**Exhibit 1.1**

 

Charter of Mechel OAO

 

 
| ** ** | **APPROVED**                                |
|------------|---------------------------------------------|
|       |                                        |
|       | By the Annual General  Meeting of           |
|       | Shareholders of Mechel OAO                  |
|       |                                        |
|       | Minutes No 1 of the Annual  General Meeting |
|       | of Shareholders                             |
|       |                                        |
|       | Chairman of the Meeting                     |
|       |                                        |
|       |                                        |  (I.V. Zyuzin) |
|       |                                        |
|       | Secretary of the meeting                    |
|       |                                        |
|       |                                        |  (O.A. Yakunina) |

 

 

**Charter**

**Open Joint Stock Company**

**“Mechel”**

 

(New version)

 

*Moscow, 2005*

 

1

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**CONTENTS**

 
| **Article 1.**  | **GENERAL PROVISIONS**                                                                | **3**      |
|----------------------|---------------------------------------------------------------------------------------|------------|
| **Article 2.**  | **CORPORATE NAME AND LOCATION OF THE COMPANY**                                        | **3**      |
| **Article 3.**  | **LEGAL STATUS OF THE COMPANY**                                                       | **3**      |
| **Article 4.**  | **AIMS, SUBJECT MATTER AND TYPES OF OPERATIONS OF THE COMPANY**                       | **4**      |
| **Article 5.**  | **LIABILITY OF THE COMPANY AND SHAREHOLDERS**                                         | **5**      |
| **Article 6.**  | **FOUNDATION DOCUMENTS OF THE COMPANY**                                               | **6**      |
| **Article 7.**  | **CHARTER CAPITAL OF THE COMPANY**                                                    | **6**      |
| **Article 8.**  | **INCREASE OF THE CHARTER CAPITAL**                                                   | **6**      |
| **Article 9.**  | **REDUCTION OF THE CHARTER CAPITAL**                                                  | **7**      |
| **Article 10.** | **SHARES OF THE COMPANY**                                                             | **8**      |
| **Article 11.** | **RIGHTS AND OBLIGATIONS OF SHAREHOLDERS OF THE COMPANY**                             | **9**      |
| **Article 12.** | **BONDS AND OTHER SECURITIES ISSUED BY THE COMPANY**                                  | **11**     |
| **Article 13.** | **FUNDS, NET ASSETS, PROFIT AND DIVIDENDS.**                                          | **11**     |
| **Article 14.** | **PLACEMENT OF SHARES AND SECURITIES ISSUED BY THE COMPANY**                          | **13**     |
| **Article 15.** | **REGISTER OF SHAREHOLDERS OF THE COMPANY**                                           | **14**     |
| **Article 16.** | **MANAGEMENT BODIES OF THE COMPANY**                                                  | **14**     |
| **Article 17.** | **GENERAL MEETING OF SHAREHOLDERS**                                                   | **14**     |
| **Article 18.** | **BOARD OF DIRECTORS OF THE COMPANY**                                                 | **20**     |
| **Article 19.** | **EXECUTIVE BODY OF THE COMPANY**                                                     | **25**     |
| **Article 20.** | **RESPONSIBILITY OF THE BOARD OF DIRECTORS AND THE GENERAL DIRECTOR OF  THE COMPANY** | **26**     |
| **Article 21.** | **ACQUISITION AND REACQUISITION OF PLACED SHARES BY THE COMPANY**                     | **27**     |
| **Article 22.** | **MAJOR TRANSACTIONS**                                                                | **27**     |
| **Article 23.** | **INTERESTED PARTY TRANSACTIONS**                                                     | **28**     |
| **Article 24.** | **CONTROL OVER FINANCIAL AND BUSINESS OPERATIONS OF THE COMPANY**                     | **29**     |
| **Article 25.** | **ACCOUNTING AND REPORTING, DOCUMENTS OF THE COMPANY.**                               | ** ** |
| ** **           | **INFORMATION ABOUT THE COMPANY**                                                     | **30**     |
| **Article 26.** | **REORGANIZATION OF THE COMPANY**                                                     | **32**     |
| **Article 27.** | **LIQUIDATION OF THE COMPANY**                                                        | **33**     |

 

2

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**Article 1.GENERAL PROVISIONS**

 
| 1.1  |   | Mechel Open  Joint Stock Company (hereinafter the “Company”) has been founded and operates  in accordance with the Civil Code of the Russian Federation, the Federal Law  on Joint Stock Companies (No 208-FZ of December 26, 1995; hereinafter  called “the Federal Law on Joint Stock Companies), the Federal Law on Foreign  Investments (No 160-FZ of July 9, 1999), applicable rules, regulations,  and legislation of all exchanges on which the Company’s securities are  traded, other Russian legislation, and this Charter. |
|------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 1.2  |   | The type of  the Company shall be open joint stock company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 1.3. |   | The Company  shall be established for an indefinite period of time.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 1.4. |   | This Charter  is a new version of the charter first registered on March 19, 2003.                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |

 

**Article 2.CORPORATE NAME AND LOCATION OF THE COMPANY**

 
| 2.1. |   | The full corporate name of the Company in  the Russian language shall be - [Russian Text].                                                                                |
|------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2.2. |   | The  abbreviated corporate name of the Company in the Russian language shall be –  [Russian Text].                                                                   |
| 2.3. |   | The  abbreviated corporate name of the Company in the English language shall be –  Mechel OAO.                                                                       |
| 2.4. |   | Documents of  the Company intended for third parties shall contain either of the above  names.                                                                            |
| 2.5. |   | The location  of the Company shall be: Russian Federation, Moscow, Krasnopresnenskaya  Naberezhnaya 12.                                                                   |
| 2.6. |   | The mailing  address of the Company shall be: 123610, Russian Federation, Moscow,  Krasnopresnenskaya Naberezhnaya 12, World Trade Center, office building,  office 1002. |

 

**Article 3. LEGALSTATUS OF THE COMPANY**

 
| 3.1. |   | The Company  shall be a legal entity and shall own separate property accounted for on the  independent balance sheet thereof, including the property contributed by  shareholders as payment for shares. The Company shall be entitled on its own  behalf to acquire and exercise property and personal non-property rights,  have obligations, sue and be sued in a court of law. Until 50 percent of the  Company shares distributed among shareholders thereof are paid, the Company  shall not be entitled to enter into transactions unrelated to the foundation  of the Company. |
|------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3.2. |   | The Company  shall be deemed established as a legal entity from the moment of state  registration thereof in compliance with the procedure established by Federal  Laws.                                                                                                                                                                                                                                                                                                                                                                                                               |
| 3.3. |   | The Company  shall have a round seal containing the full corporate name thereof in the  Russian language and an indication as to the location thereof. The seal  may also contain the corporate name of the Company in any foreign  language. The Company shall be entitled to have stamps and letterheads  bearing the name thereof, an emblem of its own, as well as trademarks and  other means of visual identification registered in the established manner.                                                                                                                 |
| 3.4. |   | The Company  shall be entitled to open bank accounts on the territory of the Russian  Federation and abroad.                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 3.5. |   | The Company  may on the voluntary basis join unions, associations, concerns,  inter-departmental, regional and other associations on conditions that do not  contradict the current law of the Russian Federation.                                                                                                                                                                                                                                                                                                                                                                |
| 3.6. |   | The Company  shall be entitled to establish subsidiaries and open representative offices  on the territory of the Russian Federation in compliance with the  requirements of the legislation of the Russian Federation.                                                                                                                                                                                                                                                                                                                                                                |

 

3

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| 3.7.  |   | The establishment by the Company of subsidiaries and the opening of  its representative offices beyond the territory of the Russian Federation  shall also comply with the legislation of the foreign state where such  subsidiaries and representative offices are located, unless otherwise  provided by an international agreement of the Russian Federation.                                                                      |
|-------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3.8.  |   | Subsidiaries  and representative offices shall operate on behalf of the Company, which is  responsible for their operations.                                                                                                                                                                                                                                                                                                          |
| 3.9.  |   | A subsidiary  of the Company shall be a separate unit thereof located outside the location  of the Company, performing all the functions thereof, including those of a  representative office or part thereof.                                                                                                                                                                                                                   |
| 3.10. |   | A  representative office shall be a separate unit thereof located outside the  location of the Company, representing the interests of the Company and  providing protection thereof.                                                                                                                                                                                                                                                  |
| 3.11. |   | The Company  shall allocate property to subsidiaries and representative offices.  Subsidiaries and representative offices shall not be legal entities and shall  operate on the basis of regulations thereon approved by the Company.                                                                                                                                                                                                 |
| 3.12. |   | The property  of subsidiaries and representative offices shall be accounted for both on  their separate balance sheets and on the balance sheet of the Company.                                                                                                                                                                                                                                                                       |
| 3.13. |   | Decisions on  the establishment of a subsidiary or a representative office and liquidation  thereof, regulations thereon, decisions on appointing heads of subsidiaries  and representative offices shall be taken by the Board of Directors of the  Company in compliance with the legislation of the country, where such  subsidiaries and representative offices are established.                                                  |
| 3.14. |   | Heads of  subsidiaries and representative offices shall act on the basis of a power of  attorney issued by the Company.                                                                                                                                                                                                                                                                                                               |
| 3.15. |   | The Company  shall be entitled to have affiliates and dependent companies with the rights  of a legal entity established in compliance with the current law of the  Russian Federation on the territory of the Russian Federation, and in  compliance with the legislation of a foreign state where such branch or  dependent company is located, unless otherwise provided by an international  agreement of the Russian Federation. |
| 3.16. |   | The Company  shall be entitled to acquire and possess securities (shares in the capital)  of other legal entities in compliance with the current law.                                                                                                                                                                                                                                                                                 |
| 3.17. |   | Works and  services shall be provided for prices, tariffs and in the forms established  by the Company independently, except for the cases stipulated by the current  law.                                                                                                                                                                                                                                                            |

 

**Article 4.AIMS, SUBJECT MATTER AND TYPES OF OPERATIONS OF THE COMPANY**

 
| 4.1. |   | The main aim  of the Company is to make profit and to fully meet the demand of legal  entities and physical persons in the highest quality products (works and  services) produced (performed, rendered) by the Company. |
|------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 4.2. |   | The Company  shall have civil rights and bear responsibilities necessary for performing  any types of operations not prohibited by Federal Laws.                                                                         |
| 4.3. |   | The Company  shall participate in business operations using the property of the Company  with the aim of making profits in the interests of shareholders.                                                                |
| 4.4. |   | The Company  shall perform the following types of operations:                                                                                                                                                       |

 
| 4.4.1. |   | capital  investments in securities;                                                            |
|--------|--------|------------------------------------------------------------------------------------------------|
| 4.4.2. |   | business  management of coal mining and processing;                                            |
| 4.4.3. |   | business  management of metallurgical production;                                              |
| 4.4.4. |   | business  management of retail and wholesale trade in metallurgical, coal and other  products; |
| 4.4.5. |   | supply and  sales;                                                                             |

 

4

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| 4.4.6.  |   | organization  of the manufacturing and sales of products, retail and wholesale trade;                                                                                                                                                                                      |
|---------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 4.4.7.  |   | logistical  and sales management;                                                                                                                                                                                                                                          |
| 4.4.8.  |   | market  research, consulting in the sphere of marketing management;                                                                                                                                                                                                        |
| 4.4.9.  |   | consulting  in the sphere of financial management of companies, design of accounting  systems, production cost accounting, control procedures over budget and  management;                                                                                                 |
| 4.4.10. |   | consulting  in the sphere of human resource management;                                                                                                                                                                                                                    |
| 4.4.11. |   | consulting  in the sphere of planning, organization, efficiency and control;                                                                                                                                                                                               |
| 4.4.12. |   | providing  public relations services;                                                                                                                                                                                                                                      |
| 4.4.13. |   | providing  other services related to company management;                                                                                                                                                                                                                   |
| 4.4.14. |   | consulting  in the sphere of accounting and taxation, commercial operations and company  management;                                                                                                                                                                       |
| 4.4.15. |   | providing  assistance and practical help in civil, arbitration or administrative court  hearings, in the arbitration court, in the international commercial  arbitration court and other bodies established for dispute settlement;                                        |
| 4.4.16. |   | consulting  in the sphere of state registration of title to real estate and transactions  therewith;                                                                                                                                                                       |
| 4.4.17. |   | providing  recommendations and consultations on general issues, preparation of legal  documents, company charters and similar documents related to the  establishment of companies, patents and copyright agreements, preparation of  legal acts, powers of attorney, etc. |
| 4.4.18. |   | market  research, including market potential, acceptability of products, awareness of  products and buying habits of consumers for the purposes of promoting the  goods and developing new types of products, including statistical analysis of  results;                  |
| 4.4.19. |   | transportation  and logistics;                                                                                                                                                                                                                                             |
| 4.4.20. |   | foreign  economic activity.                                                                                                                                                                                                                                                |

 
| 4.5. |   | The Company  shall be entitled to perform other operations not prohibited by the  legislation of the Russian Federation.                                                                                                                                                                                                            |
|------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 4.6. |   | The Company  shall be entitled to engage in certain types of operations, the list of which  is determined by Federal Laws, only on the basis of a special permit  (license).                                                                                                                                                             |
| 4.7. |   | If  conditions for issuing a special permit (license) for engaging in a certain  type of operations require that such operations be exclusive, the Company  shall not be entitled to perform other operations, except for the  operations stipulated by the special permit (license) for the term of the  special permit (license). |

 

**Article 5. LIABILITY OF THE COMPANY ANDSHAREHOLDERS**

 
| 5.1. |   | The Company  shall be liable for all its obligations with all the property it owns.                                                                                                                                                                                                                                                                                                                                            |
|------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 5.2. |   | The Company  shall not be liable for the obligations of shareholders thereof.                                                                                                                                                                                                                                                                                                                                                  |
| 5.3. |   | Shareholders  shall not be liable for the obligations of the Company and shall bear the  risk of losses related to operations thereof to the extent of the value of  shares owned by them.                                                                                                                                                                                                                                     |
| 5.4. |   | Shareholders  who have not paid their shares in full shall be jointly liable for the  obligations of the Company to the extent of the unpaid portion of shares  owned by them.                                                                                                                                                                                                                                                 |
| 5.5. |   | If  insolvency (bankruptcy) of the Company is caused by actions (omissions) of  shareholders thereof or other persons, who are entitled to give instructions  obligatory for the Company or otherwise have an opportunity to determine  actions thereof, a subsidiary liability for the Company obligations  may be placed on such shareholders and other persons in the event of  insufficiency of the Company property. |
| 5.6. |   | Insolvency  (bankruptcy) of the Company shall be deemed caused by actions (omissions) of  shareholders thereof or other persons, who are entitled to give instructions  obligatory for the                                                                                                                                                                                                                                     |

