**Exhibit 4.47**

 

EXECUTION COPY

 

Dated 14 December 2005

 

 

 

**US$200,000,000**

 

**FACILITY AGREEMENT**

 

For

 

**CLOSEDJOINT STOCK COMPANY “UKRAINIAN MOBILE COMMUNICATIONS”**

 

arranged by

 

**CITIBANK, N.A.**

**ING BANK N.V.**

 

as Bookrunner

 

**CITIBANK, N.A.**

**ING BANK N.V.**

**RAIFFEISENZENTRALBANK****ÖSTERREICH AG**

 

as Mandated LeadArrangers

 

with

 

**CITIBANKINTERNATIONAL PLC**

acting as Agent

 

 

Paveletskaya sq. 2, bld. 2

Moscow 115054

 

Telephone (7-095) 797 9797

Facsimile (7-095) 797 9798

 

Ref MK/TP

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| CLAUSE                                                         | ** ** |  | **     CONTENTS     ** | ** ** | ** ** | **PAGE** |
|----------------------------------------------------------------|------------|--|--------------------------------------------------------------------------|------------|------------|----------|
| SECTION 1 INTERPRETATION                                       |       |
| 1   DEFINITIONS AND INTERPRETATION                   |       |
| SECTION 2 THE FACILITIES                                       |       |
| 2   THE FACILITIES                                   |       |
| 3   PURPOSE                                          |       |
| 4   CONDITIONS OF UTILISATION                        |       |
| SECTION 3 UTILISATION                                          |       |
| 5   UTILISATION                                      |       |
| SECTION 4 REPAYMENT, PREPAYMENT AND CANCELLATION               |       |
| 6   REPAYMENT                                        |       |
| 7   PREPAYMENT AND CANCELLATION                      |       |
| SECTION 5 COSTS OF UTILISATION                                 |       |
| 8   INTEREST                                         |       |
| 9   INTEREST PERIODS                                 |       |
| 10   CHANGES TO THE CALCULATION OF INTEREST          |       |
| 11   FEES                                            |       |
| SECTION 6 ADDITIONAL PAYMENT OBLIGATIONS                       |       |
| 12   TAX GROSS-UP AND INDEMNITIES                    |       |
| 13   INCREASED COSTS                                 |       |
| 14   OTHER INDEMNITIES                               |       |
| 15   MITIGATION BY THE LENDERS                       |       |
| 16   COSTS AND EXPENSES                              |       |
| SECTION 7  REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT |       |

 

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| 17   REPRESENTATIONS                                    |   |
|-------------------------------------------------------------------|--------|
| 18   INFORMATION UNDERTAKINGS                           |   |
| 19   FINANCIAL COVENANTS                                |   |
| 20   GENERAL UNDERTAKINGS                               |   |
| 21   EVENTS OF DEFAULT                                  |   |
| SECTION 8  CHANGES TO PARTIES                                     |   |
| 22   CHANGES TO THE LENDERS                             |   |
| 23   CHANGES TO THE BORROWER                            |   |
| SECTION 9 THE  FINANCE PARTIES                                    |   |
| 24   ROLE OF THE AGENT AND THE MANDATED LEAD  ARRANGERS |   |
| 25   CONDUCT OF BUSINESS BY THE FINANCE PARTIES         |   |
| 26   SHARING AMONG THE FINANCE PARTIES                  |   |
| SECTION 10  ADMINISTRATION                                        |   |
| 27   PAYMENT MECHANICS                                  |   |
| 28   SET-OFF                                            |   |
| 29   NOTICES                                            |   |
| 30   CALCULATIONS AND CERTIFICATES                      |   |
| 31   PARTIAL INVALIDITY                                 |   |
| 32   REMEDIES AND WAIVERS                               |   |
| 33   AMENDMENTS AND WAIVERS                             |   |
| 34   COUNTERPARTS                                       |   |
| SECTION 11  GOVERNING LAW AND ENFORCEMENT                         |   |
| 35   GOVERNING LAW                                      |   |
| 36   ARBITRATION                                        |   |
| 37   JURISDICTION                                       |   |

 

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| SCHEDULE 1 The Original  Lenders                  |   |
|---------------------------------------------------|--------|
| SCHEDULE 2  Conditions precedent                  |   |
| SCHEDULE 3  Utilisation Request                   |   |
| SCHEDULE 4  Mandatory Cost formula                |   |
| SCHEDULE 5 Form  of Transfer Certificate          |   |
| SCHEDULE 6 Form  of Compliance Certificate        |   |
| SCHEDULE 7  Selection Notice                      |   |
| SCHEDULE 8  Parent Guarantee                      |   |
| SCHEDULE 9  Amended and Restated Parent Guarantee |   |

 

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THISAGREEMENT is dated 14 December 2005 and made between:

**(1)****                             ****CLOSED JOINT STOCK COMPANY “UKRAINIAN MOBILE COMMUNICATIONS”**, a closedjoint-stock company established and existing under the laws of Ukraineregistered with number 14333937 and having its registered address atLeiptsyzska St. 15, City of Kyiv, 01015, Ukraine, as borrower (the “**Borrower**”);

**(2)****                             ****CITIBANK, N.A.**and**ING BANK N.V.** as Bookrunners (the “**Bookrunners**”);

**(3)****                             ****CITIBANK, N.A.**,**INGBANK N.V.**and **RAIFFEISENZENTRALBANK****Ö****STERREICH AG**as MandatedLead Arrangers (the “**Mandated Lead Arrangers**”);

**(4)****                             ****THE FINANCIAL INSTITUTIONS** listed in Schedule 1 as lenders (the “**Original Lenders**”); and

**(5)****                             ****CITIBANK INTERNATIONAL PLC**as agent of the other Finance Parties(the “**Agent**”).

IT ISAGREED as follows:

**SECTION 1INTERPRETATION**

**1**                                      DEFINITIONS AND INTERPRETATION

**1.1**                            Definitions

In thisAgreement:

“**Additional Cost Rate**” has the meaning givento it in Schedule 4 (*Mandatory Cost**formula*).

“**Affiliate**” means, in relation to anyperson, a Subsidiary of that person or a Holding Company of that person or anyother Subsidiary of that Holding Company.

“**Amended and Restated Parent Guarantee**”means the guarantee of the obligations of the Borrower under the FinanceDocuments by the Parent to be entered into in favour of the Agent (for thebenefit of the Finance Parties) substantially in the form set out in Schedule 9(*Amended and Restated Parent Guarantee*).

“**Annualised Consolidated EBITDA**” has themeaning given to it in Clause 19 (*FinancialCovenants*).

“**Authorisation**” means an authorisation,consent, approval, resolution, licence, exemption, filing, notarisation orregistration.

“**Availability Period**” means the period fromand including the Signing Date to and including the date which is 60 days afterthe Signing Date.

“**Available Commitment**” means, in relation toa Facility, a Lender’s Commitment under that Facility minus:

(a)                                the amountof its participation in any outstanding Loans under that Facility; and

(b)                               in relationto any proposed Utilisation, the amount of its participation in any Loans thatare due to be made under that Facility on or before the proposed UtilisationDate.

“**Available Facility**” means, in relation to aFacility, the aggregate for the time being of each Lender’s AvailableCommitment in relation to that Facility.

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“**Borrower Audited Original Financial Statements**”means the audited consolidated financial statements of the Borrower for thefinancial year ending 31 December 2004.

“**Borrower Litigation**” means any of theclaims, proceedings (present or future) and causes of action involving theParent and/or any of its Affiliates (including the Borrower) relating to orarising out of the sale of the Borrower to the Parent or the acquisition,reorganization or ownership of the Borrower by the Parent.

“**Break Costs**” means the amount (if any) bywhich:

(a)                                the interest(excluding the Margin) which a Lender should have received for the period fromthe date of receipt of all or any part of its participation in a Loan or UnpaidSum to the last day of the current Interest Period in respect of that Loan orUnpaid Sum, had the principal amount or Unpaid Sum received been paid on thelast day of that Interest Period;

exceeds:

(b)                               the amountwhich that Lender would be able to obtain by placing an amount equal to theprincipal amount or Unpaid Sum received by it on deposit with a leading bank inthe London interbank market for a period starting on the Business Day followingreceipt or recovery and ending on the last day of the current Interest Period.

“**Business Day**” means a day (other than aSaturday or Sunday) on which banks are open for general business in Amsterdam,London, Moscow, Kyiv and New York City.

“**Commitment**” means a Facility 1 Commitmentor a Facility 2 Commitment.

“**Compliance Certificate**” means a certificatesubstantially in the form set out in Schedule 6 (*Form of Compliance Certificate*).

“**Confidentiality Undertaking**” means aconfidentiality undertaking substantially in a recommended form of the LMA orin any other form agreed between the Borrower and the Agent.

“**Consolidated EBITDA**” has the meaning givento it in Clause 19 (*Financial Covenants*).

“**Consolidated Total Debt**” has the meaninggiven to it in Clause 19 (*FinancialCovenants*).

“**Consolidated Total Net Worth**” has themeaning given to it in Clause 19 (*FinancialCovenants*).

“**Debt Service**” has the meaning given to itin Clause 19 (*Financial Covenants*).

“**Default**” means an Event of Default or anyevent or circumstance specified in Clause 21 (*Eventsof Default*) which would (with the expiry of a grace period, thegiving of notice, the making of any determination under the Finance Documentsor any combination of any of the foregoing) be an Event of Default.

“**Environment**” means living organismsincluding the ecological systems of which they form part and the followingmedia:

(a)                                air(including air within natural or man-made structures, whether above or belowground);

(b)                               water(including territorial, coastal and inland waters, water under or within landand water in drains and sewers); and

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(c)                                land(including land under water).

“**Environmental Law**” means all laws andregulations of any relevant jurisdiction which:

(a)                                have as apurpose or effect the protection of, and/or prevention of harm or damage to,the Environment;

(b)                               provideremedies or compensation for harm or damage to the Environment; or

(c)                                relate toany waste, pollutant, contaminant or other substance (including any liquid,solid, gas, ion, living organism or noise) that may be harmful to human healthor other life or the Environment or a nuisance to any person or that may makethe use or ownership of any affected land or property more costly or health andsafety matters.

“**Environmental Licence**” means anyAuthorisation required at any time under Environmental Law.

“**Event of Default**” means any event orcircumstance specified as such in Clause 21 (*Eventsof Default*).

“**Facilities**” means Facility 1 and Facility2, and “**Facility**” means either ofthem.

“**Facility 1**” means the term loan facilitymade available under this Agreement as described in paragraph (a) ofClause 2.1 (*The Facilities*).

“**Facility 1 Commitment**” means:

(a)                                in relationto an Original Lender, the amount set opposite its name under the heading “Facility1 Commitment” in Schedule 1 (*The Original Lenders*)and the amount of any other Facility 1 Commitment transferred to it under thisAgreement; and

(b)                               in relationto any other Lender, the amount of any Facility 1 Commitment transferred to itunder this Agreement,

to the extent notcancelled, reduced or transferred by it under this Agreement.

“**Facility 1 Loan**” means a loan made or to bemade under Facility 1 or the principal amount outstanding for the time being ofthat loan.

“**Facility 2**” means the term loan facilitymade available under this Agreement as described in paragraph (b) ofClause 2.1 (*The Facilities*).

“**Facility 2 Commitment**” means:

(c)                                in relationto an Original Lender, the amount set opposite its name under the heading “Facility2 Commitment” in Schedule 1 (*The OriginalLenders*) and the amount of any other Facility 2 Commitmenttransferred to it under this Agreement; and

(d)                               in relationto any other Lender, the amount of any Facility 2 Commitment transferred to itunder this Agreement,

to the extent notcancelled, reduced or transferred by it under this Agreement.

“**Facility 2 Loan**” means a loan made or to bemade under Facility 2 or the principal amount outstanding for the time being ofthat loan.

“**Facility Office**” means the office oroffices notified by a Lender to the Agent in writing on or before the date itbecomes a Lender (or, following that date, by not less than five Business Days’

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writtennotice) as the office or offices through which it will perform its obligationsunder this Agreement.

“**Fee Letter**” means the letter dated on orabout the Signing Date between the Mandated Lead Arrangers and the Borrower (orthe Agent and the Borrower) setting out the fees referred to in Clause 11 (*Fees*).

“**Final Maturity Date**” means the date whichis 12 Months after the Signing Date.

“**Finance Document**” means this Agreement, anyFee Letter, the Mandate Letter, the Parent Guarantee, the Amended and RestatedParent Guarantee and any other document designated as such by the Agent and theBorrower.

“**Finance Party**” means the Agent, theMandated Lead Arrangers or a Lender.

“**Financial Indebtedness**” means any indebtedness for or inrespect of:

(a)                                moneysborrowed;

(b)                               any amountraised by acceptance under any acceptance credit facility or dematerialisedequivalent;

(c)                                any amountraised pursuant to any note purchase facility or the issue of bonds, notes,debentures, loan stock or any similar instrument;

(d)                               the amountof any liability in respect of any lease or hire purchase contract which would,in accordance with GAAP, be treated as a finance or capital lease;

(e)                                receivablessold or discounted (other than any receivables to the extent they are sold on anon-recourse basis);

(f)                                  any amountraised under any other transaction (including any forward sale or purchaseagreement) having the commercial effect of a borrowing;

(g)                               anyderivative transaction entered into in connection with protection against orbenefit from fluctuation in any rate or price (and, when calculating the valueof any derivative transaction, only the marked to market value shall be takeninto account);

(h)                               shares whichare expressed to be redeemable at the option of the holder on or prior to theFinal Maturity Date (but excluding any accrued dividends);

(i)                                   anycounter-indemnity obligation in respect of a guarantee, indemnity, bond,standby or documentary letter of credit or any other instrument issued by abank or financial institution; and

(j)                                   the amountof any liability in respect of any guarantee or indemnity for any of the itemsreferred to in paragraphs (a) to (i) above.

“**GAAP**” means generally accepted accounting principles, standards and practices inthe United States of America.

“**Group**” means the Parent and itsSubsidiaries for the time being.

“**Holding Company**” means, in relation to aperson, any other person in respect of which it is a Subsidiary.

“**IFRS**” means the International FinancialReporting Standards issued by the International Accounting Standards Committee,London.

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“**Interest Period**” means, in relation to aLoan, each period determined in accordance with Clause 9 (*Interest Periods*) and, in relation to anUnpaid Sum, each period determined in accordance with Clause 8.3 (*Default interest*).

“**Lender**” means:

(a)                                any OriginalLender; and

(b)                               any bank,financial institution, trust, fund or other entity which has become a Party inaccordance with Clause 22 (*Changes to theLenders*),

whichin each case has not ceased to be a Party in accordance with the terms of thisAgreement.

“**LIBOR**” means, in relation to any Loan:

(a)                                theapplicable Screen Rate; or

(b)                               (if noScreen Rate is available for Dollars or the Interest Period of that Loan) thearithmetic mean of the rates (rounded upwards to four decimal places) assupplied to the Agent at its request quoted by the Reference Banks to leadingbanks in the London interbank market,

as of11:00 a.m. on the Quotation Day for the offering of deposits in Dollarsfor a period comparable to the Interest Period for that Loan.

“**LMA**” means the Loan Market Association.

“**Loan**” means a Facility 1 Loan or a Facility2 Loan.

“**Majority Lenders**” means:

(a)                                if there areno Loans then outstanding, a Lender or Lenders whose Commitments aggregate morethan 662/3% of the Total Commitments (or, if theTotal Commitments have been reduced to zero, aggregated more than 662/3% of the Total Commitments immediatelyprior to the reduction); or

(b)                               at any othertime, a Lender or Lenders whose participations in the Loans then outstandingaggregate more than 662/3% of all the Loans then outstanding.

“**Mandate Letter**” means the letter betweenthe Mandated Lead Arrangers and the Borrower dated on or about the date of thisAgreement.

“**Mandatory Cost**” means the percentage rateper annum calculated by the Agent in accordance with Schedule 4 (*Mandatory Cost formula*).

“**Margin**” means:

(a)                                   in relationto Facility 1, 0.75 (zero point seventy five) per cent. per annum; and

(b)                                  in relationto Facility 2, 2.25 (two point twenty five) per cent. per annum,

subject,in relation to Facility 2, to adjustment in accordance with Clause 8.5 (*Adjustment of Margin*).

“**Material Adverse Effect**” means a materialadverse effect on or material adverse change in:

(a)                                thefinancial condition, operations, assets, prospects or business of any Obligoror the consolidated financial condition, operations, assets, prospects orbusiness of the Group;

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(b)                               the abilityof any Obligor to perform and comply with their respective obligations underany Finance Document to which they are a party; or

(c)                                thevalidity, legality or enforceability of any Finance Document, or the rights orremedies of any Finance Party thereunder.

“**Measurement Period**” has the meaning givento it in Clause 19 (*Financial Covenants*).

“**Month**” means a period starting on one dayin a calendar month and ending on the numerically corresponding day in the nextcalendar month, except that:

(a)                                if thenumerically corresponding day is not a Business Day, that period shall end onthe next Business Day in that calendar month in which that period is to end ifthere is one, or if there is not, on the immediately preceding Business Day;and

(b)                               if there isno numerically corresponding day in the calendar month in which that period isto end, that period shall end on the last Business Day in that calendar month.

Theabove rules will only apply to the last Month of any period.

“**NBU**” means the National Bank of Ukraine.

“**Obligor**” means the Borrower or the Parent.

“**Original Financial Statements**” means:

(a)                                the ParentAudited Original Financial Statements;

(b)                               the BorrowerAudited Original Financial Statements; and

(c)                                theunaudited consolidated financial statements of the Parent for the financialquarter ending 30 September 2005 prepared in accordance with RAS.

“**Parent**” means Mobile TeleSystems Open JointStock Company, an open joint stock company established and existing under thelaws of the Russian Federation and having its registered address at 4Marksistskaya Street, 109147 Moscow, Russian Federation.

“**Parent Audited Original Financial Statements**”means the audited consolidated and non-consolidated financial statements of theParent for the financial year ending 31 December 2004.

“**Parent Guarantee**” means the guarantee ofthe obligations of the Borrower under the Finance Documents by the Parent to beentered into in favour of the Agent (for the benefit of the Finance Parties)substantially in the form set out in Schedule 8 (*Parent Guarantee*).

“**Participating Member State**” means anymember state of the European Communities that adopts or has adopted the euro asits lawful currency in accordance with legislation of the European Communityrelating to Economic and Monetary Union.

“**Party**” means a party to this Agreement.

“**Permitted Security**” means:

(a)                                any Securityon any assets of any corporation existing at the time such corporation ismerged or consolidated with or into the Parent or any Subsidiary of the Parentor becomes a Subsidiary of the Parent and not created in contemplation of suchevent, provided that no such Security shall extend to any other assets;

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(b)                               any Securityexisting on any assets prior to the acquisition thereof by the Parent or anySubsidiary of the Parent and not created in contemplation of such acquisition,provided that no such Security shall extend to any other assets;

(c)                                any Securityon any assets securing Financial Indebtedness of the Parent or FinancialIndebtedness of any Subsidiary of the Parent incurred or assumed for thepurpose of financing all or part of the cost of acquiring, repairing orrefurbishing such assets, provided that (i) no such Security shall extendto any other assets; (ii) the aggregate principal amount of all FinancialIndebtedness secured by such Security on such assets shall not exceed the lowerof (x) the purchase price of such assets and (y) the fair marketvalue of such assets at the time of acquisition, repair or refurbishing; and (iii) suchSecurity attaches to such assets concurrently with the repair or refurbishingthereof or within 90 days after the acquisition thereof, as the case may be;

(d)                               any Securityarising by operation of law, including any Security (i) arising in theordinary course of business with respect to amounts not yet delinquent or beingcontested by the Parent or a Subsidiary of the Parent in good faith inappropriate proceedings or (ii) for taxes, assessments, government chargesor claims, including without limitation those in favour of Russian governmentalfiscal authorities;

(e)                                any Securityon the assets of any Subsidiary of the Parent securing intercompany FinancialIndebtedness of such Subsidiary owing to the Parent or another Subsidiary ofthe Parent;

(f)                                  any nettingor set-off arrangement entered into by a member of the Group with a bank or anyother financial institution in the normal course of its banking arrangementsfor the purpose of netting or setting off its debit and credit facilities withthat bank or financial institution;

(g)                               easements,rights-of-way, restrictions and any other similar charges or encumbrancesincurred in the ordinary course of business and not interfering in any materialrespect with the business of the Parent or the business of any Subsidiary ofthe Parent, including any encumbrance or restriction with respect to an equityinterest of any joint venture pursuant to a joint venture agreement;

(h)                               anyextension, renewal or replacement of any Security described in clauses (a) to(g) above, provided that (i) such extension, renewal or replacementshall be no more restrictive in any material respect than the originalSecurity; (ii) the amount of Financial Indebtedness secured by suchSecurity is not increased; and (iii) if the assets securing the FinancialIndebtedness subject to such Security are changed in connection with suchrefinancing, extension or replacement, the fair market value of the property orassets is not increased; and

(i)                                   any otherSecurity (excluding any Security described in (a)-(h) above) providedthat, immediately after giving effect to such Security, the aggregate amount ofall secured Financial Indebtedness of the Group does not exceed 10% of theParent’s Total Assets.

