Exhibit 4.11


 


Open Joint
Stock Company “Mobile TeleSystems”


Location: Russian
Federation, 109147, Moscow City, Marksistskaya street, 4.


Postal address: Russian Federation, 109147, Moscow City, Marksistskaya
street, 4.


 


CERTIFICATE OF SECURITIES


 


interest-bearing documentary non-convertible
bearer notes under mandatory centralized storage, series 03 ̧ in total
10,000,000 (Ten million) pieces of par value RUR 1,000 (One thousand roubles)
each, maturity on the day 3,640 (Three thousand six hundred fortieth) from the
Opening date of the Notes placement through public offering.


 


State registration number of the
securities issuance:          


Date of state registration of the
securities issuance:
                    ,
200  .


 


This paper is to certify title to 10,000,000
(Ten million) Notes of par value RUR 1,000 (One thousand roubles) each and RUR
10,000,000 (Ten billion roubles) in total.


 


Total quantity of Notes having state registration #                       is 10,000,000 (Ten
million) Notes of par value RUR 1,000 (One thousand roubles) each and RUR
10,000,000 (Ten billion roubles) in total.


 


Open Joint Stock Company “Mobile TeleSystems” shall ensure the rights
of Note owners, provided they comply with the procedures for execution of such
rights set by Russian Federation law.


 


This Certificate shall be deposited with Non-Commercial Partnership
“National Depository Centre” having registered address: Moscow, Sredniy
Kislovskiy per., 1/13, building 4, and providing mandatory centralized storage
of the Note Certificates.


 


Surety for the Notes was provided by:


 


Limited Liability Company “Mobile TeleSystems —
Capital”


	
  General Director

  	
   

  	
   

  
	
  of Limited Liability Company

  	
   

  	
   

  
	
  “Mobile TeleSystems — Capital”

  	
   

  	
            /
                        /

  
	
   

  	
   

  	
   

  
	
     
             200  

  	
   

  	
   

  



Place of
Corporate Seal


 


	
  CEO

  	
   

  	
   

  
	
  Open
  Joint Stock Company  

  	
   

  	
   

  
	
  “Mobile
  TeleSystems”

  	
   

  	
                       /
                        /

  
	
   

  	
   

  	
  Place
  of Corporate Seal

  
	
                                    
  200  

  	
   

  	
   

  



 

















 


Open Joint Stock Company “Mobile
TeleSystems”


 


1. Class, category (type) of securities:


 


Class of
securities: Bearer Notes.


Identification features of the offered securities: non-convertible interest-bearing documentary bearer
notes under mandatory centralized storage, series 03 (hereinafter in this
document jointly “Notes” or “Issuance Notes” and individually “Note” or “Issuance
Note”).


 


2. Form of the securities:


 


Documentary issuance.


 


3. Indication of mandatory centralized storage:


 


The Issuance Notes shall be under
mandatory centralized storage.


 


The Depository providing mandatory centralized storage:


 


Full corporate name: Non-Commercial Partnership “National Depository
Centre”


Short corporate name: NDC


Location: Moscow City, Sredniy Kislovskiy per., 1/13,
building 4


Postal address: 105062, Russia, Moscow City, Mashkova street, 13, building. 1.


TIN (Taxpayer’s Identification Number): 7706131216


Tel. # (495) 956-2790, (495)
956-2791


Data of professional
securities market participant license for conducting depository activities:


License # 177-03431-000100


Date of Issuance: 04.12.2000


Effective period: no limitation of the effective period


The License was issued
by: Federal Commission for the Security Market of
Russia


 


All Notes of the
issuance are documented with one certificate (hereinafter, “The Certificate”),
which is subject to mandatory centralized storage  in Non-Commercial
Partnership “National Depository Centre” (hereinafter, also “NDC” and “The Depository”).  Prior to the Opening date of the Notes
placement the Issuer shall deliver the Certificate to NDC for storage.


 


A sample copy of the
Certificate is provided in Appendix to the Decision on issuance of securities
and to the Securities Issuance Prospectus. 
No separate Note Certificates shall be provided to Note owners on hand.  Note owners shall not be entitled to demand
delivery of Certificates on hand.


 


Title to the Notes and
transfer of the Notes including encumbrances on the Notes shall be registered
and certified by NDC acting as a depository, and by the depositories acting as
depositors of NDC (hereinafter, jointly — “The Depositories”).


 


Title to the Notes
shall be certified by extracts from depo accounts issued by NDC and the
Depositories.


 


Title to the Notes
shall pass from a person to another person at the moment of entry record to the
Notes acquirer’s depo account with NDC and the Depositories.


 


The Notes shall be
written off the depo accounts at redemption after the issuer performs all its
obligations to the Note owners with respect of coupon income payment and the
Notes nominal value repayment.


 


The Certificate shall
be cancelled after all Notes are written off the NDC depo accounts.


 


Procedures for registration and
transfer of title to prospectus-based securities under mandatory centralized
storage were established by Federal Law “On the Securities Market” # 39-FZ of
22.04.96, and “The Regulation on Depository Activities in the Russian
Federation” approved by Federal Commission on the Securities Market of Russia #
36 of 16.10.97, and internal regulations of NDC and Depositories.


 


As per Federal Law “On
the Securities Market” # 39-FZ of 22.04.96:


 


If certificates for
bearer documentary securities are stored and/or rights of ownership for such
securities are registered with a depository, transfer of title to a bearer
documentary security shall pass to the acquirer at the moment of entry record
made to the acquirer’s depo account. The rights provided for by a
prospectus-based security shall pass to the acquirer at the moment of transfer
of rights for such security.


 


If certificates for
bearer documentary securities are stored with a depository, the rights provided
for by a prospectus-based security shall be exercised with support of
certificates presented by such depositories under instructions specified in
depository contracts of owners, with attachment of a list of such owners.  An issuer in this case shall ensure
implementation of the rights under bearer securities by the person included in
such list.


 


If by the moment of making a List
of Owners and/or Nominal Holders of Securities for the purpose of execution of
Issuer’s obligations under the securities, information on a new owner was not
delivered to the securities Depository or to the securities nominal holder,
execution of obligations to the owner included in the List of Owners and/or
Nominal Holders of Securities shall be deemed proper. The responsibility of
timely notification shall be with the securities acquirer.


 


As per “The Regulation on
Depository Activities in the Russian Federation” approved by Federal Commission
on the Securities Market of Russia # 36 of 16.10.97:


 


A depository shall ensure
segregated storage of securities and (or) registration of rights for securities
of each customer (depositor) from the securities of other customers
(depositors) of the depository, in particular, by opening to each customer
(depositor) of a separate depo account. 
Records of title to securities made by a depository shall certify the
rights for securities, unless established otherwise through court proceedings.  A Depository shall execute transactions with
its customers’ (depositors’) securities exclusively on assignment from such
customers (depositors) or persons authorized by them including account
custodians, and within the timeframe set by depository contracts.  A Depository shall only make records to
customer’s (depositor’s) depo account if documents have been presented that
under The Regulation on Depository Activities in the Russian Federation and
other regulatory acts and depository contract represent the authorization
documents for making such records.


 


Records to customer’s
(depositor’s) depo account can be made on the basis of the following
authorization documents:


 


· instruction issued by a customer (depositor) or
by its authorized representative including an account custodian, in accordance
with the terms of a depository contracts;


· in case title to securities passes under other
than civil law transactions: the documents certifying transfer of title to
securities under applicable laws and other regulatory acts.


 


A depository shall
register the facts of encumbrances on customers’ (depositors’) securities by
pledge or other rights of third parties under the procedures set in the
depository contracts.


