to be given therein, the GDR Holder shall with all practicable speed do all such acts and things and execute all such documents that may be required to enable the Company or the LSE GDR Tender Agent to secure the full benefits of sub-paragraph 6(c) of this announcement;

(j)               it has observed the laws of all relevant jurisdictions, obtained all requisite governmental, exchange control or other required consents, complied with all requisite formalities in connection with any tender of any GDRs, in any jurisdiction and that it has not taken or omitted to take any action in breach of the terms of this announcement which will or may result in the Company or the LSE GDR Tender Agent or any other person acting in breach of the legal or regulatory requirements of any such jurisdiction in connection with this Tender Offer or tender of GDRs in connection therewith;

(k)             it will indemnify and hold harmless the Company and the LSE GDR Tender Agent and each of their affiliates, employees, directors and officers and each person, if any, who controls the Company and the LSE GDR Tender Agent from and against any and all losses, claims, damages and liabilities (including, without limitation, legal fees and other expenses incurred by any of them in connection with any suit, action or proceeding or any claim asserted, as such fees and expenses are incurred), joint or several, in connection with any matter in any way relating to their participation in the Tender Offer, any breach of the warranties in this paragraph 6 or otherwise referred to in this announcement; and

(l)               (i) it is not a Sanctioned Person; and (ii) it will not use, directly or indirectly, the proceeds received by it from the sale of its GDRs pursuant to this Tender Offer for the purpose of financing or making funds available directly or indirectly to or for the benefit of any Sanctioned Person.

7.                TENDER FORM

Each Shareholder by whom, or on whose behalf, a Tender Form is executed in respect of certificated Ordinary Shares hereby irrevocably undertakes, represents, warrants and agrees to and with the Company (so as to bind him, his personal representatives, heirs, successors and assigns) that:

(a)              the execution of the Tender Form shall constitute an offer to sell to the Company of the number of Ordinary Shares inserted, or deemed to be inserted, in the relevant box on the Tender Form, in each case, on and subject to the terms and conditions set out or referred to in this announcement and the Tender Form and that, once lodged, such offer shall be irrevocable;

(b)             such Shareholder has full power and authority to tender, sell, assign or transfer the Ordinary Shares in respect of which such offer is accepted (together with all rights attaching thereto) and, when the same are purchased by the Company, the Company will acquire such Ordinary Shares with full title guarantee, fully paid and free from all liens, charges, encumbrances, equitable interests, rights of pre-emption or other third party rights of any nature and together with all rights attaching thereto on or after the Expiration Time including the right to receive all dividends and other distributions declared paid or made after that date and that such representation shall be deemed to be repeated at the time the Company purchases such Ordinary Shares;

(c)              the execution of the Tender Form will, subject to the Tender Offer becoming unconditional, in respect of the Ordinary Shares referred to in sub-paragraph 7(a) of this Announcement, constitute the irrevocable appointment of any director or officer of the Company as such Shareholder's attorney and/or agent (the attorney), and an irrevocable instruction and authority to the attorney to complete and execute all or any instruments of transfer and/or other documents at the attorney's discretion in relation to such Ordinary Shares in favour of the Company or such other person or persons as the Company may direct and to deliver such instrument(s) of transfer and/or other document(s) at the discretion of the attorney, together with the Ordinary Share certificate(s) and/or other document(s) of title relating to such Ordinary Shares, for registration and to do all such other acts and things as may in the opinion of such attorney be necessary or expedient for the purpose of, or in connection with, the Tender Offer and to vest in the Company or its nominee(s) or such other person(s) as the Company may direct such Ordinary Shares;

(d)             such Shareholder will ratify and confirm each and every act or thing which may be done or effected by the Company or any of its directors, officers or any person nominated by the company in the proper exercise of its or his or her respective powers and/or authorities hereunder (including any attorney);

(e)              such Shareholder will deliver to the Company its Ordinary Share certificate(s) and/or other document(s) of title in respect of the Ordinary Shares referred to in sub-paragraph 7(a) of this Announcement, or an indemnity acceptable to the Company in lieu thereof, or will procure the delivery of such document(s) to such person as soon as possible thereafter and, in any event, not later than the Expiration Time;

(f)              such Shareholder shall do all such acts and things as shall be necessary or expedient and execute any additional documents deemed by the Company to be desirable, in each case to complete the purchase of the Ordinary Shares and/or to perfect any of the authorities expressed to be given hereunder;

(g)             if such Shareholder is an Overseas Security Holder, (i) it is not resident or located in any territory in which it is unlawful to make or accept the Tender Offer or to use the Tender Form in any manner in which the person has used or will use it, (ii) it has fully observed any applicable legal and regulatory requirements of the territory in which such Overseas Security Holder is resident or located and (iii) the invitation under the Tender Offer may be made to such Overseas Security Holder under the laws of the relevant jurisdiction;