 

5

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|   |   | Company or  otherwise have an opportunity to determine actions thereof, only if they used  such right or opportunity to cause the Company to perform actions  knowing in advance that insolvency (bankruptcy) of the Company would ensue. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 5.7.   |   | The state  and bodies thereof shall not be liable for the obligations of the Company,  and the Company shall not be liable for the obligations of the state and  bodies thereof.                                                               |

 

**Article 6.FOUNDATION DOCUMENTS OF THE COMPANY**

 
| 6.1. |   | This Charter  shall be the foundation document of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 6.2. |   | Requirements  of the Charter of the Company shall be obligatory for all the bodies of the  Company and shareholders thereof.                                                                                                                                                                                                                                                                                                                                                                     |
| 6.3. |   | Introduction  of amendments and addenda to the Company Charter or approval of the Company  Charter in a new version shall take place in compliance with a resolution of  the General Meeting of shareholders of the Company passed by a three quarters  majority of the votes of holders of voting shares, who attended the General  Meeting of shareholders of the Company, except for the cases stipulated by  paragraphs 2-5 of article 12 of the Federal Law on Joint Stock  Companies. |

 

**Article 7.CHARTER CAPITAL OF THE COMPANY**

 
| 7.1. |   | The charter  capital of the Company shall be **4,162,707,450.00**  (Four billion one hundred sixty two million seven hundred seven thousand four  hundred fifty) rubles. The charter capital of the Company shall consist of  the nominal value of **416,270,745**  (four hundred sixteen million two hundred seventy thousand seven hundred  forty five) common registered shares with the nominal value of **10** (ten) rubles each.                                                                                                                                                                       |
|------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 7.2. |   | The number  of placed shares of the Company shall be **416,270,745**  (four hundred sixteen million two hundred seventy thousand seven hundred  forty five) common registered shares. The form of issuance of the shares  is the book-entry form. The shares of the Company distributed at the time of  foundation shall be fully paid within one year after the moment of state  registration of the Company. At least 50% (fifty percent) of the shares of  the Company distributed upon the foundation shall be paid within 3 (three)  months after the moment of state registration of the Company. |
| 7.3. |   | The number  of declared shares that the Company is entitled to issue in addition to the  placed shares shall be **81,698,341**  (eighty one million six hundred ninety eight thousand three hundred forty  one) common registered shares with the value of **10** (ten) rubles each. The form of issuance is the book-  entry form.                                                                                                                                                                                                                                                                     |
| 7.4. |   | The declared  shares entitle their owners to the same rights as the placed shares of the  corresponding class (type) stipulated by this Charter.                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 7.5. |   | The charter  capital of the Company shall determine the minimal property of the Company,  which guarantees the interests of creditors thereof.                                                                                                                                                                                                                                                                                                                                                                                                                                                               |

 

**Article 8.INCREASE OF THE CHARTER CAPITAL**

 

8.1.          Thecharter capital of the Company may be increased by increasing the nominalvalue of shares or issuing additional shares.

8.2.          Thedecision to increase the charter capital of the Company by increasing thenominal value of shares shall be taken by the General Meeting of shareholders.

 

6

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8.3.          Thedecision to increase the charter capital of the Company by issuing additionalshares shall be taken by the Board of Directors, except for the cases when incompliance with the Federal Law on Joint Stock Companies such decision can onlybe taken by the General Meeting of shareholders.

8.3.1.     Thedecision of the Board of Directors of the Company to increase the chartercapital of the Company by placing additional shares shall be taken unanimouslyby all members of the Board of Directors, with the votes of retired members ofthe Board of Directors not taken into account.

8.3.2.     Ifthe Board of Directors fails to reach a unanimous decision to increase thecharter capital of the Company by placing additional shares, the Board ofDirectors may decide to refer the issue of increasing the charter capitalof the Company by placing additional shares to the General Meeting ofshareholders for consideration.

8.4.          Inincreasing the charter capital the Company shall be guided by the restrictionsestablished by the current law of the Russian Federation.

8.5.          Theresolution on increasing the charter capital of the Company by placingadditional shares shall determine the number of additional common shares to beplaced within the limits of the declared shares of this class (type), themanner of issuing, the cost of placing additional shares by subscription or theprocedure for evaluation of such cost, including the cost of issuing additionalshares to shareholders having a preemptive right to purchase issued shares andthe method of determining such cost, the form of payment for additionalshares placed by subscription. The resolution may determine otherconditions of placement.

8.6.          Increasingthe charter capital of the Company by placing additional shares may beperformed at the expense of the property of the Company. Increasing the chartercapital of the Company by increasing the nominal value of shares may beperformed only at the expense of the property of the Company. The amount, bywhich the charter capital of the Company is increased at the expense of theproperty of the Company, shall not exceed the difference between the value ofthe net assets of the Company and the amount of the charter capital and the reservefund of the Company. In increasing the charter capital of the Company at theexpense of the property thereof by means of issuing additional shares, suchshares shall be distributed among all shareholders, with each shareholdergetting shares of the same class (type) he owns, in proportion to thenumber of shares owned by him.

8.7.          Itshall not be allowed to increase the charter capital of the Company by placingadditional shares, as a result of which split shares are formed.

 

**Article 9. REDUCTION OF THE CHARTERCAPITAL**

 

9.1.          TheCompany shall be entitled to, and in cases stipulated by the current law shallbe obligated to reduce the charter capital thereof.

9.2.          Thecharter capital of the Company may be reduced by reducing the nominalvalue of shares or reducing their aggregate number, including by means ofacquiring a portion of shares. 

9.3.          Thedecision to reduce the charter capital by reducing the nominal value of sharesor by acquiring a portion of shares for the purposes of reducing the aggregatenumber thereof shall be taken by the General Meeting of shareholders.

9.4.          Thecharter capital may be reduced on the basis of a resolution of the GeneralMeeting of shareholders on reducing the charter capital by canceling the sharesacquired by the Company in the following cases:

-     ifshares, the title to which reverted to the Company due to failure on the part ofa founder to fully pay for such shares within the established period of time,were not sold within one year after their acquisition by the Company;

 

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| - |   | if shares  acquired by the Company on shareholders’ demand were not sold within one year  after their acquisition by the Company (except for the case of acquiring  shares when a decision on the reorganization of the Company was taken); |
|---|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| - |   | if shares  acquired by the Company in compliance with paragraph 2 of article 72 of  the Federal Law on Joint Stock Companies were not sold within one year after  their acquisition.                                                        |

 
| 9.5.   |   | If upon  completion of the second and every consecutive fiscal year the annual balance  sheet submitted for the approval by the General Meeting of shareholders or  the results of an audit examination show that the value of the net assets of  the Company is less that the charter capital thereof, the Company shall  undertake to announce the reduction of the charter capital to the amount not  exceeding the value of the net assets thereof. In this case the reduction of  the charter capital of the Company is performed by reducing the nominal value  of shares. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 9.6.   |   | Within 30  days after taking the decision to reduce the charter capital, the Company  shall undertake to notify in written form creditors of the Company of  reducing the charter capital of the Company and of the new amount thereof,  and to publish a notice of the decision taken in a publication designed to  publish information on state registration of legal entities.                                                                                                                                                                                           |
| 9.7.   |   | The charter  capital of the Company shall be reduced by canceling a portion of shares on  the basis of a resolution of the General Meeting of shareholders in cases:                                                                                                                                                                                                                                                                                                                                                                                                             |
|   |   | - stipulated  by subparagraph 1 of paragraph 6 of article 76 of the Federal Law on  Joint Stock Companies;                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|   |   | - reorganization  of the Company in the form of spin-off by means of canceling converted  shares.                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 9.8.   |   | In reducing  the charter capital the Company shall be governed by restrictions established  by Federal Laws.                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |

 

**Article 10.SHARES OF THE COMPANY**

 
| 10.1. |   | A share is a  security issued by the Company that entitles its owner to a portion of  profits of the Company in the form of dividends, to the participation in  the management of the Company and to a portion of the property remaining  after liquidation.                                                                                                                                                                                                                                               |
|-------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 10.2. |   | The shares  shall be issued in the book entry form; owners of shares (shareholders) shall  be established on the basis of an entry in the register of shareholders of  the Company.                                                                                                                                                                                                                                                                                                                             |
| 10.3. |   | The Company  shall be entitled to issue common and all classes (types) of preferred  shares, whose conditions of issuance do not contradict the current law.                                                                                                                                                                                                                                                                                                                                                    |
| 10.4. |   | All shares of  the Company shall be registered.                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 10.5. |   | Shares owned  by any of the founders of the Company shall entitle the owner to the right to  vote irrespective of their full payment. In the event shares are not fully  paid up within one year after the moment of state registration of the  Company, the title to such shares with a placement cost corresponding to the  unpaid amount (the value of the property, which was not contributed as  payment for shares), shall revert to the Company.                                                         |
| 10.6. |   | The nominal  value of one share of the Company shall be **10**  (ten) rubles.                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 10.7. |   | In the event  the Company places securities convertible into shares of a certain  class (type), the number of the declared shares of this  class (type) shall not be less than the number necessary for the conversion  during the circulation term of such securities. The Company shall not be  entitled to pass resolutions restricting the rights given by the shares, into  which securities issued by the Company may be converted, without the  consent of the owners of such securities. |
| 10.8. |   | Payment for  the shares distributed among the founders of the Company at the time of  foundation and additional shares placed by subscription may be made with  cash, securities, other property or property rights or other rights having a  monetary valuation (only such rights to intellectual property may be  used as payment for shares of the Company that have a material (documentary)  form                                                                                                |

 

8

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|   |   | recognized  by the law and may be divested *de  facto* by their owner and sold to any authorized person). Payment  for other securities issued by the Company can be made only in cash.                                                                                                                                                                                                                                                                   |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 10.9.  |   | Additional  shares and other securities of the Company placed by subscription shall be  placed on condition of their full payment. When payment for additional shares  or other Company’s securities is not made in cash, the monetary valuation of  the property contributed as payment for shares shall be made by the Board of  Directors in compliance with the procedure stipulated by article 77 of  the Federal Law on Joint Stock Companies. |
| 10.10. |   | When payment  for shares is not made in cash, an independent valuator shall be invited to  determine the market value of such property. The monetary valuation of the  property made by the founders of the Company and by the Board of Directors  cannot exceed the valuation made by an independent valuator.                                                                                                                                                |
| 10.11. |   | A  shareholder cannot be released from the obligation to pay for the shares of  the Company, including the release from such obligation by means of  offsetting his claims against the Company.                                                                                                                                                                                                                                                                |
| 10.12. |   | A share  shall not entitle its owner to the right to vote until it is fully paid,  except for the shares purchased by the founders at the time of foundation of  the Company.                                                                                                                                                                                                                                                                                  |
| 10.13. |   | In the event  a share is not fully paid within the period of time determined by the  resolution on issuance in compliance with the provisions of this article, the  share shall revert to the Company, and a corresponding entry shall be made in  the register of shareholders of the Company. Cash and (or) other property  contributed as payment for such share shall not be returned upon expiration  of the payment period determined by the resolution. |
| 10.14. |   | Shares that  revert to the Company shall not give the right to vote, shall not be taken  into account when counting votes, dividends shall not be paid on them. Such  shares shall be sold not later than one year after their acquisition by the  Company, otherwise the General Meeting of shareholders of the Company shall  take a decision on reducing the charter capital of the Company by canceling  such shares.                                      |

 

**Article 11.RIGHTS AND OBLIGATIONS OF SHAREHOLDERS OF THE COMPANY**

 
| 11.1. |   | Each common  share of the Company shall entitle its owner to an equal volume of rights.                                                                     |
|-------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 11.2. |   | Preferred  shares of the Company of the same class (type) shall entitle their owner  to an equal volume of rights and shall have equal nominal values. |
| 11.3. |   | General  rights of holders of all classes (types) of shares:                                                                                                |

 

•      todispose of any shares owned by them without consent of other shareholders andthe Company;

•      shareholdersof the Company shall have a preemptive right to acquire additional shares andsecurities convertible into shares placed by open subscription in the amountproportional to the number of shares of this class (type) owned by them;

•      shareholdersof the Company who voted against or did not participate in the voting of thematter of placing shares and securities convertible into shares by closedsubscription shall have a preemptive right to purchase additional shares andsecurities convertible into shares placed by closed subscription in the amountproportional to the number of shares of this class (type) owned by them. Theabove mentioned right shall not apply to the placement of shares and securitiesconvertible into shares by closed subscription only among shareholders, ifshareholders have an opportunity to purchase an integral number of placedshares and securities convertible into shares proportional to the number ofshares of the corresponding class (type) owned by them;

•      toreceive a portion of net profits (dividends) to be distributed amongshareholders in compliance with the procedure stipulated by the law and thecharter, depending on the class (type) of shares owned by them;

 

9

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•      toreceive a part of the property of the Company (a liquidation quota)remaining after liquidation of the Company proportional to the number of sharesof the corresponding class (type) owned by them;

•      tohave access to the documents of the Company in compliance with the procedurestipulated by the law and the Charter, and to obtain copies thereof forpayments that do not exceed the cost of making such copies;

•      totransfer all or a part of the rights given by a share of the correspondingclass (type) to his representative (representatives) on the basis of apower of attorney;

•      tofile suits in a court of law;

•      toelect and be elected in the management and control bodies of the Company;

•      toexercise other rights stipulated by the legislation, the Charter andresolutions of the General Meeting of shareholders passed in compliance withthe competence thereof.

 
| 11.4.  |   | In  compliance with the Federal Law on Joint Stock Companies and the Charter of  the Company holders of common shares of the Company shall be entitled to  participate in the General Meeting of shareholders of the Company with the  right to vote on all issues within the competence thereof, to receive  dividends and to receive a part of the property of the Company in the  event of liquidation thereof.                                                                                                                                                                                                                        |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 11.5.  |   | Shareholders  (a shareholder) owning on aggregate at least 2 percent of the voting shares  of the Company shall be entitled to introduce issues to the agenda of the  annual General Meeting of shareholders and to nominate candidates to the  Board of Directors of the Company, the audit commission and the counting  commission of the Company, the number of which cannot exceed the membership  of the corresponding body, as well as a candidate for the position of the  sole executive body. Such proposals shall be submitted to the Company not  later than 30 days after the end of the fiscal year.                              |
|   |   | In the event  the proposed agenda of an extraordinary General Meeting of shareholders  contains the issue of electing members of the Board of Directors of the  Company to be elected by cumulative voting, shareholders (a shareholder)  owning on aggregate at least 2 percent of the voting shares of the Company  shall be entitled to propose candidates to the Board of Directors of the  Company, the number of which cannot exceed the membership of the Board of  Directors of the Company. Such proposals shall be submitted to the Company at  least 30 days before the date of the extraordinary General Meeting of  shareholders. |
| 11.6.  |   | In  compliance with the current law the Company shall be entitled to issue any  classes and types of preferred shares and determine conditions of the  issuance at the time the resolution on such issuance is passed, and take the  decision on introducing corresponding changes to the Charter of the Company.                                                                                                                                                                                                                                                                                                                              |
| 11.7.  |   | In the event  the Company issues preferred shares of a certain class (type), the  holders of preferred shares of the Company shall not be entitled to vote at  the General Meeting of shareholders of the Company, except for the cases determined  by the current law for a certain class (type) of preferred shares of the  Company.                                                                                                                                                                                                                                                                                               |
| 11.8.  |   | Shareholders  of the Company shall undertake:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |

 

•      to observe theprovisions of this Charter and other documents of the Company;

•      to pay for shares in compliancewith the procedure stipulated by the current law and this Charter;

•      to inform the registrarof the changes of their names, locations and mailing addresses, bank detailsand other data necessary for the register of shareholders;

•      to discharge obligationswith respect to the Company undertaken in the established manner;

•      to obey resolutions of themanagement bodies of the Company passed within the scope of their competence;

 

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•      to refrain fromdivulging confidential information about operations of the Company. The list ofdata constituting confidential information shall be determined by the Board ofDirectors upon the proposal of the sole executive body of the Company.