 


Title to securities
stored in a depository and (or) to securities rights for which are registered
by a depository shall be deemed passed from the moment of entry record made by
the depository to the to customer’s (depositor’s) depo account.  However, in absence of a record on the depo
account, the person concerned is not deprived of its capacity to prove its
rights for a security by reference to other evidence.


 


Should the applicable
legislation and / or regulations issued by federal regulator of the securities
market be amended, the procedures for registration and transfer of title to the
Notes shall be regulated with due account of the amended provisions of
legislation and / or regulations issued by federal regulator of the securities
market.


 


Decision on Issuance of
Securities


 


2

















 


4. Par value of each security in the issuance:


 


RUR 1 000
(One thousand).


 


5. Quantity of securities in the issuance:


 


Quantity of Notes in the
placement: 10 000 000 (Ten million).


The Notes issuance is not
expected to include tranches.


 


6. Total quantity of previously placed securities of this issuance:


 


No securities of this issuance
were previously placed.


 


7. Owner’s rights for each security in the
issuance:


 


The Notes represent direct
unconditional obligations of Open Joint Stock Company “Mobile TeleSystems”
(hereinafter, “The Issuer”).


 


Owner
of the Note is entitled to receive par value of the Note at its redemption at
maturity.


 


Owner
of the Note is entitled to receive coupon income (interest on the Notes par
value) on expiration of each coupon period.


 


Owner
of the Note is entitled to demand buy-out of the Notes by the Issuer in the
cases and under the terms specified in the Securities Issuance Prospectus and
Decision on the Securities Issuance.


 


Owner of the Notes is
entitled to demand a compensation of the Notes par value and payment of the accrued coupon income on the
Notes due to it in the following cases:


 


· The
Notes have been delisted by every stock exchange that had the Notes in its
Quote Lists, provided that under the Federal Law “On the Securities Market” and
other federal laws, the Notes issuance does not require state registration of a
report on the securities issuance results;


· The Issue was more than 7 (Seven) days late in
repayment of its obligations on coupon income on the Notes than the due date of
coupon income payment set out in the Decision on Issuance of Securities and the
Securities Issuance Prospectus;


·  The Issue has
declared its default on financial obligations with respect of Notes holders of
the issuance.


Holder of the Notes can demand reimbursement of the Notes nominal value
and repayment of accrued coupon interest on the Notes due to it and assessed in
accordance with clause 15 of the Decision on Issuance of Securities and clause
10.10 of the Securities Issuance Prospectus. on the next day after the date
when any of the above events occurred.


 


The Notes shall be
prematurely redeemed upon request of their holders within 60 (Sixty) working
days from the moment of disclosure of information on occurrence of the above
events in accordance with the procedures set out in clauses 9.5. and 11.) of
the Decision on Issuance of Securities, or from the date when holders of the
Notes learned or were to learn of the fact of occurrence of such event.


 


The Notes may be
prematurely redeemed only after registration of
the Report on the securities issuance, or after filing with the registering
body of a notice on the issuance results, provided that under the Federal Law “On
the Securities Market” and other federal laws, the Notes issuance does not
require state registration of a report on the securities issuance results.


 


Holder of the Notes is
entitled to freely sell of otherwise dispose of the Notes. The Holder of the
Notes that purchased the Notes in the course of the IPO is not entitled to
exercise transactions with the Notes before the Notes are fully repaid and
before a report on the securities
issuance results is registered by the
state authority, or a notice is filed with the registering authority on the
Notes issuance results as required by the applicable Russian Federation legislation.


 


Holder of the Notes is
entitled to exercise other rights provided for by the Russian Federation
legislation.


 


The
Issue undertakes to ensure the Notes holders’ rights, provided they comply with
the procedures for exercising such rights set by the Russian Federation
legislation.


 


Should
the Issue fail to perform or properly perform its obligations under the Notes,
owners of the Notes shall be entitled to address claims to Open Joint Stock
Company Mobile TeleSystems - Capital  (hereinafter, the Warrantor) that has provided surety for the Notes in
accordance with the terms of provision of surety in the form of a warranty for
the purposes of the Notes issuance.


 


Information of the
person that provided surety for the issued notes:


 


Full corporate name:
Limited Liability Company Mobile
TeleSystems - Capital


Abbreviated corporate
name: LLC MTS-Capital


Location: Russian Federation, Moscow
City, Vorontsovskaya, 5, building 2.


Location of the Warrantor’s permanent executive body: Russian Federation, Moscow
City, Vorontsovskaya, 5,building 2.


 


The Warrantor that provided
the surety shall bear responsibility jointly with the Issuer for the Issuer’s
failure to perform (properly perform) its obligations under the Notes.


 


Title to the provided surety
shall pass to acquirer of the Note together with transfer of title to the Note,
in the same scope and under the same terms that apply at the moment of transfer
of title to the Note.  Transfer of rights
arising from the provided surety shall not be effective if no transfer of title
to the Note takes place.


 


Information on guarantees of fulfillment of
obligations under the issued Notes and the procedures to be followed by owners
and/or nominal holders of the Notes in case the Issuer defaults on its obligations
under the Notes of this issuance or fails to perform or properly perform the
obligations, were described in clauses 9.7, 12.2 of the Decision on issuance of
securities and clause 9.1.2. of the Securities Issuance Prospectus.


 


If the Issue has overdue
payments under the Notes of the issue to several Note holders, none of the Note
holders shall have any priority with respect of such Issuer’s payables.


 


The Issuer undertakes that
it shall repay the invested funds to the Note holders, should the Notes issuance
be recognized as legally ineffective or invalid.


 


8. The terms and provisions of placement of the securities issuance.


 


8.1. Method of the securities placement: public subscription.


 


8.2 Validity period of the securities placement.


 


The procedures for establishing the Opening date of
the placement:


 


The Opening date of
the placement shall be established by the Issuer’s authorized management body
and shall be communicated to all stakeholders in accordance with the RF
legislation and the procedures for information disclosure set out in clause 11.
of the Decision on issuance of securities and clause 2.9. of the Securities
Issuance Prospectus.


 


The Opening date of
the Notes placement cannot be earlier than two weeks after publication of an
announcement on state registration of the securities issuance in accordance
with the RF legislations and the procedures for information disclosure set out
in clause 11. of the Decision on issuance of securities and clause 2.9. of the
Securities Issuance Prospectus.


 


The above two weeks
period shall be counted from the date following the date of publication of an
announcement on state registration of the Notes issuance by Vedomosti
Newspaper.


 


The Opening date of
the Notes placement established by the Issuer’s authorized management body can
be modified by decision of the same Issuer’s management body, provided that all
requirements to procedures of information disclosure on changing the date of
the Notes placement have been complied with, as set out in the RF legislation,
the Decision on issuance of the securities and the Securities Issuance
Prospectus.


 


The procedures for establishing the final date
of the placement:


 


The final date of the placement shall
be established as the earlier of two dates:


 


a) 10 (Tenth) working day in a row from the date following the Opening date of the
Notes placement;


b) the date of placement of the last Note in the issuance.


 


3

















 


The
Notes placement validity period shall not exceed one year from the state of
state registration of the Notes issuance.


 


8.3.
Procedures for the securities placement:


 


No preferential rights for
acquisition of the offered securities have been provided for
including preferential rights of the securities acquisition as per Articles 40
and 41 the Federal Law “On Joint Stock Companies”.


