Announcement Regarding the EBRD Equalisation Agreement

24 November 2016, Moscow – Brunswick Rail Limited (the “Company”) announces that an agreement (the “Equalisation Agreement”) between European Bank for Reconstruction and Development (“EBRD”), certain ordinary shareholders of the Company (the “Participating Ordinary Shareholders”) and the Company (acting in an administrative capacity) has come into force today.  As of the date of announcement, the Participating Ordinary Shareholders hold approximately 51.1% of the Company’s issued ordinary shares.

The Equalisation Agreement provides that if holders of more than 85% of the ordinary shares accede to the Equalisation Agreement on or before 29 December 2016 (which date is extendable by EBRD but not beyond 31 March 2017 (the "Long Stop Date")) and provided that no Agreed Sale (as further described below) has then been agreed, EBRD and the Participating Ordinary Shareholders will take such steps as are necessary to convert all the Preferred Securities into ordinary shares representing 13.27% of the outstanding ordinary shares post-conversion (“Voluntary Conversion”). 

If, however, Voluntary Conversion has not occurred on or before 31 March 2017 but a sale of all EBRD's Preference Shares and more than 50% of the ordinary shares has been completed on or before that date (an "Agreed Sale"), then, under the terms of the Equalisation Agreement, EBRD has agreed to share certain surplus consideration (if any) in respect of its Preferred Securities with those Participating Ordinary Shareholders who voluntarily sold their shares in that Agreed Sale.  The Equalisation Agreement contains provisions providing for surplus consideration to be calculated based on the consideration received by EBRD for its Preferred Securities less the portion of the net consideration to which EBRD would have been entitled if it was a 13.27% ordinary shareholder and had sold the relevant number of ordinary shares in the Agreed Sale.  The Equalisation Agreement also contains provisions providing for EBRD to direct that the applicable surplus consideration to be shared with Participating Ordinary Shareholders under the Equalisation Agreement is shared amongst Participating Ordinary Shareholders who voluntarily sold their shares pro-rata to the ordinary shares that they sold as part of the Agreed Sale.

It is open to ordinary shareholders to accede to the Equalisation Agreement and become Participating Ordinary Shareholders at any time on or before the Long Stop Date.
The Equalisation Agreement will terminate on the earliest of:

(i) the day immediately following the Long Stop Date if holders of more than 85% of the ordinary shares have not acceded to the agreement on or before the Long Stop Date and if no Agreed Sale has occurred on or before the Long Stop Date;
(ii) the date on which Voluntary Conversion occurs; and
(iii) 1st April 2017, if neither the Voluntary Conversion nor an Agreed Sale have occurred before that date.


About Brunswick Rail:

Brunswick Rail is a private railcar operating lessor providing freight railcars to large corporate clients in Russia. Established in 2004, Brunswick Rail currently owns a fleet of ca. 25.8 thousand railcars (as of 30 June 2016), which represents approximately 2% of the total Russian railcar fleet.


Investor Contacts

Richard Sultanov

Ричард Султанов

This announcement is for general information only and does not constitute or form part of, and should not be construed as, an offer for sale or subscription of, or a solicitation of any offer to buy or exchange or subscribe for, any securities.
This announcement may contain forward-looking statements regarding future events or the future financial performance of Brunswick Rail (the “Company”). You can identify forward looking statements by terms such as “expect”, “believe”, “estimate”, “anticipate”, “intend”, “will”, “could”, “may”, or “might”, the negative of such terms or other similar expressions. These forward-looking statements include matters that are not historical facts and statements regarding the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, financial condition, liquidity, prospects, growth, strategies, and the industry in which the Company operates. By their nature, forward-looking statements involve risks and uncertainties, because they relate to events and depend on circumstances that may or may not occur in the future. The Company cautions you that forward-looking statements are not guarantees of future performance and that the Company’s actual results of operations, financial condition, liquidity, prospects, growth, strategies and the development of the industry in which the Company operates may differ materially from those described in or suggested by the forward-looking statements contained in these materials. In addition, even if the Company’s results of operations, financial condition, liquidity, prospects, growth, strategies and the development of the industry in which the Company operates are consistent with the forward-looking statements contained in this announcement, those results or developments may not be indicative of results or developments in future periods. The Company does not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in forward-looking statements of the Company, including, among others, general economic conditions, the competitive environment, risks associated with operating in Russia, market change in the Russian freight rail market, as well as many other risks specifically related to the Company and its operations.