 

**Article 12.BONDS AND OTHER SECURITIES ISSUED BY THE COMPANY**

 
| 12.1. |   | The Company  shall be entitled to place bonds and other securities stipulated by the legal  acts of the Russian Federation on securities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|-------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 12.2. |   | The Company  shall place bonds and other securities non-convertible to shares; securities  convertible to common shares by open subscription and constituting not more  than 25% of common shares placed earlier; bonds convertible to preferred  shares and other securities convertible to shares by open subscription upon  resolution of the Board of Directors of the Company.                                                                                                                                                                                                                                                                                                     |
| 12.3. |   | A bond of  the Company shall establish the right of its owner to demand retirement of  the bond (payment of the nominal value or the nominal value and interest)  within an established period of time.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 12.4. |   | A resolution  on the issuance of bonds shall determine the form, time frames and other  conditions of bond retirement. A bond shall have a nominal value. The nominal  value of all bonds issued by the Company shall not exceed the amount of the  charter capital of the Company, or the amount of the security made available  to the Company by third parties for the purpose of issuing bonds. The Company  shall be entitled to place bonds only after the full payment of the charter  capital of the Company.                                                                                                                                                                   |
| 12.5. |   | The Company  shall be entitled to issue bonds with a simultaneous maturity date or bonds  with pre-determined serial maturity dates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 12.6. |   | At  retirement bonds may be paid for by cash or in kind in compliance with  the resolution on the issuance thereof. The Company shall be entitled to  place bonds secured by certain property of the Company, or bonds provided  with a security made available to the Company by third parties, and unsecured  bonds. Placement of unsecured bonds shall be allowed, provided the Company  is, at least, in its third year of operations and two balance sheets of the  Company have been properly approved by that time.                                                                                                                                                         |
| 12.7. |   | Bonds  may be registered or bearer bonds. In the event of issuing registered  bonds the Company shall keep the register of bond owners. A lost registered  bond shall be replaced by the Company for a reasonable payment. The rights of  a lost bearer bond owner shall be restored by a court of law in compliance  with the procedure established by the legislation of the Russian Federation.  The Company shall be entitled to stipulate the possibility of early  retirement of bonds if their owners so desire. In this case the resolution on  the issuance of bonds shall determine the redemption cost and the cut-off  date, after which early retirement is possible. |
| 12.8. |   | The Company  shall not be entitled to place bonds and securities convertible to shares of  the Company, if the number of declared shares of the Company of certain  classes and types is less than the number of shares of such classes and  types, to which such securities are convertible.                                                                                                                                                                                                                                                                                                                                                                                           |
| 12.9. |   | Bond holders  shall have a preemptive right to the profit distributed and the assets of the  Company in the event of liquidation thereof, compared to shareholders in  compliance with the procedure established by the current law of Russia.                                                                                                                                                                                                                                                                                                                                                                                                                                          |

 

**Article 13.FUNDS, NET ASSETS, PROFIT AND DIVIDENDS.**

 
| 13.1. |   | The Company  shall set up a reserve fund in the amount equal to 5% (five percent) of the  charter capital of the Company. |
|-------|--------|---------------------------------------------------------------------------------------------------------------------------|

 

11

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| 13.2.  |   | The reserve  fund of the Company shall be formed by obligatory annual allocations until it  reaches the amount established by the Charter of the Company. The amount of  annual allocations shall be at least 5% (five percent) of the net profit  until it reaches the amount established by this Charter. The reserve fund of  the Company is designed to cover losses, as well as to retire bonds and  reacquire the Company’s own shares in the event other means are unavailable.  The reserve fund cannot be used for other purposes.                                                                                                                                                       |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 13.3.  |   | The value of  net assets of the Company shall be evaluated on the basis of accounting  information in compliance with the procedure established by the current law  of Russia.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 13.4.  |   | If at the  end of the second and each consecutive fiscal year the annual balance sheet  submitted to shareholders of the Company for approval or the results of an  audit examination show that the value of the net assets of the Company is  less than the charter capital, the Company shall be obligated to declare the  reduction of the charter capital thereof to the amount not exceeding the  value of the net assets thereof.                                                                                                                                                                                                                                                                |
| 13.5.  |   | If at the  end of the second and each consecutive fiscal year the annual balance sheet  submitted to shareholders of the Company for approval or the results of an  audit examination show that the value of the net assets of the Company is  less than the minimal charter capital, determined in compliance with the  current law of the Russian Federation, the Company shall be obligated to pass  a resolution on liquidation thereof.                                                                                                                                                                                                                                                           |
| 13.6.  |   | The gross  profit and the net profit of the Company shall be determined in compliance  with the norms of accounting for financial and business operations of  companies acting on the territory of the Russian Federation and shall be  reflected on the balance sheet of the Company. The part of the net  profit remaining after payment of taxes and other obligatory payments,  payments on interest on bonds (if such are available), replenishment of the  reserve fund and other funds of the Company shall be subject to the  distribution among shareholders.                                                                                                                            |
| 13.7.  |   | A dividend  is a part of the net profit of the Company subject to distribution among  shareholders and payable per common and/or preferred share.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 13.8.  |   | On the basis  of the results of the first quarter, six months, nine months of a fiscal year  and (or) the results of a fiscal year the Company shall be entitled to pass a  resolution on (to declare) the payment of dividend on shares issued by the  Company, unless otherwise provided by the Federal Law on Joint Stock  Companies. A resolution on the payment of dividends on the basis of the  results of the first quarter, six months, and nine months of a fiscal year  may be passed within three months upon the expiry of a corresponding period.  The Company shall undertake to pay dividends declared on the shares of each  class (type). Dividends shall be paid in cash. |
| 13.9.  |   | A resolution  on the payment of dividends, their amount and form of payment shall be  passed by the General Meeting of shareholders of the Company. The amount of  dividends shall not exceed the amount recommended by the Board of Directors  of the Company. Dividends for a fiscal year shall be paid not later than  December 31 of the year following the reporting year.                                                                                                                                                                                                                                                                                                              |
| 13.10. |   | The list of  persons entitled to dividends shall be made as of the date of the list of  persons entitled to participate in the General Meeting of shareholders that  passes a resolution on the payment of corresponding dividends. For the  purpose of making a list of persons entitled to dividends a nominal  shareholder shall provide information on the persons, in whose interests he  owns the shares.                                                                                                                                                                                                                                                                                        |
| 13.11. |   | The Company  shall not be entitled to declare and pay dividends:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |

 
| 13.11.1. |   | until full  payment of the charter capital of the Company;                                                                                                                        |
|----------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 13.11.2. |   | until  reacquisition of all shares to be reacquired in compliance with  article 76 of the Federal Law on Joint Stock Companies;                                              |
| 13.11.3. |   | if on the  date of passing a resolution on the payment of dividends, the Company meets  the definition of insolvency (bankruptcy) in compliance with the legislative  acts of the |

 

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|     |   | Russian  Federation on insolvency (bankruptcy) of companies or it would meet such  definition as a result of payment of dividends;                                                                                                                                                                                                                                                            |
|----------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 13.11.4. |   | if on the  date of passing a resolution on the payment of dividends, the value of the  net assets of the Company is less than the charter capital, the reserve fund  and the excess of the liquidation cost of preferred shares placed by the Company  over the nominal value determined by the Charter or would become less than  the amount thereof as a result of passing such resolution. |

 
| 13.12. |   | The Company  shall not be entitled to pass resolutions on (to declare) payment of  dividends (including dividends based on the results of the first quarter, six  months, nine months of a fiscal year) on common and preferred shares, the  amount of dividend on which has not been determined, unless a resolution has  been passed to fully pay dividend (including accumulated dividend on  cumulative preferred shares) on all types of preferred shares, the amount of  dividend on which (including dividends based on the results of the first  quarter, six months, nine months of a fiscal year) is determined by the  Charter of the Company. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 13.13. |   | The Company  shall not be entitled to pass resolutions on (to declare) payment of  dividends on preferred shares of a certain type, the amount of dividend on  which is determined by the Charter of the Company, unless a resolution has  been passed to fully pay dividend (including full payment of all accumulated  dividends on cumulative preferred shares) on all types of preferred shares,  which provide an advantage in the order of priority of receiving dividends on  preferred shares of this type.                                                                                                                                       |
| 13.14. |   | Dividends  shall not be paid on shares that have not been issued or are on the balance  sheet of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| 13.15. |   | The Company  shall not be entitled to pay declared dividends on shares:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |

 
| 13.15.1. |   | if on the  date of payment, the Company meets the definition of insolvency (bankruptcy)  in compliance with the legislation of the Russian Federation on insolvency  (bankruptcy) or it would meet such definition as a result of payment of  dividends;                                                                                       |
|----------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 13.15.2. |   | if on the  date of payment, the value of the net assets of the Company is less than the  charter capital, the reserve fund and the excess of the liquidation cost of  preferred shares placed by the Company over the nominal value determined by  the Charter or would become less than the amount thereof as a result of  payment dividends; |
| 13.15.3. |   | in other  cases stipulated by Federal Laws.                                                                                                                                                                                                                                                                                                    |

 
| 13.16. |   | Upon  termination of circumstances mentioned in paragraph 13.15 the Company shall  undertake to pay declared dividends to shareholders. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------|

 

**Article 14. PLACEMENT OF SHARES ANDSECURITIES ISSUED BY THE COMPANY**

 
| 14.1. |   | The Company  shall be entitled to place additional shares or other securities of the  Company by subscription or conversion. In the event the charter capital of  the Company is increased at the expense of the property thereof, the Company  shall distribute additional shares among shareholders. |
|-------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 14.2. |   | Additional  shares of the Company shall be purchased at a price determined by the Board  of Directors of the Company in compliance with article 77 of the Federal  Law on Joint Stock Companies, but not less than the nominal value thereof.                                                     |
| 14.3. |   | The  placement price, at which additional shares are offered to shareholders of  the Company exercising the preemptive right of purchasing shares, may be  lower that the placement price, at which they are offered to other parties,  but not more than by 10%.                                 |
| 14.4. |   | The  remuneration of an intermediary participating in the placement of additional  shares of the Company by subscription shall not exceed 10 percent of the cost  of placing shares.                                                                                                                   |
| 14.5. |   | Shareholders  of the Company shall have a preemptive right to purchase additional shares  and securities convertible to shares placed by open subscription** **proportional to the number of shares of                                                                                            |

 

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this class (type) owned by them incompliance with the procedure determined by article 41 of the Federal Lawon Joint Stock Companies.

Shareholders of the Company who voted againstor did not participate in the voting on the matter of issuing shares andsecurities convertible into shares by closed subscription shall have apreemptive right to purchase additional shares and securities convertible intoshares placed by closed subscription in the amount proportional to the numberof shares of this class (type) owned by them. The above mentioned rightshall not apply to the placement of shares and securities convertible into sharesby closed subscription only among shareholders, if shareholders have anopportunity to purchase an integral number of placed shares and securitiesconvertible into shares proportional to the number of shares of thecorresponding class (type) owned by them in compliance with the proceduredetermined by article 41 of the Federal Law on Joint Stock Companies.

