PAO Severstal (SVST) PAO Severstal: IMPORTANT NOTICE TO NOTEHOLDERS 13-Jul-2022 / 14:00 MSK Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 (MAR), transmitted by EQS Group. The issuer is solely responsible for the content of this announcement.

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NOT FOR DISTRIBUTION IN OR INTO OR TO ANY PERSON LOCATED OR RESIDENT IN ANY JURISDICTION WHERE IT IS UNLAWFUL TO DISTRIBUTE THIS DOCUMENT.

THIS NOTICE IS IMPORTANT AND REQUIRES THE IMMEDIATE ATTENTION OF HOLDERS. IF HOLDERS ARE IN ANY DOUBT AS TO THE ACTION THEY SHOULD TAKE, THEY SHOULD IMMEDIATELY CONSULT THEIR OWN INDEPENDENT PROFESSIONAL ADVISERS.

THIS NOTICE CONTAINS IMPORTANT INFORMATION THAT IS OF INTEREST TO THE REGISTERED AND BENEFICIAL OWNERS OF THE NOTES. IF APPLICABLE, ALL DEPOSITORIES, CUSTODIANS AND OTHER INTERMEDIARIES RECEIVING THIS NOTICE ARE REQUIRED TO EXPEDITE TRANSMISSION HEREOF TO BENEFICIAL OWNERS OF THE NOTES IN A TIMELY MANNER. IF HOLDERS OR BENEFICIAL OWNERS OF THE NOTES ARE IN ANY DOUBT AS TO THE MATTERS REFERRED TO IN THIS NOTICE, THEY SHOULD CONSULT THEIR STOCKBROKER, LAWYER, ACCOUNTANT OR OTHER PROFESSIONAL ADVISER WITHOUT DELAY.

If you have recently sold or otherwise transferred your entire holding(s) of Notes referred to below, you should immediately forward this notice to the purchaser or transferee or to the stockbroker, bank or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

13 July 2022

PAO "SEVERSTAL" ("SEVERSTAL")

IMPORTANT NOTICE TO NOTEHOLDERS

Programme for the Issuance of Loan Participation Notes issued by Steel Capital S.A. (the "Issuer") for the purpose of funding loans to Severstal (the "Programme")

U.S.USD750,000,000 in aggregate principal amount of 5.90 per cent. Series 3 Loan Participation Notes due 2022 issued by the Issuer pursuant to the Programme on 15 October 2012 for the purpose of funding a U.S.USD750,000,000 loan to Severstal (the "Loan")

of which U.S.USD634,051,000 is currently outstanding

ISINs: XS0841671000; US85805RAB42 (the "Notes")

Severstal is soliciting consents of the holders of the Notes ("the Noteholders") to the proposals set out herein (the "Proposals") to be approved by a written resolution of the Noteholders (the "Written Resolution") adopted pursuant to paragraph 9 (Written Resolution) of Schedule 5 (Provisions for Meetings of Noteholders) of the Trust Deed dated 19 October 2010 between the Issuer and the Trustee as supplemented by the Supplemental Trust Deed dated 17 October 2012 (" Trust Deed").

Terms defined in the Trust Deed or the Written Resolution shall have the same meaning herein unless the context requires otherwise. 1. Background

As a result of extensive sanctions and other restrictive measures, including the full blocking sanctions, that have been recently introduced by the U.S., the EU and the UK against Russia and/or various Russian individuals and entities (such as Severstal), any payment of interest or principal under the Loan made by Severstal or received from the Issuer or Severstal by Citibank N.A., London branch (the "Principal Paying and Transfer Agent") will likely be blocked, delayed or frozen for an uncertain period of time and, consequently, those funds will not be distributed among the Noteholders. Though Severstal filed license applications with competent sanctions authorities in the relevant jurisdictions requesting authorizations required for processing of payments under the Loan and the Notes as per the ordinary course, no such authorizations have been received to date and no assurance can be given as to when (if at all) they will be granted.

In addition, in response to the international sanctions, the Russian authorities effectively restricted certain payments from the Russian Federation to a number of jurisdictions, unless there is a governmental permission to a specific payment. If the governmental authorities reject to issue such permission to Severstal, it may not be able to repay interest or principal to the Issuer under the Loan and, consequently, the Issuer may not be able to repay the principal and interest accrued on the Notes in accordance with the original terms of the Notes.

