Uzhuralzoloto – aiming to succeed

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30.06.2020

Petropavlovsk Annual General Meeting and Board Appointments UGC Response

Uzhuralzoloto Group of Companies ("UGC") notes the announcement this morning by Petropavlovsk Plc ("Petropavlovsk" or the “Company”) regarding the appointment of four new directors with effect from the end of the Company's AGM.

While UGC welcomes the fact that the Company has respected the wishes of all shareholders who voted at the AGM, it is concerned about the independence of the new temporary directors as well as the allegations made against UGC and its nominee in the announcement both of whom are supportive of the Company.

The results of the AGM, without the additional appointment of the new directors, would have left the board with three independent non-executive directors and one non-executive director who is UGC's nominee. UGC believes that, whilst the appointment of an interim CEO is necessary in the circumstances, the appointment of another three non-executives, notwithstanding their expertise for the positions to which they have been appointed, is not necessary.

UGC does not believe the temporary board fulfils the criteria for independence as set out in the UK Corporate Governance Code.

UGC will however support the interim board commencing, with the appointment of appropriate independent head hunters, a process to find a strong and diverse set of candidates for the next general meeting.

In relation to the Company's claim that voting at the AGM has been engineered by UGC and Mr Nikolai Lustiger, UGC strongly denies any such allegation. UGC has not acted in concert with any other shareholder.

UGC notes that it is not the responsibility of its appointed nominee on the board to inform the Company how UGC will vote at a general meeting. UGC voted for two independent non-executive directors proposed by the Company to remain on the board, along with its nominee, as it did not want to compromise the independence of the board, but wished a new independent board to be constituted around them.

UGC, as the Company's largest shareholder has sought and will continue to seek to work proactively and constructively with Petropavlovsk's interim board of directors in the hope of being able to ensure that the proposed candidates for the board to be put to the new general meeting can be supported by all shareholders.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU)

For more information

Alexey Ivanov

+7 903 797 7382

Alexey.Ivanov@ugold.ru