(h)             the provisions of the Tender Form shall be deemed to be incorporated into the terms and conditions of the Tender Offer;

(i)               the despatch of a cheque in respect of the consideration payable to such Shareholder at his registered address or such other address as is specified in the Tender Form will constitute a complete discharge by the Company of its obligations to make such payment to such Shareholder;

(j)               the execution of the Tender Form constitutes a warranty by such Shareholder that the information given by or on behalf of the Shareholder in the Tender Form will be true in all respects at the time the Company purchases the Ordinary Shares referred to in paragraph 7(a) of this Announcement as if it had been given afresh at such time and shall not be extinguished by such purchase;

(k)             on execution, the Tender Form takes effect as a deed;

(l)               the execution of the Tender Form constitutes such Shareholder's submission to the exclusive jurisdiction of the courts of England and Wales in relation to all matters arising out of or in connection with the Tender Offer and/or the Tender Form;

(m)            if the appointment of an attorney provision under sub-paragraph 6(c) of this Announcement shall be unenforceable or invalid or shall not operate so as to afford any director or officer of the Company the benefit or authority expressed to be given therein, the Shareholder shall with all practicable speed do all such acts and things and execute all such documents that may be required to enable the Company to secure the full benefits of sub-paragraph 6(c) of this Announcement;

(n)             it has observed the laws of all relevant jurisdictions, obtained all requisite governmental, exchange control or other required consents, complied with all requisite formalities in connection with any tender of any Ordinary Shares, in any jurisdiction and that it has not taken or omitted to take any action in breach of the terms of this announcement or the Tender Form which will or may result in the Company or any other person acting in breach of the legal or regulatory requirements of any such jurisdiction in connection with this Tender Offer or tender of Ordinary Shares in connection therewith;

(o)             it will indemnify and hold harmless the Company and each of its affiliates, employees, directors and officers and each person, if any, who controls the Company from and against any and all losses, claims, damages and liabilities (including, without limitation, legal fees and other expenses incurred by any of them in connection with any suit, action or proceeding or any claim asserted, as such fees and expenses are incurred), joint or several, in connection with any matter in any way relating to their participation in the Tender Offer, any breach of the warranties referred to in this paragraph 7, the Tender Form or otherwise referred to in this announcement; and

(p)             (i) it is not a Sanctioned Person; and (ii) it will not use, directly or indirectly, the proceeds received by it from the sale of its GDRs pursuant to this Tender Offer for the purpose of financing or making funds available directly or indirectly to or for the benefit of any Sanctioned Person.

A reference in this paragraph 7 to a Shareholder includes a reference to the person or persons executing the Tender Form and, in the event of more than one person executing a Tender Form, the provisions of this paragraph 7 will apply to them jointly and to each of them.

8.                TERMINATION OF THE TENDER OFFER

If, at any time prior to the announcement of the results of the Tender Offer:

(a)              the Board in its absolute discretion concludes that the Tender Offer would no longer be in the best interests of the Company and/or the shareholders as a whole (in exercising such discretion, the Board will give consideration, among other things, to the impact of the Tender Offer on the Company’s on-going compliance with applicable rules and regulations);

(b)             any action or proceeding has been instituted or threatened that would, in the Company’s reasonable judgment, be prejudicial to the Tender Offer;

(c)              acceptance for purchase or payment for any Securities pursuant to this Tender Offer would violate any law or regulation applicable to the Company, including any Sanctions, or any contractual obligations of the Company or the Group in relation to compliance with Sanctions; or

(d)             there shall occur:

(i)               any general suspension of, shortening of hours for, or limitation on prices for trading in securities on any securities exchange or in the over-the-counter market on which any securities of the Company, including the GDRs, trade;

(ii)             any material adverse change in the price of the Ordinary Shares or GDRs on the LSE, MOEX or on any securities exchange or in the over-the-counter market on which any securities of the Company, including the GDRs, trade;

(iii)           a material impairment in the trading market for debt securities;

(iv)            a declaration of a banking moratorium or any suspension of payments in respect of banks by Cyprus, Russia, the United Kingdom or Federal or state authorities in the United States (whether or not mandatory);

(v)             a commencement of a war, armed hostilities, terrorist action or other national or international crisis or national calamity;

(vi)            any limitation (whether or not mandatory) by any governmental authority on, or other event having a reasonable likelihood of affecting, the extension of credit by banks or other lending institutions in the European Union or the United States;