“**Quotation Day**” means, in relation to anyperiod for which an interest rate is to be determined, two Business Days beforethe first day of that period unless market practice differs in the Londoninterbank market, in which case the Quotation Day will be determined by theAgent in accordance with market practice in the London interbank market (and ifquotations for that currency and period would normally be given by leadingbanks in the London interbank market on more than one day, the Quotation Daywill be the last of those days).

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“**RAS**” means generally accepted accountingprinciples, standards and practices in the Russian Federation.

“**Reference Banks**” means in relation to LIBORand Mandatory Cost the principal London offices of the Mandated Lead Arrangers,ABN AMRO Bank N.V., HSBC Bank PLC or such other banks as may be appointed bythe Agent in consultation with the Borrower.

“**Registration Certificate**” means thecertificate issued by the NBU confirming the registration of this Agreement.

“**Repayment Date**” means the date falling 3Months after the Signing Date, the date falling 6 Months after the Signing Date,the date falling 9 Months after the Signing Date and the Final Maturity Date.

“**Repeating Representations**” means each ofthe representations set out in Clauses 17.1 (*Status*),17.2 (*Binding obligations*), 17.3(*Non-conflict with other obligations*),17.4 (*Power and authority*), 17.6(*Governing law and enforcement*),17.10 (*No default*), 17.12 (*Pari Passu Ranking*), 17.13 (*No proceedings pending or threatened*),17.14 (*Environmental laws and licences*)and 17.15 (*Telecommunications law andlicences*).

“**Russian Insolvency Law**” means the FederalLaw of the Russian Federation No. 127-FZ of 26 October 2002 “OnInsolvency (Bankruptcy)”.

“**Screen Rate**” means the British BankersAssociation Interest Settlement Rate for Dollars for the relevant perioddisplayed on the appropriate page of the Telerate screen. If the agreed page isreplaced or service ceases to be available, the Agent may specify another page orservice displaying the appropriate rate after consultation with the Borrowerand the Lenders.

“**Security**” means a mortgage, charge, lien,pledge or other security interest securing any obligations of any person or anyother agreement or arrangement having a similar effect.

“**Selection Notice**” means a noticesubstantially in the form set out in Schedule 7 (*Selection Notice*) given in accordance with Clause 9 (*Interest Periods*).

“**Significant Subsidiary**” means:

(a)                                anySubsidiary of the Parent to which (i) the Parent sells, leases orotherwise transfers its GSM 900 or 1800 licences or (ii) any such licenceis re-issued; and

(b)                               anySubsidiary of the Parent (i) whose total assets (or, where such Subsidiaryprepares consolidated accounts, whose total consolidated assets) have a bookvalue (as determined by reference to the most recent management accounts ofthat Subsidiary prepared in accordance with GAAP) equal to or exceeding 10% ofthe Parent’s Total Assets or (ii) whose gross annual revenues (or, wheresuch Subsidiary prepares consolidated accounts, whose gross annual consolidatedrevenues) (as determined by reference to the most recent management accounts ofthat Subsidiary prepared in accordance with GAAP) are equal to or exceed 10% ofthe Parent’s gross annual consolidated revenues in the year for which theParent’s most recent consolidated financial statements were prepared.

“**Signing Date**” means the date of thisAgreement.

“**Sistema JSFC**” means Joint Stock FinancialCorporation Sistema.

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“**Specified Time**” means 10.00 a.m. onthe Business Day which is three Business Days before the relevant UtilisationDate or, as the case may be, before the first day of the relevant InterestPeriod.

“**Subsidiary**” means an entity from time totime of which a person has direct or indirect control or owns directly orindirectly more than 50% of the share capital or similar right of ownership.

“**Syndication Date**” means (unless otherwiseagreed by the Borrower and the Bookrunners) 31 March 2006.

“**Tax**” means any tax, levy, impost, duty orother charge or withholding of a similar nature (including any penalty orinterest payable in connection with any failure to pay or any delay in payingany of the same).

“**Telecommunications Authorisation**”****means anyAuthorisation from any governmental or other regulatory authority necessary inorder for each of the Parent and its Significant  Subsidiaries to maintain, operate and conductits business as it is being conducted in accordance with TelecommunicationsLaws.

“**Telecommunications Laws**”****means (a) all laws and regulations which relate totelecommunications and/or the business of providing mobile telephone servicesand (b) all rules, guidelines, policies and regulations made thereunder,that are applicable to each of the Parent and its Significant Subsidiariesand/or the business carried on by it.

“**Total Assets**” means the book value of theconsolidated total assets of the Parent as determined by reference to theParent’s most recent annual consolidated balance sheet delivered in accordancewith paragraph (a) of Clause 18.1 (*Financialstatements*) or, prior to the first delivery, to the Parent AuditedOriginal Financial Statements.

“**Total Commitments**” means the aggregate ofthe Total Facility 1 Commitments and the Total Facility 2 Commitments, being$200,000,000 at the Signing Date.

“**Total Facility 1 Commitments**” means theaggregate of the Facility 1 Commitments, being $103,000,000 at the SigningDate.

“**Total Facility 2 Commitments**” means theaggregate of the Facility 2 Commitments, being $97,000,000 at the Signing Date.

“**Transfer Certificate**” means a certificatesubstantially in the form set out in Schedule 5 (*Form of Transfer Certificate*) or any other form agreedbetween the Agent and the Borrower.

“**Transfer Date**” means, in relation to atransfer, the later of:

(a)                                the proposedTransfer Date specified in the Transfer Certificate; and

(b)                               the date onwhich the Agent executes the Transfer Certificate.

“**Ukrainian Insolvency Law**” means the Law ofUkraine No. 2343-XII of 14 May 1992 “*On the Restoration of the Solvency of a Debtor or the Declaration of itas a Bankrupt*”.

“**Ukrainian Servicing Bank**” means JSCBCitibank (Ukraine)..

“**Unpaid Sum**” means any sum due and payablebut unpaid by the Borrower under the Finance Documents.

“**US Dollars**”, “**Dollars**”, “**USD**”and “**$**” denote the lawful currencyof the United States of America.

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“**Utilisation**” means a utilisation of aFacility.

“**Utilisation Date**” means the date of aUtilisation, being the date on which the relevant Loan is to be made.

“**Utilisation Request**” means a noticesubstantially in the form set out in Schedule 3 (*Utilisation**Request*).

“**VAT**” means value added tax and any other taxof a similar nature.

**1.2**                            Construction

(a)                               Unless acontrary indication appears, any reference in this Agreement to:

(i)                                   the “**Agent**”, any “**Mandated Lead Arranger**”, any “**Finance****Party**”,any “**Lender**”, the “**Borrower**” and any “**Party**” shall be construed so as to includeits successors in title, permitted assigns and permitted transferees;

(ii)                                “**assets**” includes present and futureproperties, revenues and rights of every description;

(iii)                             “**control**” means the possession, directly orindirectly, of the power to direct or cause the direction of the managementpolices of a person, whether through the ownership of voting securities, bycontract or credit arrangement, as trustee or executor, or otherwise;

(iv)                            a “**Finance****Document**” or any other agreementor instrument is a reference to that Finance Document or other agreement orinstrument as amended or novated;

(v)                               “**indebtedness**” includes any obligation(whether incurred as principal or as surety) for the payment or repayment ofmoney, whether present or future, actual or contingent;

(vi)                            a “**person**”includes any person, firm, company, corporation, government, state or agency ofa state or any association, trust or partnership (whether or not havingseparate legal personality) or two or more of the foregoing;

(vii)                         a “**regulation**”includes any regulation, rule, official directive, request or guideline(whether or not having the force of law) of any governmental, intergovernmentalor supranational body, agency, department or regulatory, self-regulatory orother authority or organisation;

(viii)                      a provision of law is a reference to thatprovision as amended or re-enacted; and

(ix)                              a time ofday is a reference to London time.

(b)                              Section,Clause and Schedule headings are for ease of reference only.

(c)                               Unless acontrary indication appears, a term used in any other Finance Document or inany notice given under or in connection with any Finance Document has the samemeaning in that Finance Document or notice as in this Agreement.

(d)                              A Default(other than an Event of Default) is “**continuing**”if it has not been remedied or waived and an Event of Default is “**continuing**” if it has not been waived.

**1.3**                            Third Party Rights

Aperson who is not a Party has no right under the Contracts (Rights of ThirdParties) Act 1999 to enforce or to enjoy the benefit of any term of thisAgreement.

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**1.4**                            Governing Language

ThisAgreement is entered into in both English and Ukrainian language counterparts. Inthe event of any inconsistency between the English language text and theUkrainian language text, the English language text shall prevail.

**1.5**                            Term of the Agreement

ThisAgreement shall come into force from the date of its proper registration withthe NBU (notwithstanding any subsequent modification to or termination of suchregistration) and shall continue in force until all monies payable under ithave been fully paid in accordance with its terms.

 

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**SECTION 2THE FACILITIES**

**2**                                      THE FACILITIES

**2.1**                            The Facilities

Subjectto the terms of this Agreement, the Lenders make available to the Borrower:

(a)                                a term loanfacility in Dollars to be designated “**Facility1**” in an aggregate amount equal to the Total Facility 1 Commitments;and

(b)                               a term loanfacility in Dollars to be designated “**Facility2**” in an aggregate amount equal to the Total Facility 2 Commitments.

**2.2**                            Finance Parties’ rights and obligations

(a)                               Theobligations of each Finance Party under the Finance Documents are several.Failure by a Finance Party to perform its obligations under the FinanceDocuments does not affect the obligations of any other Party under the FinanceDocuments. No Finance Party is responsible for the obligations of any other FinanceParty under the Finance Documents.

(b)                              The rightsof each Finance Party under or in connection with the Finance Documents areseparate and independent rights and any debt arising under the FinanceDocuments to a Finance Party from the Borrower shall be a separate andindependent debt.

(c)                               A FinanceParty may, except as otherwise stated in the Finance Documents, separatelyenforce its rights under the Finance Documents.

**3**                                      PURPOSE

**3.1**                            Purpose

TheBorrower shall apply all amounts borrowed by it under the Facilities towardsits general corporate purposes, including towards the financing of capitalexpenditure and the refinancing of existing indebtedness.

**3.2**                            Monitoring

NoFinance Party is bound to monitor or verify the application of any amountborrowed pursuant to this Agreement.

**4**                                      CONDITIONS OF UTILISATION

**4.1**                            Initial conditions precedent

(a)                               The Borrowermay not deliver the first Utilisation Request in respect of Facility 2 unlessthe Agent has received all of the documents and other evidence listed in Part Iof Schedule 2 (*Conditions precedent*)in form and substance satisfactory to the Agent. The Agent shall notify theBorrower and the Lenders promptly upon being so satisfied.

(b)                              The Borrowermay not deliver the first Utilisation Request in respect of Facility 1 unlessthe Agent has received all of the documents and other evidence listed in Part Iand Part II of 

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Schedule 2 (*Conditionsprecedent*) in form and substance satisfactory to the Agent. TheAgent shall notify the Borrower and the Lenders promptly upon being sosatisfied.

**4.2**                            Further conditions precedent

TheLenders will only be obliged to comply with Clause 5.4 (*Lenders’ participation*) if on the date ofthe Utilisation Request and on the proposed Utilisation Date:

(i)                                   no Defaultis continuing or would result from the proposed Loan;

(ii)                                theRepeating Representations are true in all material respects; and

(iii)                             theRegistration Certificate has not been cancelled or amended and remains in fullforce and effect.

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**SECTION 3UTILISATION**

**5**                                      UTILISATION

**5.1**                            Delivery of a Utilisation Request

TheBorrower may utilise a Facility by delivery to the Agent of a duly completedUtilisation Request not later than 10:00 a.m. on the day falling 3Business Days before the proposed Utilisation Date.

**5.2**                            Completion of a Utilisation Request

(a)                               EachUtilisation Request is irrevocable and will not be regarded as having been dulycompleted unless:

(i)                                   itidentifies the Facility to be utilised;

(ii)                                the proposedUtilisation Date is a Business Day within the Availability Period;

(iii)                             the currencyand amount of the Utilisation comply with Clause 5.3 (*Currency and amount*); and

(iv)                            it specifies that the proceeds of theUtilisation are to be credited into account number 2600 5 200092 015 held atthe Ukrainian Servicing Bank.

(b)                              Only oneLoan may be requested in each Utilisation Request.

**5.3**                            Currency and amount

(a)                               The currencyspecified in a Utilisation Request must be Dollars.

(b)                              The amountof the proposed Loan must be:

(i)                                   a minimum of$10,000,000 and integral multiple of $5,000,000 or, if less, the AvailableFacility; or

(ii)                                in any eventsuch that it is less than or equal to the Available Facility.

**5.4**                            Lenders’ participation

(a)                               If theconditions set out in this Agreement have been met, each Lender shall make itsparticipation in each Loan available by the Utilisation Date through itsFacility Office.

(b)                              The amountof each Lender’s participation in each Loan will be equal to the proportionborne by its Available Commitment to the relevant Available Facilityimmediately prior to making that Loan.

(c)                               The Agentshall notify each Lender of the amount of each Loan and the amount of itsparticipation in that Loan not later than 5:00 p.m. on the day falling 3Business Days before the relevant Utilisation Date.

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**SECTION 4REPAYMENT, PREPAYMENT AND CANCELLATION**

**6**                                      REPAYMENT

(a)                               The Borrowershall repay the Loans in four equal instalments, by paying on each RepaymentDate an amount equal to one quarter of the amount of the Loans outstanding atthe close of business on the last day of the Availability Period for theFacilities.

(b)                              The Borrowermay not reborrow any part of the Facilities which is repaid.

(c)                               The Borrowershall repay the Loans from account number 2600 5 200092 015 held at theUkrainian Servicing Bank unless the Agent notifies the Borrower otherwise.

**7**                                      PREPAYMENT AND CANCELLATION

**7.1**                            Illegality

If itbecomes unlawful in any applicable jurisdiction for a Lender to perform any ofits obligations as contemplated by this Agreement or to fund or maintain itsparticipation in any Loan:

(a)                                that Lendershall promptly notify the Agent upon becoming aware of that event;

(b)                               upon theAgent notifying the Borrower, the Commitment of that Lender will be immediatelycancelled; and

(c)                                the Borrowershall repay that Lender’s participation in the Loans on the last day of theInterest Period for each Loan occurring after the Agent has notified theBorrower or, if earlier, the date specified by the Lender in the noticedelivered to the Agent (being no earlier than the last day of any applicablegrace period permitted by law).

**7.2**                            Voluntary cancellation

TheBorrower may, if it gives the Agent not less than 5 Business Days’ (or suchshorter period as the Majority Lenders may agree) prior written notice, cancelthe whole or any part (being a minimum amount of $10,000,000) of an AvailableFacility. Any cancellation under this Clause 7.2 shall reduce the Commitmentsof the Lenders rateably under that Facility.

**7.3**                            Voluntary prepayment of Loans

(a)                               The Borrowermay, if it gives the Agent not less than 10 Business Days’ (or such shorterperiod as the Majority Lenders may agree) prior written notice, prepay thewhole or any part of any Loan (but, if in part, being an amount that reducesthe Loan by a minimum amount of $5,000,000).

(b)                              A Loan inrespect of a Facility may only be prepaid after the last day of theAvailability Period (or, if earlier, the day on which the relevant AvailableFacility is zero).

(c)                               Eachprepayment shall be applied in satisfaction of the Borrower’s obligations underClause 6 (*Repayment*) in theinverse order of maturity of the Loans (or, at the option of the Borrower, *pro rata* to the remaining principalinstalments thereof).

**7.4**                            Mandatory Prepayment — Change of Control

(a)                               In thisClause 7.4, “**Change of Control**”means any of the following events or circumstances:

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(i)                                   the Parentceases to be the legal and beneficial owner of not less than 99% of the issuedshares of the Borrower or ceases to own or control of not less than 99% of thevoting interests of the share capital of the Borrower; or

(ii)                                any personor group of persons acting in concert or under an express or implied agreementor understanding, directly or through one or more intermediaries, shall (x) acquireultimate beneficial or legal ownership of, or control over, more than 50% ofthe issued shares of the Parent; (y) acquire ownership of or control overmore than 50% of the voting interests in the share capital of the Parent; or (z) obtainthe power (whether or not exercised) to elect not less than half of thedirectors of the Parent; (provided, however, that any acquisition by SistemaJSFC or any of its Subsidiaries that results in the 50% threshold in paragraphs(x) and (y) above being exceeded, or in the power referred to inparagraph (z) above being obtained, will not be a Change of Control).

(b)                              If there isa Change of Control:

(i)                                   the Borrowershall, or (if applicable) shall procure that the Parent shall, promptly notifyeach Lender (through the Agent) upon the Borrower or (if applicable) the Parentbecoming aware of that event;

(ii)                                the Borrowermay not make a Utilisation; and

(iii)                             if anyLender (in its sole discretion) so requires, it may, within 5 Business Days ofits receipt of the notification under sub-clause (i) above, direct theAgent to send a notice to the Borrower requiring the Borrower to repay thatLender’s participations in the Loans (together with accrued interest) in fullon the day (the “**Early Repayment Date**”)falling 30 days after the date of the notification under sub-clause (i) above.Before the Early Repayment Date, the Lender and the Borrower shall consult witheach other for a period of 5 Business Days with respect to the transfer of thatLender’s rights and obligations under this Agreement to another reputableinternational bank or financial institution nominated by the Borrower (butwhich is not an Affiliate of the Borrower) in accordance with Clause 22.5 (*Procedure for transfer*). If no suchtransfer has been effected on or before the Early Repayment Date, then (x) theBorrower shall repay that Lender’s participations in the Loans (together withaccrued interest) in full on the Early Repayment Date and (y) theCommitments of that Lender shall be reduced to zero on that date.

**7.5**                            Right of repayment and cancellation in relationto a single Lender

If:

(a)                                any sumpayable to any Lender by the Borrower is required to be increased underparagraph (c) of Clause 12.2 (*Taxgross-up*); or

(b)                               any Lenderclaims indemnification from the Borrower under Clause 12.3 (*Tax indemnity*) or Clause 13 (*Increased Costs*),

theBorrower may, whilst the circumstance giving rise to the requirement orindemnification continues, give the Agent notice of cancellation of theCommitments of that Lender and its intention to procure the repayment of thatLender’s participation in the Loans on the last day of the Interest Periodending after the date of such notice (or, if earlier, on such other date asspecified by the Borrower in that notice) (the “**Cancellation Date**”). Before the Cancellation Date, the Lenderand the Borrower shall consult with each other for a period of 5 Business Dayswith respect to the transfer of that Lender’s rights and obligations under thisAgreement to 

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anotherreputable international bank or financial institution nominated by the Borrower(but which is not an Affiliate of the Borrower) in accordance with Clause 22.5(*Procedure for transfer*). If nosuch transfer has been effected on or before the Cancellation Date, then (x) theBorrower shall repay that Lender’s participations in the Loans (together withaccrued interest) in full on the Cancellation Date and (y) the Commitmentsof that Lender shall be reduced to zero on that date.

**7.6**                            Restrictions

(a)                               Any noticeof cancellation or prepayment given by any Party under this Clause 7 shall beirrevocable and, unless a contrary indication appears in this Agreement, shallspecify the date or dates upon which the relevant cancellation or prepayment isto be made and the amount of that cancellation or prepayment.

(b)                              Anyprepayment under this Agreement shall be made together with accrued interest onthe amount prepaid and, subject to any Break Costs, without premium or penalty.

(c)                               The Borrowermay not reborrow any part of a Facility which is prepaid.

(d)                              The Borrowershall not repay or prepay all or any part of the Loans or cancel all or anypart of the Commitments except at the times and in the manner expresslyprovided for in this Agreement.

(e)                               No amount ofthe Total Commitments cancelled under this Agreement may be subsequentlyreinstated.

(f)                                 If the Agentreceives a notice under this Clause 7 it shall promptly forward a copy of thatnotice to either the Borrower or the affected Lender, as appropriate.

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**SECTION 5COSTS OF UTILISATION**

**8**                                      INTEREST

**8.1**                            Calculation of interest

Therate of interest on each Loan for each Interest Period is the percentage rateper annum which is the aggregate of the applicable:

(a)                                Margin;

(b)                               LIBOR; and

(c)                                MandatoryCost, if any.

**8.2**                            Payment of interest

TheBorrower shall pay accrued interest on each Loan on the last day of eachInterest Period (and, if the Interest Period is longer than 6 Months, on thedate falling at six monthly intervals after the first day of the InterestPeriod).