 


Procedures and terms for
making agreements (procedures and terms for filing and fulfillment of
applications) seeking disposal of securities in the course of securities
placement:


 


The Issue shall
exercise placement of the Notes through involvement of professional
participants of the securities market providing services to the Issuer of the
securities placement and organization of the securities placement:


 


The organizations that shall provide to the Issuer the services of the
Notes placement (hereinafter, the Originators) shall be Gazprombank (Open Joint
Stock Company), Closed Joint Stock Company Raffeisenbank Austria, Closed Joint
Stock Company Investment Company Troyka Dialog.


 


Full corporate name: Gazprombank (Open Joint Stock Company)


Abbreviated corporate name: GPB (OJSC)


TIN: 7744001497


Location: 117420, Moscow City,
Namiotkina Street, 16, block 1


Postal address: 117418, Moscow City,
Novocheriomushkinskaya street, 63


License #:   177-04229-100000 (for brokerage activities)


Date of issuance: December 27,
2000


Validity period: unrestricted
validity period


Licensor: Federal Commission
for the Securities Market of Russia


License #:
177-04280-010000 (for dealership activities)


Date of issuance: December 27,
2000


Validity period:
unrestricted validity period


Licensor: Federal Commission
for the Securities Market of Russia


 


Full corporate name: Closed Joint Stock Company Raffeisenbank Austria


Abbreviated corporate name: CJSC Raffeisenbank
Austria


TIN: 7744000302


Location: 129090, Moscow City,
Troitskaya street, 17, building 1


Postal address: 129090, Moscow City,
Troitskaya street, 17, building 1


License #:  License for brokerage activities # 177-02900-100000


Date of issuance: 27.11.2000


Validity period: unrestricted
validity period


The Licensor that issued the above license: Federal Commission for the Securities Market of Russia


 


Full corporate name: Closed Joint Stock Company Investment Company Troyka Dialog


Abbreviated corporate name: CJSC IC Troyka Dialog


TIN: 7710048970


Location: Russian Federation,
125009, Moscow City, Romanov side street, 4


Postal address: Russian Federation,
125009, Moscow City, Romanov side street, 4


License #:  177-06514-100000 (for brokerage activities)


Date of issuance: April 08, 2003


Validity period: unrestricted
validity period


Licensor: Federal Commission
for the Securities Market of Russia


License #: 177-06518-010000
(for dealership activities)


Date of issuance: April 08, 2003


Validity period: unrestricted
validity period


Licensor: Federal Commission
for the Securities Market of Russia


 


Any of the
above Originators can act as Underwriter of the Notes Issuance (intermediary at
placement) acting on behalf and on account of the Issuer.


 


Together with
disclosure of the placement Opening date of the, the Issuer shall disclose
information on the Underwriter, to whom Trade Participants of MICEX Stock
Exchange shall address their applications for acquisition of the Notes during
the tender to be held by CJSC MICEX Stock Exchange between potential purchasers
of the Notes at the Opening date of the Notes placement.


 


The Issuer
shall disclose the Underwriter’s information to whom Trade Participants of
MICEX Stock Exchange shall address their applications for acquisition of the
Notes during the tender of CJSC MICEX Stock Exchange between potential
purchasers of the Notes at the Opening date of the Notes placement, using the
following methods:


 


· news lines of AK&M and Interfax agencies, and of other
information agencies authorized by federal regulator of the securities market
to disclose information to the securities market — not later than 5 (Five) days
before the Opening date of the securities placement;


· The Issuer’s website - www.mts.ru - not later than 4 (Four)
days before the Opening date of the securities placement.


The above
announcement should also include information on the bank account to which cash
funds shall be received in payment for the Notes.


 


Key functions of the
Originators:


 


Organization of preparation and placement of the Notes issue.


 


Key functions of the
Underwriter:


 


The Underwriter shall
act under a relevant agreement with The Issuer on organization of a loan
supported by Notes (hereinafter, The Agreement).  As set out in the above Agreement, the
Underwriter shall perform the following functions:


 


· In its own name, but on account, and on behalf
of the Issuer, the Underwriter shall sell the Notes in accordance with the
Agreement and under the procedures set out in the Decision on issuance of
securities and the Securities Issuance Prospectus.


· Not later than the next
working day after cash funds are received by the Underwriter from the Notes
buyers in payment for the Notes to the Underwriter’s account, the Underwriter
shall transfer the above funds to the Issuer’s settlement account specified in
the Agreement, or to another Issuer’s account, additionally provided by the
Issuer.  The Underwriter shall make the
cash transfer with deduction of commission charged by CJSC MICEX Stock Exchange
(hereinafter, MICEX Stock Exchange, the Market Maker) and by CJSC MICEX.


· In accordance with the procedures and timeframe
set out in the Agreement, the Underwriter shall file with the Issuer a written
report on execution of such Agreement by the Underwriter.


· Maintain accounting of the Issuer’s cash funds
received by the Underwriter in connection with the Notes placement separately
from accounting for own cash fund, and cash funds of other customers.


· Perform other actions required to fulfill its
obligations with respect of the Notes placement in accordance with the
applicable Russian Federation legislation.


 


The Originators’
obligations, if any, with respect of purchasing the securities that have not
been placed within the allocated timeframe, and provided that such obligation
exists, the quantity (the procedures for establishing the quantity) of
securities that have not been placed within the allocated timeframe and that
constitute the Originators’ purchasing obligation, and the time period (the
procedures for establishing the time period) on expiration of which the
Originators shall be obliged to purchase the above quantity of the securities:


 


In accordance
with the Agreement, the Originators shall have no obligations of purchasing the
securities that have not been placed within
the allocated timeframe.


 


4

















 


The Originators’
responsibilities, if any, with respect of maintaining the prices for the
securities in the placement at a certain level during a certain time period
after their placement is completed (stabilization), including provision of
market maker’s services, and, if applicable, the time period (the procedures
for establishing the time period) during which the Originators shall be
responsible for ensuring stabilization or provision of market maker’s services:


 


As per the Agreement between the Issuer and the Originators,
the latter shall not be responsible for maintaining the prices for the
securities in the placement at a certain level during a certain time period
after their placement is completed (stabilization).


 


Should the Notes be
included in quoting list “B” of CJSC MICEX Stock Exchange, the Originators
expect singing a contract on execution of market maker’s responsibilities with
respect of the Notes throughout the period of their inclusion in quoting list “B”.  Throughout the period of inclusion of the
Notes in quoting list “B” of CJSC MICEX Stock Exchange, the Market-maker shall
provide services of the Notes trade in Closed Joint Stock Company MICEX Stock
Exchange by way of setting and maintaining bilateral put and call quotes for
the Notes.


 


Information on the Originators’ rights for
acquisition of additional quantity of the Issuer’s securities that belong to
the Issuer’s placed (traded) securities of the same kind, category (type) as
the securities being offered; these additional securities may be sold or not
sold depending on the securities placement results:


 


The Originators have no rights
for acquisition of additional quantity of the Issuer’s securities that belong
to the Issuer’s placed (traded) securities of the same kind, category (type) as
the securities being offered.


 


Amount of the Underwriter’s remuneration; if such
remuneration (part of remuneration) is paid to the above parties for the
services of maintaining prices for the offered securities at a certain level
during a certain time period after the placement is completed (stabilization),
including the market maker’s services — the amount of remuneration for such
services:


 


In accordance
with the Agreement, the Originators’ remuneration shall not exceed 1% (One per
cent) of nominal value of the Notes issuance (shall not exceed RUR 100,000,000
(One hundred million).