 

**Article 15.REGISTER OF SHAREHOLDERS OF THE COMPANY**

 
| 15.1. |   | The register  of shareholders of the Company shall contain data about each registered  party, the number and classes (types) of shares registered in the name of  each registered party, other data stipulated by the legislative acts of the  Russian Federation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|-------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 15.2. |   | The register  of shareholders of the Company may be kept by the Company or a  professional participant of the securities market, who keeps the register of  holders of registered securities of the Company on the basis of an agreement  made with the Company. In the event the number of shareholders of the Company  exceeds 50, the registrar may only be an independent specialized  organization, which is a professional participant of the securities market  and keeps the register of holders of registered securities. In this case the  Company shall make an agreement on keeping the register with a specialized  registrar on the basis of a corresponding resolution of the Board of  Directors passed by a majority of the votes of attending members of the Board  of Directors. An agreement to keep the register shall be made with one legal  entity only. |
| 15.3. |   | The  specialized registrar keeping the register of the Company shall not be  entitled to carry out transactions with the securities of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
| 15.4. |   | Any party  registered in the register of shareholders of the Company shall undertake to  inform the registrar of the Company of all changes in his data in a  timely manner. In the event he fails to provide information on changes in his  data, the Company and the specialized registrar shall not be liable for  losses inflicted in connection therewith.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 15.5. |   | It shall not  be allowed to refuse to have an entry made in the register of shareholders of  the Company or to evade such entry, including on the part of a good  faith purchaser, except for the cases stipulated by Federal Laws.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |

 

**Article 16.MANAGEMENT BODIES OF THE COMPANY**

 
| 16.1.  | The  management bodies of the Company shall be: |
|--------|-------------------------------------------------|
|   | 16.1.1.                                         | The General  Meeting of shareholders; |
|   | 16.1.2.                                         | The Board of  Directors; |
|   | 16.1.3.                                         | The General  Director. |

 

**Article 17.GENERAL MEETING OF SHAREHOLDERS**

 
| 17.1. |   | The General  Meeting of shareholders shall be the supreme management body of the Company.                                                                                                    |
|-------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17.2. |   | The Company  shall undertake annually to hold an annual General Meeting of shareholders  irrespective of holding other (extraordinary) meetings. The annual General  Meeting of shareholders |

 

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|   |   | shall be  held at least two months and not later than six months after the end of a  fiscal year. The date and procedure of conducting the General Meeting of  shareholders, the procedure of notification about the meeting, the list of  materials provided shall be determined by a decision of the Board of  Directors in compliance with this Charter. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17.3.  |   | The  following matters shall refer to the competence of the General Meeting of  shareholders:                                                                                                                                                                                                                                                               |

 
| 17.3.1.  |   | introduction  of amendments and addenda to the Charter of the Company or approval of a new version of the Charter of the  Company, except for the cases stipulated by paragraphs 2-5 of article 12 of the Federal Law on Joint Stock  Companies;                                                                                                                                                                                           |
|----------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17.3.2.  |   | reorganization  of the Company;                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 17.3.3.  |   | liquidation  of the Company, appointment of the liquidation commission and approval of the  interim and final liquidation balance sheets;                                                                                                                                                                                                                                                                                                                 |
| 17.3.4.  |   | determination  of the membership of the Board of Directors, election of members thereof and  termination of their authority before the expiration of the term of office  thereof;                                                                                                                                                                                                                                                                         |
| 17.3.5.  |   | determination  of the number, nominal value, class (type) of declared shares and rights given by such shares;                                                                                                                                                                                                                                                                                                                                   |
| 17.3.6.  |   | increasing  the charter capital of the Company by increasing the nominal value of shares;                                                                                                                                                                                                                                                                                                                                                                 |
| 17.3.7.  |   | increasing  the charter capital of the Company by placing additional shares by closed  subscription within the limits of the number of declared shares;                                                                                                                                                                                                                                                                                                   |
| 17.3.8.  |   | issuance of  securities of the Company convertible to shares by closed subscription;                                                                                                                                                                                                                                                                                                                                                                      |
| 17.3.9.  |   | increasing  the charter capital of the Company by open-subscription placement of common shares constituting more  than 25 percent of earlier issued common shares;                                                                                                                                                                                                                                                                                   |
| 17.3.10. |   | issuance by  open subscription of securities convertible to common shares constituting more than 25 percent of earlier  placed common shares;                                                                                                                                                                                                                                                                                                        |
| 17.3.11. |   | increasing  the charter capital of the Company by open-subscription placement of common shares in the amount  constituting 25 percent or less of earlier placed common shares, if the Board of Directors  failed to reach a consensus on the matter;                                                                                                                                                                                            |
| 17.3.12. |   | increasing  the charter capital of the Company by placing additional shares within the limits of the number and classes  (types) of declared shares at the expense of the Company’s property, when additionally placed shares are  distributed among shareholders,  if the Board of Directors failed to reach a consensus on the matter;                                                                                              |
| 17.3.13. |   | increasing  the charter capital of the Company by issuing additional preferred shares within the limits of the number of  declared shares of this class (type) by open subscription, when additionally placed shares are distributed  among shareholders, if the Board  of Directors failed to reach a consensus on the matter;                                                                                                       |
| 17.3.14. |   | reducing the  charter capital of the Company by reducing the nominal value of shares, by acquiring a portion of shares by  the Company for the purpose of reducing their overall number, and by canceling shares acquired or re-acquired by  the Company;                                                                                                                                                                                       |
| 17.3.15. |   | election of  members of the Audit Commission of the Company and termination of their authority before the expiration of  the term of office thereof;                                                                                                                                                                                                                                                                                                 |
| 17.3.16. |   | approval of  the auditor of the Company;                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 17.3.17. |   | payment  (declaration) of dividends based on the results of the first quarter, six  months, and nine months of a fiscal year;                                                                                                                                                                                                                                                                                                                             |
| 17.3.18. |   | approval of  the annual report, annual accounting reports, including profit and loss statements (profit and loss  accounts) of the Company, as well as distribution of profits (including payment (declaration) of  dividends, except for the profit distributed as dividends based on the results of the first quarter, six  months, nine months of a fiscal year)  and losses of the Company based on the results of a fiscal year; |

 

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| 17.3.19. |   | determination  of the procedure of the General Meeting of shareholders;                                                                                            |
|----------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17.3.20. |   | election of  members of the counting commission and termination of their authority before  the expiration of the term of office thereof;                           |
| 17.3.21. |   | splitting  and consolidation of shares;                                                                                                                            |
| 17.3.22. |   | passing  resolutions on approving transactions in cases stipulated by article 83  of the Federal  Law on Joint Stock Companies;                          |
| 17.3.23. |   | passing  resolutions on approving major transactions in cases stipulated by  article 79 ofthe Federal Law on Joint Stock Companies;                           |
| 17.3.24. |   | acquisition  of shares issued by the Company in cases stipulated by the Federal Law on Joint Stock Companies;                                                 |
| 17.3.25. |   | passing  resolutions on the participation in holding companies, financial and  industrial groups,  associations and other unions of commercial organizations; |
| 17.3.26. |   | approval of  internal documents regulating the operation of the bodies of the Company;                                                                             |
| 17.3.27. |   | passing  resolutions on transferring powers of the sole executive body of the Company  to a  managing organization or a manager; and                          |
| 17.3.28. |   | resolution  of other matters stipulated by the Federal Law on Joint Stock Companies.                                                                               |

 
| 17.4.  |   | Any matters  referred to the competence of the General Meeting of shareholders shall not  be passed to the executive body of the Company for resolution. Matters  referred to the competence of the General Meeting of shareholders shall not be passed to the  Board of Directors of the Company forresolution, except for the matters stipulated by the Federal Law on  Joint Stock Companies and the Charter  of the Company.                                                                                                                                                                                      |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17.5.  |   | The General  Meeting of shareholders shall not be entitled to consider and resolve any  matters that are  not referred to the competence thereof by the Federal Law on Joint Stock  Companies.                                                                                                                                                                                                                                                                                                                                                                                                                             |
| 17.6.  |   | A resolution  of the General Meeting of shareholders on a matter put to the vote shall be  passed by a majority  of the votes of holders of the voting shares of the Company participating in  the meeting, unless otherwise  provided by the Federal Law on Joint Stock Companies. Resolutions on the  matters stated in  subparagraphs 17.3.1 -17.3.3, 17.3.5, 17.3.7 – 17.3.10 and 17.3.24 of this  Charter shall be passed by the  General Meeting of shareholders by a three quarter majority of holders of the  voting shares of the Company  participating in the meeting of shareholders. |
| 17.7.  |   | A resolution  on the approval of a major transaction, the subject matter of which is  property, the valueof which is over 50 (fifty) percent of the balance sheet assets of the  Company, shall be passed by the General  Meeting of shareholders by a three quarter majority of holders of the voting  shares of the Company  participating in the meeting of shareholders.                                                                                                                                                                                                                                          |
| 17.8.  |   | A resolution  on the matters stated in subparagraphs 17.3.2, 17.3.7 - 17.3.10, 17.3.21 -  17.3.26 of this Charter  shall be passed by the General Meeting of shareholders only upon  recommendation of the Board of  Directors.                                                                                                                                                                                                                                                                                                                                                                                       |
| 17.9.  |   | Voting at  the General Meeting of shareholders shall be conducted on the basis of the  principle “one voting  share — one vote”, except for the case stated in paragraph 18.4 of this  Charter.                                                                                                                                                                                                                                                                                                                                                                                                             |
| 17.10. |   | Notice of a General  Meeting of Shareholders and its agenda shall be given no later than 30  (thirty) days before the meeting. If the proposed agenda of an extraordinary  General Meeting of Shareholders includes the matter of election of members of  the Company’s Board of Directors (supervisory board) by cumulative voting,  notice of the meeting shall be given no later than 50 (fifty) days before the  meeting. The agenda of a meeting may not be altered after notification  of shareholders.                                                                                                         |
| 17.11. |   | On the above  dates the notification of the convocation of the General Meeting of  shareholders shallbe forwarded to each party stated in the list of parties entitled to  participate in the General Meeting of  shareholders by an ordinary mailing or delivered to each of the above parties  against their signature, or  published in the newspaper “Rossiyskaya Gazeta”. Electronic means of  notification of                                                                                                                                                                                         |

 

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the convocation of the General Meeting, as well as other mass media(television, radio), or internet may be used as additional means ofnotification. 

17.12.      Anotification of the convocation of the General Meeting of shareholders shallcontain: 
| 17.12.1. |   | the full  corporate name of the Company and the location of the Company;                                                                                                                                    |
|----------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17.12.2. |   | the  form of conducting the General Meeting of shareholders (a meeting or  voting *in*  *absentia*);                                                                                              |
| 17.12.3. |   | the date,  place and time of conducting the General Meeting of shareholders;                                                                                                                                |
| 17.12.4. |   | the date of  compiling the list of parties entitled to participate in the General Meeting  of shareholders;                                                                                                 |
| 17.12.5. |   | the agenda  of the General Meeting of shareholders;                                                                                                                                                         |
| 17.12.6. |   | the  procedure of getting acquainted with the information (materials) to be  provided during the preparation to the General Meeting of shareholders and  the address (addresses), at which it is available; |
| 17.12.7. |   | the time of  the beginning of the registration of parties participating in the General  Meeting of shareholders.                                                                                            |
| 17.12.8. |   | other  information stipulated by the current law.                                                                                                                                                           |

17.13.      Thelist of parties entitled to participate in the General Meeting of shareholdersshall be made on the basis of the data from the register of shareholders of theCompany as of the date determined by the Board of Directors. 
| 17.13.1. |   | The date of  compiling the list of parties entitled to participate in the General Meeting  of shareholders shall not be determined earlier than the date of passing a  resolution on conducting the General Meeting of shareholders and more than 50  (fifty) days before the date of the General Meeting of shareholders.                                                                                                                                                                                                           |
|----------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17.13.2. |   | The date of  compiling the list of parties entitled to participate in the General Meeting  of shareholders, if the proposed agenda of an extraordinary General Meeting  of shareholders includes the matter of electing members of the Board of  Directors of the Company, to be elected by cumulative voting, shall not be  determined earlier than the date of passing a resolution on conducting the  General Meeting of shareholders and more than 65 (sixty five) days before the  date of the General Meeting of shareholders. |

 
| 17.14. |   | The list of  parties entitled to participate in the General Meeting of shareholders  contains the name of each such party, data necessary for the identification  thereof, data on the number and class (type) of voting shares he owns,  the mailing address in the Russian Federation.                                                                                                                                                                                                                                                                                            |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17.15. |   | The list of  parties entitled to participate in the General Meeting of shareholders shall  be made available by the Company on demand by parties included in the list  and owning at least 1 (one) percent of votes on any matter of the agenda of  the General Meeting, in compliance with the procedure established by the  legislation for providing information (materials) during the preparation for  the General Meeting. The data of the documents and the mailing addresses of  the physical persons included in the list shall be provided only upon consent  of such persons. |
| 17.16. |   | Upon demand  of any interested party, the Company shall undertake within three days to  provide such party with an excerpt from the list of parties entitled to  participate in the General Meeting of shareholders, which contains  information about such party or a statement to the effect that such party was  not included in the list of parties entitled to participate in the General  Meeting of shareholders.                                                                                                                                                                 |
| 17.17. |   | Changes  shall be allowed to be made in the list of parties entitled to participate in  the General Meeting of shareholders only in the event of restoring the rights  of parties not included in the list as of the date of the compilation  thereof, or to correct mistakes made during such compilation.                                                                                                                                                                                                                                                                              |

 

17

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| 17.18. |   | The General  Meeting of shareholders shall be deemed to have authority (to have a quorum)  if shareholders owning on aggregate more than one half of the placed voting  shares of the Company participate therein.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   | Shareholders  shall be deemed to have participated in the General Meeting of shareholders  if they registered for the participation therein. Shareholders shall be  deemed to have participated in the General Meeting of shareholders conducted  in the form of voting *in absentia*  if their ballots were received before the closing date for accepting ballots.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 17.19. |   | If elections  of the Board of Directors, the audit commission of the Company, the auditor  of the Company are included in the agenda of the General Meeting of  shareholders, candidates to the Board of Directors, the audit commission of  the Company and the auditor of the Company shall be present at such meeting.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| 17.20. |   | The General  Meeting conducted in the form of a meeting shall be opened if by the  time of the beginning of the meeting there is a quorum with respect to at  least one matter included in the agenda of the General Meeting. Registration  of parties entitled to participate in the General Meeting who failed to  register for the General Meeting before it was opened shall not be finished  until the completion of the discussion of the last matter on the agenda of  the General Meeting, for which there is a quorum.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|   |   | If by the  time of the beginning of the General Meeting there is no quorum for a single  matter included in the agenda of the General Meeting, the opening of the  General Meeting shall be postponed for one hour.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 17.21. |   | In the  absence of a quorum for the conduct of the annual General Meeting of  shareholders a resumed General Meeting of shareholders shall be held with the  same agenda. In the absence of a quorum for the conduct of an extraordinary  General Meeting of shareholders the General Meeting of shareholders  may be resumed later, handling the same agenda.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 17.22. |   | The resumed  General Meeting of shareholders shall be deemed to have authority (to have a  quorum) if shareholders owning on aggregate at least 30 (thirty) percent of  placed voting shares of the Company participated therein.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 17.23. |   | Notice of a resumed  General Meeting of  Shareholders shall be given in accordance with the requirements of  article 52 of the Federal Law on Joint Stock Companies (except the second  paragraph of clause 1 of that article) within the times established by  article 17.10 hereof.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 17.24. |   | If the  resumed General Meeting of shareholders is conducted less than 40 days after  the failed General Meeting of shareholders, parties entitled to participate  in the General Meeting of shareholders shall be determined in accordance with  the list of parties who were entitled to participate in the failed General  Meeting of shareholders.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 17.25. |   | Upon  resolution of the Board of Directors of the Company, voting on the matters on  the agenda of the General Meeting of shareholders in the form of a  meeting may be carried out by voting ballots. The Board of Directors  shall approve the form and text of the voting ballots.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|   |   | A resolution  of the General Meeting of shareholders may be passed without holding a  meeting (joint presence of shareholders for the purpose of discussing the  matters on the agenda and passing resolutions on the matters put to the vote)  by voting *in absentia* (by poll)  in compliance with legislative acts of the Russian Federation. A resolution  of the General Meeting of shareholders of the Company on the matters  mentioned in subparagraphs 17.3.4, 17.3.15, 17.3.16 and 17.3.18 of this  Charter cannot be passed by voting *in  absentia* (by poll). A resolution of the General Meeting of  shareholders passed by voting *in absentia*  (by poll) shall be deemed valid if shareholders owning on aggregate at least  half of the voting shares of the Company participated in the voting. Voting *in absentia* shall be held with the use  of voting ballots meeting the requirements of article 60 of the Federal  Law on Joint Stock Companies. The date of providing shareholders with voting  ballots shall be at least 20 (twenty) days before the date of the General  Meeting of shareholders. |