**8.3**                            Default interest

(a)                               If theBorrower fails to pay any amount payable by it under a Finance Document on itsdue date, interest shall accrue on the overdue amount from the due date up tothe date of actual payment (both before and after judgment) at a rate which,subject to paragraph (b) below, is the sum of 2 per cent. and the ratewhich would have been payable if the overdue amount had, during the period ofnon-payment, constituted a Loan in the currency of the overdue amount forsuccessive Interest Periods, each of a duration selected by the Agent (actingreasonably). Any interest accruing under this Clause 8.3 shall be immediatelypayable by the Borrower on demand by the Agent.

(b)                              If anyoverdue amount consists of all or part of a Loan which became due on a daywhich was not the last day of an Interest Period relating to that Loan:

(i)                                   the firstInterest Period for that overdue amount shall have a duration equal to theunexpired portion of the current Interest Period relating to that Loan; and

(ii)                                the rate ofinterest applying to the overdue amount during that first Interest Period shallbe the sum of 2 per cent. and the rate which would have applied if the overdueamount had not become due.

(c)                               Defaultinterest (if unpaid) arising on an overdue amount will be compounded with theoverdue amount at the end of each Interest Period applicable to that overdue amountbut will remain immediately due and payable.

**8.4**                            Notification of rates of interest

TheAgent shall promptly notify the Lenders and the Borrower of the determinationof a rate of interest under this Agreement.

**8.5**                            Adjustment of Margin

(a)                               Subject to thisClause 8.5, the Margin applicable to each Utilisation under Facility 2 shall bereduced to 0.75 (zero point seventy five) per cent. per annum.

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(b)                              Noadjustment shall be made to the Margin under paragraph (a) above untilreceipt by the Agent of evidence satisfactory to it that the terms of Clause20.17 (*Parent Guarantee in respect ofFacility 2*) have been fully complied with, including (for theavoidance of doubt) evidence that the requisite corporate approvals have beencorrectly obtained.

(c)                               Any adjustmentto the Margin under paragraph (a) above shall take effect on the datefalling two Business Days after receipt by the Agent of the evidence referredto in paragraph (b) above.

**9**                                      INTEREST PERIODS

**9.1**                            Selection of Interest Periods

(a)                               The Borrowermay select an Interest Period for a Loan in the Utilisation Request for thatLoan or (if the Loan has already been borrowed) in a Selection Notice.

(b)                              EachSelection Notice for a Loan is irrevocable and must be delivered to the Agentby the Borrower not later than the Specified Time.

(c)                               If theBorrower fails to deliver a Selection Notice to the Agent in accordance withparagraph (b) above, the relevant Interest Period will be one Month,subject to paragraph (e) below.

(d)                              Subject tothis Clause 9, the Borrower may select an Interest Period of 1, 2 or 3 Monthsor any other period agreed between the Borrower and the Agent (acting on theinstructions of all the Lenders).

(e)                               An InterestPeriod for a Loan shall not extend beyond the Final Maturity Date.

(f)                                 EachInterest Period for a Loan shall start on the Utilisation Date or (if alreadymade) on the last day of its preceding Interest Period.

(g)                              Prior to theSyndication Date each Interest Period shall have a duration of 1 Month or suchother duration as is advised to the Borrower by the Bookrunners to ensure thatsuch Interest Period shall end on the Syndication Date.

**9.2**                            Non-Business Days

If anInterest Period would otherwise end on a day which is not a Business Day, thatInterest Period will instead end on the next Business Day in that calendarmonth (if there is one) or the preceding Business Day (if there is not).

**10**                               CHANGES TO THE CALCULATION OF INTEREST

**10.1**                     Absenceof quotations

Subjectto Clause 10.2 (*Market disruption*),if LIBOR is to be determined by reference to the Reference Banks but aReference Bank does not supply a quotation by 11:00 a.m. on the QuotationDay, the applicable LIBOR shall be determined on the basis of the quotations ofthe remaining Reference Banks.

**10.2**                     Marketdisruption

(a)                               If a MarketDisruption Event occurs in relation to a Loan for any Interest Period, then therate of interest on each Lender’s share of that Loan for the Interest Periodshall be the rate per annum which is the sum of:

(i)                                   the Margin;

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(ii)                                the ratenotified to the Agent by that Lender as soon as practicable and in any eventbefore interest is due to be paid in respect of that Interest Period, to bethat which expresses as a percentage rate per annum the cost to that Lender offunding its participation in that Loan from whatever source it may reasonablyselect; and

(iii)                             theMandatory Cost, if any, applicable to that Lender’s participation in the Loan.

(b)                              In thisAgreement “**Market Disruption Event**”means:

(i)                                   at or aboutnoon on the Quotation Day for the relevant Interest Period the Screen Rate isnot available and none or only one of the Reference Banks supplies a rate tothe Agent to determine LIBOR for Dollars for the relevant Interest Period; or

(ii)                                before closeof business in London on the Quotation Day for the relevant Interest Period,the Agent receives notifications from a Lender or Lenders (whose participationsin a Loan exceed 35 per cent. of that Loan) that the cost to it of obtainingmatching deposits in the London interbank market would be in excess of LIBOR.

**10.3**                     Alternativebasis of interest or funding

(a)                               If a MarketDisruption Event occurs and the Agent or the Borrower so requires, the Agentand the Borrower shall enter into negotiations (for a period of not more than30 days) with a view to agreeing a substitute basis for determining the rate ofinterest.

(b)                              Anyalternative basis agreed pursuant to paragraph (a) above shall, with theprior consent of all the Lenders and the Borrower, be binding on all Parties.

**10.4**                     BreakCosts

(a)                               The Borrowershall, within three Business Days of demand by a Finance Party, pay to thatFinance Party its Break Costs attributable to all or any part of a Loan orUnpaid Sum being paid by the Borrower on a day other than the last day of anInterest Period for that Loan or Unpaid Sum.

(b)                              Each Lendershall, as soon as reasonably practicable after a demand by the Agent, provide acertificate confirming the amount of its Break Costs for any Interest Period inwhich they accrue.

**11**                                FEES

**11.1**                      Commitment fee

(a)                               The Borrowershall pay to the Agent (for the account of each Lender) a commitment fee,calculated on a daily basis at the rate of 45 per cent of the applicable Marginon that Lender’s Available Commitment under the Facilities for the AvailabilityPeriod.

(b)                              The commitmentfee will accrue from the Signing Date, and is payable in arrears on the lastday of each successive Interest Period which ends during the AvailabilityPeriod, on the last day of the Availability Period and, if cancelled in full,on the cancelled amount of the relevant Lender’s Commitment at the time thecancellation is effective.

**11.2**                      Arrangement fee

TheBorrower shall pay to the Mandated Lead Arrangers an arrangement fee in theamount and at the times agreed in the Fee Letter.

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**11.3**                      Agency fee

TheBorrower shall pay to the Agent (for its own account) an agency fee in theamount and at the times agreed in the Fee Letter.

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**SECTION 6ADDITIONAL PAYMENT OBLIGATIONS**

**12**                               TAX GROSS-UP AND INDEMNITIES

**12.1**                     Definitions

(a)                               In thisAgreement:

“**Protected Party**” means a Finance Partywhich is or will be subject to any liability, or required to make any payment,for or on account of Tax in relation to a sum received or receivable (or anysum deemed for the purposes of Tax to be received or receivable) under a FinanceDocument.

“**Tax Credit**” means a credit against, reliefor remission for, or repayment of any Tax.

“**Tax Deduction**” means a deduction orwithholding for or on account of Tax from a payment under a Finance Document.

“**Tax Payment**” means an increased payment madeby the Borrower to a Finance Party under Clause 12.2 (*Tax gross-up*) or a payment underClause 12.3 (*Tax indemnity*).

(b)                              Unless acontrary indication appears, in this Clause 12 a reference to “**determines**” or “**determined**” means a determination made in the absolutediscretion of the person making the determination.

**12.2**                     Taxgross-up

(a)                               The Borrowershall make all payments to be made by it without any Tax Deduction, unless aTax Deduction is required by law.

(b)                              The Borrowershall promptly upon becoming aware that it must make a Tax Deduction (or thatthere is any change in the rate or the basis of a Tax Deduction) notify theAgent accordingly. Similarly, a Lender shall notify the Agent on becoming soaware in respect of a payment payable to that Lender. If the Agent receivessuch notification from a Lender, it shall notify the Borrower.

(c)                               If a TaxDeduction is required by law to be made by the Borrower, the amount of thepayment due from the Borrower shall be increased to an amount which (aftermaking any Tax Deduction) leaves an amount equal to the payment which wouldhave been due if no Tax Deduction had been required, subject to fulfilment byeach relevant Lender of its obligations under Clause 12.7 (*Tax forms*).

(d)                              If theBorrower is required to make a Tax Deduction, it shall make that Tax Deductionand any payment required in connection with that Tax Deduction within the timeallowed and in the minimum amount required by law.

(e)                               Within 45days of the end of each calendar quarter during which either a Tax Deduction or any payment required in connection withthat Tax Deduction was made by the Borrower, the Borrower shall deliver to theAgent for the Finance Party entitled to the payment an original receipt (orcertified copy thereof) demonstrating that the Tax Deduction has been made or(as applicable) any appropriate payment paid to the relevant taxing authority.

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**12.3**                     Taxindemnity

(a)                               The Borrowershall (within three Business Days of demand by the Agent) pay to a ProtectedParty an amount equal to the loss, liability or cost which that Protected Partydetermines has been suffered for or on account of Tax by that Protected Partyin respect of a Finance Document.

(b)                              Paragraph (a) aboveshall not apply:

(i)                                   with respectto any Tax assessed on a Finance Party:

(A)                           under the law of the jurisdiction inwhich that Finance Party is incorporated or, if different, the jurisdiction (orjurisdictions) in which that Finance Party is treated as resident for taxpurposes; or

(B)                             under thelaw of the jurisdiction in which that Finance Party’s Facility Office islocated in respect of amounts received or receivable in that jurisdiction,

if thatTax is imposed on or calculated by reference to the net income received orreceivable (but not any sum deemed to be received or receivable) by thatFinance Party; or

(ii)                                to theextent a loss, liability or cost is compensated for by an increased paymentunder Clause 12.2 (*Tax gross-up*).

(c)                               A ProtectedParty making, or intending to make, a claim under paragraph (a) aboveshall promptly notify the Agent of the event which will give, or has given,rise to the claim, following which the Agent shall notify the Borrower.

(d)                              A ProtectedParty shall, on receiving a payment from the Borrower under thisClause 12.3, notify the Agent.

**12.4**                     Tax Credit

If theBorrower makes a Tax Payment and the relevant Finance Party determines that:

(a)                                a Tax Creditis attributable to that Tax Payment; and

(b)                               that FinanceParty has obtained, utilised and retained that Tax Credit,

theFinance Party shall pay promptly an amount to the Borrower which that FinanceParty determines will leave the Finance Party (after that payment) in the sameafter-Tax position as it would have been in had the Tax Payment not been madeby the Borrower.

**12.5**                     Stamptaxes

TheBorrower shall pay and, within three Business Days of demand, indemnify eachFinance Party against any cost, loss or liability that Finance Party incurs inrelation to all stamp duty, registration and other similar Taxes payable inrespect of any Finance Document.

**12.6**                     Valueadded tax

(a)                               Allconsideration expressed to be payable under a Finance Document by any Party toa Finance Party shall be deemed to be exclusive of any VAT. If VAT ischargeable on such consideration, that Party shall pay to the Finance Party (ordirectly to the appropriate tax authority, if so required by law) (in additionto and at the same time as paying the consideration) an amount equal to theamount of the VAT.

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(b)                              Where aFinance Document requires any Party to reimburse a Finance Party for any costsor expenses, that Party shall also at the same time pay and indemnify theFinance Party against all VAT incurred by the Finance Party in respect of thecosts or expenses to the extent that the Finance Party reasonably determinesthat neither it nor any other member of the group of which it is a member forVAT purposes is entitled to credit or repayment from the relevant tax authorityin respect of the VAT.

**12.7**                     Taxforms

(a)                               At least 10Business Days prior to the date of the first scheduled payment of interestunder this Agreement, and within 20 Business Days from the beginning of eachcalendar year falling after the Signing Date, each Lender shall use itsreasonable efforts to provide to the Borrower a document issued by the relevantgovernment authority in its jurisdiction of residence confirming that it is aresident of that jurisdiction.

(b)                              At therequest of the Borrower (acting reasonably), each Lender shall use itsreasonable efforts to provide any other documentation or information to theBorrower that may be reasonably necessary for the Borrower to establish acomplete exemption from Ukrainian withholding tax in relation to payments ofinterest under this Agreement.

**13**                               INCREASED COSTS

**13.1**                     Increasedcosts

(a)                               Subject toClause 13.3 (*Exceptions*) theBorrower shall, within three Business Days of a demand by the Agent, pay forthe account of a Finance Party the amount of any Increased Costs incurred bythat Finance Party or any of its Affiliates as a result of (i) theintroduction of or any change in (or in the interpretation, administration orapplication of) any law or regulation or (ii) compliance with any law orregulation made after the Signing Date.

(b)                              In thisAgreement “**Increased Costs**” means:

(i)                                   a reductionin the rate of return from a Facility or on a Finance Party’s (or its Affiliate’s)overall capital;

(ii)                                anadditional or increased cost; or

(iii)                             a reductionof any amount due and payable under any Finance Document,

whichis incurred or suffered by a Finance Party or any of its Affiliates to theextent that it is attributable to that Finance Party having entered into itsCommitment or funding or performing its obligations under any Finance Document.

**13.2**                     Increasedcost claims

(a)                               A FinanceParty intending to make a claim pursuant to Clause 13.1 (*Increased costs*) shall notify the Agent ofthe event giving rise to the claim, following which the Agent shall promptlynotify the Borrower.

(b)                              Each FinanceParty shall, as soon as practicable after a demand by the Agent, provide acertificate confirming the amount of its Increased Costs.

**13.3**                     Exceptions

(a)                               Clause 13.1(*Increased costs*) does not applyto the extent any Increased Cost is:

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(i)                                   attributableto a Tax Deduction required by law to be made by the Borrower;

(ii)                                compensatedfor by Clause 12.3 (*Tax indemnity*)(or would have been compensated for under Clause 12.3 (*Tax indemnity*) but was not so compensatedsolely because any of the exclusions in paragraph (b) of Clause 12.3 (*Tax indemnity*) applied);

(iii)                             compensatedfor by the payment of the Mandatory Cost; or

(iv)                            attributable to the wilful breach by therelevant Finance Party or its Affiliates of any law or regulation.

(b)                              In thisClause 13.3, a reference to a “**Tax Deduction**”has the same meaning given to the term in Clause 12.1 (*Definitions*).

**14**                               OTHER INDEMNITIES

**14.1**                     Currencyindemnity

(a)                               If any sumdue from the Borrower under the Finance Documents (a “**Sum**”), or any order, judgment or awardgiven or made in relation to a Sum, has to be converted from the currency (the “**First Currency**”) in which that Sum ispayable into another currency (the “**SecondCurrency**”) for the purpose of:

(i)                                   making orfiling a claim or proof against the Borrower;

(ii)                                obtaining orenforcing an order, judgment or award in relation to any litigation or arbitrationproceedings,

theBorrower shall as an independent obligation, within three Business Days ofdemand, indemnify each Finance Party to whom that Sum is due against any cost,loss or liability arising out of or as a result of the conversion including anydiscrepancy between (A) the rate of exchange used to convert that Sum fromthe First Currency into the Second Currency and (B) the rate or rates ofexchange available to that person at the time of its receipt of that Sum.

(b)                              The Borrowerwaives any right it may have in any jurisdiction to pay any amount under theFinance Documents in a currency or currency unit other than that in which it isexpressed to be payable.

**14.2**                     Otherindemnities

TheBorrower shall, within three Business Days of demand, indemnify each FinanceParty against any cost, loss or liability incurred by that Finance Party as aresult of:

(a)                                theoccurrence of any Event of Default;

(b)                               a failure bythe Borrower to pay any amount due under a Finance Document on its due date,including without limitation, any cost, loss or liability arising as a resultof Clause 26 (*Sharing among the FinanceParties*);

(c)                                funding, ormaking arrangements to fund, its participation in a Loan requested by theBorrower in a Utilisation Request but not made by reason of the operation ofany one or more of the provisions of this Agreement (other than by reason ofdefault or negligence by that Finance Party alone); or

(d)                               a Loan (orpart of a Loan) not being prepaid in accordance with a notice of prepaymentgiven by the Borrower.

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**14.3**                     Indemnityto the Agent

TheBorrower shall promptly indemnify the Agent against any cost, loss or liabilityincurred by the Agent (acting reasonably) as a result of:

(a)                                investigatingany event which it reasonably believes is a Default; or

(b)                               acting orrelying on any notice, request or instruction which it reasonably believes tobe genuine, correct and appropriately authorised.

**15**                               MITIGATION BY THE LENDERS

**15.1**                     Mitigation

(a)                               Each FinanceParty shall, in consultation with the Borrower, take all reasonable steps tomitigate any circumstances which arise and which would result in any amountbecoming payable under or pursuant to, or cancelled pursuant to, any of Clause7.1 (*Illegality*), Clause 12 (*Tax gross-up and indemnities*) or Clause 13.1(*Increased costs*) including (butnot limited to) transferring its rights and obligations under the FinanceDocuments to another Affiliate or Facility Office.

(b)                              Paragraph (a) abovedoes not in any way limit the obligations of the Borrower under the FinanceDocuments.

**15.2**                     Limitationof liability

(a)                               The Borrowershall indemnify each Finance Party for all costs and expenses reasonablyincurred by that Finance Party as a result of steps taken by it under Clause15.1 (*Mitigation*).

(b)                              A FinanceParty is not obliged to take any steps under Clause 15.1 (*Mitigation*) if, in the opinion of thatFinance Party (acting reasonably), to do so might be prejudicial to it.

**16**                               COSTS AND EXPENSES

**16.1**                     Transactionexpenses

TheBorrower shall within 15 Business Days of demand pay the Agent, the Bookrunnersand the Mandated Lead Arrangers the amount of all reasonable out-of-pocketcosts and legal expenses incurred by any of them in connection with thenegotiation, preparation, delivery, execution, administration and syndicationof:

(a)                                thisAgreement and any other documents referred to in this Agreement; and

(b)                               any otherFinance Documents executed after the date of this Agreement,

subject,in each case, to the cap on such amounts agreed between the Mandated LeadArrangers and the Borrower.

**16.2**                     Amendmentcosts

If (a) anyObligor requests an amendment, waiver or consent or (b) an amendment isrequired pursuant to Clause 27.9 (*Change ofcurrency*), the Borrower shall, within 10 Business Days of demand,reimburse the Agent for the amount of all costs and expenses (including legalfees) reasonably incurred by the Agent in responding to, evaluating,negotiating or complying with that request or requirement.

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**16.3**                     Enforcementcosts

TheBorrower shall, within 10 Business Days of demand, pay to each Finance Partythe amount of all costs and expenses (including legal fees) incurred by thatFinance Party in connection with the enforcement of, or the preservation of anyrights under, any Finance Document.

 

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**SECTION 7REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT**

**17**                               REPRESENTATIONS

TheBorrower makes the representations and warranties set out in this Clause 17 toeach Finance Party on the date of this Agreement.

**17.1**                     Status

(a)                               It is aclosed joint-stock company, duly established, registered and validly existingunder the laws of Ukraine.

(b)                              Each Obligorand each Significant Subsidiary has the power to own its assets and carry onits business as it is being conducted.

**17.2**                     Bindingobligations

Theobligations expressed to be assumed by it in each Finance Document are legal,valid, binding and enforceable obligations, subject to insolvency and otherlaws affecting creditors’ rights generally and principles of equity.

**17.3**                     Non-conflictwith other obligations

Theentry into and performance by it of, and the transactions contemplated by, theFinance Documents do not and will not conflict with:

(a)                                any law orregulation applicable to it;

(b)                               its or anymember of the Group’s constitutional documents; or

(c)                                any agreementor instrument binding upon it or any member of the Group or any member of theGroup’s assets.

**17.4**                     Powerand authority

EachObligor has the power to enter into, perform and deliver, and has taken allnecessary action to authorise its entry into, performance and delivery of, theFinance Documents and the transactions contemplated by those Finance Documents.

**17.5**                     Validityand admissibility in evidence

AllAuthorisations required:

(a)                                to enableeach Obligor lawfully to enter into, exercise its rights and comply with itsobligations in the Finance Documents;

(b)                               for eachObligor and each Significant Subsidiary to carry on its and their business; and

(c)                                to make theFinance Documents to which each Obligor is a party admissible in evidence inits jurisdiction of incorporation,

havebeen obtained or effected and are in full force and effect (except, in relationto paragraph (b) above, where the failure to obtain such Authorisations(excluding any Telecommunications Authorisations) is not reasonably likely tohave a Material Adverse Effect).