(vii)          any material adverse change in Eurozone, Russian, U.K. or U.S. currency exchange rates or a suspension of, or limitation on, the markets thereof (whether or not mandatory);

(viii)        any material adverse change in Eurozone, Russian, U.K. or U.S. securities or financial markets generally;

(ix)            any material adverse change in the financial position or prospects and/or circumstances of the Company (including, without limitation, in relation to the distributable profits of the Company or by reason of any change in legislation, practice, circumstances or otherwise); or

(x)             in the case of any of the foregoing existing at the time of the commencement of the Tender Offer, a material acceleration or worsening thereof.

such that the purchase of Securities by the Company may render (in the reasonable opinion of the Board), the Tender Offer temporarily or permanently impractical or inadvisable (taking into account the background to and reasons for the Tender Offer), the Board may terminate the Tender Offer without any liability on the part of the Company. If the Tender Offer is terminated, the Company will make an announcement through a regulatory information service to notify Security Holders in writing that such is the case.

The Company reserves the right, at any time, to revise the aggregate value of the Tender Offer based on market conditions and/or other factors, subject to compliance with applicable legal and regulatory requirements. The Company shall notify Security Holders of any such revision without delay by public announcement through a regulatory information service.

9.               ADDITIONAL PROVISIONS

Each Security Holder may tender all or part of their holding of Securities by the Expiration Time. In respect of Ordinary Shares held in certificated form, if: (i) Box 2 of the Tender Form is not completed; or (ii) in the Company’s determination (in its absolute discretion) Box 2 has not been validly completed, provided that the Tender Form is otherwise in order and accompanied by all other relevant documents, the tender may be accepted as a valid tender in respect of the entire holding of Ordinary Shares which that Shareholder holds at the time of providing the Tender Form. However, if the Ordinary Share certificate(s) and/or other document(s) of title accompanying such Tender Form total less than the entire holding of Ordinary Shares which that Shareholder holds at the time of providing the Tender Form, then the Tender Form shall be treated as a tender for such lesser amount.

Ordinary Shares acquired by the Company under the Tender Offer will be acquired in accordance with the Cyprus Companies Law.

Securities sold by Security Holders pursuant to the Tender Offer will be acquired with full title guarantee, fully paid and free from all liens, charges, encumbrances, equitable interests, rights of pre-emption or other third party rights of any nature and together with all rights attaching thereto on or after the Expiration Time including the right to receive all dividends and other distributions declared, paid or made after that date.

Unless lapsed, extended or terminated in accordance with the provisions of this announcement, the Tender Offer will close at the Expiration Time and it is expected that one Business Day after the Expiration Time the Company will make a public announcement of the total number of Securities tendered.

Each Security Holder who tenders or procures the tender of Securities will thereby be deemed to have agreed that, in consideration of the Company agreeing to process their tender, such Security Holder will not revoke their tender or withdraw their Securities. Security Holders should note that, once tendered, Securities may not be sold, transferred, charged or otherwise disposed of other than in accordance with the Tender Offer.

Any omission to despatch this announcement or the Tender Form or any notice required to be despatched under the terms of the Tender Offer to, or any failure to receive the same by, any person entitled to participate in the Tender Offer shall not invalidate the Tender Offer in any way or create any implication that the Tender Offer has not been made to any such person.

No acknowledgement of receipt of any Tender Form(s), Ordinary Share certificate(s) and/or document(s) of title will be given. All communications, notices, certificates, documents of title and remittances to be delivered by or sent to or from Security Holders (or their designated agents) will be delivered by or sent to or from Security Holders (or their designated agents) at their own risk.

All powers of attorney and authorities on the terms conferred by or referred to in this announcement or the Tender Form are given by way of security for the performance of the obligations of the Security Holders concerned and are irrevocable in accordance with section 4 of the Powers of Attorney Act 1971.

All tenders by Shareholders must be made on the relevant prescribed Tender Form, duly completed in accordance with the instructions set out within the Tender Form which constitute part of the terms of the Tender Offer. A Tender Form will only be valid when the procedures contained in these terms and conditions and in the Tender Form are complied with. The Tender Offer and all tenders are and will be governed by and construed in accordance with English law. Delivery or posting of a Tender Form will constitute submission to the exclusive jurisdiction of the English courts.

In the case of LSE GDRs, the LSE GDR Tender Agent will, as soon as practicable after receiving confirmation from the Company of the Tender Offer lapsing or being terminated, give instructions to the relevant Clearing System to release all LSE GDRs previously tendered back to the original available balances from which those LSE GDRs came.

If the Tender Offer lapses or is terminated, all documents lodged pursuant to the Tender Offer will be returned promptly by post, within 14 Business Days of the Ten