 

18

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| 17.26. |     | Extraordinary  General Meetings of shareholders shall be held upon resolution of the Board  of Directors of the Company on the initiative thereof, upon request of the  audit commission, the auditor of the Company, or shareholders owning on  aggregate at least 10% (ten percent) of the voting shares as of the date the  request for the convocation of the meeting is filed. |
|--------|----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | 17.26.1. |                                                                                                                                                                                                                                                                                                                                                                                | An  extraordinary General Meetings of shareholders convened upon request of the  audit commission, the auditor of the Company, or shareholders (a shareholder)  owning on aggregate at least 10% (ten percent) of the voting shares of the  Company shall be held within 40 (forty) days after the moment of filing the  request for the convocation of an extraordinary General Meeting of  shareholders. |   |
|   | 17.26.2. |                                                                                                                                                                                                                                                                                                                                                                                | If the  proposed agenda of an extraordinary General Meeting of shareholders contains  the matter of electing members of the Board of Directors of the Company, to  be elected by cumulative voting, such General Meeting of shareholders shall  be held within 70 (seventy) days after the moment of filing the request for  the convocation of an extraordinary General Meeting of shareholders. |   |
|        |          |                                                                                                                                                                                                                                                                                                                                                                                     |  |  |  |  |

 
| 17.27. |   | The request  for the convocation of an extraordinary General Meeting of shareholders shall  contain the wording of the matters to be included in the agenda of the  meeting. The Board of Directors shall not be entitled to introduce changes in  the wording of the matters on the agenda of an extraordinary General Meeting  of shareholders, convened upon request of the audit commission, the auditor  of the Company, or shareholders (a shareholder) owning on aggregate at least  10% (ten percent) of the voting shares of the Company.                                                                                                                                                                                                              |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17.28. |   | If the  request for the convocation of an extraordinary General Meeting of  shareholders is filed by shareholders (a shareholder), it shall contain the  names of the shareholders (a shareholder) requesting the convocation of the  meeting, the number and class (type) of shares owned by them. The  request for the convocation of an extraordinary General Meeting of  shareholders shall be signed by persons (a person) requesting the convocation  of an extraordinary General Meeting of shareholders.                                                                                                                                                                                                                                           |
| 17.29. |   | Within five  days after filing the request of the audit commission, the auditor of the  Company, or shareholders (a shareholder) owning on aggregate at least 10%  (ten percent) of the voting shares of the Company for the convocation of an  extraordinary General Meeting of shareholders, the Board of Directors of the  Company shall pass a resolution on convening an extraordinary General Meeting  of shareholders or refusing to convene it. A resolution on the refusal to  convene an extraordinary General Meeting of shareholders upon request of the  audit commission, the auditor of the Company, or shareholders (a shareholder)  owning on aggregate at least 10% (ten percent) of the voting shares of the  Company may be passed if: |

 
| 17.29.1. |   | the  procedure of filing a request for the convocation of a meeting stipulated by  this Charter has not been followed;                                                                                    |
|----------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17.29.2. |   | the  shareholders (shareholder) requesting the convocation of an extraordinary  General Meeting of shareholders do not own the number of the voting shares of  the Company stipulated by the legislation; |
| 17.29.3. |   | neither of  the matters proposed for the inclusion in the agenda of an extraordinary  General Meeting of shareholders of the Company is referred to the competence  thereof;                              |
| 17.29.4. |   | the matter  proposed for the inclusion in the agenda does not meet the requirements of  this Charter and legislative acts of the Russian Federation.                                                      |

 
| 17.30. |   | A resolution  of the Board of Directors on convening an extraordinary General Meeting of  shareholders or a motivated refusal to convene it shall be forwarded to the  parties requesting the convocation thereof not later than 3 (three) days  after the moment such resolution is passed. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17.31. |   | If the Board  of Directors of the Company fails to pass a resolution on convening an  extraordinary General Meeting of shareholders or pass a resolution on the  refusal to convene it within the period of                                                                                  |

 

19

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|   |   | time  established by the Charter of the Company for the convocation of such  meeting, an  extraordinary General Meeting of shareholders  may be convened by the bodies or parties requesting such convocation. In  this case expenses for the preparation and conduct of the General Meeting of  shareholders may be reimbursed, upon resolution of the General Meeting  of shareholders from the funds of the Company.                                                                                                                                                                                                   |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 17.32. |   | The Company  shall set up a counting commission. The membership of the counting commission  shall be 3 persons. Members of the counting commission shall be approved by  the General Meeting of shareholders. Members of the Board of Directors, the  audit commission of the Company, the sole executive body of the Company, the  managing organization or the manager, as well as candidates for these  positions cannot be members of the counting commission.                                                                                                                                                                       |
| 17.33. |   | The counting  commission shall verify the authority and register parties participating in  the General Meeting of shareholders, determine the quorum of the General  Meeting of shareholders, settle problems arising due to shareholders’ (their  representatives’) rights to vote at the General Meeting, explain the  procedure of voting on matters put to the vote, ensure the established  procedure of the voting and the rights of shareholders to participate in the  voting, count votes and determine the outcome of the voting, make a protocol  of the outcome of the voting, file voting ballots in the archive. |

 

**Article 18.BOARD OF DIRECTORS OF THE COMPANY**

 
| 18.1.  |   | The Board of  Directors shall exercise general management of operations of the Company,  except for the issues referred by the Federal Law on Joint Stock Companies  and this Charter to the competence of the General Meeting of shareholders. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 18.2.  |   | The Board of Directors  shall consist of 9 (nine) persons, and a majority of the elected members  shall be independent (independent directors).                                                                                                 |
|   |   | An independent director is  a member of the Board of Directors who:                                                                                                                                                                             |

 
| • |   | who have not been in the  last 3 years and are not currently officers (managers) or employees of the  Company, or officers or employees of the management organization of the  Company, and whose close family members (spouses and direct relatives:  parents, children, grandparents, siblings) over the last 3 years have not  been and are not currently officers (managers) or employees of the Company,  or officers or employees of the management organization of the Company;                                                                  |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | is not currently and has  not in the last 3 years been an officer of another company in which any  officer of the Company is a member of the personnel and compensation  committee of the board of directors, or a close family member (spouse, or direct  ascendant or descendant: parent, child, grandparent, or grandchild) of a  person who is currently or has in the last 3 years has been an officer of  another company in which any officer of the Company is a member of the  personnel and compensation committee of the board of directors; |
| • |   | is not an affiliate of any  officer (manager) of the Company or of a managing organization of the  Company;                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| • |   | is not an affiliate of the  Company or of a current or former internal or external auditor of the  Company, or an affiliate of such an affiliate, and is not a close family  member (spouse, or direct ascendant or descendant: parent, child,  grandparent, or grandchild) of an affiliate of the Company or of a current or  former internal or external auditor of the Company, or an affiliate of such  an affiliate;                                                                                                                               |
| • |   | is not currently and has  not in the last 3 years been a senior officer of an organization that is or  has been a party to a transaction with the Company under which the money paid  or received by the organization in one financial year exceeds 2 percent of  the total annual revenue of such                                                                                                                                                                                                                                                      |

 

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|   |   | organization (and its  subsidiaries), and is not a close family member (spouse, or direct ascendant or descendant: parent, child, grandparent, or grandchild) of such a  senior officer;                                                                                                                                                                                                                                                                     |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • |   | has not received, and is  not a direct family member (spouse, or direct ascendant or descendant:  parent, child, grandparent, or grandchild) of a person who has received, more  than USD 100,000 in the last 3 years in direct compensation from the Company,  other than compensation for participation in the  Board of Directors or its committees, or compensation in the form of a pension or other deferred compensation for past services; |
| • |   | is not a party to obligations  of the Company pursuant to which the director could acquire property (or receive money) in an amount equal to or greater than 10  percent of his or her total annual income, other than compensation for  participation in the Board of Directors;                                                                                                                                                                       |
| • |   | is not a major  counterparty of the Company (i.e., a counterparty whose total transaction  volume with the Company in one year is equal to or  greater than 10 percent of the book value of the Company’s assets);                                                                                                                                                                                                                                 |
| • |   | is not a representative of  the State;                                                                                                                                                                                                                                                                                                                                                                                                                            |
| • |   | have not been members of  the Board of Directors for more than 5 years.                                                                                                                                                                                                                                                                                                                                                                                           |

 

If, after a person’s election to the Board of Directors, changes occuror circumstances arise due to which an independent director ceases to be deemedindependent, such person shall submit a statement to the Board of Directorssetting out such changes and circumstances. In such case, and in any other casewhen the Board of Directors becomes aware of such changes or circumstances, theBoard of Directors shall convey such information to the shareholders, and ifnecessary call an extraordinary general shareholders meeting to elect a newBoard of Directors.

 

The status of independent director shall be determined by a resolutionof the Board of Directors subject to applicable legislation, the rules ofthe exchange on which the Company’s securities are traded, the Company’sCharter and internal documents, and other relevant factors.

 

18.3.        Thefollowing matters shall refer to the competence of the Board of Directors: 

 
| 18.3.1. |   | determination  of the priority directions of operations of the Company, including the  approval of annual and quarterly budgets (financial plans) of the Company;                                                                                                                                                                                                                          |
|---------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 18.3.2. |   | convocation  of the annual and extraordinary General Meetings of shareholders of the  Company, except for the cases stipulated by paragraph 8 of article 55 of  the Federal  Law on Joint Stock Companies;                                                                                                                                                                       |
| 18.3.3. |   | approval of  the agenda of the General Meeting of shareholders;                                                                                                                                                                                                                                                                                                                            |
| 18.3.4. |   | determination  of the date of compiling the list of parties entitled to participate in the  General Meeting of shareholders and other matters referred to the competence  of the Board of Directors in compliance with the provisions of  article VII of the Federal Law on Joint Stock Companies and related to  the preparation and conduct of the General Meeting of shareholders; |
| 18.3.5. |   | referring  matters stipulated by subparagraphs 17.3.2, 17.3.7 - 17.3.10, 17.3.21 - 17.3.26  of this Charter to the General Meeting of shareholders for resolution;                                                                                                                                                                                                                         |
| 18.3.6  |   | increasing  the charter capital of the Company by issuing additional shares within the  limits of the number and classes (types) of declared shares at the expense of  the  property of the Company, when additional shares are  distributed among shareholders;                                                                                                                      |
| 18.3.7. |   | increasing  the charter capital of the Company by issuing additional common shares within  the limit of declared shares of this class (type) by open subscription  in the amount equal to 25 or less percent of placed common shares of the  Company;                                                                                                                                 |
| 18.3.8. |   | increasing  the charter capital of the Company by issuing additional preferred shares  within the limit of declared shares of this class (type) by open  subscription;                                                                                                                                                                                                                |

 

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| 18.3.9.  |   | placement of  securities convertible to common shares by open subscription in the amount equal to 25 or less percent  of placed common shares of the Company;                                                                                                                                                                                                                                                                   |
|----------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 18.3.10. |   | issuance of  bonds and other securities by the Company in cases stated in paragraph 12.2 of this Charter;                                                                                                                                                                                                                                                                                                                       |
| 18.3.11. |   | determination  of the price (monetary valuation) of the property, the cost of issuance and reacquisition of securities in  cases stipulated by the Federal Law on Joint Stock Companies;                                                                                                                                                                                                                                   |
| 18.3.12. |   | acquisition  of shares issued by the Company in compliance with paragraph 2 of  article 72 of the Federal Law on Joint Stock Companies;                                                                                                                                                                                                                                                                                         |
| 18.3.13. |   | acquisition  of bonds and other securities issued by the Company in cases stipulated by the Federal Law on Joint Stock  Companies;                                                                                                                                                                                                                                                                                              |
| 18.3.14. |   | approval of  the report on the outcome of the acquisition of shares acquired in compliance with paragraph 1 of  article 72 of the Federal Law on Joint Stock Companies;                                                                                                                                                                                                                                               |
| 18.3.15. |   | establishment  of the sole executive body of the Company and termination of his authority before the expiration of  the term of office thereof, approval of the terms and conditions of the agreement made with the sole executive  body, including remuneration and  other payments, determination of the person authorized to sign the agreement  on behalf of the Company with  the sole executive body;      |
| 18.3.16. |   | recommendations  with respect to the remunerations and compensations paid to members of the audit commission and  determination of the amount of payment for the services of the auditor;                                                                                                                                                                                                                                  |
| 18.3.17. |   | recommendations  to the General Meeting of shareholders with respect to the amount of dividend on shares and the  procedure of payment thereof;                                                                                                                                                                                                                                                                                 |
| 18.3.18. |   | use of the  reserve and other funds of the Company;                                                                                                                                                                                                                                                                                                                                                                                  |
| 18.3.19. |   | approval of  internal documents of the Company, except for the internal documents regulating activities of the bodies  of the Company approved by a resolution of the General Meeting, and other internal documents of the Company,  the approval of which is  referred to the competence of the sole executive body of the Company by the Charter, introduction of amendments  and additions to such documents; |
| 18.3.20. |   | establishment  and liquidation of subsidiaries, opening and liquidation of representative offices, approval of regulations on  subsidiaries and representative offices, introduction of amendments and addenda thereto, appointment of heads of  subsidiaries and representative  offices and termination of authority thereof;                                                                                       |
| 18.3.21. |   | introduction  of amendments to the Charter of the Company related to the establishment of subsidiaries, the opening of  representative offices and liquidation thereof;                                                                                                                                                                                                                                                         |
| 18.3.22. |   | passing  resolutions on the approval of major transactions related to the acquisition  and disposal  of property by the Company, in cases stipulated by chapter X of the Federal Law on Joint Stock Companies;                                                                                                                                                                                                             |
| 18.3.23. |   | passing  resolutions on the approval of transactions stipulated by chapter XI of the Federal Law on Joint Stock  Companies;                                                                                                                                                                                                                                                                                                     |
| 18.3.24. |   | approval of  resolutions on the issuance (additional issuance) of securities, the prospectus of securities issuance,  reports on the outcome of securities issuance (additional issuance), introduction of amendments and  additions therein;                                                                                                                                                                              |
| 18.3.25. |   | approval of  the registrar of the Company and terms and conditions of agreement therewith, as well as termination  of agreement therewith;                                                                                                                                                                                                                                                                                      |