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**17.6**                     Governinglaw and enforcement

(a)                               The choiceof English law as the governing law of the Finance Documents will be recognisedand enforced in its jurisdiction of incorporation.

(b)                              Anyarbitration award obtained in England in relation to a Finance Document will berecognised and enforced in its jurisdiction of incorporation in accordance withthe 1958 New York Convention on Recognition and Enforcement of Foreign ArbitralAwards.

**17.7**                     Nobankruptcy proceedings

Neitherthe Borrower, the Parent nor any Significant Subsidiary has taken any corporateaction nor have any other steps been taken or legal proceedings been startedor, to the best of its knowledge and belief (after due inquiry), threatenedagainst any Obligor or any Significant Subsidiary for:

(a)                                itsliquidation, winding-up, insolvency, dissolution, administration,reorganisation or bankruptcy or the appointment of a liquidation commission (*likvidatsiyna komisiya/ likvidatsionnaya komissiya*)or a similar officer of any Obligor or any Significant Subsidiary;

(b)                               thesuspension of payments, a moratorium of any indebtedness, judicial management,receivership, provisional supervision, the institution of supervision (*nablyudeniye*), financial rehabilitation (*finansovoe ozdorovlenie*) and any otherrehabilitation procedure (*sanatsiya*),external management (*vneshniy upravlayucshiy*),bankruptcy (assets) administration (*rozporyadjennya*),liquidation procedure (*likvidatsiynaprocedura*) and/or the appointment of a bankruptcy manager (*arbitrajnyi keruyuchy/konkursniy upravlayuschiy*)or similar officer of any Obligor or any Significant Subsidiary;

(c)                                acomposition, assignment or arrangement with any creditor of any Obligor or anySignificant Subsidiary or the convening of a meeting of creditors for thepurposes of considering an amicable settlement (as defined in the UkrainianInsolvency Law or the Russian Insolvency Law, as applicable);

(d)                               theappointment of a liquidator, judicial manager, receiver and/or manager,administrator, administrative receiver, compulsory manager, provisionalsupervisor, supervisor, bankruptcy manager or other similar officer in respectof any Obligor or any Significant Subsidiary; or

(e)                                anyanalogous act in respect of any Obligor or any Significant Subsidiary in anyjurisdiction.

**17.8**                     Nofiling or stamp taxes

Underthe law of its jurisdiction of incorporation it is not necessary that theFinance Documents be filed, recorded, enrolled or registered with any court orother authority in that jurisdiction, except for the registration of thisAgreement with the NBU, or that any stamp, registration or similar tax be paidon or in relation to the Finance Documents or the transactions contemplated bythe Finance Documents, except for any fees in connection with the registrationof this Agreement with the NBU and court registration fees in connection withany enforcement proceedings in such court.

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**17.9**                     Paymentof Taxes

Neitherany Obligor nor any Significant Subsidiary has overdue Tax liabilities, otherthan Tax liabilities (a) whose amount, applicability or validity is beingcontested in good faith by appropriate proceedings and for which adequatereserves or other appropriate provision has been made or (b) whose amount,together with all such other unpaid or undischarged Taxes, does not inaggregate exceed $25,000,000 in relation to the Parent or $10,000,000 inrelation to the Borrower or any Significant Subsidiary (or its equivalent inany other currency or currencies).

**17.10**              Nodefault

(a)                               No Defaultor Event of Default is continuing or might reasonably be expected to resultfrom the making of any Utilisation.

(b)                              No event orcircumstance is outstanding which constitutes a default under any otheragreement or instrument which is binding on it or any other member of the Groupor to which its (or any other member of the Group’s) assets are subject whichis reasonably likely to have a Material Adverse Effect.

**17.11**               Financialstatements

(a)                               The OriginalFinancial Statements were prepared in accordance with GAAP consistentlyapplied.

(b)                              The BorrowerAudited Original Financial Statements were audited by reputable internationalauditors and fairly represent the Borrower’s financial condition and operationsas at the end of and for the relevant financial year.

(c)                               The ParentAudited Original Financial Statements fairly represent the Parent’s and theGroup’s consolidated, financial condition and operations as at the end of andfor the relevant financial year.

(d)                              There hasbeen no material adverse change in its business or financial condition (or thebusiness or consolidated financial condition of the Group) since the date ofthe Parent Audited Original Financial Statements.

**17.12**              *Pari passu* ranking

EachObligor’s payment obligations under the Finance Documents rank at least *pari passu* with the claims of all itsother unsecured and unsubordinated creditors, except for obligationsmandatorily preferred by law applying to companies generally.

**17.13**              Noproceedings pending or threatened

Otherthan:

(a)                                the BorrowerLitigation; and

(b)                               litigationrelating to assets which the Parent acquired between 1 November 2005 andthe date of this Agreement (provided that the amount claimed (if quantified bythe claimant) or otherwise the value of the claim as determined by the Agent(acting reasonably after consultation with the Borrower) (as applicable) doesnot exceed $330,000,000),

nolitigation, arbitration or administrative proceedings of or before any court,arbitral body or agency (including but not limited to, investigative proceedings)have, to the best of its knowledge and belief (after due inquiry), been startedor threatened against any Obligor or any Significant Subsidiary which, ifadversely determined would be reasonably likely to have a Material AdverseEffect.

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**17.14**              Environmentallaws and licences

Exceptas disclosed in writing to the Agent before the date hereof, each member of theGroup has:

(a)                                compliedwith all Environmental Laws to which it may be subject;

(b)                               obtained allEnvironmental Licences required in connection with its business; and

(c)                                compliedwith the terms of those Environmental Licences,

in eachcase where failure to do so would be reasonably likely to have a MaterialAdverse Effect.

**17.15**              Telecommunicationslaws and licences

(a)                               Each of theBorrower, the Parent and the Significant Subsidiaries has:

(i)                                   complied inall material respects with all Telecommunications Laws to which it may besubject;

(ii)                                obtained allmaterial Telecommunications Authorisations necessary to conduct its business;and

(iii)                             complied inall material respects with the terms of those Telecommunication Authorisations,

in eachcase other than where failure to do so would not reasonably be expected to havea Material Adverse Effect.

(b)                              There hasbeen no act, omission or event which might reasonably be expected to give riseto the material amendment, revocation, suspension, cancellation, withdrawal ortermination of any provision of any Telecommunications Authorisation. To thebest of its knowledge and belief (after due inquiry), no TelecommunicationsAuthorisation is the subject of any pending or threatened proceedings which, ifadversely determined, would reasonably be expected to have a Material AdverseEffect.

**17.16**              Compliancewith laws

Each ofthe Borrower, the Parent and the Significant Subsidiaries is conducting itsbusiness and operations in compliance with all laws and regulations and alldirectives of any government agency having legal force applicable or relevantto it, excluding any such non-compliance which would not reasonably be expectedto have a Material Adverse Effect.

**17.17**              NoImmunity

(a)                               Theexecution by the Borrower of the Finance Documents constitutes, and itsexercise of its rights and performance of its obligations thereunder willconstitute, private and commercial activities done and performed for privateand commercial purposes (rather than public and governmental purposes).

(b)                              In anyproceedings taken in the Russian Federation or Ukraine in relation to theFinance Documents, the Borrower will not be entitled to claim for itself or anyof its assets immunity from suit, execution, attachment or other legal process.

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**17.18**              Repetition

TheRepeating Representations are deemed to be made by the Borrower by reference tothe facts and circumstances then existing on the date of each UtilisationRequest and the first day of each Interest Period, provided that:

(a)                                whenever therepresentation in paragraph (c) of Clause 17.3 (*Non-conflict with other obligations*) is deemed to be made ona date other than the Signing Date or a Utilisation Date, the statement “exceptwhere the same would not be reasonably likely to have a Material Adverse Effect”shall qualify the representation in said paragraph (c)); and

(b)                               from thedate of the Parent Guarantee until such time as the obligations of the Parentthereunder have been discharged, the Repeating Representations (other than theRepeating Representation in Clause 17.13 (*NoProceedings Pending or Threatened*) shall be deemed to be made onlyin respect of the Borrower and its Subsidiaries and not, for the avoidance ofdoubt, the Parent or any other member of the Group.

**18**                               INFORMATION UNDERTAKINGS

Theundertakings in this Clause 18 remain in force from the date of this Agreementfor so long as any amount is outstanding under the Finance Documents or anyCommitment is in force.

**18.1**                     Financialstatements

(a)                               The Borrowershall supply (or, where applicable, shall procure that the Parent shall supply)to the Agent in sufficient copies for all the Lenders:

(i)                                   as soon asthe same become available, but in any event within 90 days after the end ofeach of its financial years:

(A)                           its audited financial statements for that financial year; and

(B)                             the audited consolidated and non-consolidated financial statements ofthe Parent for that financial year; and

(ii)                                as soon asthe same become available, but in any event within 60 days after the end ofeach of its first, second and third financial quarters and within 90 days ofits fourth financial quarter:

(A)                           its unaudited financial statements for that financial quarter; and

(B)                             the unaudited consolidated and non-consolidated financial statements ofthe Parent for that financial quarter.

(b)                              From thedate of the Parent Guarantee until such time as the obligations of the Parentthereunder have been discharged, the obligation to supply (or, whereapplicable, to procure to supply) the financial statements referred to insub-paragraphs (i) and (ii) above shall be limited to the obligationto supply financial statements in respect of the Borrower and not, for theavoidance of doubt, in respect of the Parent.

**18.2**                     ComplianceCertificate

(a)                               The Borrowershall supply to the Agent with each set of financial statements deliveredpursuant to Clause 18.1 (*Financialstatements*), a Compliance Certificate setting out (in reasonabledetail)

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computations as to compliance with Clause 19 (*Financial Covenants*) as at the date as atwhich those financial statements were drawn up.

(b)                              EachCompliance Certificate shall be signed by an authorised officer of the Borrowerand, if required to be delivered with the financial statements deliveredpursuant to paragraph (a) of Clause 18.1 (*Financialstatements*), shall be reported on by the Borrower’s auditors in theform set out in Schedule 6 (*Form ofCompliance Certificate*).

(c)                               From thedate of the Parent Guarantee until such time as the obligations of the Parentthereunder have been discharged, a Compliance Certificate shall be issued bythe Borrower in respect of the Borrower and not, for the avoidance of doubt, inrespect of the Parent.

**18.3**                     Requirementsas to financial statements

(a)                               Each set offinancial statements delivered by the Borrower or the Parent pursuant to Clause18.1 (*Financial statements*) shallbe certified by an authorised officer of the Borrower or an authorised officerof the Parent in respect of financial statements of the Parent as fairlyrepresenting its (or, as the case may be, its consolidated) financial conditionand operations as at the end of and for the period in relation to which thosefinancial statements were drawn up.

(b)                              The Borrowershall procure that each set of consolidated financial statements deliveredpursuant to Clause 18.1 (*Financialstatements*) is prepared using GAAP****accounting practices and financial reference periods consistent withthose applied in the preparation of the Original Financial Statements unless,in relation to any set of financial statements, it notifies the Agent thatthere has been a change in GAAP, the accounting practices or reference periodsand its auditors deliver to the Agent:

(i)                                   a descriptionof any change necessary for those financial statements to reflect the GAAP,accounting practices and reference periods upon which the Original FinancialStatements were prepared; and

(ii)                                sufficientinformation, in form and substance as may be reasonably required by the Agent,to enable the Lenders to determine whether Clause 19 (*Financial covenants*) has been compliedwith and make an accurate comparison between the financial position indicatedin those financial statements and that the Original Financial Statements.

(c)                               Anyreference in this Agreement to those financial statements shall be construed asa reference to those financial statements as adjusted to reflect the basis uponwhich the Original Financial Statements were prepared.

(d)                              The Borrowershall procure that each set of non-consolidated financial statements deliveredpursuant to Clause 18.1 (*Financialstatements*):

(i)                                   in respectof the Parent, is prepared using RAS accounting practices and financialreference periods; and

(ii)                                in respectof the Borrower, is prepared using GAAP accounting practices and financialreference periods.

**18.4**                     Information:miscellaneous

(a)                               Subject toparagraph (b) below, the Borrower shall supply, and shall procure that theParent shall supply, to the Agent (in sufficient copies for all the Lenders, ifthe Agent so requests):

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(i)                                   alldocuments dispatched by the Borrower and the Parent to their respectiveshareholders (or any class of them) or their respective creditors generally atthe same time as they are dispatched;

(ii)                                promptlyupon becoming aware of them, the details of any litigation, arbitration oradministrative proceedings which are current, threatened or pending against anymember of the Group, and which would, if adversely determined, be reasonablylikely to have a Material Adverse Effect;

(iii)                             promptly,such information as may be reasonably requested by the Agent (includingrelevant figures from management accounts) to ascertain whether any Subsidiaryof the Parent falls within paragraph (b) of the definition of “SignificantSubsidiary”; and

(iv)                            promptly, such further informationregarding the financial condition, business and operations of any member of theGroup and access to the Borrower’s premises as any Finance Party (through theAgent) may reasonably request.

(b)                              From thedate of the Parent Guarantee until such time as the obligations of the Parentthereunder have been discharged, the obligation to provide the informationreferred to in sub-paragraphs (i) to (iv) above shall be limited toinformation in respect of the Borrower and its Subsidiaries and not, for theavoidance of doubt, in respect of the Parent or any other member of the Group.

**18.5**                     Notificationof Default

(a)                               The Borrowershall notify the Agent of any Default (and the steps, if any, being taken toremedy it) promptly upon becoming aware of its occurrence.

(b)                              Promptlyupon a request by the Agent, the Borrower shall supply to the Agent acertificate signed by two of its directors or senior officers on its behalfcertifying that no Default is continuing (or if a Default is continuing,specifying the Default and the steps, if any, being taken to remedy it).

**18.6**                     Knowyour customer checks

(a)                               If:

(i)                                   theintroduction of or any change in (or in the interpretation, administration orapplication of) any law or regulation made after the date of this Agreement;

(ii)                                any changein the status of the Borrower after the date of this Agreement; or

(iii)                             a proposedassignment or transfer by a Lender of any of its rights and obligations underthis Agreement to a party that is not a Lender prior to such assignment ortransfer,

obligesthe Agent or any Lender (or, in the case of paragraph (iii) above, anyprospective new Lender) to comply with “know your customer” or similaridentification procedures in circumstances where the necessary information isnot already available to it, the Borrower shall promptly upon the request ofthe Agent or any Lender supply, or procure the supply of, such documentationand other evidence as is reasonably requested by the Agent (for itself or onbehalf of any Lender) or any Lender (for itself or, in the case of the eventdescribed in paragraph (iii) above, on behalf of any prospective newLender) in order for the Agent, such Lender or, in the case of the eventdescribed in paragraph (iii) above, any prospective new Lender to carryout and be satisfied it has complied with all necessary “know your customer” orother similar

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checksunder all applicable laws and regulations pursuant to the transactionscontemplated in the Finance Documents.

(b)                              Each Lendershall promptly upon the request of the Agent supply, or procure the supply of,such documentation and other evidence as is reasonably requested by the Agent(for itself) in order for the Agent to carry out and be satisfied it hascomplied with all necessary “know your customer” or other similar checks underall applicable laws and regulations pursuant to the transactions contemplatedin the Finance Documents.

**19**                               FINANCIAL COVENANTS

Thefinancial undertakings in this Clause 19 shall remain in force from the SigningDate for so long as any amount is outstanding under the Finance Documents orany Commitment is in force.

**19.1**                     Financialcondition

TheBorrower shall ensure that:

(a)                                the ratio ofConsolidated Total Debt to Annualised Consolidated EBITDA will not exceed 3:1at any time;

(b)                               the ratio ofConsolidated Total Debt to Consolidated Total Net Worth will not exceed 1:1 atany time;

(c)                                for eachMeasurement Period, the ratio of aggregate Consolidated EBITDA for thatMeasurement Period and the previous Measurement Period to aggregate DebtService for that Measurement Period and the previous Measurement Period willnot be less than 1.75:1; and

(d)                               during anyfinancial year of the Borrower, the ratio of aggregate Consolidated EBITDA forthat financial year to aggregate Debt Service for that financial year will notbe less than 1.75:1.

**19.2**                     Financialcovenant calculations

(a)                               AnnualisedConsolidated EBITDA, Consolidated EBITDA, Consolidated Total Debt, ConsolidatedTotal Net Worth and Debt Service shall be calculated and interpreted with theprinciples applicable to the Borrower Audited Original Financial Statements andshall be expressed in Dollars.

(b)                              Any amountin a currency other than US Dollars is to be taken into account at its USDollars equivalent calculated on the basis of:

(i)                                   the Agent’sspot rate of exchange for the purchase of the relevant currency in the Londonforeign exchange market with US Dollars at or about 11.00 a.m. on the daythe relevant amount falls to be calculated; or

(ii)                                if theamount is to be calculated on the last day of a financial period of theBorrower, the relevant rates of exchange used by the Borrower in, or inconnection with, its financial statements for that period.

**19.3**                     Definitions

In thisClause 19:

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“**Annualised Consolidated EBITDA**” meansConsolidated EBITDA for a Measurement Period aggregated with the ConsolidatedEBITDA for the three preceding Measurement Periods.

“**Consolidated EBITDA**” means the consolidatednet pre-taxation profits of the UMC Group for a Measurement Period, all asadjusted by:

(i)                                   adding backconsolidated interest payable;

(ii)                                subtractingany consolidated interest receivable;

(iii)                             taking noaccount of any exceptional or extraordinary item;

(iv)                            excluding any amount attributable tominority interests;

(v)                               adding backdepreciation and amortisation;

(vi)                            adding back unrealised FX losses;

(vii)                         subtracting unrealised FX gains; and

(viii)                      taking no account of any revaluation ofan asset or any loss or gain over book value arising on the disposal of anasset (otherwise than in the ordinary course of trading) by a member of the UMCGroup during that Measurement Period.

“**Consolidated Total Debt**” means, in respectof the UMC Group, at any time the aggregate of the following:

(a)                                theoutstanding principal amount of any moneys borrowed;

(b)                               theoutstanding principal amount of any acceptance under any acceptance credit;

(c)                                theoutstanding principal amount of any bond, note, debenture, loan stock or othersimilar instrument;

(d)                               the capitalisedelement of indebtedness under a finance or capital lease;

(e)                                theoutstanding principal amount of all moneys owing in connection with the sale ordiscounting of receivables (otherwise than on a non-recourse basis);

(f)                                  theoutstanding principal amount of any indebtedness arising from any deferredpayment agreements arranged primarily as a method of raising finance orfinancing the acquisition of an asset;

(g)                               any fixed orminimum premium payable on the repayment or redemption of any instrument referredto in paragraph (c) above;

(h)                               theoutstanding principal amount of any indebtedness arising in connection with anyother transaction (including any forward sale or purchase agreement) which hasthe commercial effect of a borrowing; and

(i)                                   the outstandingprincipal amount of any indebtedness of any person of a type referred to inparagraphs (a) - (h) above which is the subject of a guarantee,indemnity or similar assurance against financial loss given by a member of theUMC Group.

“**Consolidated Total Net Worth**” means at anytime the aggregate of:

(a)                                the amountpaid up or credited as paid up on the issued share capital of the Borrower; and

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(b)                               the amountstanding to the credit of the consolidated capital and revenue reserves of theUMC Group,

basedon the consolidated balance sheet of the Borrower as reported in its financialstatements delivered at the end of each Measurement Period but adjusted by:

(i)                                   deductingany dividend or other distribution declared, recommended or made by any memberof the UMC Group; and

(ii)                                excludingany amount attributable to minority interests.

“**Debt Service**” means the aggregate of allinterest, commission and other finance payments (including, without limitation,under this Agreement; the interest element of leasing and hire purchasepayments; and capitalised and accreted interest) incurred by the Borrower inrespect of a Measurement Period, plus the aggregate of all payments ofprincipal required to be made during such period in respect of all FinancialIndebtedness which bears interest, commission, fees or other charges.

“**Measurement Period**” means a financialquarter of the Borrower ending on the last day of each financial quarter of theBorrower.

“**UMC Group**” means the Borrower and itsSubsidiaries, if any.

**20**                               GENERAL UNDERTAKINGS

Subjectto Clause 20.18 (*Undertakings in respect ofmembers of the Group*), the undertakings in this Clause 20 remain inforce from the date of this Agreement for so long as any amount is outstandingunder the Finance Documents or any Commitment is in force.

**20.1**                     Authorisationsand registration

(a)                               The Borrowershall promptly:

(i)                                   obtain,comply with and do all that is necessary to maintain in full force and effect;and

(ii)                                supplycertified copies to the Agent of,

theRegistration Certificate and any other Authorisation required under any law orregulation of its jurisdiction of incorporation to enable each Obligor toperform its obligations under the Finance Documents and to ensure the legality,validity, enforceability or admissibility in evidence in its jurisdiction ofincorporation of any Finance Document.