 


The Originators’ remuneration (part of
remuneration) for the services of maintaining prices for the offered securities
at a certain level during a certain time period after the placement is
completed (stabilization), including the market maker’s services shall not
exceed RUR 50,000 (Fifty thousand).


 


The Notes placement may be
exercised with or without inclusion of the Notes in quoting list “B”. Inclusion
of the Notes in quoting list “B” shall following the Rules of Listing,
Acceptance for Placement and Trade of Securities by Closed Joint Stock Company
MICEX Stock Exchange.


 


Placement of the Notes shall be exercised
through purchase and sale deals at the Notes offering price indicated in clause
8.4. . of the Decision on issuance of securities and clause 9.2. of the
Securities Issuance Prospectus).


 


If a potential buyer is not a
Trade Participant of MICEX Stock Exchange, it should execute a relevant
contract with any broker being a MICEX Stock Exchange Trade Participant, and
issue to it an assignment for buying the Notes.


 


A potential buyer being a Trade
Participant of MICEX Stock Exchange acts on its own.


 


A potential buyer of
the Notes shall be required to open a relevant depo account with NDC or another
Depository.  The procedures and timeframe
of depo accounts opening shall follow the internal rules of respective
depositories.


 


Terms and procedures of the securities
placement:


 


The Notes shall be
placed through a public offering by way of conducting trade by a securities
market maker.


 


Information of
the securities market maker:


Full and
abbreviated corporate name: Closed Joint Stock Company MICEX Stock Exchange (CJSC
MICEX Stock Exchange)


Location: 125009, Moscow City, Bolshoy Kislovskiy, 13


Postal address:  125009, Moscow City, Bolshoy Kislovskiy, 13


License
information:


Stock Exchange License #: 077-10489-000001


Date of License issuance: August 23, 2007


License Validity period: unrestricted


Licensor:  Federal Commission for the Securities Market of
Russia


 


In connection with the
Notes placement, deals shall be made at MICEX Stock Exchange by way of
fulfillment of addressed applications for Notes purchase submitted via MICEX
Stock Exchange trading system and CJSC MICEX clearing system, respectively, in
accordance with Rules of Securities Trading and other regulations of MICEX
Stock Exchange (hereinafter, MICEX Stock Exchange Rules) and regulations of
CJSC MICEX.


 


Deals of the
Notes placement shall be launched after the tender for interest rate on the
first coupon of the Notes is completed (hereinafter, the Tender) and finished
at the final date of the Notes issue placement.


 


The Tender shall be
launched and completed at the Opening date of the Notes issue placement.  The Procedures for holding the Tender have
been described in clause 9.3. of the Decision on issuance of securities and in
clause 9.1.2. of the Securities Issuance Prospectus.


 


Having received
information from the Issuer on interest rate established for the first coupon,
the Underwriter shall make deals by submission to MICEX Stock Exchange trading
system of addressed counter applications to the ones indicating lower or the
same interest rate as that established for the first coupon.  MICEX Stock Exchange shall set the time for
conducting transactions under the Tender framework and for making placement
deals in coordination with the Underwriter and/or the Issuer.


 


The Underwriter shall
publish an announcement of interest rate on the first coupon assisted by MICEX
Stock Exchange trading system via an e-mail to all Trade Participants of MICEX
Stock Exchange.


 


The Underwriter shall
satisfy the submitted applications for purchasing the Notes in full scope provided
that the quantity of Notes indicated in purchase applications does not exceed
the quantity of unplaced Notes.  If a
purchase application exceeds the quantity of unplaced Notes, such an
application for purchasing the securities shall be satisfied within the
available quantity of unplaced Notes. 
The Underwriter shall satisfy the Notes purchase applications using the
following procedures:


 


1) applications shall
be met in the ascending order of the interest rate indicated in the above
applications; i.e., first to be satisfied is the application which quotes the
lowest interest rate of all applications submitted, second to be satisfied is
the application which includes the lowest interest rate of all unsatisfied
applications, etc.;


 


2) if applications quote
equal interest rates, they shall be satisfied in the order of submission.  After all Notes are place, no more deals
shall be made.


 


After establishing
interest rate of the first coupon on the Notes and satisfaction of applications
submitted during the Tender, and provided that not all Notes are placed through
the Tender, MICEX Stock Exchange Trade Participants acting on their own behalf
and account, as well as on behalf and on account of potential buyers shall be
able to submit addressed applications for purchasing the Notes throughout the
whole placement period.  The acceptable
applications shall be addressed to the Underwriter and shall have settlement
code T0.


 


Starting from the
second day of placement, a purchaser of Notes shall pay the accrued coupon
income on the Notes for the respective days under the procedures set out in
clause 8.4. of the Decision on issuance of securities and in clause 9.2. of the
Securities Issuance Prospectus.


 


Addressed applications
for purchase of the Notes submitted by MICEX Stock Exchange Trade Participants
shall be registered provided that the condition of adequacy of the provided
surety is met, as required by CJSC MICEX Rules for Conducting Clearing
Activities on the Stock Market.


 


5

















 


The Underwriter shall
make a deal by submitting a counter application at the same date as that of the
original application.  Applications shall
be satisfied in the order of their submission.


 


If an application
requests more Notes than the quantity available on the Underwriter’s trading
section, such application shall be satisfied within the balance of the Notes
available on the Underwriter’s trading section.


 


Deals of Notes
placement shall be made in accordance with MICEX Stock Exchange Rules.


 


Settlements on the
signed deals shall be made in accordance with CJSC MICEX Rules for
Conducting Clearing Activities on the Stock Market.


 


The Depository shall
transfer the Sold Notes to buyers’ depo accounts as at the date of the purchase
and sale deals.


 


Amendment or
termination of contracts made at placement of the Notes shall take place on the
grounds and under the procedures set out in Chapter 29 of the RF Civil Code.


 


The procedures for
making an entry record to depo account of the first acquirer with a depository
providing centralized storage:


 


Non-Commercial
Partnership National Depository Centre or another Depository shall record the
Notes placed through MICEX Stock Exchange to depo accounts of the Notes buyers
as at the date of the respective purchase and sale transaction.


 


An entry record to
depo account of the first acquirer with NDC shall be made under the
instructions issued by CJSC MICEX, the clearing entity servicing the deals made
in the course of the Notes placement through MICEX Stock Exchange.  The Depository shall record the placed Notes
to accounts of the Notes buyers using the procedures for clearing activities of
a clearing organization, and procedures for depository activities of
Depositories.


 


All expenses
arising in connection with entry records of the placed Notes to depo accounts
of their first owners (acquirers) shall be borne by owners (acquirers) of such
Notes.


 


8.4. The price (prices) or the
procedures for establishing the securities placement price:


 


The Notes
shall be placed at the price of RUR 1,000 (One thousand) per one Note (100%
(One hundred per cent) of the Notes nominal value).


 


Starting from the second day of the Notes
placement, at buying a Note, the buyer shall also pay the accrued coupon income
for the respective quantity of days.  The
accrued coupon income (ACI) per one Note shall be computed using the following
formula:


 


ACI = Nom * C * ((T - T0)/ 365)/ 100 %, where


Nom — is nominal value of a Note,


C — interest rate of the first coupon (per cent
annual),


T —date of the Notes placement;


T0 - Opening date of
the Notes placement.


 


Accrued
coupon income shall be computed down to one kopeck, truncation of computed
values shall be based on the rules of mathematical round-up.  Rules of mathematical round-up shall be construed as the method that does not change
the value of whole kopecks provided that the first figure after truncation is
from 0 to 4, but increases the quantity of whole kopecks by one provided that
the first figure after truncation is from 5 to 9.