 

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| 18.3.26.                                                                                                                                                  |   | passing  resolutions on the disposal of the placed shares of the Company owned by the Company;                                                                                                                                                                                                                                 |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 18.3.27.                                                                                                                                                  |   | approval of  the report on the outcome of the acquisition of shares of the Company for the purposes of cancellation  thereof;                                                                                                                                                                                                  |
| 18.3.28.                                                                                                                                                  |   | recommendations  to the General Meeting of shareholders with respect to the procedure of distributing profits and losses  of the Company based on the results of a fiscal year;                                                                                                                                                |
| 18.3.29.                                                                                                                                                  |   | preliminary  approval of annual reports of the Company;                                                                                                                                                                                                                                                                             |
| 18.3.30.                                                                                                                                                  |   | determination  of the procedure for the Company’s participation in commercial and  non-commercial organizations, preliminary approval of charters of legal  entities established by the Company, as well as charters of organizations, where  the Company is the sole participant,  sole shareholder or sole member; |
| 18.3.31.                                                                                                                                                  |   | approval of  the quarterly report of the issuing Company on securities issuance;                                                                                                                                                                                                                                                    |
| 18.3.32.                                                                                                                                                  |   | approval of  the procedures of internal control over financial and business operations of the Company;                                                                                                                                                                                                                         |
| 18.3.33.                                                                                                                                                  |   | control over  the establishment of the system of risk management; and                                                                                                                                                                                                                                                               |
| 18.3.34.                                                                                                                                                  |   | other  matters stipulated by the Federal Law on Joint Stock Companies and this  Charter, and  the internal documents of the Company.                                                                                                                                                                                           |
| Matters  referred to the competence of the Board of Directors of the Company cannot be  passed to the  executive body of the Company for resolution. |

 
| 18.4.  |   | Members of  the Board of Directors of the Company shall be elected by the General Meeting  of shareholders of the Company by cumulative voting for a period until a  subsequent annual General Meeting of shareholders. A resolution of the  General Meeting of shareholders on the termination of their authority before  the expiration of the term may be passed only with respect to all  members of the Board of Directors. In the event of termination of the  authority of the Board of Directors before the expiration of the term  thereof, the authority of the newly elected Board of Directors shall remain  in force until the election (re-election) of a new composition of the Board  of Directors by the closest General Meeting of shareholders. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 18.5.  |   | In the event  of cumulative voting, the number of votes of each shareholder shall be  multiplied by thenumber of persons to be elected to the Board of Directors of the  Company, and a shareholder shall be  entitled to give votes thus obtained to one candidate or distribute them  between two or more candidates.                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 18.6.  |   | The term of  office of the Board of Directors shall be counted from the moment they are  elected by the  annual General Meeting of shareholders until the moment a new composition of  the Board of Directors of the Company is elected by the next annual General  Meeting of shareholders. Persons elected to the Board of Directors of the  Company may be reelected an indefinite number of times.                                                                                                                                                                                                                                                                                                                                                        |
| 18.7.  |   | In the event  the number of members of the Board of Directors becomes less than 5 (five),  the Board of Directors shall undertake to convene an extraordinary General  Meeting of shareholders to elect a new Board of Directors. The remaining  members of the Board of Directors shall be entitled to pass resolutions only  on the convocation of such extraordinary General Meeting of shareholders.                                                                                                                                                                                                                                                                                                                                                                |
| 18.8.  |   | The Chairman  of the Board of Directors of the Company shall be elected by members of the  Board of  Directors of the Company from their number by a majority of the total number  of members of the Board of  Directors of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 18.9.  |   | The person  performing the functions of the sole executive body cannot simultaneously be  Chairman of  the Board of Directors of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 18.10. |   | The Board of  Directors of the Company shall be entitled to reelect its Chairman at any  time by a majority of the total number of members of the Board of Directors  of the Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |

 

23

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| 18.11. |   | The Chairman  of the Board of Directors of the Company shall organize the work thereof,  convene meetings of the Board of Directors of the Company and chair them,  organize the keeping of minutes of such meetings, chair the General Meeting  of shareholders.   |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 18.12. |   | For purposes of improving  the effectiveness and quality of the work of the Board of Directors,  the following committees will be formed to perform preliminary  examination of the most important questions within the competence of the  Board of Directors: |

•      Strategy,Planning and Coordination Committee;

•      AuditCommittee;

•      Mining Development Strategy Committee;

•      Metallurgy Development Strategy Committee.
|   |   | The Board of Directors  may create a Personnel and Compensation Committee, a Corporate Conflict  Resolution Committee, and other permanently standing or temporary (ad hoc)  committees. Procedures for the formation and operation of such committees  will be defined by bylaws approved by the Board of Directors.                                                                                                                                                                                                                              |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 18.13. |   | In the  absence of the Chairman of the Board of Directors of the Company one of the  members of the Board of Directors of the Company shall perform his  functions upon resolution of the Board of Directors of the Company.                                                                                                                                                                                                                                                                                                                       |
| 18.14. |   | A meeting of  the Board of Directors of the Company shall be convened by the Chairman of  the Board of Directors of the Company upon his initiative, upon request of a  member of the Board of Directors of the Company, the audit commission of the  Company, the auditor of the Company or the sole executive body of the  Company.                                                                                                                                                                                                                   |
| 18.15. |   | A quorum for a meeting of  the Company’s Board of Directors is the attendance of at least five of its members, including at least one independent director.                                                                                                                                                                                                                                                                                                                                                                                   |
|   |   | A quorum for a meeting of  the Company’s Board of Directors concerning the matters set forth in articles  18.3.1, 18.3.6, 18.3.7, 18.3.8, and 18.3.17 of this Charter, or the  submission of issues of reorganization or liquidation of the Company to the  general shareholders meeting, is the attendance of at least three-quarters of  the elected members of the Board of Directors, including at least one-third  of its elected independent directors.                                                                                      |
| 18.16. |   | Resolutions  of a meeting of the Board of Directors of the Company shall be passed by a  majority of the votes of those present, unless otherwise provided by the  Federal Law on Joint Stock Companies, this Charter of the Company or internal  documents thereof. In resolving issues at a meeting of the Board of Directors  each member of the Board of Directors of the Company shall have one vote.                                                                                                                                              |
| 18.17. |   | A member of  the Board of Directors shall not be allowed to transfer his right to vote to  another person, including another member of the Board of Directors.                                                                                                                                                                                                                                                                                                                                                                                          |
| 18.18. |   | In the event  of equal votes in passing resolutions at the meetings of the Board of  Directors of the Company, the Chairman of the Board of Directors shall have a  casting vote.                                                                                                                                                                                                                                                                                                                                                                       |
| 18.19. |   | Minutes  shall be kept at meetings of the Board of Directors. The minutes of a meeting  of the Board of Directors shall be prepared not later than 3 (three) days  after the meeting. The minutes of a meeting shall contain: the place and time  of the meeting, persons attending the meeting; matters put to the vote and  the outcome of the voting; resolutions passed. The minutes of a meeting of  the Board of Directors of the Company shall be signed by the Chairman of the  meeting, who is responsible for the correctness of the minutes. |
| 18.20. |   | Meetings of  the Board of Directors of the Company may be held in the form of a  meeting or *in absentia*(by  poll). The Chairman of the Board of Directors shall determine the  form of a meeting.                                                                                                                                                                                                                                                                                                                                      |
| 18.21. |   | When a  meeting of the Board of Directors is held in the form of a meeting,  written opinions of absent members of the Board of Directors shall be taken  into account.                                                                                                                                                                                                                                                                                                                                                                            |
| 18.22. |   | Other  matters related to the convocation and conduct of meetings of the Board of  Directors may be determined by the internal documents of the Company.                                                                                                                                                                                                                                                                                                                                                                                           |

 

24

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| 18.23. |   | Members of  the Board of Directors shall disclose information on their holding of the  Company securities and on sale and/or purchase of the Company securities. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

 

**Article 19.EXECUTIVE BODY OF THE COMPANY**

 
| 19.1. |   | Current  operations of the Company shall be managed by the sole executive body of the  Company — the General Director of the Company.                                                                                                                                                                                                                                                                                                            |
|-------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 19.2. |   | All matters  of managing current operations of the Company, except for the matters  referred to the competence of the General Meeting of shareholders or the  Board of Directors of the Company shall refer to the competence of the sole  executive body of the Company. The sole executive body of the Company shall  organize the implementation of resolutions of the General Meeting of  shareholders and the Board of Directors of the Company. |
| 19.3. |   | The General  Director of the Company shall act on behalf of the Company without a power of  attorney, including the following:                                                                                                                                                                                                                                                                                                                        |

 
| 19.3.1.  |   | perform routine  management of the Company operations;                                                                                                                                                                                                                                                                                     |
|----------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 19.3.2.  |   | have the  right of the first signature under financial documents;                                                                                                                                                                                                                                                                               |
| 19.3.3.  |   | manage the  property of the Company to ensure current operations thereof within the  limits established by this Charter and the current law of Russia;                                                                                                                                                                                          |
| 19.3.4.  |   | represent  the interests of the Company both in the Russian Federation and abroad;                                                                                                                                                                                                                                                              |
| 19.3.5.  |   | approve  staff, make labor contracts with employees of the Company, reward employees and impose penalties thereon;                                                                                                                                                                                                                         |
| 19.3.6.  |   | enter into  transactions on behalf of the Company;                                                                                                                                                                                                                                                                                              |
| 19.3.7.  |   | issue powers  of attorney on behalf of the Company;                                                                                                                                                                                                                                                                                             |
| 19.3.8.  |   | open and  close bank accounts of the Company;                                                                                                                                                                                                                                                                                                   |
| 19.3.9.  |   | organize  accounting and reporting in the Company;                                                                                                                                                                                                                                                                                              |
| 19.3.10. |   | issue orders  and give instructions obligatory for all employees of the Company;                                                                                                                                                                                                                                                                |
| 19.3.11. |   | organize the  implementation of resolutions of the General Meeting of shareholders and the Board of Directors of the Company;                                                                                                                                                                                                              |
| 19.3.12. |   | perform other  functions necessary to achieve the aims of the Company and to provide normal work thereof, in compliance  with the current law and the Charter of the Company, except for the functions  laid upon other management bodies of the Company by the Federal Law on Joint  Stock Companies and the Charter of the Company. |

 
| 19.4.  |   | The General  Director shall be appointed by the Board of Directors for a period of one  year.                                                                                                                                                                                                                                                                                                                                                                                    |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 19.5.  |   | A person,  who is a participant, an official or another employee of a legal entity  competing with the Company shall not be appointed to the position of the  General Director.                                                                                                                                                                                                                                                                                                  |
|   |   | The  authority of the General Director shall start from the moment he is appointed  by the Board of Directors until the moment the General Director is appointed  (re-appointed) by a meeting of the Board of Directors that takes place after  one year. If a new General Director has not been appointed for whatever reason,  the authority of the acting General Director shall be extended until the  moment a new General Director is appointed by the Board of Directors. |
| 19.6.  |   | The  authority of the General Director may be terminated before the  expiration of the term of office thereof by a resolution of the Board of  Directors for the following reasons:                                                                                                                                                                                                                                                                                         |

 

-       failureto observe the requirements of the Charter of the Company, resolutions of the General Meeting of shareholders andthe Board of Directors, internal documents of the Company;

-       incases stipulated by the agreement made therewith;

-       inother cases stipulated by the current law.