(b)                              The Borrowershall promptly submit to the NBU all documents required under Ukrainian lawand/or requested by the NBU in relation to the registration of this Agreement.

**20.2**                     Compliancewith laws

TheBorrower shall, and shall procure that the Parent shall, comply in all respectswith all laws to which it may be subject, if failure so to comply wouldmaterially impair its ability to perform its obligations under the FinanceDocuments.

**20.3**                     Maintenanceof existence

TheBorrower shall, and shall ensure that the Parent shall, maintain its corporateexistence.

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**20.4**                     Negativepledge

(a)                               The Borrowershall not (and the Borrower shall ensure that no other member of the Groupwill) create or permit to subsist any Security over any of its assets.

(b)                              The Borrowershall not (and the Borrower shall ensure that no other member of the Groupwill):

(i)                                   sell,transfer or otherwise dispose of any of its assets on terms whereby they are ormay  be leased to or re-acquired by theBorrower or any other member of the Group;

(ii)                                sell,transfer or otherwise dispose of any of its receivables on recourse terms;

(iii)                             enter intoany arrangement under which money or the benefit of a bank or other account maybe applied, set-off or made subject to a combination of accounts; or

(iv)                            enter into any other preferentialarrangement having a similar effect,

incircumstances where the arrangement or transaction is entered into primarily asa method of raising Financial Indebtedness or of financing the acquisition ofan asset.

(c)                               Paragraphs (a) and(b) above do not apply to Permitted Security.

**20.5**                     Disposals

(a)                               The Borrowershall not (and shall ensure that no other member of the Group will) enter intoa single transaction or a series of transactions (whether related or not andwhether voluntary or involuntary) to sell, lease, transfer or otherwise disposeof any asset.

(b)                              Paragraph (a) abovedoes not apply to any sale, lease, transfer or other disposal:

(i)                                   made in theordinary course of trading of the disposing entity;

(ii)                                of assets inexchange for other assets comparable or superior as to type, value and quality;

(iii)                             made fromone member of the Group (other than the Parent) to another member of the Group;

(iv)                            of cash or cash equivalents for cash orcash equivalents; or

(v)                               where thebook value of such asset (when aggregated with the book value of each otherasset disposed of under this sub-clause (v)) (in each case as calculated inaccordance with GAAP) does not exceed (x) 10% of the Parent’s Total Assetsin any financial year of the Parent and (y) 25% of the Parent’s TotalAssets during the period starting on the Signing Date and ending on the datethat all amounts outstanding under this Agreement have been paid in full. At therequest of the Agent (any such request to be made no more than once percalendar quarter, unless a Default is continuing), the Borrower shall provide acertificate to the Agent setting out in reasonable detail the book value of anyassets disposed of under this sub-clause (v) (calculated in accordancewith GAAP).

Whencalculating the Parent’s Total Assets under sub-clause (v) above, if theannual consolidated balance sheet of the Borrower for the immediately precedingfinancial year of the Parent is not available, the Parent’s Total Assets shallbe calculated by reference to the draft audit report then available for thatfinancial year and any other evidence reasonably requested by, and reasonablysatisfactory to, the Agent.

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**20.6**                     Merger

(a)                               The Borrowershall ensure that the Parent shall not enter into or become subject to anyconsolidation or reorganisation, whether by way of merger (*sliyaniye obschestva*), company accession (*prisoedinyeniye**obschestva*), company division (*razdelenie**obschestva*),company separation (*vydelyeniye**obschestva*), company transformation (*preobrazovaniye**obschestva*), company liquidation (*likvidatisyaobschestva*) or any other company reorganisation (*reorgnizatsiya**obschestva*)(as these terms are construed by applicable Russian law) or otherwise, or anyanalogous transaction in any jurisdiction, other than a consolidation or mergerwith one of its Subsidiaries where the Parent is the surviving entity.

(b)                              The Borrowershall, and shall ensure that no Significant Subsidiary will, enter into orbecome subject to any consolidation or reorganisation, whether by way of merger(*sliyaniye obschestva/ zlittya tovaristva*),company accession (*prisoedinyeniyeobschestva/priyednannya tovarystva*), company division (*razdeleyeniey obschestva/podil tovarystva*),company separation (*vydelyeniyeobschestva/vydil tovarystva*), company transformation (*preobrazovaniye**obschestva/peretvorennya tovarystva*), company liquidation (*likvidatsiya obschestva/**likvidatisya tovarystva*) or any other company reorganisation(*reorganizatsiya obschestva/reorganizaciyatovarystva*) (as these terms are construed by applicable law) orotherwise, or any analogous transaction in any jurisdiction if suchreorganisation or transaction would, in the opinion of the Agent (actingreasonably), have a Material Adverse Effect.

**20.7**                     Changeof business

TheBorrower shall procure that no substantial change is made to the general natureof the business of the Parent or the Group from that carried on at the SigningDate.

**20.8**                     Conductof business

TheBorrower shall, and shall procure that each Significant Subsidiary will,conduct its business in all material respects in accordance with:

(a)                                allTelecommunications Laws to which it is or may become subject;

(b)                               allrequirements of the telecommunications regulators of the Russian Federation,Ukraine and any other jurisdiction where it conducts its business; and

(c)                                the terms ofall relevant Telecommunications Authorisations.

**20.9**                     Assetmaintenance

TheBorrower shall, and shall procure that the Parent and each SignificantSubsidiary will, have and maintain good and marketable title to or valid leasesor licences of, or rights of use relating to, all assets necessary to maintain,develop and operate and otherwise conduct its business as then being conductedby it and in each case where failure to do so might reasonably be expected tohave a Material Adverse Effect.

**20.10**              Insurance

TheBorrower shall (and shall ensure that each other member of the Group will)maintain insurances on and in relation to its business and assets withreputable underwriters or insurance companies against those risks, and to theextent, usually insured against by prudent companies located in the same or asimilar location and carrying on a similar business.

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**20.11**               Transactionswith Related Parties

(a)                               The Borrowershall not (and the Borrower shall ensure that no other member of the Groupwill), directly or indirectly, enter into or permit to exist any intercompanyloan with, or for the benefit of, any Related Party, unless:

(i)                                   the terms ofsuch intercompany loan are no less favourable to such member of the Group thanthose that could be obtained in a comparable arm’s-length transaction or seriesof related transactions with a person that is not a Related Party; or

(ii)                                such intercompanyloan is made pursuant to a contract or contracts existing on the Signing Date(excluding any amendments or modifications thereto after the Signing Date),

providedthat the aggregate outstanding amount of all such intercompany loans describedin sub-clauses (i) and (ii) above does not, at any time, exceed$100,000,000.

(b)                              Paragraph (a) abovedoes not apply to:

(i)                                   compensationor employee benefit arrangements with any officer or director of any member ofthe Group arising out of any employment contract entered into in the ordinarycourse of business; or

(ii)                                transactionsbetween members of the Group.

(c)                               For thepurposes of this Clause 20.11 only, a “**RelatedParty**” means, with respect to any specified person:

(i)                                   any otherperson directly or indirectly controlling or controlled by or under direct orindirect common control with such specified person; or

(ii)                                any otherperson who is a director or executive officer of (a) such specified personor (b) any person described in (i) above.

Forpurposes of the definition of “**Related Party**”only, “**control**” (including, withcorrelative meanings, the terms “**controlling**,”“**controlled by**” and “**under common control with**”), as used withrespect to any person, shall mean the possession, directly or indirectly, ofthe power to direct or cause the direction of the management or policies ofsuch person, whether through the ownership of voting securities, by agreementor otherwise; provided that beneficial ownership of 10 per cent. or more of anyclass, or any series of any class, of equity securities of a person, whether ornot voting, shall be deemed to be control.

**20.12**              Restriction on acquisitions

TheBorrower shall ensure that the Parent shall not establish or acquire anySubsidiary or invest in any other entity without the consent of the MajorityLenders (such consent not to be unreasonably withheld), provided that thisClause 20.12 shall not apply to (i) any investment in connection withthe acquisition of certain assets from Telsim Mobil Telekomunikasyon HizmetleriA.S. in accordance with the process outlined in the tender document dated on oraround June 2005 and issued by the Savings Deposit Insurance Fund and (ii) anysuch acquisition or investment where:

(a)                                suchacquisition or investment relates to a Subsidiary or entity whose principalbusiness is telecommunications or the provision of data services or related orancillary businesses; and

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(b)                               theconsideration paid by the Parent in relation to such acquisition or investment,when aggregated with the consideration paid by the Parent in relation to eachother acquisition or investment permitted under this paragraph (b), does notexceed (i) 20 per cent. of the Parent’s Total Assets in the financial yearof the Parent ending 31 December 2004; and (ii) 15 per cent. (or suchhigher amount not exceeding 20 per cent. as the Majority Lenders may agree(acting reasonably)) of the Parent’s Total Assets in any other financial yearof the Parent.

**20.13**              Promptpayment of Taxes

TheBorrower shall (and shall ensure that the Parent and each SignificantSubsidiary will) duly pay all Taxes payable by it, other than (a) thosetaxes which are being contested in good faith and by appropriate proceedingsand in respect of which adequate reserves or other appropriate provisions havebeen made; or (b) whose amount does not exceed $25,000,000 (or itsequivalent in any other currencies).

**20.14**              *Pari passu*

TheBorrower shall, and shall procure that each member of the Group will, procurethat its obligations under the Finance Documents rank at least *pari passu* with all its other unsecured,unsubordinated obligations save where such other obligations are mandatorilypreferred by law.

**20.15**              Loansand guarantees

(a)                               The Borrowershall not (and the Borrower shall ensure that no member of the Group will):

(i)                                   make anyloan, or provide any form of credit or financial accommodation, to any person(including, without limitation, its employees, shareholders, another member ofthe Group and any Affiliate); or

(ii)                                give orissue any guarantee, indemnity, bond or letter of credit to or for the benefitof, or in respect of liabilities or obligations of, any other person orvoluntarily assume any liability (whether actual or contingent) of any otherperson (including, in each case and without limitation, its employees,shareholders, another member of the Group and any Affiliate).

(b)                              Therestrictions in paragraph (a) above do not apply to (i) loans,credits, financial accommodation, guarantees, indemnities, bonds and letters ofcredit expressly permitted by the Finance Documents or for normal trade crediton arm’s length terms and in the ordinary course of business or granted by amember of the Group to another member of the Group, provided that the aggregateamount of such loans, credits, financial accommodation, guarantees,indemnities, bonds and letters of credit does not at any time exceed 10 percent. of the Parent’s Total Assets; (ii) guarantees by the Parent inrelation to the obligations of any other member of the Group; or (iii) thearrangements permitted under Clause 20.11 (*Transactionswith Related Parties*).

**20.16**              ParentGuarantee in respect of Facility 1

TheBorrower shall procure that as soon as practicable, but in any event no laterthan 21 December 2005, the Parent shall enter into the Parent Guarantee.

**20.17**              ParentGuarantee in respect of Facility 2

(a)                               The Borrowershall ensure that the agenda of the Parent’s next general shareholders’ meetingfollowing the date of this Agreement shall include as an item, in a formsatisfactory to the Agent,

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approval of the entry by the Parent into theAmended and Restated Parent Guarantee as an interested party transaction (the “**Guarantee Shareholder Resolution**”), inaccordance with all legal requirements under Russian law and the constitutionaland internal documents of the Parent.

(b)                              The Borrowershall use its best endeavours to obtain the approval of the GuaranteeShareholder Resolution by more than 50 per cent. of non-interested shareholdersof the Parent (the “**Guarantee Approval**”)and will promptly thereafter deliver to the Agent a certified copy of theminutes of the relevant general shareholders’ meeting in a form acceptable tothe Agent.

(c)                               The Borrowershall procure that as soon as practicable following, but in any event within 5Business Days of, the date on which the Guarantee Approval has been obtained,the Parent shall enter into the Amended and Restated Parent Guarantee.

**20.18**              Undertakingson behalf of other members of the Group

Fromthe date of the Parent Guarantee until such time as the obligations of theParent thereunder have been discharged, the obligation of the Borrower toprocure the performance of the undertakings set out in Clauses 20.2 (*Compliance with laws*) to 20.15 (*Loans and guarantees*) by the Parent andother members of the Group shall be limited to the performance of suchundertakings by the Borrower’s Subsidiaries only and not, for the avoidance ofdoubt, performance by the Parent or any other member of the Group.

**21**                               EVENTS OF DEFAULT

Each ofthe events or circumstances set out in Clause 21 is an Event of Default.

**21.1**                     Non-payment

AnObligor does not pay on the due date any amount payable pursuant to a FinanceDocument at the place at and in the currency in which it is expressed to bepayable unless:

(a)                                its failureto pay is caused by administrative or technical error; and

(b)                               payment ismade within three Business Days of its due date.

**21.2**                     Financialcovenants

Anyrequirement of Clause 19 (*FinancialCovenants*) is not satisfied.

**21.3**                     Otherobligations

(a)                               An Obligordoes not comply with any provision of the Finance Documents (other than thosereferred to in Clause 21.1 (*Non-payment*)and Clause 21.2 (*Financial Covenants*)).

(b)                              No Event ofDefault under paragraph (a) above will occur if the failure to comply iscapable of remedy and is remedied within 10 Business Days of the Agent givingnotice to the Borrower or the relevant Obligor becoming aware of the failure tocomply.

**21.4**                     Misrepresentation

Anyrepresentation or statement made or deemed to be made by an Obligor in theFinance Documents or any other document delivered by or on behalf of theBorrower under or in connection with any Finance Document is or proves to havebeen incorrect or misleading in any material respect when made or deemed to bemade, and such representation or statement shall

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nothave been rendered correct and not misleading within 10 Business Days of theAgent giving notice to the Borrower or the relevant Obligor becoming aware ofthe same.

**21.5**                     Crossdefault

(a)                               Any singleitem of Financial Indebtedness of the Borrower in an amount exceeding$1,000,000 or of any other member of the Group in an amount exceeding$10,000,000 (or its equivalent in any other currency or currencies) is not paidwhen due nor within any originally applicable grace period.

(b)                              Any singleitem of Financial Indebtedness of the Borrower in an amount exceeding$1,000,000 or of any other member of the Group in an amount exceeding$10,000,000 (or its equivalent in any other currency or currencies) is declaredto be or otherwise becomes due and payable prior to its specified maturity as aresult of an event of default (however described).

(c)                               Any singlecommitment for any Financial Indebtedness of the Borrower in an amountexceeding $1,000,000 or of any other member of the Group in an amount exceeding$10,000,000 (or its equivalent in any other currency or currencies) iscancelled or suspended by a creditor of any member of the Group as a result ofan event of default (however described).

(d)                              Any creditorof the Borrower in an amount exceeding $1,000,000 or of any other member of theGroup becomes entitled to declare any single item of Financial Indebtedness ofany member of the Group in an amount exceeding $10,000,000 (or its equivalentin any other currency or currencies) due and payable prior to its specifiedmaturity as a result of an event of default (however described).

(e)                               Any of theevents described in paragraphs (a) to (d) above occurs in relation toany Financial Indebtedness or commitment for Financial Indebtedness of anyamount (including, for the avoidance of doubt, any amount that is less than$10,000,000 (or its equivalent in any other currency or currencies)), and theaggregate amount of all such Financial Indebtedness and commitments forFinancial Indebtedness is in excess of $1,000,000 in relation to the Borrowerand $35,000,000 in relation to any other member of the Group (or its equivalentin any other currency or currencies).

**21.6**                     Insolvency

(a)                               An Obligoror a Significant Subsidiary is unable or admits its inability to pay its debtsas they fall due, suspends making payments on its debts generally or, by reasonof actual or anticipated financial difficulties, commences negotiations withone or more of its creditors with a view to rescheduling its indebtednessgenerally.

(b)                              The value ofthe assets of an Obligor or a Significant Subsidiary is less than itsliabilities (taking into account contingent and prospective liabilities).

(c)                               A moratoriumis declared in respect of the indebtedness of an Obligor or a SignificantSubsidiary.

**21.7**                     Insolvencyproceedings

Anycorporate action, legal proceedings or other procedures are taken in relationto:

(a)                                thebankruptcy, winding-up, insolvency, dissolution, administration, reorganisationor liquidation of an Obligor or a Significant Subsidiary, including, but notlimited to, institution of supervision (*nablyudenie*),bankruptcy administration (*rozporyadjennya*),financial rehabilitation (*finansovoeozdorovlenie*) or any other rehabilitation procedure

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(*sanatsiya*),external management (*vneshneye upravlenie*),bankruptcy management (*konkursnoyeupravlenie*) or liquidation procedure (*likvidatsiyna procedura*) (and such legal proceedingscontinue for at least 14 days);

(b)                               thesuspension of payments, composition, assignment or arrangement with anycreditor, or a moratorium of any indebtedness, of an Obligor or a SignificantSubsidiary (and such suspension continues for at least 14 days);

(c)                                thepresentation or filing of a petition (or similar document) in respect of anObligor or a Significant Subsidiary in any court, state arbitration court (*arbitrazhnyi sud*), commercial court (*gospodarskyi sud*) or before any otherauthority in respect of the bankruptcy, winding-up, insolvency, dissolution,administration, reorganisation, provisional supervision, supervision or liquidationof an Obligor or a Significant Subsidiary (and such petition has not beendischarged within 14 days);

(d)                               theappointment of a liquidator (*likvidator*)or a liquidation commission (*likvidatsionnayakomissiya**/likvidatsiyna komisiya*),temporary manager (*vremenniy upravlaushiy*),assets manager (*rozporyadnyk mayna*),external manager (*konkursniy upravlaushiy*),sanation manager (*keruyuchyi sanatsieyu*),administrative manager (*administrativniyupravlaushiy*), bankruptcy manager (*konkursniyupravlaushiy**/arbitrajnyi keruyuchyi*),receiver, administrator, administrative receiver, compulsory manager,provisional supervisor, supervisor or other similar officer in respect of anObligor or a Significant Subsidiary or any of its assets (and such appointmentcontinues for at least 14 days); or

(e)                                theenforcement of any Security over any asset or assets of an Obligor or aSignificant Subsidiary (unless such enforcement is stayed within 14 days),

or anyanalogous procedure or step is taken in any jurisdiction.

**21.8**                     Creditors’process

Anyexpropriation, attachment, sequestration, distress or execution affects anyasset or assets of an Obligor or a Significant Subsidiary with a value inexcess of $10,000,000 (or its equivalent in any other currency or currencies)and is not discharged or stayed within 30 days.

**21.9**                     Judgment

Therendering against any member of the Group of a judgment, decree, act or orderfor the payment of money in an amount in excess of $10,000,000 (or itsequivalent in any other currency or currencies) and the continuance of any suchjudgment, decree, act or order unsatisfied and in effect for any period of 60consecutive days without a stay of execution.

**21.10**              Loss ofLicence

(a)                                  Any actionresults in the suspension for more than 30 days or the loss, revocation ortermination of any of:

(i)                                   the Parent’sGSM 900 or 1800 licences for the Moscow licence area;

(ii)                                the Parent’sGSM 900 or 1800 licences for the St. Petersburg licence area;

(iii)                             the Parent’sGSM 900 or 1800 licences for the Krasnodar licence area; or

(iv)                            the Borrower’s GSM 900 or 1800 licencesfor the Ukraine licence area,

exceptwhere, within 30 days of any such event, the relevant licence is re-issued onsubstantially the same terms to any member of the Group and during the periodfalling before

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suchre-issuance there is no material interruption to, or other material adverseeffect on, the operations permitted by such licence as a direct result of suchprior loss, revocation or termination.

(b)                              Any of theParent’s or the Borrower’s GSM 900 or1800 licences are amended (or any conditions are imposed with respect to anysuch licence) in a manner that, in the reasonable opinion of the MajorityLenders, has or is reasonably likely to have a Material Adverse Effect.

(c)                               Any of theParent’s or the Borrower’s assignedspectrum allocations are reassigned to other users (other than a SignificantSubsidiary of the Parent), cancelled or otherwise lost, and such event, in thereasonable opinion of the Majority Lenders, has or is reasonably likely to havea Material Adverse Effect.

(d)                              The Parentsells, leases or otherwise transfers any of its GSM 900 or 1800 licences forthe Moscow licence area.

(e)                               Any of theParent’s GSM 900 or 1800 licences (other than its GSM 900 and 1800 licences forthe Moscow licence area) is sold, leased or transferred to any person that isnot (directly or indirectly) a wholly-owned Subsidiary of the Parent.

(f)

(i)                                   Any of theGSM 900 or 1800 licences of the Borrower is sold, leased or transferred to anyperson that is not (directly or indirectly) a wholly-owned Subsidiary of theParent.