 


8.5. Procedures for exercising preemptive rights for
purchasing the offered securities:


 


No preemptive rights for purchasing
the offered securities are envisaged.


 


8.6. Terms and procedures for making settlements for the
securities:


 


At acquisition of the offered securities
of the issuance, payments can be made by cash transfer in the Russian
Federation currency.


 


Form of payment: by bank transfer.


 


Terms and procedures for
settlements for the Notes in installments.


 


Payment for the Notes in installments
is not available.


 


The Notes
are placed under the condition of full settlement.


 


Settlements for the
Notes shall be made in cash transfers in the Russian Federation currency in
accordance with clearing rules of CJSC MICEX.


 


Settlements for the
Notes at placement shall be made on the terms “delivery against payment” in
accordance with clearing rules of CJSC MICEX.  Cash proceeds received by CJSC MICEX Stock
Exchange from the Notes placement shall be recorded to the Underwriter’s
account with MICEX Clearing Chamber.


 


Crediting institution:


 


Full corporate name: NON-BANKING
CREDITING ORGANIZATION CLOSED JOINT STOCK COMPANY ‘MOSCOW INTERBANK CURRENCY
EXCHANGE CLEARING CHAMBER”


Abbreviated corporate name: CJSC MICEX Clearing
Chamber


Location: 125009, Moscow City,
Middle Kislovskiy, 1/13, building 8


Postal address: 125009, Moscow City,
Middle Kislovskiy, 1/13, building 8


BIC: 044583505


TIN: 7702165310


Correspondent acc: 30105810100000000505


 


Information of the account to which cash
funds in payment for the Notes are to be received shall be disclosed
simultaneously with disclosure of the Underwriter’s information.


 


No non-cash
payments for the securities shall be possible.


 


The Underwriter shall transfer the funds received from
the Noted placement to the Issuer’s account within the timeframe set out in the
contract on performing agency functions at placement of securities with CJSC
MICEX Stock Exchange.


 


Other terms and procedures of
settlements for the Notes:


 


Settlements for the
Notes shall follow the CJSC MICEX Rules for Conducting Clearing Activities
on the Stock Market.


 


Cash
settlements shall be executed via CJSC MICEX Clearing Chamber. Cash settlements
related to purchase and sales deals for the Notes at their placement shall be
executed on the same dates as the dates of respective deals.


 


Settlements under
purchase and sales deals at the Notes placement shall be based on “delivery
against payment” terms, i.e., the deals shall require preliminary provision of
cash and of securities.


 


8.7.
At what percentage of unplaced securities the issuance shall be recognized as
ineffective, and what procedures shall be followed to recover the funds
delivered in payment for the securities in the issue should the issue be
recognized as ineffective


 


No
percentage figure of unplaced securities has been established, at which the
issuance shall be recognized as ineffective.


 


9.
The terms of redemption of and income payment under the Notes


 


9.1. Form of
the Notes redemption


 


The Notes shall be redeemed and
income under the Notes shall be paid by a payment agent on behalf and on
account of the Issuer in the form of a cash transfer in Russian Federation
roubles (RUR).  Owners of the Notes shall not
be able to select the method and the terms of the Notes redemption.


 


6

















 


9.2. Procedures and terms of the Notes redemption; maturity


 


Redemption of the Notes of the
issuance:


 


Maturity date:


 


3640-th (Three
thousand six hundred fortieth) day from the Opening date of the Notes
placement.


 


Redemption of the
Notes shall be carried out by a payment agent on behalf and on account of the
Issuer (hereinafter, The Payment Agent). 
Data of the Payment Agent are provided in clause 9.6 of the Decision on
issuance of securities and in clause 9.1.2. (д)  of the Securities Issuance Prospectus.


 


The Issuer accepts the responsibility for
timely and complete transfer to the Payment Agent for the current Notes
issuance of the respective cash funds required to fulfill the payment
obligations in accordance with the Decision on issuance of securities, the
Securities Issuance Prospectus, and the contract between the Issuer and the
Payment Agent.


 


If the Notes
redemption maturity date is a day off, be it a day off established by the state
or a day off with respect of settlement transactions, the relevant sums shall
be paid on the first working day following the day off.  Owner of the Notes shall not be entitled to
demand accrual of interest or any other compensation for such delay of payment.


 


The Notes shall be
redeemed at their nominal value.


 


The Notes shall
be repaid in RUR as a bank transfer to benefit of the Note owners.


 


It is presumed that
nominal holders — depositors of NDC are duly authorized to receive the sums
paid in connection with redemption of the Notes.


 


Owner of the Notes that is not an
NDC depositor is entitled to authorize a nominal Note holder that is an NDC
depositor to receive the sums of the Notes redemption.  If the Owner failed to authorize the nominal
Notes holder - an NDC depositor which has the Owner’s Notes recorded to its
accounts with NDC, to receive the sums of the Notes redemption, such nominal
holder no later than 1 p.m. Moscow time on the third working day preceding the
Notes Maturity Date shall submit to NDC the list of owners including data
referred to below as required for inclusion in the list of Owners and/or
Nominal Holders of the Notes.


 


The
date (procedures for establishing the date) of the note owners list for the
purposes of the notes redemption:


 


The Notes shall be redeemed to
the benefit of the Note Owners, being such as at the end of NDC’s working day
preceding the third working date prior to the Notes Maturity Date (hereinafter,
The Date of the Note Owners and/or Nominal Holders List Production).


 


Obligations fulfilled towards an
owner included in the list of the note owners and/or nominal holders shall be
recognized as properly fulfilled, including in case of the Notes disposal after
the Date of the Note Owners and/or Nominal Holders List Production.


 


If rights of an owner
of the Notes are accounted for by a nominal holder, and the nominal holder is
authorized to receive the sums of the Notes redemption, then the person
authorized to receive the sums of the Notes redemption shall be the nominal
holder.


 


If rights of an owner
of the Notes are not accounted for by a nominal holder, and/or the nominal
holder has not been authorized to receive the sums of the Notes redemption,
then the person authorized to receive the sums of the Notes redemption shall be
the Notes owner (for an individual the list should include the owner’s full
name).


 


Not later than on the 2nd
(Second) working day before the Notes Maturity Date, NDC shall deliver to the
Issuer and/or the Payment Agent a list of Note owners or nominal holders
produced as at the Date of the Note Owners and/or Nominal Holders List
Production and including the following information:


 


a) full name (Surname,
first, patronymic name) of the person authorized to receive the sums of
redemption under the Notes.


 


b) quantity of the
Notes recorded to depo account of the person authorized to receive the sums of
redemption under the Notes;


 


c) location and postal
address of the person authorized to receive the sums of redemption under the
Notes;


 


z) banking information
of the person authorized to receive the sums of redemption under the Notes,
including:


 


·               # of account with the bank;


·               name of the bank (and the city where the bank is
located) with which the account was opened;


·               corresponding account of the bank, with which
the account was opened;


·               bank’s identification code of the bank, with
which the account was opened (BIC);


·               taxpayer’s identification # (TIN) of the payment
recipient;


·               code of reason for registration (CPP) of the
person authorized to receive the sums of redemption under the Notes.


 


d) tax status of the
person authorized to receive the sums of redemption under the Notes (resident,
non-resident with a permanent establishment in the Russian Federation,
non-resident without a permanent establishment in the Russian Federation).