 

25

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|   |   | In the event  of termination of the authority of the General Director before the expiration  of the term of office thereof, the Board of Directors shall appoint a new  General Director.                                                                                                                                                                      |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   | In the event  of termination of the authority of the General Director before the expiration  of the term of office thereof, the authority of the newly elected General  Director shall remain in force until the appointment of the sole executive  body of the Company by the Board of Directors elected by the next annual  General Meeting of shareholders. |
| 19.7.  |   | The General  Director shall not be entitled to carry out any other activity in addition to  the management of current operations of the Company, except for the  membership of the General Director, upon consent of the Company, in Boards of  Directors of other legal entities, if it is necessary for the interests of  the Company.                       |
| 19.8.  |   | At the time  of foundation the Company the General Director of the Company shall be  elected by the founders of the Company at the foundation meeting of the  Company for a period of one year.                                                                                                                                                                |
| 19.9.  |   | Other rights  and responsibilities of the General Director of the Company shall be  determined by the Federal Law on Joint Stock Companies, other regulatory and  legislative acts of the Russian Federation, internal documents of the Company  and the agreement made between the Company and the General Director.                                          |
| 19.10. |   | Upon  resolution of the General Meeting of shareholders, the authority of the sole  executive body may be laid on a commercial organization (a managing  organization) or an individual entrepreneur on a contractual basis.                                                                                                                              |
| 19.11. |   | A resolution  on transferring the authority of the sole executive body of the Company to a  managing organization or a manager shall be passed by the General Meeting of  shareholders only upon recommendation of the Board of Directors of the  Company.                                                                                                     |
| 19.12. |   | The General  Director of the Company shall disclose information on holding of the Company  securities and on sale and/or purchase of the Company securities.                                                                                                                                                                                                   |

 

**Article 20.RESPONSIBILITY OF THE BOARD OF DIRECTORS AND THE**

**GENERAL DIRECTOR OFTHE COMPANY**

 
| 20.1. |   | In  exercising their rights and discharging obligations the members of the Board  of Directors and the General Director of the Company shall act in the  interests of the Company, they shall exercise their rights and discharge  obligations in good faith and reasonably.                                                                                                                                                                 |
|-------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 20.2. |   | The members  of the Board of Directors and the General Director of the Company shall be  liable to the Company for losses inflicted on the Company by their guilty  actions (omissions), unless other grounds and amount of liability are  provided by Federal Laws. The members of the Board of Directors who voted  against the resolution that entailed losses to the Company or did not  participate in such voting shall not be liable. |
| 20.3. |   | In  determining the grounds and the amount of liability of members of the Board of  Directors and the sole executive body of the Company, normal business  conditions and other circumstances important for the case shall be taken into  account.                                                                                                                                                                                           |
| 20.4. |   | In the event  several persons are liable in compliance with the provisions of this article,  they shall have joint liability.                                                                                                                                                                                                                                                                                                                |
| 20.5. |   | The Company  or a shareholder (shareholders) owning on aggregate at least 1 percent of  placed common shares of the Company shall be entitled to sue the Board of  Directors or the sole executive body of the Company in a court of law in  order to recover damages inflicted on the Company in the case stipulated by  paragraph 20.2.                                                                                                    |

 

26

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**Article 21.ACQUISITION AND REACQUISITION OF PLACED SHARES BY THE COMPANY**

 
| 21.1.  |   | The Company  shall be entitled to acquire placed shares of the Company upon resolution of  the General Meeting of shareholders on the reduction of the charter capital  of the Company by purchasing a portion of shares for the purpose of reducing  the total number thereof.                                                                                                                                                                                                                                                   |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 21.2.  |   | The shares  acquired by the Company on the basis of a resolution of the General Meeting  of shareholders on the reduction of the charter capital of the Company by  purchasing a portion of shares for the purpose of reducing the total number  thereof shall be cancelled upon the purchase thereof.                                                                                                                                                                                                                            |
| 21.3.  |   | The Company  shall be entitled to acquire placed shares upon resolution of the Board of  Directors in compliance with paragraph 2 of article 72 of the Federal  Law on Joint Stock Companies.                                                                                                                                                                                                                                                                                                                                |
| 21.4.  |   | Shares  acquired by the Company in compliance with paragraph 2 of article 72 of  the Federal Law on Joint Stock Companies shall not attach a voting right,  shall not be taken into account when counting votes, and dividend shall not  be paid on them. Such shares shall be sold at market price not later than one  year after the date of acquisition thereof. Otherwise the General Meeting of  shareholders shall pass a resolution on the reduction of the charter capital  of the Company by canceling such shares. |
| 21.5.  |   | Payment for  the shares acquired by the Company may be made in cash, securities,  other property, as well as property related or other rights having a monetary  valuation.                                                                                                                                                                                                                                                                                                                                                  |
| 21.6.  |   | In taking a  decision to acquire placed shares of the Company, the Company shall be guided  by restrictions established by Federal Laws.                                                                                                                                                                                                                                                                                                                                                                                          |
| 21.7.  |   | Holders of  voting shares shall be entitled to demand that the Company buy all or a  portion of their shares in the following cases:                                                                                                                                                                                                                                                                                                                                                                                              |
|   |   | in case of  reorganization of the Company or in case of a major transaction, which must  be approved by a resolution of the General Meeting of shareholders in  compliance with paragraph 2 or article 79 of the Federal Law on Joint  Stock Companies, if they voted against the resolution on reorganization or  approval of such transaction, or did not participate in the voting of these  matters;                                                                                                                     |
|   |   | in case of  introduction of amendments and addenda to the Charter of the Company and  approval of a new version of the Charter of the Company, which limit their  rights, if they voted against a corresponding resolution or did not  participate in the voting.                                                                                                                                                                                                                                                                 |
| 21.8.  |   | The list of  shareholders entitled to demand that the Company buy shares owned by them  shall be made on the basis of the information from the register of  shareholders of the Company on the date of compiling a list of parties  entitled to participate in the General Meeting of shareholders, the agenda of  which includes matters, the voting of which may entail the occurrence of  the rights to demand the reacquisition of shares in compliance with the FL on  Joint Stock Companies.                           |
| 21.9.  |   | The shares  of the Company shall be reacquired at the price determined by the Board of  Directors of the Company, but not lower than the market value, which shall be  determined by an independent valuator without taking into account the changes  thereof caused by the actions of the Company that entailed the occurrence of  the right to demand the valuation and acquisition of shares.                                                                                                                                  |

 

**Article 22.MAJOR TRANSACTIONS**

 

22.1.        Majortransactions shall be:

22.1.1. a transaction (including a loan, acredit, a security, a surety) or several interconnected transactions connectedwith the purchase, disposal or the possibility of disposal by the Company, directlyor indirectly, of property, the value of which is 25 and more percent of thebalance sheet value of the Company’s assets, determined on the basis of theaccounting data as of the last reporting date, except for transactions enteredinto as a result of normal business activity of the Company, transactionsconnected with the placement by subscription (sale) of common shares of

 

27

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|   |   | the Company  and transactions connected with the issuance of securities convertible to  common shares of the Company;                                                                                                                                                                                                                                                                                                                                                                                                                     |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   | 22.1.2. a  transaction connected with the sale of an equity stake in a branch of the  Company, as a result of which the Company loses the controlling interest in  the charter capital thereof.                                                                                                                                                                                                                                                                                                                                           |
| 22.2.  |   | In order for  the Board of Directors of the Company and the General Meeting of shareholders  to pass a resolution on the approval of a major transaction stipulated by  paragraph 22.1 of this Charter, the price of the disposed of or purchased  property (services) shall be determined by the Board of Directors in  compliance with article 77 of the Federal Law on Joint Stock Companies.  The Board of Directors shall be entitled to invite an independent valuator to  determine such price.                               |
| 22.3.  |   | A resolution  on the approval of a major transaction stipulated by paragraph 22.1.1 of this  Charter, the subject of which is property, the value of which is between 25  and 50 percent of the balance sheet value of the Company’s assets, as well as  a transaction stipulated by paragraph 22.1.2 of this Charter shall be passed  by all members of the Board of Directors unanimously, with the votes of  retired members of the Board of Directors not taken into account.                                                    |
|   |   | In the event  the unanimity of the Board of Directors of the Company on the matter of  approving a major transaction has not been reached, the Board of Directors  may submit the matter of approving such major transaction to the General  Meeting of shareholders for resolution. In this case a resolution on the  approval of a major transaction shall be passed by the General Meeting of  shareholders by a majority of the votes of holders of the voting shares, who  participated in the General Meeting of shareholders. |
| 22.4.  |   | A resolution  on the approval of a major transaction stipulated by paragraph 22.1 of this  Charter, the subject of which is property, the value of which is more than 50  percent of the balance sheet value of the Company’s assets, shall be passed  by the General Meeting of shareholders by a three quarter majority of the  votes of holders of the voting shares, who participated in the General  Meeting of shareholders.                                                                                                   |
| 22.5.  |   | Major  transactions shall be approved before they are executed.                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| 22.6.  |   | A resolution  on the approval of a major transaction shall state the person (persons) that  are parties thereto, beneficiary (beneficiaries), the price, the subject of  the transaction and other significant conditions thereof.                                                                                                                                                                                                                                                                                                        |
| 22.7.  |   | In the event  a major transaction is simultaneously an interested party transaction, only  provisions of article 23 of this Charter shall apply to the procedure of  executing it.                                                                                                                                                                                                                                                                                                                                                   |

 

**Article 23.INTERESTED PARTY TRANSACTIONS**

 
| 23.1.  |   | Transactions  (including a loan, a credit, a security, a surety), in which there is an  interest on the part of a member of the Board of Directors, the person  performing the functions of the sole executive body of the Company, a  shareholder of the Company owning together with affiliated persons at least  20 percent of the voting shares of the Company, as well as a person entitled  to give the Company obligatory instructions shall be executed by the Company  in compliance with the current law. Such persons shall be deemed interested  in the Company executing a transaction if they, their spouses, parents,  children, brothers and sisters, half brothers and half-sisters, adoptive  parents and adopted children and (or) their affiliated persons:   are a party to, a beneficiary of, an intermediary or a representative in a  transaction; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   | own  (severally or on aggregate) at least 20 percent of shares (stocks, interest)  of a legal entity, which is a party to, a beneficiary of, an intermediary or  a representative in a transaction;

hold  positions in the management bodies of a legal entity, which is a party to, a  beneficiary of, an intermediary or a representative in a transaction, or  positions in the management bodies of the managing organization of such legal  entity.                                                                                                                                                                                                                                                                                                                                                                                                                  |

 

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| 23.2.  |   | Provisions  of this article shall not apply:                                                                                                                                                                                                                                                                   |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   | to companies  that have one shareholder who simultaneously performs the functions of the  sole executive body;                                                                                                                                                                                                      |
|   |   | to  transactions, in which all shareholders of the Company are interested;                                                                                                                                                                                                                                          |
|   |   | in cases of  exercising the preemptive right to purchase shares issued by the Company;                                                                                                                                                                                                                              |
|   |   | when the  Company acquires and re-acquires placed shares;                                                                                                                                                                                                                                                           |
|   |   | in case of  reorganization of the Company in the form of a merger (accession) of  companies, if the other company participating in the merger (accession) owns  more than three quarters of all the voting shares of the Company being  reorganized.                                                           |
| 23.3.  |   | Persons  mentioned in paragraph 23.1 of this Charter shall undertake to  inform the Board of                                                                                                                                                                                                                   |
|   |   | Directors,  the audit commission and the auditor of the Company of the following:                                                                                                                                                                                                                                   |
|   |   | - the legal  entities, in which they own independently or together with their affiliated  person (persons) at least 20 percent of the voting shares (stocks, interest);                                                                                                                                             |
|   |   | - the legal  entities, in whose management bodies they hold positions;                                                                                                                                                                                                                                              |
|   |   | -  transactions known to them that are being executed or planned, in which they  may be recognized as interested parties.                                                                                                                                                                                      |
| 23.4.  |   | In the event  the requirements to the procedure of entering into interested party  transactions are not met, the interested party shall be liable to the Company  to the extent of the losses caused to the Company thereby. In the event  several persons are liable to the Company, they shall be jointly liable. |
|        |        |                                                                                                                                                                                                                                                                                                                     |  |

 

**Article 24.CONTROL OVER FINANCIAL AND BUSINESS OPERATIONS OF THE COMPANY**

 
| 24.1. |   | The audit  commission shall exercise control over financial and business operations of  the Company.                                                                                                                                                                                                                                                                                                                                                                                       |
|-------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 24.2. |   | The audit  commission shall be elected at the General Meeting of shareholders for a  period of 1 (one) year and shall consist of 3 (three) persons. Shares owned  by members of the Board of Directors of the Company or persons holding  positions in the management bodies of the Company shall not participate in  the voting, when members of the audit commission are elected.                                                                                                        |
| 24.3. |   | The term of  office of the audit commission shall be counted from the moment it is elected  by the annual General Meeting of shareholders to the moment the audit  commission is elected (re-elected) by the next annual General Meeting of  shareholders.                                                                                                                                                                                                                                 |
| 24.4. |   | The  authority of separate members or the whole audit commission may be  terminated before the expiration of the term of office thereof by a  resolution of the General Meeting of shareholders on the grounds and in  compliance with the procedure stipulated by internal documents of the  Company.                                                                                                                                                                                |
| 24.5. |   | In the event  the number of members of the audit commission becomes less than half the  membership thereof stipulated by the Charter of the Company, the Board of  Directors of the Company shall convene an extraordinary General Meeting of  shareholders to elect a new Audit Commission. The remaining members of the  Audit Commission shall continue to perform their functions until a new  Audit Commission is elected by the extraordinary General Meeting of  shareholders. |
| 24.6. |   | In the event  the authority of the Audit Commission is terminated before the expiration of  the term of office thereof, the authority of the new Audit Commission shall  remain in force until the moment an audit commission is elected (re-elected)  by the next annual General Meeting of shareholders.                                                                                                                                                                                 |
| 24.7. |   | Both a  shareholder and any person proposed by a shareholder may become a member  of the Audit Commission. Members of the audit commission of the Company  cannot simultaneously be members of the Board of Directors of the Company,  the sole executive body, members of the liquidation commission of the  Company, or hold any other positions in the management bodies of the Company.                                                                                           |
| 24.8. |   | The Audit  Commission shall elect the chairman and the secretary from their numbers.                                                                                                                                                                                                                                                                                                                                                                                                       |

 

29

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| 24.9.  |   | Examination  (audit) of financial and business operations of the Company shall be carried  out on the basis of results of operations of the Company for a year.         |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 24.10. |   | Examination  (audit) of financial and business operations of the Company shall be carried  out also at any time on the initiative or in compliance with the resolution: |

 
| 24.10.1. |   | of the Audit  Commission of the Company itself;                                                     |
|----------|--------|-----------------------------------------------------------------------------------------------------|
| 24.10.2. |   | of the  General Meeting of shareholders;                                                            |
| 24.10.3. |   | of the Board  of Directors of the Company;                                                          |
| 24.10.4. |   | upon request  of a shareholder (shareholders) of the Company owning on aggregate at least 10  (ten) |
|     |   | percent of the  voting shares of the Company.                                                       |

 
| 24.11. |   | Upon request  of the Audit Commission of the Company persons holding positions in the  management bodies of the Company shall undertake to make available documents  pertaining to financial and business operations of the Company. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 24.12. |   | The Audit  Commission of the Company shall be entitled to request the convocation of the  General Meeting of shareholders in compliance with the procedure stipulated  by the Charter of the Company.                                |
| 24.13. |   | On the basis  of the results of examining financial and business operations of the Company  the audit commission of the Company shall write opinions, which shall contain  the following:                                            |

 
| 24.13.1. |   | confirmation  of the reliability of the data contained in reports and other financial  documents of the Company;                                                                                                                                                  |
|----------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 16.1.4.  |   | information  on established cases of violations of accounting and reporting procedures  stipulated by legislative acts of the Russian Federation, and violations of  legislative acts of the Russian Federation in conducting financial and  business operations. |

 
| 24.14. |   | Amounts of  remuneration and compensation of expenses connected with the execution of the  functions of members of the audit commission shall be determined by a  resolution of the General Meeting of shareholders of the Company.                    |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 24.15. |   | Activities  of the Audit Commission with respect to other matters not stipulated by this  Charter may be determined by internal documents of the Company.                                                                                              |
| 24.16. |   | The auditor  (a citizen or an audit organization) of the Company shall examine financial  and business operations of the Company in compliance with legislative acts of  the Russian Federation and on the basis of the agreement concluded therewith. |
| 24.17. |   | The General  Meeting of shareholders shall approve the auditor of the Company. The Board  of Directors shall determine the amount of remuneration for the services  thereof.                                                                           |
| 24.18. |   | On the basis  of the results of examining financial and business operations of the Company  the auditor shall write an opinion, which shall contain the following:                                                                                     |

 
| 24.18.1. |   | confirmation  of the reliability of the data contained in reports and other financial  documents of the Company;                                                                                                                                                  |
|----------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 24.18.2. |   | information  on established cases of violations of accounting and reporting procedures  stipulated by legislative acts of the Russian Federation, and violations of  legislative acts of the Russian Federation in conducting financial and  business operations. |

 

24.19.      Theinternal audit of the Company shall be carried out by the Audit Commission andcoordinated by the Audit Committee.