(ii)                                Sub-clause (i) abovedoes not apply to the transfer of the GSM 900 or 1800 licences of the Borrowerpursuant to the Borrower Litigation (provided that this sub-clause (ii) shallnot in any way prejudice the rights of the Finance Parties under Clause 21.19 (*Borrower Litigation*)).

**21.11**               Cessationof Business

AnObligor or any Significant Subsidiary suspends, ceases or threatens to suspendor cease to carry on all or a substantial part of its business.

**21.12**              Expropriation

(a)                               By or underthe authority of any government:

(i)                                   any seizure,compulsory acquisition, expropriation, nationalisation, renationalisation orre-privatisation is made after the Signing Date of all or any material part ofthe assets or shares of (or other ownership interest in) any member of theGroup;

(ii)                                themanagement of any member of the Group is wholly or partially displaced or theauthority of any member of the Group in the conduct of its business is whollyor partially curtailed; or

(iii)                             any memberof the Group is otherwise deprived of, or prevented from exercising ownershipor control of, its material business or assets.

**21.13**              Russianor Ukrainian Foreign Exchange Restrictions

Anyforeign exchange law is enacted or introduced in the Russian Federation orUkraine which has the effect of prohibiting, restricting or delaying anypayment by the Borrower or any member of the Group under the Finance Documents.

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**21.14**              Moratorium

Anymoratorium is declared on the payment of any external indebtedness of theRussian Federation or Ukraine or of Russian or Ukrainian residents generally.

**21.15**              TheRussian Federation

Thepolitical or economic situation in the Russian Federation deteriorates or anact of war or hostilities, invasion, armed conflict or act of a foreign enemy,revolution, insurrection or insurgency occurs in, or involves, the RussianFederation and such event, in the reasonable opinion of the Majority Lenders,has or is reasonably likely to have a Material Adverse Effect.

**21.16**              Ukraine

Thepolitical or economic situation in Ukraine deteriorates or an act of war orhostilities, invasion, armed conflict or act of a foreign enemy, revolution,insurrection or insurgency occurs in, or involves, Ukraine and such event, inthe reasonable opinion of the Majority Lenders, has or is reasonably likely tohave a Material Adverse Effect.

**21.17**              Unlawfulness

It isor becomes unlawful for an Obligor to perform any of its obligations under theFinance Documents.

**21.18**              Repudiation

AnObligor repudiates a Finance Document or evinces an intention to repudiate aFinance Document.

**21.19**              BorrowerLitigation

TheBorrower Litigation is adversely determined and, in the reasonable opinion ofthe Majority Lenders, such adverse determination has or is reasonably likely tohave a Material Adverse Effect.

**21.20**              Materialadverse change

TheMajority Lenders determine that a Material Adverse Effect exists, has occurredor is reasonably likely to occur.

**21.21**              Acceleration

On andat any time after the occurrence of an Event of Default which is continuing theAgent may, and shall if so directed by the Majority Lenders, by notice to theBorrower:

(a)                                cancel theTotal Commitments whereupon they shall immediately be cancelled;

(b)                               declare that all or part of the Loans, togetherwith accrued interest, and all other amounts accrued or outstanding under theFinance Documents be immediately due and payable, whereupon they shall becomeimmediately due and payable; and

(c)                                declare that all or part of the Loans be payableon demand, whereupon they shall immediately become payable on demand by theAgent on the instructions of the Majority Lenders.

 

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**SECTION 8CHANGES TO PARTIES**

**22**                               CHANGES TO THE LENDERS

**22.1**                     Assignmentsand transfers by the Lenders

(a)                               Subject tothis Clause 22, a Lender (the “**Existing****Lender**”) may:

(i)                                   assign anyof its rights; or

(ii)                                transfer bynovation any of its rights and obligations,

toanother bank or financial institution or to a trust, fund or other entity whichis regularly engaged in or established for the purpose of making, purchasing orinvesting in loans, securities or other financial assets (the “**New Lender**”).

(b)                              Unless (i) theassignment or transfer is to an Affiliate of the Existing Lender or to anotherLender or (ii) an Event of Default has occurred and is continuing, anyassignment or transfer occurring after the Syndication Date shall require theconsent of the Borrower, provided that (1) such consent shall not beunreasonably withheld or delayed; and (2) unless the Borrower or theParent has notified the Agent to the contrary within 5 Business Days ofreceiving notice of the intended assignment or transfer the Borrower and theParent will be deemed to have given its consent to that assignment or transfer.

**22.2**                     Conditionsof assignment or transfer

(a)                               Anassignment will only be effective on:

(i)                                   receipt bythe Agent of written confirmation from the New Lender (in form and substancesatisfactory to the Agent) that the New Lender will assume the same obligationsto the other Finance Parties as it would have been under if it was an OriginalLender; and

(ii)                                performanceby the Agent of all “know your customer” or other checks relating to any personthat it is required to carry out in relation to such assignment to a NewLender, the completion of which the Agent shall promptly notify to the ExistingLender and the New Lender.

(b)                              A transferwill only be effective if the procedure set out in Clause 22.5 (*Procedure for transfer*) is complied with.

**22.3**                     Assignmentor transfer fee

The NewLender shall, on the date upon which an assignment or transfer takes effect,pay to the Agent (for its own account) a fee of $1,000.

**22.4**                     Limitationof responsibility of Existing Lenders

(a)                               Unlessexpressly agreed to the contrary, an Existing Lender makes no representation orwarranty and assumes no responsibility to a New Lender for:

(i)                                   thelegality, validity, effectiveness, adequacy or enforceability of the FinanceDocuments or any other documents;

(ii)                                thefinancial condition of any Obligor;

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(iii)                             theperformance and observance by any Obligor of its obligations under the FinanceDocuments or any other documents; or

(iv)                            the accuracy of any statements (whetherwritten or oral) made in or in connection with any Finance Document or anyother document,

and anyrepresentations or warranties implied by law are excluded.

(b)                              Each NewLender confirms to the Existing Lender and the other Finance Parties that it:

(i)                                   has made(and shall continue to make) its own independent investigation and assessmentof the financial condition and affairs of each Obligor and its related entitiesin connection with its participation in this Agreement and has not reliedexclusively on any information provided to it by the Existing Lender inconnection with any Finance Document; and

(ii)                                willcontinue to make its own independent appraisal of the creditworthiness of eachObligor and its related entities whilst any amount is or may be outstandingunder the Finance Documents or any Commitment is in force.

(c)                               Nothing inany Finance Document obliges an Existing Lender to:

(i)                                   accept are-transfer from a New Lender of any of the rights and obligations assigned ortransferred under this Clause 22; or

(ii)                                support anylosses directly or indirectly incurred by the New Lender by reason of thenon-performance by any Obligor of its obligations under the Finance Documentsor otherwise.

**22.5**                     Procedurefor transfer

(a)                               Subject tothe conditions set out in Clause 22.2 (*Conditionsof assignment or transfer*) a transfer is effected in accordance withparagraph (c) below when the Agent executes an otherwise duly completedTransfer Certificate delivered to it by the Existing Lender and the New Lender.The Agent shall, subject to paragraph (b) below, as soon as reasonablypracticable after receipt by it of a duly completed Transfer Certificateappearing on its face to comply with the terms of this Agreement and deliveredin accordance with the terms of this Agreement, execute that TransferCertificate.

(b)                              The Agentshall only be obliged to execute a Transfer Certificate delivered to it by theExisting Lender and the New Lender once it is satisfied it has complied withall necessary “know your customer” or other similar checks under all applicablelaws and regulations in relation to the transfer to such New Lender.

(c)                               On theTransfer Date:

(i)                                   to theextent that in the Transfer Certificate the Existing Lender seeks to transferby novation its rights and obligations under the Finance Documents the Obligorsand the Existing Lender shall be released from further obligations towards oneanother under the Finance Documents and their respective rights against oneanother under the Finance Documents shall be cancelled (being the “**Discharged Rights and Obligations**”);

(ii)                                the Obligorsand the New Lender shall assume obligations towards one another and/or acquirerights against one another which differ from the Discharged Rights andObligations only insofar as the Obligors and the New Lender have assumed and/oracquired the same in place of the Obligors and the Existing Lender;

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(iii)                             the Agent,the Mandated Lead Arrangers, the New Lender and other Lenders shall acquire thesame rights and assume the same obligations between themselves as they wouldhave acquired and assumed had the New Lender been an Original Lender with therights and/or obligations acquired or assumed by it as a result of the transferand to that extent the Agent, the Mandated Lead Arrangers and the ExistingLender shall each be released from further obligations to each other under theFinance Documents; and

(iv)                            the New Lender shall become a Party as a “Lender”.

**22.6**                     Disclosureof information

AnyLender may disclose to any of its Affiliates and any other person:

(a)                                to (orthrough) whom that Lender assigns or transfers (or may potentially assign ortransfer) all or any of its rights and obligations under this Agreement;

(b)                               with (orthrough) whom that Lender enters into (or may potentially enter into) anysub-participation in relation to, or any other transaction under which paymentsare to be made by reference to, this Agreement or the Borrower; or

(c)                                to whom, andto the extent that, information is required to be disclosed by any applicablelaw or regulation,

anyinformation about the Borrower, the Parent, the Group and the Finance Documentsas that Lender shall consider appropriate if, in relation to paragraphs (a) and(b) above, the person to whom the information is to be given has enteredinto a Confidentiality Undertaking. This Clause supersedes any previousagreement relating to the confidentiality of this information.

**23**                               CHANGES TO THE BORROWER

TheBorrower may not assign any of its rights or transfer any of its rights orobligations under the Finance Documents.

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**SECTION 9THE FINANCE PARTIES**

**24**                               ROLE OF THE AGENT AND THE MANDATED LEADARRANGERS

**24.1**                     Appointmentof the Agent

(a)                               Each otherFinance Party appoints the Agent to act as its agent under and in connectionwith the Finance Documents.

(b)                              Each otherFinance Party authorises the Agent to exercise the rights, powers, authoritiesand discretions specifically given to it under or in connection with theFinance Documents together with any other incidental rights, powers,authorities and discretions.

**24.2**                     Dutiesof the Agent

(a)                               The Agentshall promptly forward to a Party the original or a copy of any document whichis delivered to the Agent for that Party by any other Party.

(b)                              Except wherea Finance Document specifically provides otherwise, the Agent is not obliged toreview or check the adequacy, accuracy or completeness of any document itforwards to another Party.

(c)                               If the Agentreceives notice from a Party referring to this Agreement, describing a Defaultand stating that the circumstance described is a Default, it shall promptlynotify the Finance Parties.

(d)                              If the Agentis aware of the non-payment of any principal, interest, commitment fee or otherfee payable to a Finance Party (other than the Agent or the Mandated Lead Arrangers)under this Agreement it shall promptly notify the other Finance Parties.

(e)                               The Agent’sduties under the Finance Documents are solely mechanical and administrative innature.

**24.3**                     Role ofthe Mandated Lead Arrangers

Exceptas specifically provided in the Finance Documents, the Mandated Lead Arrangershave no obligations of any kind to any other Party under or in connection withany Finance Document.

**24.4**                     Nofiduciary duties

(a)                               Nothing inthis Agreement constitutes the Agent or any Mandated Lead Arranger as a trusteeor fiduciary of any other person.

(b)                              Neither theAgent nor the Mandated Lead Arrangers shall be bound to account to any Lenderfor any sum or the profit element of any sum received by it for its ownaccount.

**24.5**                     Businesswith the Group

TheAgent and the Mandated Lead Arrangers may accept deposits from, lend money toand generally engage in any kind of banking or other business with any memberof the Group.

**24.6**                     Rightsand discretions of the Agent

(a)                               The Agentmay rely on:

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(i)                                   any representation,notice or document believed by it to be genuine, correct and appropriatelyauthorised; and

(ii)                                anystatement made by a director, authorised signatory or employee of any personregarding any matters which may reasonably be assumed to be within hisknowledge or within his power to verify.

(b)                              The Agentmay assume, unless it has received notice to the contrary in its capacity asagent for the Lenders, that:

(i)                                   no Defaulthas occurred (unless it has actual knowledge of a Default arising under Clause21.1 (*Non-payment*)); and

(ii)                                any right,power, authority or discretion vested in any Party or the Majority Lenders hasnot been exercised.

(c)                               The Agentmay engage, pay for and rely on the advice or services of any lawyers,accountants, surveyors or other experts.

(d)                              The Agentmay act in relation to the Finance Documents through its personnel and agents.

(e)                               The Agentmay disclose to any other Party any information it reasonably believes it hasreceived as agent under this Agreement.

(f)                                 Notwithstandingany other provision of any Finance Document to the contrary, neither the Agentnor any Mandated Lead Arranger is obliged to do or omit to do anything if itwould or might in its reasonable opinion constitute a breach of any law orregulation or a breach of a fiduciary duty or duty of confidentiality.

**24.7**                     MajorityLenders’ instructions

(a)                               Unless acontrary indication appears in a Finance Document, the Agent shall (i) exerciseany right, power, authority or discretion vested in it as Agent in accordancewith any instructions given to it by the Majority Lenders (or, if so instructedby the Majority Lenders, refrain from exercising any right, power, authority ordiscretion vested in it as Agent) and (ii) not be liable for any act (oromission) if it acts (or refrains from taking any action) in accordance with aninstruction of the Majority Lenders.

(b)                              Unless acontrary indication appears in a Finance Document, any instructions given bythe Majority Lenders will be binding on all the Finance Parties.

(c)                               The Agentmay refrain from acting in accordance with the instructions of the MajorityLenders (or, if appropriate, the Lenders) until it has received such securityas it may require for any cost, loss or liability (together with any associatedVAT) which it may incur in complying with the instructions.

(d)                              In theabsence of instructions from the Majority Lenders (or, if appropriate, theLenders), the Agent may act (or refrain from taking action) as it considers tobe in the best interest of the Lenders.

(e)                               The Agent isnot authorised to act on behalf of a Lender (without first obtaining thatLender’s consent) in any legal or arbitration proceedings relating to anyFinance Document.

**24.8**                     Responsibilityfor documentation

Neitherthe Agent nor any Mandated Lead Arranger:

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(a)                                isresponsible for the adequacy, accuracy and/or completeness of any information(whether oral or written) supplied by the Agent, the Mandated Lead Arrangers,the Borrower, the Parent or any other person given in or in connection with anyFinance Document; or

(b)                               isresponsible for the legality, validity, effectiveness, adequacy orenforceability of any Finance Document or any other agreement, arrangement ordocument entered into, made or executed in anticipation of or in connectionwith any Finance Document.

**24.9**                     Exclusionof liability

(a)                               Withoutlimiting paragraph (b) below, the Agent will not be liable for any actiontaken by it under or in connection with any Finance Document, unless directlycaused by its gross negligence or wilful misconduct.

(b)                              No Party(other than the Agent) may take any proceedings against any officer, employeeor agent of the Agent in respect of any claim it might have against the Agentor in respect of any act or omission of any kind by that officer, employee or agentin relation to any Finance Document and any officer, employee or agent of theAgent may rely on this Clause.

(c)                               The Agentwill not be liable for any delay (or any related consequences) in crediting anaccount with an amount required under the Finance Documents to be paid by it ifit has taken all necessary steps as soon as reasonably practicable to complywith the regulations or operating procedures of any recognised clearing orsettlement system used by it for that purpose.

(d)                              Nothing inthis Agreement shall oblige the Agent or the Mandated Lead Arrangers to carryout any “know your customer” or other checks in relation to any person onbehalf of any Lender and each Lender confirms to the Agent and the MandatedLead Arrangers that it is solely responsible for any such checks it is requiredto carry out and that it may not rely on any statement in relation to suchchecks made by the Agent or the Mandated Lead Arrangers.

**24.10**              Lenders’indemnity to the Agent

EachLender shall (in proportion to its share of the Total Commitments or, if theTotal Commitments are then zero, to its share of the Total Commitmentsimmediately prior to their reduction to zero) indemnify the Agent, within threeBusiness Days of demand, against any cost, loss or liability incurred by theAgent (otherwise than by reason of the Agent’s gross negligence or wilfulmisconduct) in acting as Agent under the Finance Documents (unless the Agenthas been reimbursed by an Obligor pursuant to a Finance Document).

**24.11**               Resignationof the Agent

(a)                               The Agentmay resign and appoint one of its Affiliates as successor by giving notice tothe other Finance Parties and the Borrower.

(b)                              Alternativelythe Agent may resign by giving notice to the other Finance Parties and theBorrower, in which case the Majority Lenders (after consultation with theBorrower) may appoint a successor Agent.

(c)                               If theMajority Lenders have not appointed a successor Agent in accordance withparagraph (b) above within 30 days after notice of resignation was given,the Agent (after consultation with the Borrower) may appoint a successor Agent.

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(d)                              The retiringAgent shall, at its own cost, make available to its successor such documentsand records and provide such assistance as its successor may reasonably requestfor the purposes of performing its functions as Agent under the FinanceDocuments.

(e)                               The Agent’sresignation notice shall only take effect upon the appointment of a successor.

(f)                                 Upon theappointment of a successor, the retiring Agent shall be discharged from anyfurther obligation in respect of the Finance Documents but shall remainentitled to the benefit of this Clause 24. Its successor and each of the otherParties shall have the same rights and obligations amongst themselves as theywould have had if such successor had been an original Party.

(g)                              Afterconsultation with the Borrower, the Majority Lenders may, by notice to theAgent, require it to resign in accordance with paragraph (b) above. Inthis event, the Agent shall resign in accordance with paragraph (b) above.

**24.12**              Confidentiality

(a)                               In acting asagent for the Finance Parties, the Agent shall be regarded as acting throughits agency division which shall be treated as a separate entity from any otherof its divisions or departments.

(b)                              If informationis received by another division or department of the Agent, it may be treatedas confidential to that division or department and the Agent shall not bedeemed to have notice of it.

**24.13**              Relationshipwith the Lenders

(a)                               The Agentmay treat each Lender as a Lender, entitled to payments under this Agreementand acting through its Facility Office unless it has received not less thanfive Business Days prior notice from that Lender to the contrary in accordancewith the terms of this Agreement.

(b)                              Each Lendershall supply the Agent with any information required by the Agent in order tocalculate the Mandatory Cost in accordance with Schedule 4 (*Mandatory Cost**formula*).

**24.14**              Creditappraisal by the Lenders

Withoutaffecting the responsibility of the Borrower for information supplied by it oron its behalf in connection with any Finance Document, each Lender confirms tothe Agent and the Mandated Lead Arrangers that it has been, and will continueto be, solely responsible for making its own independent appraisal andinvestigation of all risks arising under or in connection with any FinanceDocument including but not limited to:

(a)                                thefinancial condition, status and nature of each member of the Group;

(b)                               thelegality, validity, effectiveness, adequacy or enforceability of any FinanceDocument and any other agreement, arrangement or document entered into, made orexecuted in anticipation of, under or in connection with any Finance Document;

(c)                                whether thatLender has recourse, and the nature and extent of that recourse, against anyParty or any of its respective assets under or in connection with any FinanceDocument, the transactions contemplated by the Finance Documents or any otheragreement, arrangement or document entered into, made or executed in anticipationof, under or in connection with any Finance Document; and

(d)                               theadequacy, accuracy and/or completeness of any other information provided by theAgent, any Party or by any other person under or in connection with any Finance

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Document, the transactions contemplated by theFinance Documents or any other agreement, arrangement or document entered into,made or executed in anticipation of, under or in connection with any FinanceDocument.

**24.15**              ReferenceBanks

If aReference Bank (or, if a Reference Bank is not a Lender, the Lender of which itis an Affiliate) ceases to be a Lender, the Agent shall (in consultation withthe Borrower) appoint another Lender or an Affiliate of a Lender to replacethat Reference Bank.

**24.16**              Deductionfrom amounts payable by the Agent

If anyParty owes an amount to the Agent under the Finance Documents the Agent may,after giving notice to that Party, deduct an amount not exceeding that amountfrom any payment to that Party which the Agent would otherwise be obliged tomake under the Finance Documents and apply the amount deducted in or towardssatisfaction of the amount owed. For the purposes of the Finance Documents thatParty shall be regarded as having received any amount so deducted.

**25**                               CONDUCT OF BUSINESS BY THE FINANCE PARTIES

Noprovision of this Agreement will:

(a)                                interferewith the right of any Finance Party to arrange its affairs (tax or otherwise)in whatever manner it thinks fit;

(b)                               oblige anyFinance Party to investigate or claim any credit, relief, remission orrepayment available to it or the extent, order and manner of any claim; or

(c)                                oblige anyFinance Party to disclose any information relating to its affairs (tax orotherwise) or any computations in respect of Tax.