 


In addition to the above, a
nominal holder is required to file with NDC, and NDC is obliged to include in
the list of Notes owners and/or nominal holders for repayment of redemption
sums, the following information on individual and corporate Note owners that
are not tax residents of the Russian Federation, irrespective of nominal
holder’s authority to receive redemption under the Note or absence of such
authority:


 


a) if owner of the
Notes is a corporate non-resident entity:


· individual identification number (IIN) — if
applicable;


b) if owner of the
Notes is an individual:


· kind, #, date and place of issuance of the
individual’s identification document, name of the issuing agency;


· the owner’s birth day, month and year;


· the owner’s place of registration and postal
address including zip code;


· the owner’s tax status;


· the owner’s # of state pension security
certificate (if applicable);


· the owner’s TIN (if applicable).


· code of reason for registration (CPP) of the
person authorized to receive the sums of redemption under the Note (if
applicable).


 


The Issuer’s
obligations shall be considered fulfilled from the moment of writing off
respective cash funds from account of the Payment Agent.


 


The Note owners, their
authorized persons including NDC depositors shall themselves be responsible for
ensuring completeness and relevancy of information submitted by them to NDC
(information required to perform the obligations under the Notes) including but
not limited to banking data and information on the persons authorized to receive
the sums of redemption under the Notes. 
In case of failure to submit such information to NDC or failure to
submit it in a timely manner, the above obligations shall be executed towards
the person who presented a claim on fulfillment of obligations, and who is the
Notes owner as at the date of presenting the claim.  The Issuer shall in this case fulfill the
obligations under the Notes on the basis of data available to NDC.  And in this case the Issuer’s obligations
shall be recognized fulfilled in full scope and in due manner.  If banking and other information provided by
owner or nominal holder or available to NDC and required by the Issuer to
perform its obligations under the Notes, prevent the Payment Agent from transferring cash funds in
a timely manner, such delay cannot be viewed as delinquency of obligations
under the Notes, and the Notes owner shall not be able to demand accrual of
interest or any other compensation for such delay of payment.


 


The Issuer shall
transfer the required cash funds for redemption of the Note to account of the
Payment Agent within the timeframe and under the procedures set out in the
Contract between the Issuer and the Payment Agent.


 


The Payment Agent shall compute
the sum of cash funds payable to each of the persons in the list of owners
and/or nominal holders of the Notes.


 


7

















 


As at the Notes Maturity Date, Payment Agent shall transfer the required cash funds to
accounts of the persons authorized to receive the sums of redemption under the
Notes to benefit of the Note owners.


 


If one
person is authorized to receive the sums of redemption under the Notes by
several Note owners, such person shall receive an aggregate amount not broken
down by each Note owner.


 


If the Notes
Maturity Date is a non-working day,
be it a day off established by the state or a day off with respect of
settlement transactions, the relevant sum shall be paid on the first working
day following such day off.  Owner of the
Notes shall not be entitled to demand accrual of interest or any other
compensation for such delay of payment.


 


9.3. Procedures for assessing income payable
under each Note.


 


	
  Coupon (interest-bearing) period

  	
   

  	
   

  
	
  Opening date

  	
   

  	
  Closing date

  	
   

  	
  Coupon (interest) income

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1. Coupon: Interest rate on
  the first coupon - C1 — shall be established through the tender of potential
  buyers of the Notes in the first day of the Notes placement.  The procedures and terms of the tender have
  been set out in clause 9.3. of the Decision on issuance of securities
  and in clause 9.1.2. ()  of the Securities Issuance Prospectus

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the first coupon of the issue is the Opening
  date of the Notes placement.

  	
   

  	
  The
  Closing date of the first coupon period is the date of repayment of this
  coupon, i.e. 182nd  day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the first coupon per each Note
  shall be computed with the following formula:

  K1 = C1 * Nom * (T(1) - T(0))/ 365/ 100 %,

  where

  K1 — total coupon payment under 1st coupon per one
  Note, RUR;

  C1 — interest rate of the 1st coupon, per cent
  annual;

  Nom — nominal value of a Note, RUR;

  T(0) — Opening date of the 1st coupon period;

  T(1) — Closing date of the 1st coupon period.

  The
  sum of coupon payment shall be computed down to one kopeck (truncation shall
  be based on the rules of mathematical round-up to the nearest whole
  number. Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2. Coupon: Interest rate on
  the second coupon — C2 — shall be computed in accordance with the procedures
  set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the second coupon of the issue is the182nd day
  from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the second coupon period is the date of repayment of this
  coupon, i.e. 364th day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the second coupon per each Note
  shall be computed with the following formula:

  K2 = C2 * Nom * (T(2) - T(1))/ 365/ 100 %,

  where

  K2 — total coupon payment under 2nd coupon per one Note, RUR;

  C2 — interest rate of the  coupon, per cent annual;

  Nom — nominal value of a Note, RUR;

  T(1) - Opening date of the  coupon period;

  T(2) - Closing date of the  coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3. Coupon: Interest rate on
  the third coupon - C3 — shall be computed in accordance with the procedures
  set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the third coupon of the issue is the364th day
  from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the third coupon period is the date of repayment of this
  coupon, i.e. 546th day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the third coupon per each Note
  shall be computed with the following formula:

  K3 = C3 * Nom * (T(3) - T(2))/ 365/ 100 %,

  where

  K3 — total coupon payment under 3rd coupon per one Note, RUR;

  C3 — interest rate of the 3rd coupon, per cent annual;

  Nom — nominal value of a Note, RUR;

  T(2) — Opening date of the 3rd coupon period;

  T(3) — Closing date of the 3rd coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4. Coupon: Interest rate on
  the fourth coupon - C4 - shall be computed in accordance with the procedures
  set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the fourth coupon of the issue is the546th day
  from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the fourth coupon period is the date of repayment of this
  coupon, i.e. 728th day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the fourth coupon per each Note
  shall be computed with the following formula:

  K4 = C4 * Nom * (T(4) - T(3))/ 365/ 100 %,

  where

  K4 — total coupon payment under 4th coupon per one Note, RUR;

  C4 — interest rate of the 4th coupon, per cent annual;

  Nom — nominal value of a Note, RUR;

  T(3) — Opening date of the  coupon period;

  T(4) — Closing date of the  coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5. Coupon: Interest rate on
  the fifth coupon - C5 - shall be computed in accordance with the procedures
  set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of 

  	
   

  	
  The
  Closing date of the fifth 

  	
   

  	
  Total payments under the fifth coupon per each Note
  shall be computed with the 

  



 


8

















 


	
  the
  fifth coupon of the issue is the728  day from the Opening date of the Notes
  placement.

  	
   

  	
  coupon
  period is the date of repayment of this coupon, i.e. 910th day from the Opening date of the Notes
  placement.

  	
   

  	
  following formula:

  K5 = C5 * Nom * (T(5) - T(4))/ 365/ 100 %,

  where

  K5 — total coupon payment under 5th coupon per one Note, RUR;

  C5 — interest rate of the 5th coupon, per cent annual;

  Nom — nominal value of a Note, RUR;

  T(4) — Opening date of the 5th coupon period;

  T(5) — Closing date of the 5th coupon period.

  The
  sum of coupon payment shall be computed down to one kopeck (truncation shall
  be based on the rules of mathematical round-up to the nearest whole
  quantity.  Rules of mathematical
  round-up shall be construed as the truncation method that does not change the
  quantity of whole kopecks provided that the first figure after truncation is
  from 0 to 4, but increases by one provided that the first figure after
  truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6. Coupon: Interest rate on
  the sixth coupon - C6 - shall be computed in accordance with the procedures
  set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the sixth coupon of the issue is 910th day from the Opening date of the Notes
  placement.