In light of the above, in order to ensure the Noteholders' rights are not prejudiced and with a view to facilitate payments in relation to the Notes, Severstal is seeking the Noteholders' consent to certain modifications to the terms of the Notes, as set out in more detail below. 2. Proposals sought by way of the Written Resolution

This notice is a summary of some of the Proposals only and does not contain a full description of all Proposals included into the Written Resolution and should be read in conjunction with the Written Resolution which you can request as per the Section 3 below. a. Amended Payment Mechanics

Since the aforementioned circumstances have resulted in a significant disruption of the Notes' payment infrastructure, Severstal invites the Noteholders to agree and authorise that the Issuer and/or Severstal can make any payment of interest or principal or can procure that such payment of interest or principal is made directly (or through relevant clearing systems or other financial intermediaries) to Noteholders as per below (the "Amended Payment Mechanics"): i. Payments to the following Noteholders would be made in Roubles at the Central Bank of Russia foreignexchange rate (as of the payment date):

-- the Noteholders holding Notes through Russian National Settlement Depository ("NSD") or other Russiancustodians being the accountholders of Euroclear Bank SA/NV and Clearstream Banking, S.A. (the "Other RussianCustodians") as of 27 July 2022 (the "Record Date"), including those Noteholders which have arranged for theirNotes to be transferred to an account with any Other Russian Custodian by the Record Date. Such Noteholders wouldreceive payments through NSD or the relevant Other Russian Custodian, as applicable. The relevant paymentobligations under the Notes would be discharged when the funds are received by NSD or Other Russian Custodians, asappropriate; and

-- the Noteholders which, as of the Record Date, hold their Notes through foreign nominee holders and haveelected, by application to Severstal delivered not later than 7 Russian business days prior to the payment date(which is fixed at 17 October 2022) (the "Payment Date"), unless otherwise set out in the Written Resolution, forpayments to be made to a Rouble account opened in their name with a Russian credit institution, or, subject to allapplicable laws, a foreign credit institution. Such Noteholders would receive payments from Severstal directly orthrough such financial intermediaries or other paying agents as may be engaged by Severstal at its sole discretion.The relevant payment obligations under the Notes would be discharged when the funds are debited from Severstal'sRussian bank account; ii. Payments to the Noteholders not referred to in sub-paragraph (i) above would continue to be expressed tobe made in accordance with the original terms of the Notes. These payments shall be made only after all relevantregulatory licenses from the authorities outside the Russian Federation, which, in case they are not granted toSeverstal, shall be procured by the respective Noteholders, and all relevant approvals from the Russianauthorities,

subject to additional conditions, procedures and requirements as set out in the Written Resolution.

Accordingly, the Noteholders, which hold their Notes outside of NSD or Other Russian Custodians, willing to receive payments in Roubles are encouraged either to transfer their Notes to an account with any Other Russian Custodian and/or open Rouble bank accounts with credit institutions. b. Deferral of Interest Payment

As a result of the events beyond the Issuer's and Severstal's control, the interest under the Loan due on 17 April 2022 (the "April 2022 Interest") and the interest under the Notes due on 17 April 2022 (the "April 2022 Coupon") have not been paid and remain outstanding to date.

To ensure that the rights of the Noteholders are not prejudiced and that the arrangement expressed to allow the Noteholders to receive payments under the Notes (i.e., the Amended Payment Mechanics) is in place before the payment of the April 2022 Interest and the April 2022 Coupon is made, Severstal is seeking consent of the Noteholders to defer the April 2022 Interest and the April 2022 Coupon to the Payment Date with no default interest or similar payment accrued and/or being payable with respect to any amount of the April 2022 Interest and/or the April 2022 Coupon so deferred. c. Early Redemption

In addition, Severstal invites the Noteholders to agree and authorise that Severstal and/or the Issuer shall on 29 August 2022 (the "Early Redemption Date") redeem the Loan and the Notes then outstanding at par together with accrued and unpaid interest thereon as at the Early Redemption Date (the "Early Redemption"). To the extent such Early Redemption is approved, any reference to the Payment Date shall be read as reference to the Early Redemption Date. 3. Execution requirements and effectiveness condition

In accordance with paragraph 9 (Written Resolution) of Schedule 5 (Provisions for Meetings of Noteholders) of the Trust Deed, the Written Resolution would become effective if signed by or on behalf of Noteholders representing in aggregate not less than two thirds in principal amount of the Notes outstanding at the time (the "Effectiveness Condition"). The Proposals set out in section 2(c) (Early Redemption) above will constitute a separate and independent part of the Written Resolution and will only become effective if the Proposals set out in sections 2(a) (Amended Payment Mechanics) and 2(b) (Deferral of Interest Payment) above become effective.

(MORE TO FOLLOW) Dow Jones Newswires

July 13, 2022 07:00 ET (11:00 GMT)

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