**26**                               SHARING AMONG THE FINANCE PARTIES

**26.1**                     Paymentsto Finance Parties

If aFinance Party (a “**Recovering Finance Party**”)receives or recovers any amount from the Borrower other than in accordance withClause 27 (*Payment Mechanics*) andapplies that amount to a payment due under the Finance Documents then:

(a)                                theRecovering Finance Party shall, within three Business Days, notify details ofthe receipt or recovery to the Agent;

(b)                               the Agentshall determine whether the receipt or recovery is in excess of the amount theRecovering Finance Party would have been paid had the receipt or recovery beenreceived or made by the Agent and distributed in accordance with Clause 27 (*Payment Mechanics*), without taking accountof any Tax which would be imposed on the Agent in relation to the receipt,recovery or distribution; and

(c)                                theRecovering Finance Party shall, within three Business Days of demand by theAgent, pay to the Agent an amount (the “**SharingPayment**”) equal to such receipt or recovery less any amount whichthe Agent determines may be retained by the Recovering Finance Party as itsshare of any payment to be made, in accordance with Clause 27.5 (*Partial payments*).

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**26.2**                     Redistributionof payments

TheAgent shall treat the Sharing Payment as if it had been paid by the Borrowerand distribute it between the Finance Parties (other than the RecoveringFinance Party) in accordance with Clause 27.5 (*Partialpayments*).

**26.3**                     RecoveringFinance Party’s rights

(a)                               On adistribution by the Agent under Clause 26.2 (*Redistributionof payments*), the Recovering Finance Party will be subrogated to therights of the Finance Parties which have shared in the redistribution.

(b)                              If and tothe extent that the Recovering Finance Party is not able to rely on its rightsunder paragraph (a) above, the Borrower shall be liable to the RecoveringFinance Party for a debt equal to the Sharing Payment which is immediately dueand payable.

**26.4**                     Reversalof redistribution

If anypart of the Sharing Payment received or recovered by a Recovering Finance Partybecomes repayable and is repaid by that Recovering Finance Party, then:

(a)                                each FinanceParty which has received a share of the relevant Sharing Payment pursuant toClause 26.2 (*Redistribution of payments*)shall, upon request of the Agent, pay to the Agent for account of that RecoveringFinance Party an amount equal to the appropriate part of its share of theSharing Payment (together with an amount as is necessary to reimburse thatRecovering Finance Party for its proportion of any interest on the SharingPayment which that Recovering Finance Party is required to pay); and

(b)                               thatRecovering Finance Party’s rights of subrogation in respect of anyreimbursement shall be cancelled and the Borrower will be liable to thereimbursing Finance Party for the amount so reimbursed.

**26.5**                     Exceptions

(a)                               This Clause26 shall not apply to the extent that the Recovering Finance Party would not,after making any payment pursuant to this Clause, have a valid and enforceableclaim against the Borrower.

(b)                              A RecoveringFinance Party is not obliged to share with any other Finance Party any amountwhich the Recovering Finance Party has received or recovered as a result oftaking legal or arbitration proceedings, if:

(i)                                   it notifiedthat other Finance Party of the legal or arbitration proceedings; and

(ii)                                that otherFinance Party had an opportunity to participate in those legal or arbitrationproceedings but did not do so as soon as reasonably practicable having receivednotice and did not take separate legal or arbitration proceedings.

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**SECTION 10ADMINISTRATION**

**27**                               PAYMENT MECHANICS

**27.1**                     Paymentsto the Agent

(a)                               On each dateon which an Obligor or a Lender is required to make a payment under a FinanceDocument, the Obligor or Lender shall make the same available to the Agent(unless a contrary indication appears in a Finance Document) for value on thedue date at the time and in such funds specified by the Agent as beingcustomary at the time for settlement of transactions in the relevant currencyin the place of payment.

(b)                              Paymentshall be made to such account in the principal financial centre of the countryof that currency (or, in relation to euro, in the principal financial centre ina Participating Member State or London) with such bank as the Agent specifies.

**27.2**                     Distributionsby the Agent

Eachpayment received by the Agent under the Finance Documents for another Partyshall, subject to Clause 27.3 (*Distributionsto**the**Borrower*) and Clause 27.4 (*Clawback*), be made available by the Agentas soon as practicable after receipt to the Party entitled to receive paymentin accordance with this Agreement (in the case of a Lender, for the account ofits Facility Office), to such account as that Party may notify to the Agent bynot less than five Business Days’ notice with a bank in the principal financialcentre of the country of that currency.

**27.3**                     Distributionsto the Borrower

TheAgent may (with the Borrower’s consent or in accordance with Clause 28 (*Set-off*)) apply any amount received by itfor the Borrower in or towards payment (on the date and in the currency andfunds of receipt) of any amount due from the Borrower under the FinanceDocuments or in or towards purchase of any amount of any currency to be soapplied.

**27.4**                     Clawback

(a)                               Where a sumis to be paid to the Agent under the Finance Documents for another Party, theAgent is not obliged to pay that sum to that other Party (or to enter into orperform any related exchange contract) until it has been able to establish toits satisfaction that it has actually received that sum.

(b)                              If the Agentpays an amount to another Party and it proves to be the case that the Agent hadnot actually received that amount, then the Party to whom that amount (or theproceeds of any related exchange contract) was paid by the Agent shall ondemand refund the same to the Agent together with interest on that amount fromthe date of payment to the date of receipt by the Agent, calculated by theAgent to reflect its cost of funds.

**27.5**                     Partialpayments

(a)                               If the Agentreceives a payment that is insufficient to discharge all the amounts then dueand payable by the Borrower under the Finance Documents, the Agent shall applythat payment towards the obligations of the Borrower under the FinanceDocuments in the following order:

(i)                                   first, in ortowards payment pro rata of any unpaid fees, costs and expenses of the Agent orthe Mandated Lead Arrangers under the Finance Documents;

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(ii)                                secondly, inor towards payment pro rata of any accrued interest, fee or commission due butunpaid under this Agreement;

(iii)                             thirdly, inor towards payment pro rata of any principal due but unpaid under thisAgreement; and

(iv)                            fourthly, in or towards payment pro rataof any other sum due but unpaid under the Finance Documents.

(b)                              The Agentshall, if so directed by the Majority Lenders, vary the order set out inparagraphs (a)(ii) to (iv) above.

(c)                               Paragraphs (a) and(b) above will override any appropriation made by the Borrower.

**27.6**                     Noset-off by the Borrower

Allpayments to be made by the Borrower under the Finance Documents shall be calculatedand be made without (and free and clear of any deduction for) set-off orcounterclaim.

**27.7**                     BusinessDays

(a)                               Any paymentwhich is due to be made on a day that is not a Business Day shall be made onthe next Business Day in the same calendar month (if there is one) or thepreceding Business Day (if there is not).

(b)                              During anyextension of the due date for payment of any principal or Unpaid Sum under thisAgreement interest is payable on the principal or Unpaid Sum at the ratepayable on the original due date.

**27.8**                     Currencyof account

(a)                               Subject toparagraphs (b) to (e) below, Dollars is the currency of account andpayment for any sum due from the Borrower under any Finance Document.

(b)                              A repaymentof a Loan or Unpaid Sum or a part of a Loan or Unpaid Sum shall be made in thecurrency in which that Loan or Unpaid Sum is denominated on its due date.

(c)                               Each paymentof interest shall be made in the currency in which the sum in respect of whichthe interest is payable was denominated when that interest accrued.

(d)                              Each paymentin respect of costs, expenses or Taxes shall be made in the currency in whichthe costs, expenses or Taxes are incurred.

(e)                               Any amountexpressed to be payable in a currency other than Dollars shall be paid in thatother currency.

**27.9**                     Changeof currency

(a)                               Unlessotherwise prohibited by law, if more than one currency or currency unit are atthe same time recognised by the central bank of any country as the lawfulcurrency of that country, then:

(i)                                   anyreference in the Finance Documents to, and any obligations arising under theFinance Documents in, the currency of that country shall be translated into, orpaid in, the currency or currency unit of that country designated by the Agent(after consultation with the Borrower); and

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(ii)                                anytranslation from one currency or currency unit to another shall be at theofficial rate of exchange recognised by the central bank for the conversion ofthat currency or currency unit into the other, rounded up or down by the Agent(acting reasonably).

(b)                              If a changein any currency of a country occurs, this Agreement will, to the extent theAgent (acting reasonably and after consultation with the Borrower) specifies tobe necessary, be amended to comply with any generally accepted conventions andmarket practice in the London interbank market and otherwise to reflect thechange in currency.

**28**                               SET-OFF

AFinance Party may set off any matured obligation due from the Borrower underthe Finance Documents (to the extent beneficially owned by that Finance Party)against any matured obligation owed by that Finance Party to the Borrower,regardless of the place of payment, booking branch or currency of eitherobligation. If the obligations are in different currencies, the Finance Partymay convert either obligation at a market rate of exchange in its usual courseof business for the purpose of the set-off.

**29**                               NOTICES

**29.1**                     Communicationsin writing

Anycommunication to be made under or in connection with the Finance Documentsshall be made in writing and, unless otherwise stated, may be made by fax orletter.

**29.2**                     Addresses

Theaddress and fax number (and the department or officer, if any, for whoseattention the communication is to be made) of each Party for any communicationor document to be made or delivered under or in connection with the FinanceDocuments is:

(a)                                in the caseof the Borrower, that identified with its name below;

(b)                               in the caseof each Lender, that notified in writing to the Agent on or prior to the dateon which it becomes a Party; and

(c)                                in the caseof the Agent, that identified with its name below,

or anysubstitute address, fax number or department or officer as the Party may notifyto the Agent (or the Agent may notify to the other Parties, if a change is madeby the Agent) by not less than five Business Days’ notice.

**29.3**                     Delivery

(a)                               Anycommunication or document made or delivered by one person to another under orin connection with the Finance Documents will only be effective:

(i)                                   if by way offax, when received in legible form; or

(ii)                                if by way ofletter, when it has been left at the relevant address or five Business Daysafter being deposited in the post postage prepaid in an envelope addressed toit at that address,

and, ifa particular department or officer is specified as part of its address detailsprovided under Clause 29.2 (*Addresses*),if addressed to that department or officer.

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(b)                              Anycommunication or document to be made or delivered to the Agent will beeffective only when actually received by the Agent and then only if it isexpressly marked for the attention of the department or officer identified withits signature below (or any substitute department or officer as it shallspecify for this purpose).

(c)                               All noticesfrom or to the Borrower shall be sent through the Agent.

**29.4**                     Notificationof address and fax number

Promptlyupon receipt of notification of an address and fax number or change of addressor fax number pursuant to Clause 29.2 (*Addresses*)or changing its own address or fax number, the Agent shall notify the otherParties.

**29.5**                     Electroniccommunication

(a)                               Anycommunication to be made between the Agent and a Lender under or in connectionwith the Finance Documents may be made by electronic mail or other electronicmeans, if the Agent and the relevant Lender:

(i)                                   agree that,unless and until notified to the contrary, this is to be an accepted form ofcommunication;

(ii)                                notify eachother in writing of their electronic mail address and/or any other informationrequired to enable the sending and receipt of information by that means; and

(iii)                             notify eachother of any change to their address or any other such information supplied bythem.

(b)                              Anyelectronic communication made between the Agent and a Lender will be effectiveonly when actually received in readable form and in the case of any electroniccommunication made by a Lender to the Agent only if it is addressed in such amanner as the Agent shall specify for this purpose.

**29.6**                     Englishlanguage

(a)                               Any noticegiven under or in connection with any Finance Document must be in English.

(b)                              All otherdocuments provided under or in connection with any Finance Document must be:

(i)                                   in English;or

(ii)                                if not inEnglish, and if so required by the Agent, accompanied by a certified Englishtranslation and, in this case, the English translation will prevail unless thedocument is a constitutional, statutory or other official document.

**30**                               CALCULATIONS AND CERTIFICATES

**30.1**                     Accounts

In anylitigation or arbitration proceedings arising out of or in connection with aFinance Document, the entries made in the accounts maintained by a FinanceParty are prima facie evidence of the matters to which they relate.

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**30.2**                     Certificatesand Determinations

Anycertification or determination by a Finance Party of a rate or amount under anyFinance Document is, in the absence of manifest error, conclusive evidence ofthe matters to which it relates.

**30.3**                     Daycount convention

Anyinterest, commission or fee accruing under a Finance Document will accrue fromday to day and is calculated on the basis of the actual number of days elapsedand a year of  360 days or, in any casewhere the practice in the London interbank market differs, in accordance withthat market practice.

**31**                               PARTIAL INVALIDITY

If, atany time, any provision of the Finance Documents is or becomes illegal, invalidor unenforceable in any respect under any law of any jurisdiction, neither thelegality, validity or enforceability of the remaining provisions nor thelegality, validity or enforceability of such provision under the law of anyother jurisdiction will in any way be affected or impaired.

**32**                               REMEDIES AND WAIVERS

Nofailure to exercise, nor any delay in exercising, on the part of any FinanceParty, any right or remedy under the Finance Documents shall operate as awaiver, nor shall any single or partial exercise of any right or remedy preventany further or other exercise or the exercise of any other right or remedy. Therights and remedies provided in this Agreement are cumulative and not exclusiveof any rights or remedies provided by law.

**33**                               AMENDMENTS AND WAIVERS

**33.1**                     Requiredconsents

(a)                               Subject toClause 33.2 (*Exceptions*) any termof the Finance Documents may be amended or waived only with the consent of theMajority Lenders and the Borrower and any such amendment or waiver will bebinding on all Parties.

(b)                              The Agentmay effect, on behalf of any Finance Party, any amendment or waiver permittedby this Clause.

**33.2**                     Exceptions

(a)                               An amendmentor waiver that has the effect of changing or which relates to:

(i)                                   the definitionof “**Majority Lenders**” in Clause1.1 (*Definitions*);

(ii)                                an extensionto the date of payment of any amount under the Finance Documents;

(iii)                             a reductionin the Margin or a reduction in the amount of any payment of principal,interest, fees or commission payable;

(iv)                            an increase in or an extension of anyCommitment;

(v)                               a change toan Obligor;

(vi)                            any provision which expressly requiresthe consent of all the Lenders; or

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(vii)                         Clause 2.2 (*Finance Parties’ rights and obligations*), Clause 22 (*Changes to the Lenders*), Clause 26 (*Sharing among the Finance Parties*) or thisClause 33,

shall not be madewithout the prior consent of all the Lenders.

(b)                              An amendmentor waiver which relates to the rights or obligations of the Agent or theMandated Lead Arrangers may not be effected without the consent of the Agent orthe Mandated Lead Arrangers.

**34**                               COUNTERPARTS

EachFinance Document may be executed in any number of counterparts, and this hasthe same effect as if the signatures on the counterparts were on a single copyof the Finance Document.

 

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**SECTION 11GOVERNING LAW AND ENFORCEMENT**

**35**                               GOVERNING LAW

ThisAgreement is governed by English law.

**36**                               ARBITRATION

**36.1**                     Arbitration

Subjectto Clause 36.4 (*Agent’s option*),any dispute arising out of or in connection with this Agreement (including adispute regarding the existence, validity or termination of this Agreement) (a “**Dispute**”) shall be referred to and finally resolved byarbitration under the Arbitration Rules (the “**Rules**”) of the London Court of International Arbitration (the “**LCIA Court**”).

**36.2**                     Procedurefor arbitration

(a)                               The arbitraltribunal shall consist of three arbitrators. The claimant(s), irrespective ofnumber, shall nominate jointly one arbitrator; the respondent(s), irrespectiveof number, shall nominate jointly the second arbitrator; and a thirdarbitrator, who shall serve as Chairman (who shall be a lawyer currentlyqualified in England and Wales and be admitted to the Bar of England andWales), shall be appointed by the LCIA Court within 15 days of the appointmentof the second arbitrator.

(b)                              In the eventthe claimant(s) or the respondent(s) shall fail to nominate anarbitrator within the time limits specified in the Rules, such arbitrator shallbe appointed by the LCIA Court within 15 days of such failure. In the eventthat both the claimant(s) and the respondent(s) fail to nominate anarbitrator within the time limits specified in the Rules, all three arbitratorsshall be appointed by the LCIA Court within 15 days of such failure who shalldesignate one of them as chairman.

(c)                               If all theparties to an arbitration so agree, there shall be a sole arbitrator appointedby the LCIA Court within 15 days of such agreement.

(d)                              The seat ofarbitration shall be London, England and the language of the arbitration shallbe English.

**36.3**                     Recourseto courts

Save asprovided in Clause 36.4 (*Agent’s option*),the parties exclude the jurisdiction of the courts under Sections 45 and 69 ofthe Arbitration Act 1996.

**36.4**                     Agent’soption

Beforean arbitrator has been appointed by a Finance Party to determine a Dispute, theAgent may (and, if so instructed by the Majority Lenders, shall) by notice inwriting to the Borrower require that all Disputes or a specific Dispute beheard by a court of law. If the Agent gives such notice, the Dispute to which suchnotice refers shall be determined in accordance with Clause 37 (*Jurisdiction*).

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**37**                               JURISDICTION

**37.1**                     Jurisdictionof English courts

(a)                               The courtsof England have exclusive jurisdiction to settle all Disputes.

(b)                              The Partiesagree that the courts of England are the most appropriate and convenient courtsto settle Disputes and accordingly no Party will argue to the contrary.

(c)                               ThisClause 37.1 is for the benefit of the Finance Parties only. As a result,no Finance Party shall be prevented from taking proceedings relating to aDispute in any other courts with jurisdiction. To the extent allowed by law,the Finance Parties may take concurrent proceedings in any number ofjurisdictions.

**37.2**                     Serviceof process

Withoutprejudice to any other mode of service allowed under any relevant law, theBorrower:

(a)                                irrevocablyappoints Law Debenture Trust Corporation, located at the date hereof at 5th Floor, 100 Wood Street, London EC2V 7EX,England, as its agent for service of process in relation to any proceedings commencedin accordance with this Agreement; and

(b)                               agrees thatfailure by a process agent to notify the Borrower of the process will notinvalidate the proceedings concerned.

**37.3**                     Waiverof immunity

TheBorrower irrevocably agrees that, should any party take any proceedingsanywhere (whether for an injunction, specific performance, damages orotherwise), no immunity (to the extent that it may at any time exist, whetheron the grounds of sovereignty or otherwise) from those proceedings, fromattachment (whether in aid of execution, before judgment or otherwise) of itsassets or from execution of judgment shall be claimed by it or on behalf of itor with respect to its assets, any such immunity being irrevocably waived. TheBorrower irrevocably agrees that it and its assets are, and shall be, subjectto such proceedings, attachment or execution in respect of its obligationsunder the Finance Documents.

**This Agreement has been enteredinto on the date stated at the beginning of this Agreement.**

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**SCHEDULE 1The Original Lenders**

 
| **Name of Original Lender**  | ** ** | **Facility 1  Commitment  (US$)** | ** ** | **Facility 2  Commitment  (US$)** | ** ** |
|---------------------------------------------|------------|----------------------------------------|------------|----------------------------------------|------------|
| Citibank, N.A.                              |       | 34,333,333.34                          |       | 32,333,333.33                          |       |
|                                        |       |                                   |       |                                   |       |
| ING Bank N.V.                               |       | 34,333,333.33                          |       | 32,333,333.34                          |       |
|                                        |       |                                   |       |                                   |       |
| Raiffeisen  Zentralbank Österreich  AG |       | 34,333,333.33                          |       | 32,333,333.33                          |       |
|                                        |       |                                   |       |                                   |       |
| **TOTAL:**                                  | ** ** | **103,000,000**                        | ** ** | **97,000,000**                         | ** ** |

 

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**SCHEDULE 2Conditions precedent**

**Part I**

**1****                                     ****Finance Documents**

Executedoriginals of:

(a)                                thisAgreement;

(b)                               the FeeLetter; and

(c)                                the MandateLetter.

**2****                                     ****The Borrower**

(a)                               Certifiedcopies of the Borrower’s duly registered constitutional documents and thecertificates of state registration of the Borrower.

(b)                              Certifiedcopy of the most recent certificate from the Unified State Register ofEnterprises and Organisations of Ukraine.

(c)                               Certifiedcopies of all corporate resolutions necessary to authorise the Borrower toexecute and perform the Finance Documents and any documents referred to thereinand the transactions contemplated thereunder (including but not limited to anymajor transaction approvals or interested party transaction approvals, ifapplicable).

(d)                              Evidence ofthe authority of the relevant signatories of the Borrower (including, but notlimited to, its Chief Accountant and Chairman) to execute each Finance Documentto which it is a party and any documents referred to therein and thetransactions contemplated thereunder.

(e)                               A certifiedcopy of the most recent balance sheet of the Borrower and the Parent byreference to the date of each Finance Document.

(f)                                 a certifiedcopy of each of the Original Financial Statements.