  	
   

  	
  The
  Closing date of the sixth coupon period is the date of repayment of this
  coupon, i.e. 1092nd day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the sixth coupon per each Note
  shall be computed with the following formula:

  K6 = C6 * Nom * (T(6) - T(5))/ 365/ 100 %,

  where

  K6 — total coupon payment under 6th coupon per one Note, RUR;

  C6 — interest rate of the 6th coupon, per cent annual;

  Nom — nominal value of a Note, RUR;

  T(5) — Opening date of the 6th coupon period;

  T(6) — Closing date of the 6th coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7. Coupon: Interest rate on the
  seventh coupon — C7 - shall be computed in accordance with the procedures set
  here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the seventh coupon of the issue is the1092nd
  day from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the seventh coupon period is the date of repayment of this
  coupon, i.e. 1274th day from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the seventh coupon per each
  Note shall be computed with the following formula:

  K7 = C7 * Nom * (T(7) - T(6))/ 365/ 100 %,

  where

  K7 — total coupon payment under 7th coupon per one Note, RUR;

  C7 — interest rate of the 7th coupon, per cent annual;

  Nom — nominal value of a Note, RUR;

  T(6) — Opening date of the  coupon period;

  T(7) — Closing date of the  coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8. Coupon: Interest rate on
  the eighth coupon — C8 - shall be computed in accordance with the procedures
  set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the eighth coupon of the issue is the1274th day
  from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the eighth coupon period is the date of repayment of this
  coupon, i.e. 1456th day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the eighth coupon per each Note
  shall be computed with the following formula:

  K8 = C8 * Nom * (T(8) - T(7))/ 365/ 100 %,

  where

  K8 — total coupon payment under 8th coupon per one Note, RUR;

  C8 — interest rate of the 8th coupon, per cent annual;

  Nom — nominal value of a Note, RUR;

  T(7) — Opening date of the 8th coupon period;

  T(8) — Closing date of the 8th coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9. Coupon: Interest rate on
  the ninth coupon — C9 - shall be computed in accordance with the procedures set
  here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the ninth coupon of the issue is the1456th day
  from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the ninth coupon period is the date of repayment of this
  coupon, i.e. 1638th day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the ninth coupon per each Note
  shall be computed with the following formula:

  K9 = C9 * Nom * (T(9) - T(8))/ 365/ 100 %,

  where

  K9 — total coupon payment under 9th coupon per one Note, RUR;

  C9 — interest rate of the 9th coupon, per cent annual;

  Nom — nominal value of a Note, RUR;

  T(8) — Opening date of the 9th coupon period;

  T(9) — Closing date of the 9th coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10. Coupon: Interest rate on
  the tenth coupon — C10 - shall be computed in accordance with the procedures
  set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the tenth coupon of the issue is 

  	
   

  	
  The
  Closing date of the tenth coupon period is the date of 

  	
   

  	
  Total payments under the tenth coupon per each Note
  shall be computed with the following formula:

  



 


9

















 


	
  the1638th
  day from the Opening date of the Notes placement.

  	
   

  	
  repayment
  of this coupon, i.e. 1820th day
  from the Opening date of the Notes placement.

  	
   

  	
  K10 = C10 * Nom * (T(10) - T(9))/ 365/ 100 %,

  where

  K10 — total coupon payment under 10th coupon per one Note, RUR;

  C10 — interest rate of the 10th coupon, per cent annual;

  Nom — nominal value of a Note, RUR;

  T(9) — Opening date of the 10th coupon period;

  T(10) — Closing date of the 10th coupon period.

  The
  sum of coupon payment shall be computed down to one kopeck (truncation shall
  be based on the rules of mathematical round-up to the nearest whole
  quantity.  Rules of mathematical
  round-up shall be construed as the truncation method that does not change the
  quantity of whole kopecks provided that the first figure after truncation is
  from 0 to 4, but increases by one provided that the first figure after
  truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11. Coupon: Interest rate on
  the eleventh coupon — C11 - shall be computed in accordance with the
  procedures set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the eleventh coupon of the issue is the1820th
  day from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the eleventh coupon period is the date of repayment of this
  coupon, i.e. 2002nd day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the eleventh coupon per each
  Note shall be computed with the following formula:

  K11 = C11 * Nom * (T(11) - T(10))/ 365/ 100 %,

  where

  K11 — total coupon payment under 11th coupon per one Note, RUR;

  C11 — interest rate of the 11th coupon, per cent annual;

  Nom — nominal value of a Note, RUR;

  T(10) — Opening date of the 11th coupon period;

  T(11) — Closing date of the 11th coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12. Coupon: Interest rate on
  the twelfth coupon — C12 - shall be computed in accordance with the
  procedures set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the twelfth coupon of the issue is the2002nd
  day from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the twelfth coupon period is the date of repayment of this
  coupon, i.e. 2184th day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the twelfth coupon per each
  Note shall be computed with the following formula:

  K12 = C12 * Nom * (T(12) - T(11))/ 365/ 100 %,

  where

  K12 — total coupon payment under 12th coupon per one Note, RUR;

  C12 — interest rate of the 12th coupon, per cent annual;

  Nom — nominal value of a Note, RUR;

  T(11) — Opening date of the 12th coupon period;

  T(12) — Closing date of the 12th coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13. Coupon: Interest rate on
  the thirteenth coupon — C13 - shall be computed in accordance with the
  procedures set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the thirteenth coupon of the issue is the2184- day from the Opening date of the Notes
  placement.

  	
   

  	
  The
  Closing date of the thirteenth coupon period is the date of repayment of this
  coupon, i.e. 2366- day from the
  Opening date of the Notes placement.

  	
   

  	
  Total payments under the thirteenth coupon per each
  Note shall be computed with the following formula:

  K13 = C13 * Nom * (T(13) - T(12))/ 365/ 100 %,

  where

  K13 — total coupon payment under 13th coupon per one Note, RUR;

  C13 — interest rate of the 13th coupon, per cent annual;

  Nom — nominal value of a Note, RUR;

  T(12) — Opening date of the 13th coupon period;

  T(13) — Closing date of the 13th coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14. Coupon: Interest rate on
  the fourteenth coupon — C14 - shall be computed in accordance with the
  procedures set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the fourteenth coupon of the issue is the2366th
  day from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the fourteenth coupon period is the date of repayment of this
  coupon, i.e. 2548th day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the fourteenth coupon per each
  Note shall be computed with the following formula:

  K14 = C14 * Nom * (T(14) - T(13))/ 365/ 100 %,

  where

  K14 — total coupon payment under 14th coupon per one Note, RUR;

  C14 — interest rate of the 14th coupon, per cent annual;

  Nom — nominal value of a Note, RUR;

  T(13) — Opening date of the 14th coupon period;

  T(14) — Closing date of the  coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  15. Coupon: Interest rate on
  the fifteenth coupon — C15 - shall be computed in accordance with the
  procedures set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the fifteenth coupon of the issue is the2548th
  day from the Opening 

  	
   

  	
  The
  Closing date of the fifteenth coupon period is the date of repayment of this
  coupon, i.e. 

  	
   

  	
  Total payments under the fifteenth coupon per each
  Note shall be computed with the following formula:

  K15 = C15 * Nom * (T(15) - T(14))/ 365/ 100 %,

  



 


10














 


	
  date
  of the Notes placement.

  	
   

  	
  2730th day from the Opening date of the Notes
  placement.

  	
   

  	
  where

  K15 – total coupon payment under 15th coupon per one Note, RUR;

  C15 – interest rate of the 15th coupon, per cent annual;

  Nom – nominal value of a Note, RUR;

  T(14) – Opening date of the 15th coupon period;

  T(15) – Closing date of the 15th coupon period.