 

**Article 25.ACCOUNTING AND REPORTING, DOCUMENTS OF THE**

**COMPANY. INFORMATIONABOUT THE COMPANY**

 
| 25.1. |   | The Company  shall conduct accounting and submit financial reports in compliance with the  procedure established by the legislation of the Russian Federation.                                             |
|-------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 25.2. |   | The fiscal  year of the Company shall be from January 1 till December 31. The  first fiscal year (the year of foundation) shall be from the moment of state  registration till December 31. |

 

30

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| 25.3. |   | The  responsibility for the organization, condition and reliability of accounting  in the Company, timely filing of the annual report and other financial  reports with corresponding bodies, information about operations of the  Company provided to shareholders, creditors and the mass media shall be borne  by the General Director of the Company in compliance with the Federal Law on  Joint Stock Companies, other legislative acts of the Russian Federation and  the Charter of the Company. |
|-------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 25.4. |   | The  reliability of the data contained in the annual report of the Company and  annual accounting reports shall be confirmed by the Audit Commission of the  Company. Before the Company publishes the documents stated in this paragraph  in the *Moskovskaya Pravda*  newspaper, the Company shall undertake to invite an auditor not connected  with the Company or shareholders thereof by property interests for the annual  examination and confirmation of annual financial reports.              |
| 25.5. |   | The annual  report of the Company shall be preliminarily approved by the Board of  Directors at least 30 (thirty) days before the date of the annual General  Meeting of shareholders of the Company.                                                                                                                                                                                                                                                                                                    |
| 25.6. |   | In  compliance with the requirements of the current law the Company shall keep  the following documents:                                                                                                                                                                                                                                                                                                                                                                                                 |

 
| 25.6.1.  |   | the  foundation agreement of the Company;                                                                                                                                                                                                                                                                                                               |
|----------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 25.6.2.  |   | the Charter  of the Company, amendments and addenda introduced to the Charter of the  Company and registered in the established manner, resolution on the  establishment of the Company, certificate of state registration of the  Company;                                                                                                             |
| 25.6.3.  |   | documents  confirming the right of the Company to the property on the balance sheet  thereof;                                                                                                                                                                                                                                                           |
| 25.6.4.  |   | internal  documents of the Company;                                                                                                                                                                                                                                                                                                                     |
| 25.6.5.  |   | regulations  on the affiliate or representative office of the Company;                                                                                                                                                                                                                                                                                  |
| 25.6.6.  |   | annual  reports;                                                                                                                                                                                                                                                                                                                                        |
| 25.6.7.  |   | prospectus  of issuance, quarterly reports of the issuer and other documents containing  information to be published or otherwise disclosed in compliance with the  Federal Law on Joint Stock Companies and other Federal Laws;                                                                                                                        |
| 25.6.8.  |   | accounting  documents;                                                                                                                                                                                                                                                                                                                                  |
| 25.6.9.  |   | accounting  reporting documents;                                                                                                                                                                                                                                                                                                                        |
| 25.6.10. |   | minutes of  General Meetings of shareholders of the Company, meetings of the Board of  Directors of the Company, the Audit Commission of the Company;                                                                                                                                                                                                   |
| 25.6.11. |   | lists of  affiliated persons of the Company;                                                                                                                                                                                                                                                                                                            |
| 25.6.12. |   | opinions of  the Audit Commission of the Company, the auditor of the Company, state and  municipal financial control bodies;                                                                                                                                                                                                                            |
| 25.6.13. |   | voting  ballots, as well as powers of attorney (copies of powers of attorney) for the  participation in the General Meeting of shareholders;                                                                                                                                                                                                            |
| 25.6.14. |   | reports of  independent valuators;                                                                                                                                                                                                                                                                                                                      |
| 25.6.15. |   | lists of  parties entitled to participate in the General Meeting of shareholders,  entitled to receive dividends, and other lists made by the Company to ensure  that shareholders exercise their rights in compliance with the requirements  of the Federal Law on Joint Stock Companies;                                                              |
| 25.6.16. |   | other  documents stipulated by the Federal Law on Joint Stock Companies, the Charter  of the Company, internal documents of the Company, resolutions of the General  Meeting of shareholders, the Board of Directors of the Company, management  bodies of the Company, as well as documents stipulated by legislative acts of  the Russian Federation. |

 
| 25.7. |   | Documents  stated in paragraph 25.6 shall be stored at the location of the sole  executive body of the Company. |
|-------|--------|-----------------------------------------------------------------------------------------------------------------|

 

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| 25.8.  |   | The Company  shall provide access of shareholders of the Company to the documents stipulated  by paragraph 25.6 of this Charter, except for accounting documents.                                                                                                                                                                                                                                                                                                      |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 25.9.  |   | The  documents stipulated by paragraph 25.6 shall be provided by the Company  within seven days of the date a corresponding request was made on the  premises of the executive body of the Company.                                                                                                                                                                                                                                                                    |
| 25.10. |   | Shareholders  (a shareholder) owning on aggregate at least 25 (twenty five) percent of the  voting shares of the Company shall have access to accounting documents.  Documents of the Company shall be made available to a shareholder of the  Company for familiarization on the basis of a written request of the  shareholder of the Company at the address, where such documents are stored.                                                                       |
| 25.11. |   | Upon request  of a shareholder the Company shall undertake to provide copies of the  documents stated in paragraph 25.6 for payment not exceeding costs of  producing such copies, except for the documents stated in subparagraph 25.6.8  of this Charter. Copies of the documents stated in subparagraph 25.6.8 of  this Charter shall be made available to shareholders owning on aggregate at  least 25 (twenty five) percent of the voting shares of the Company. |
| 25.12. |   | Copies shall  be made available to a shareholder within a reasonable time, but at any rate  not earlier than the time necessary for making such copies.                                                                                                                                                                                                                                                                                                                |
| 25.13. |   | The amount  of payment shall be established by the Company and cannot exceed the expenses  for making copies of documents and forwarding copies by mail or messenger.                                                                                                                                                                                                                                                                                                  |
| 25.14. |   | Responsibility  for the organization and storage of documents of the Company shall be borne  by the sole executive body of the Company, whose orders determine the  procedure of accepting, storing and making available documents of the Company  (including other documents), as well as the responsible employees of the  Company, who accept, store and make available documents of the Company in  compliance with this Charter and the current law.              |
| 25.15. |   | The Company  shall disclose information in compliance with the current law and the  internal documents of the Company. The executive body of the Company – the  General Director shall be responsible for disclosing information on the  operations of the Company.                                                                                                                                                                                               |

 

**Article 26.REORGANIZATION OF THE COMPANY**

 
| 26.1.  |   | The Company  may be voluntarily reorganized upon resolution of the General Meeting of  shareholders. Other grounds and the procedure of reorganizations shall be  determined by the current law of the RF.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 26.2.  |   | Reorganization  of the Company may take place in the form of merger, accession,  split-up, spin-off and transformation into another form of incorporation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 26.3.  |   | The property  of companies created as a result of reorganization shall be made up only of  the property of companies being reorganized.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|   |   | In case of  reorganization of the Company in the form of accession of another  company thereto, the Company shall be deemed reorganized from the moment an  entry is made in the single state register of legal entities about the  termination of the accessed company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 26.4.  |   | Not later  than 30 days after passing a resolution on reorganization of the Company, and  in cases of reorganization of the Company in the form of merger or  accession – from the date a resolution to this effect is passed by the last  of the companies participating in such merger or accession, the Company shall  undertake to notify in written form all creditors of the Company thereof  and to publish an announcement of the resolution passed in a publication  designed for the publication of information about state registration of legal  entities.

Within 30  days of forwarding notifications to them or 30 days after the date of  publication of an announcement of the resolution passed, creditors of the  Company shall be entitled to demand in |

 

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|   |   | written  form termination before the expiration of the term thereof or discharge  of corresponding obligations and recovery of damages.                                                                                                                                               |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 26.5.  |   | State  registration of companies created as a result of reorganization and making  entries about the termination of reorganized companies shall be carried out,  provided there is evidence of notifying creditors in compliance with the  procedure established by this paragraph.        |
|   |   | If the  dividing balance sheet or the acceptance act does not make it possible to  determine the successor of the reorganized company, legal entities created as  a result of reorganization shall be jointly liable for the obligations of the  reorganized company to creditors thereof. |

 

**Article 27.LIQUIDATION OF THE COMPANY**

 
| 27.1.  |   | The Company  may be liquidated voluntarily upon a resolution of the General Meeting of  shareholders or upon a court ruling in cases and in compliance with the  procedure stipulated by the current law of the RF.                                                                                                                                                                                    |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 27.2.  |   | In the event  of voluntary liquidation of the Company, the Board of Directors shall refer  the issue of liquidation of the Company and appointment of the liquidation  commission to the General Meeting of shareholders for resolution.                                                                                                                                                                    |
|   |   | The General  Meeting of shareholders shall pass a resolution on liquidation of the Company  and appointment  of the liquidation commission, the membership of which shall be equal to that  of the Board of Directors determined by this Charter.                                                                                                                                                      |
|   |   | The  procedure of proposing candidates to the liquidation commission and the  procedure of voting shall be determined by the Regulation on the liquidation  commission approved by the General Meeting of shareholders.                                                                                                                                                                                     |
|   |   | In the event  of forced liquidation, the liquidation commission may be appointed by a  court of law that also determines the membership thereof.                                                                                                                                                                                                                                                       |
| 27.3.  |   | From the  moment the liquidation commission is appointed it shall acquire all the  authority in managing operations of the Company. The liquidation commission  shall represent the Company in a court of law.                                                                                                                                                                                              |
|   |   | The  liquidation commission shall be responsible for the damages inflicted on the  Company, shareholders thereof and third parties in compliance with the norms  of the civil legislation of the RF.                                                                                                                                                                                                        |
| 27.4.  |   | The  liquidation commission shall place an announcement of liquidation of the  Company, the procedure and time period for making claims by creditors thereof  in the organs that publish information about registration of legal entities.  The period of time for creditors to make their claims cannot be less than two  months of the date the announcement of liquidation of the Company is  published. |
| 27.5.  |   | In the event  the Company does not have liabilities to creditors at the time a resolution  on liquidation of the Company is passed, the property thereof shall be  distributed among shareholders in compliance with this Charter.                                                                                                                                                                          |
| 27.6.  |   | The  liquidation commission shall take measures to identify creditors and receive  accounts receivable, and shall notify creditors in written form about  liquidation of the Company.                                                                                                                                                                                                                  |
| 27.7.  |   | Upon  expiration of the period of time, during which creditors may make  claims, the liquidation commission shall prepare an interim liquidation  balance sheet, containing information about the property of the Company,  claims of creditors and results of consideration thereof.                                                                                                                  |
|   |   | The interim  liquidation balance sheet shall be approved by the General Meeting of shareholders.                                                                                                                                                                                                                                                                                                            |
| 27.8.  |   | If the  Company does not have enough cash to meet the claims of creditors, the  liquidation commission shall sell other property of the Company from a public  auction in compliance with the procedure established for the implementation  of court rulings.                                                                                                                                               |

 

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| 27.9.  |   | The  liquidation commission shall pay cash amounts to creditors in compliance with  the order of priority established by paragraph 1 of article 64 of the  Civil Code of the RF, in compliance with the interim balance sheet, starting  from the date of the approval thereof, except for creditors of the fifth  order of priority, who shall be paid after the expiration of one month after  the date of the approval of the interim balance sheet.   |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 27.10. |   | After  settling accounts with creditors the liquidation commission shall prepare a  liquidation balance sheet, which shall be approved by the General Meeting of  shareholders.                                                                                                                                                                                                                                                                                |
| 27.11. |   | The property  of the Company remaining after the settlement of accounts with creditors  shall be distributed by the liquidation commission among shareholders in the  following order of priority:                                                                                                                                                                                                                                                             |
|   |   | - firstly,  payments shall be made for the shares that must be reacquired in compliance  with this Charter;                                                                                                                                                                                                                                                                                                                                                    |
|   |   | - secondly,  declared but unpaid dividends on preferred shares and the nominal value of  preferred shares shall be paid;                                                                                                                                                                                                                                                                                                                                       |
|   |   | - thirdly,  the property of the Company shall be distributed among holders of common and  preferred shares with account of earlier paid nominal value of preferred  shares.                                                                                                                                                                                                                                                                                    |
| 27.12. |   | Distribution  of property of each order of priority shall take place after full  distribution of property of the preceding order of priority.                                                                                                                                                                                                                                                                                                                  |
|   |   | If the  Company does not have enough property to pay declared but unpaid dividends  and the liquidation value determined by this Charter to all holders of  preferred shares, the property shall be distributed among holders of  preferred shares proportional to the number of shares owned by them.                                                                                                                                                         |
| 27.13. |   | If the  General Meeting of shareholders agrees, upon request of the receiver, the  property that he originally contributed as payment for shares may be  returned to him as his share of the unrestricted residual property. If the  value of such property is estimated higher than the amount to be returned,  the receiver shall undertake to pay the Company the arising difference,  otherwise he shall receive only the cash amount to be returned. |
|   |   | The property  transferred to the Company by shareholders for use shall be returned in its  natural form without remuneration at the time of liquidation.                                                                                                                                                                                                                                                                                                  |
| 27.14. |   | Liquidation  of the Company shall be deemed completed and the Company terminated from the  moment the state registration body makes a corresponding entry in the single  state register of legal entities.                                                                                                                                                                                                                                                     |

 

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