(g)                              Acertificate executed on behalf of each of the Borrower:

(i)                                   certifyingthe sample signature and office of each person that signed the relevant FinanceDocument and any documents referred to therein and the transactionscontemplated thereunder on behalf of the Borrower and certifying that suchsignatories hold the positions in which capacity they executed such documents;and

(ii)                                certifyingthat each copy document relating to it specified in this Schedule 2 Part Iis correct, complete and in full force and effect as at a date no earlier thanthe date of this Agreement.

**3****                                     ****Legal opinions**

(a)                               A legalopinion of Linklaters as to matters of English law.

(b)                              A legalopinion of Linklaters CIS as to matters of Russian law.

(c)                               A legalopinion of B.C. Toms & Co JSC as to matters of Ukrainian law.

(d)                              An in-houselegal opinion of the Borrower.

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**4****                                     ****Other documents and evidence**

(a)                               Evidencethat the process agent referred to in Clause 37.2 (*Service of process*) has accepted its appointment.

(b)                              A copy ofany other Authorisation or other document, opinion or assurance which the Agentconsiders to be necessary or desirable (if it has notified the Borroweraccordingly) in connection with the entry into and performance of the transactionscontemplated by any Finance Document or for the validity and enforceability ofany Finance Document.

(c)                               The OriginalFinancial Statements.

(d)                              Evidencethat the fees, costs and expenses then due from the Borrower pursuant to Clause11 (*Fees*) and 16 (*Costs and expenses*) have been paid or willbe paid by the first Utilisation Date.

(e)                               TheRegistration Certificate of the NBU confirming the registration of thisAgreement as required by Ukrainian law.

(f)                                 Evidencethat the relevant accounts with the Ukrainian Servicing Bank has beenestablished.

(g)                              Such otherdocuments or evidence which the Agent may reasonably require.

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**Part II**

**1****                                     ****Parent Guarantee**

Executedoriginal of the Parent Guarantee

**2****                                     ****The Parent**

(a)                               Certifiedcopies of the Parent’s duly registered constitutional documents.

(b)                              Certifiedcopies of all corporate resolutions necessary to authorise the Parent toexecute and perform the Finance Documents and any documents referred to thereinand the transactions contemplated thereunder (including but not limited to anymajor transaction approvals or interested party transaction approvals, ifapplicable).

(c)                               Evidence ofthe authority of the relevant signatories of the Parent (including, but notlimited to, its Chief Accountant) to execute each Finance Document to which itis a party and any documents referred to therein and the transactionscontemplated thereunder.

(d)                              A certifiedcopy of the most recent balance sheet of the Parent by reference to the date ofeach Finance Document.

(e)                               Acertificate executed on behalf of the Parent:

(i)                                   certifyingthe sample signature and office of each person that signed the relevant FinanceDocument and any documents referred to therein and the transactionscontemplated thereunder on behalf of the Parent and certifying that suchsignatories hold the positions in which capacity they executed such documents;and

(ii)                                certifyingthat each copy document relating to it specified in this Schedule 2 Part IIis correct, complete and in full force and effect as at a date no earlier thanthe date of the Parent Guarantee.

**3****                                     ****Legal opinions**

(a)                               A legalopinion of Linklaters as to matters of English law.

(b)                              A legalopinion of Linklaters CIS as to matters of Russian law.

(c)                               An in-houselegal opinion of the Parent.

**4****                                     ****Other documents and evidence**

(a)                               Evidencethat the process agent referred to in Clause 16.2 (*Service of process*) of the Parent Guarantee has accepted itsappointment.

(b)                              A copy ofany other Authorisation or other document, opinion or assurance which the Agentconsiders to be necessary or desirable (if it has notified the Borroweraccordingly) in connection with the entry into and performance of thetransactions contemplated by any Finance Document or for the validity andenforceability of any Finance Document.

(c)                               Such other documentsor evidence which the Agent may reasonably require.

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**SCHEDULE 3Utilisation Request**

From:                  Closed Joint Stock Company “UkrainianMobile Communications”

To:          Citibank International plc as Agent

Dated:

DearSirs

**Closed Joint Stock Company “UkrainianMobile Communications” — US$200,000,000 Facility Agreementdated[                   ](the “Agreement”)**

**1****                                     **We refer tothe Agreement. This is a Utilisation Request. Terms defined in the Agreementhave the same meaning in this Utilisation Request unless given a differentmeaning in this Utilisation Request.

**2****                                     **We wish toborrow a Loan on the following terms:

 
| Proposed Utilisation Date: |   | [                   ]  or, if that is not a Business Day, the next Business Day) |
|----------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                       |   |                                                                                                                                                                            |
| Facility to be  utilised   |   | [Facility 1]/[Facility 2]*                                                                                                                                                      |
|                       |   |                                                                                                                                                                            |
| Amount:                    |   | [                   ]  or, if less, the Available Facility                       |
|                       |   |                                                                                                                                                                            |
| Interest Period:           |   | [                   ]                                                            |

 

**3****                                     **We confirmthat each condition specified in Clause 4.2 (*Furtherconditions precedent*) is satisfied on the date of this UtilisationRequest.

**4****                                     **The proceedsof this Loan should be credited to account number [•] held at theUkrainian Servicing Bank.

**5****                                     **ThisUtilisation Request is irrevocable.

ClosedJoint Stock Company “Ukrainian Mobile Communications”
| By:                      |   |
|--------------------------|--------|
| Name:                    |
| Title: General  Director |

 

----

 

*Deleteas appropriate

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**SCHEDULE 4Mandatory Cost formula**

**1****                                     **TheMandatory Cost is an addition to the interest rate to compensate Lenders forthe cost of compliance with (a) the requirements of the Bank of Englandand/or the Financial Services Authority (or, in either case, any otherauthority which replaces all or any of its functions) or (b) therequirements of the European Central Bank.

**2****                                     **On the firstday of each Interest Period (or as soon as possible thereafter) the Agent shallcalculate, as a percentage rate, a rate (the “**AdditionalCost Rate**”) for each Lender, in accordance with the paragraphs setout below. The Mandatory Cost will be calculated by the Agent as a weightedaverage of the Lenders’ Additional Cost Rates (weighted in proportion to thepercentage participation of each Lender in the relevant Loan) and will beexpressed as a percentage rate per annum.

**3****                                     **TheAdditional Cost Rate for any Lender lending from a Facility Office in aParticipating Member State will be the percentage notified by that Lender tothe Agent. This percentage will be certified by that Lender in its notice tothe Agent to be its reasonable determination of the cost (expressed as apercentage of that Lender’s participation in all Loans made from that FacilityOffice) of complying with the minimum reserve requirements of the EuropeanCentral Bank in respect of loans made from that Facility Office.

**4****                                     **TheAdditional Cost Rate for any Lender lending from a Facility Office in theUnited Kingdom will be calculated by the Agent as follows:

|  | per cent. per annum. |
|--|----------------------|

 

Where:

E                                               is designedto compensate Lenders for amounts payable under the Fees Rules and iscalculated by the Agent as being the average of the most recent rates of chargesupplied by the Reference Banks to the Agent pursuant to paragraph 7 below andexpressed in pounds per £1,000,000.

**5****                                     **For thepurposes of this Schedule:

(a)                                “**Fees Rules**” means the rules onperiodic fees contained in the FSA Supervision Manual or such other law orregulation as may be in force from time to time in respect of the payment offees for the acceptance of deposits;

(b)                               “**Fee Tariffs**” means the fee tariffsspecified in the Fees Rules under the activity group A.1 Deposit acceptors(ignoring any minimum fee or zero rated fee required pursuant to the Fees Rules buttaking into account any applicable discount rate); and

(c)                                “**Tariff Base**” has the meaning given to itin, and will be calculated in accordance with, the Fees Rules.

**6****                                     **Theresulting figure shall be rounded to four decimal places.

**7****                                     **If requestedby the Agent, each Reference Bank shall, as soon as practicable afterpublication by the Financial Services Authority, supply to the Agent, the rateof charge payable by that Reference Bank to the Financial Services Authoritypursuant to the Fees Rules in respect of the relevant financial year ofthe Financial Services Authority (calculated for this purpose by that 

72

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Reference Bank as being the average of the FeeTariffs applicable to that Reference Bank for that financial year) andexpressed in pounds per £1,000,000 of the Tariff Base of that Reference Bank.

**8****                                     **Each Lendershall supply any information required by the Agent for the purpose ofcalculating its Additional Cost Rate. In particular, but without limitation,each Lender shall supply the following information on or prior to the date onwhich it becomes a Lender:

(a)                                thejurisdiction of its Facility Office; and

(b)                               any otherinformation that the Agent may reasonably require for such purpose.

EachLender shall promptly notify the Agent of any change to the informationprovided by it pursuant to this paragraph.

**9****                                     **The rates ofcharge of each Reference Bank for the purpose of E above shall be determined bythe Agent based upon the information supplied to it pursuant to paragraphs 7and 8 above.

**10****                              **The Agentshall have no liability to any person if such determination results in anAdditional Cost Rate which over or under compensates any Lender and shall beentitled to assume that the information provided by any Lender or ReferenceBank pursuant to paragraphs 3, 7 and 8 above is true and correct in allrespects.

**11****                               **The Agentshall distribute the additional amounts received as a result of the MandatoryCost to the Lenders on the basis of the Additional Cost Rate for each Lenderbased on the information provided by each Lender and each Reference Bankpursuant to paragraphs 3, 7 and 8 above.

**12****                              **Anydetermination by the Agent pursuant to this Schedule in relation to a formula,the Mandatory Cost, an Additional Cost Rate or any amount payable to a Lendershall, in the absence of manifest error, be conclusive and binding on allParties.

**13****                              **The Agentmay from time to time, after consultation with the Borrower and the Lenders,determine and notify to all Parties any amendments which are required to bemade to this Schedule in order to comply with any change in law, regulation orany requirements from time to time imposed by the Bank of England, theFinancial Services Authority or the European Central Bank (or, in any case, anyother authority which replaces all or any of its functions) and any suchdetermination shall, in the absence of manifest error, be conclusive andbinding on all Parties.

73

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**SCHEDULE 5Form of Transfer Certificate**

To:          Citibank International plc as Agent

From:      [                   ](the “Existing Lender”) and[                   ](the “New Lender”)

Dated:

**Closed Joint Stock Company “UkrainianMobile Communications” — US$200,000,000 Facility Agreementdated[                   ](the “Agreement”)**

**1****                                     **We refer tothe Agreement. This is a Transfer Certificate. Terms defined in the Agreementhave the same meaning in this Transfer Certificate unless given a differentmeaning in this Transfer Certificate.

**2****                                     **We refer toClause 22.5 (*Procedure for transfer*):

(a)                                The ExistingLender and the New Lender agree to the Existing Lender transferring to the NewLender by novation all or part of the Existing Lender’s Commitment, rights andobligations referred to in the Schedule in accordance with Clause 22.5 (*Procedure for transfer*).

(b)                               The proposedTransfer Date is[                   ].

(c)                                The FacilityOffice and address, fax number and attention details for notices of the NewLender for the purposes of Clause 29.2 (*Addresses*)are set out in the Schedule.

**3****                                     **The NewLender expressly acknowledges the limitations on the Existing Lender’sobligations set out in paragraph (c) of Clause 22.4 (*Limitation of responsibility of Existing Lenders*).

**4****                                     **ThisTransfer Certificate may be executed in any number of counterparts and this hasthe same effect as if the signatures on the counterparts were on a single copyof this Transfer Certificate.

**5****                                     **ThisTransfer Certificate is governed by English law.

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**THESCHEDULECommitment/rights and obligations to be transferred**

[insert relevant details]

[Facility Office address, fax number andattention details for notices and account details for payments.]
| [Existing Lender] |   | [New Lender ] |   |
|-------------------|--------|---------------|--------|
|              |   |          |   |
| By:               |   | By:           |   |

 

 

ThisTransfer Certificate is accepted by the Agent and the Transfer Date isconfirmed as[                   ].

CitibankInternational plc

By:

75

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**SCHEDULE 6Form of Compliance Certificate**
| To:    |   | Citibank International plc as Agent                                     |
|--------|--------|-------------------------------------------------------------------------|
|   |   |                                                                    |
| From:  |   | Closed Joint Stock Company “Ukrainian Mobile  Communications” |
|   |   |                                                                    |
| Dated: |   |                                                                    |

 

DearSirs

**Closed Joint Stock Company “UkrainianMobile Communications” — US$200,000,000 Facility Agreementdated[                   ](the “Agreement”)**

Werefer to the Agreement. This is a Compliance Certificate. Terms defined in theAgreement have the same meaning in this Compliance Certificate unless given adifferent meaning in this Compliance Certificate.

**1****                                     **[We confirmthat no Default is continuing.]*

**2****                                     **We confirmthat the ratio of Consolidated Total Debt to Annualised Consolidated EBITDA was[•].

**3****                                     **We confirmthat the ratio of Consolidated Total Debt to Consolidated Total Net Worth was[•].

**4****                                     **We confirmthat for the previous Measurement Period ending on [•], the ratio ofaggregate Consolidated EBITDA for that Measurement Period and the previousMeasurement Period ending on [•] to aggregate Debt Service for thatMeasurement Period and the previous Measurement Period ending on [•] was[•].

**5****                                     **We confirmthat during the previous financial year, the ratio of aggregate ConsolidatedEBITDA for that financial year to aggregate Debt Service for that financialyear was never less than 1.75:1.
| Signed:                                                                 |   |   |
|-------------------------------------------------------------------------|--------|--------|
| General Director  of                                                    |
| Closed Joint  Stock Company “Ukrainian Mobile Communications” |

* *

****insert applicable certification language*

We havereviewed the Facility Agreement and audited consolidated financial statementsof Closed Joint Stock Company “Ukrainian Mobile Communications” for the yearended [                   ].

On thebasis of that review and audit, nothing has come to our attention which wouldrequire any modification to the confirmations in paragraphs 2 or 3 of the aboveCompliance Certificate.

----

 
| * | If this statement cannot be  made, the certificate should identify any Default that is continuing and the  steps, if any, being taken to remedy it. |
|---|-----------------------------------------------------------------------------------------------------------------------------------------------------|

 

76

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for andon behalf of

*name of auditors of*Closed JointStock Company “Ukrainian Mobile Communications”

77

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**SCHEDULE 7Selection Notice**
| From:  |   | Closed Joint Stock Company “Ukrainian Mobile  Communications” |
|--------|--------|-------------------------------------------------------------------------|
|   |   |                                                                    |
| To:    |   | Citibank International plc (as Agent)                                   |

 

Dated:

Dear Sirs

**Closed Joint Stock Company “UkrainianMobile Communications” — US$200,000,000 Facility Agreement dated [_______] 2005 (the “Agreement”)**

**1****                                     **We refer tothe Agreement. This is a Selection Notice. Terms defined in the Agreement havethe same meaning in this Selection Notice unless given a different meaning inthis Selection Notice.

**2****                                     **We refer to the following Loan[s] with an InterestPeriod ending on[                   ].*

We request that the next Interest Period for the aboveLoan[s] is[                   ].

**3****                                     **This Selection Notice is irrevocable.

Yours faithfully

for and on behalf ofClosedJoint Stock Company“Ukrainian Mobile Communications”
| By:                      |   |   |
|--------------------------|--------|--------|
|                     |
| Name:                    |
|                     |
| Title: General  Director |

 

----

 

*Insert details of all Loans which have anInterest Period ending on the same date.

78

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**SCHEDULE 8Parent Guarantee**

79

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** **

**SCHEDULE 9Amended and Restated Parent Guarantee**

80

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** **

**The Borrower**

**Closed Joint Stock Company “UkrainianMobile Communications”**
| Address: |   | Leiptsyzska St. 15,   |
|----------|--------|-----------------------|
|     |   |                  |
|     |   | City of Kyiv,  01015, |
|     |   |                  |
|     |   | Ukraine               |

 

 

Fax No:   +380 44230 02 55

Attention:                           Mark Burden / Antonina Koroliova
| By:                      |   |   |
|--------------------------|--------|--------|
|                     |
| Name:                    |
|                     |
| Title: General  Director |

 

**The Bookrunners**

Citibank, N.A.
| By:    |   |   |
|--------|--------|--------|
|   |
| Name:  |
|   |
| Title: |

 

Address:                                                                                                                                        Citibank NA Loans Operations Department, 5thFloor, Citigroup Centre, 33 Canada Square, Canary Wharf, London E14 5 LB

Attn:                                                                                                                                                             UK Loans Processing Unit

Payment Instructions for USD:

BankName:                                           CitibankNA, New York

SWIFT:                                  CITIUS33

Infavour of:                                          CitibankNA, London

SWIFT:                                  CITIGB2L

AccountNumber:                                10990765

Attn:                                                       UKLoans Dept

81

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ING Bank N.V.
| By:    |   |   |
|--------|--------|--------|
|   |
| Name:  |
|   |
| Title: |

 
| Address:     |   | 49 St. Stephen’s Green, Dublin 2, Ireland |
|--------------|--------|------------------------------------------------|
|         |   |                                           |
| Tax Address: |   | Amstelveenseqeg 500, 1081 KL Amsterdam         |
|         |   |                                           |
| Telephone:   |   | +353 1 6384016                                 |
|         |   |                                           |
| Fax:         |   | +353 1 6384050                                 |
|         |   |                                           |
| Email:       |   | emma.condon@ie.ing.com                         |
|         |   |                                           |
| Attention:   |   | Emma Condon                                    |

 

Payment Instructions for USD:
| Name of Bank:                                                              |   | JP Morgan Chase, New York                                                                    |
|----------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------|
|                                                                       |   |                                                                                         |
| SWIFT:          CHASUS33 |
|                                                                       |
| ING Bank Dublin Acc. No: 001-1-427457                                      |
|                                                                       |
| SWIFT:          INGBIE2D |
|                                                                       |
| Reference:                                                                 |   | CJSC “Ukrainian Mobile Communications - USD 200m  Facility Agreement, attn. Emma Condon |

 

**The Mandated Lead Arrangers**

Citibank, N.A.
| By:    |   |   |
|--------|--------|--------|
|   |
| Name:  |
|   |
| Title: |

 

ING Bank N.V.
| By:    |   |   |
|--------|--------|--------|
|   |
| Name:  |
|   |
| Title: |

 

82

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Raiffeisen Zentralbank Österreich AG
| By:    |   |   |
|--------|--------|--------|
|   |
| Name:  |
|   |
| Title: |

 
| Address:   |   | Am Stadtpark 9, 1030 Vienna, Austria |
|------------|--------|--------------------------------------|
|       |   |                                 |
| Telephone: |   | +43 1 71707 1398                     |
|       |   |                                 |
| Fax:       |   | +43 1 71707 2383                     |
|       |   |                                 |
| E-mail:    |   | Verena.Walter@rzb.at                 |
|       |   |                                 |
| Attention: |   | Ms. Verena Walter               |

 

Payment Instructions for USD:
| Name of bank:                                                         |   | Citibank N.A.                                                                                         |
|-----------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------|
|                                                                  |   |                                                                                                  |
| SWIFT:                                                                |   | CITIUS33                                                                                              |
|                                                                  |   |                                                                                                  |
| Account No.:                                                          |   | 1092 - 0871                                                                                           |
|                                                                  |   |                                                                                                  |
| Account Name: Raiffeisen  Zentralbank Österreich AG, Vienna |
|                                                                  |   |                                                                                                  |
| Reference:                                                            |   | CJSC “Ukrainian Mobile Communications - USD  112,500,000 Facility Agreement, attn. Verena Walter |

 

**The Original Lenders**

Citibank, N.A.
| By:    |   |   |
|--------|--------|--------|
|   |
| Name:  |
|   |
| Title: |

 

ING Bank N.V.
| By:    |   |   |
|--------|--------|--------|
|   |
| Name:  |
|   |
| Title: |

 

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RaiffeisenZentralbank Österreich AG
| By:    |   |   |
|--------|--------|--------|
|   |
| Name:  |
|   |
| Title: |

 

**The Agent**

 

Citibank International plc

 
| Address:   |   | 2nd Floor, 4 Harbour Exchange Square, London E14 9GE |
|------------|--------|------------------------------------------------------|
|       |   |                                                 |
| Fax:       |   | +44 20 8636 3824                                     |
|       |   |                                                 |
| Attention: |   | Loans Agency                                         |

 
| By:    |   |   |
|--------|--------|--------|
|   |
| Name:  |
|   |
| Title: |

 

Payment Instructions for USD:
| Bank Name:                                                                    |   | Citibank NA, New York      |
|-------------------------------------------------------------------------------|--------|----------------------------|
|                                                                          |   |                       |
| SWIFT:          CITIUS33    |
|                                                                          |
| In favour of:                                                                 |   | Citibank International PLC |
|                                                                          |   |                       |
| SWIFT:          CITTGB2LELA |
|                                                                          |
| Account Number:                                                               |   | 10963054                   |
|                                                                          |   |                       |
| Attn:                                                                         |   | Loans Agency/John Nelson   |

 

 

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