  The
  sum of coupon payment shall be computed down to one kopeck (truncation shall
  be based on the rules of mathematical round-up to the nearest whole
  quantity.  Rules of mathematical
  round-up shall be construed as the truncation method that does not change the
  quantity of whole kopecks provided that the first figure after truncation is
  from 0 to 4, but increases by one provided that the first figure after truncation
  is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  16. Coupon: Interest rate on
  the sixteenth coupon – C16 - shall be computed in accordance with the
  procedures set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the sixteenth coupon of the issue is the2730th
  day from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the sixteenth coupon period is the date of repayment of this
  coupon, i.e. 2912th day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the sixteenth coupon per each
  Note shall be computed with the following formula:

  K16 = C16 * Nom * (T(16) - T(15))/ 365/ 100 %,

  where

  K16 – total coupon payment under 16th coupon per one Note, RUR;

  C16 – interest rate of the 16th coupon, per cent annual;

  Nom – nominal value of a Note, RUR;

  T(15) – Opening date of the 16th coupon period;

  T(16) – Closing date of the 16th coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  17. Coupon: Interest rate on the
  seventeenth coupon – C17 - shall be computed in accordance with the
  procedures set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the seventeenth coupon of the issue is
  the2912nd day from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the seventeenth coupon period is the date of repayment of
  this coupon, i.e. 3094th day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the seventeenth coupon per each
  Note shall be computed with the following formula:

  K17 = C17 * Nom * (T(17) - T(16))/ 365/ 100 %,

  where

  K17 – total coupon payment under 17th coupon per one Note, RUR;

  C17 – interest rate of the 17th coupon, per cent annual;

  Nom – nominal value of a Note, RUR;

  T(16) – Opening date of the 17th coupon period;

  T(17) – Closing date of the 17th coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  18. Coupon: Interest rate on the
  eighteenth coupon – C18 - shall be computed in accordance with the procedures
  set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the eighteenth coupon of the issue is the3094th
  day from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the eighteenth coupon period is the date of repayment of this
  coupon, i.e. 3276th day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the eighteenth coupon per each
  Note shall be computed with the following formula:

  K18 = C18 * Nom *
  (T(18) - T(17))/ 365/ 100 %,

  where

  K18 – total coupon payment under 18th coupon per one Note, RUR;

  C18 – interest rate of the 18th coupon, per cent annual;

  Nom – nominal value of a Note, RUR;

  T(17) – Opening date of the 18th coupon period;

  T(18) – Closing date of the 18th coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  19. Coupon: Interest rate on the
  nineteenth coupon – C19 - shall be computed in accordance with the procedures
  set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the nineteenth coupon of the issue is the3276th
  day from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the nineteenth coupon period is the date of repayment of this
  coupon, i.e. 3458th day
  from the Opening date of the Notes placement.

  	
   

  	
  Total payments under the nineteenth coupon per each
  Note shall be computed with the following formula:

  K19 = C19 * Nom * (T(19) - T(18))/ 365/ 100 %,

  where

  K19 – total coupon payment under 19th coupon per one Note, RUR;

  C19 – interest rate of the 19th coupon, per cent annual;

  Nom – nominal value of a Note, RUR;

  T(18) – Opening date of the 19th coupon period;

  T(19) – Closing date of the 19th coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  20. Coupon: Interest rate on the
  twentieth coupon – C20 - shall be computed in accordance with the procedures
  set here below.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The
  coupon period Opening date of the twentieth coupon of the issue is the3458th
  day from the Opening date of the Notes placement.

  	
   

  	
  The
  Closing date of the twentieth coupon period is the date of repayment of this
  coupon, i.e. 3640th day
  from the Opening date

  	
   

  	
  Total payments under the twentieth coupon per each
  Note shall be computed with the following formula:

  K20 = C20 * Nom * (T(20) - T(19))/ 365/ 100 %,

  where

   

  



 


11

















 


	
   

  	
   

  	
  of
  the Notes placement.

  	
   

  	
  K20 – total coupon payment under 20th coupon per one Note, RUR;

  C20 – interest rate of the 20th coupon, per cent annual;

  Nom – nominal value of a Note, RUR;

  T(19) – Opening date of the 20th coupon period;

  T(20) – Closing date of the 20th coupon period.

  The sum of coupon payment shall be computed down to
  one kopeck (truncation shall be based on the rules of mathematical
  round-up to the nearest whole quantity. 
  Rules of mathematical round-up shall be construed as the
  truncation method that does not change the quantity of whole kopecks provided
  that the first figure after truncation is from 0 to 4, but increases by one
  provided that the first figure after truncation is from 5 to 9).

  



 


Procedures for establishing
interest rate for the first coupon:


 


Interest rate on the first coupon shall be established through the Tender held by
stock exchange – MICEX Stock Exchange – between potential buyers of the Notes
as at the Notes Placement Opening Date.


 


On the day of the
Tender MICEX Stock Exchange Trade Participants shall submit addressed bids for
the Notes with settlement code T0 to Underwriter via MICEX Stock Exchange
trading system, both on their on account, and on account and on behalf of their
customers.  MICEX Stock Exchange shall
set the time and procedures for submission of Tender bids in coordination with
the Underwriter and/or the Issuer.


 


A bid shall state the
following relevant terms:


i. Purchasing price;


ii. Quantity of the
Notes;


iii. Acceptable
interest rate of the first coupon;


iv. Other parameters
in accordance with Rules of Securities Trading and other regulations of
MICEX Stock Exchange.


 


Cash provision should
be made in the amount sufficient for full payment for the Notes, as stated in
the applications including commission fees of MICEX Stock Exchange and CJSC
MICEX.


 


Purchasing price shall
state the Notes Placement Price as per the Securities Issuance Prospectus and
the Decision on issuance of securities.


 


The Notes quantity
shall state the maximum quantity of the Notes that the potential buyer would be
willing to buy, provided the Issuer sets the first coupon interest rate above
or equal the acceptable interest rate for the first coupon, as stated in the
bid.


 


The acceptable
interest rate for the first coupon shall state the first coupon interest rate
to be announced by the Issuer, at which rate the potential investor would be
willing to buy the Notes in the quantity stated in the bid.  The acceptable interest rate shall be stated
as per cent annual rate down to one hundredth of a per cent.


 


A bid of a MICEX Stock
Exchange Trade Participant shall be accepted for execution if the provided
surety is sufficient in accordance with CJSC MICEX Rules for Conducting
Clearing Activities on the Stock Market.


 


The Issuer shall take decision on interest
rate for the first coupon and shall inform MICEX Stock Exchange of its decision
in writing.  After an information agency
publishes an announcement of the first coupon interest rate, the Issuer shall
inform the Underwriter of the established interest rate for the first coupon.


 


The
Underwriter shall publish an announcement of the first coupon interest rate
using the MICEX Stock Exchange Trading System via e-mail to all Trade
Participants.


 


The Issuer
shall disclose the interest rate established for the first coupon in accordance
with the procedures set in clause 11. of the Decision on issuance of securities
and clause 2.9. of the Securities Issuance Prospectus.


 


Procedures for
setting interest rate to the coupons starting from the second coupon:


 


1) Within 2
(Two) working days from the Notes Placement Opening, the Issuer may take a
decision on purchasing the Notes from their owners within the next 5 (Five)
working days of coupon period j (j=1-19). 
If the Issuer takes such decision, interest rates for all coupons of the
Notes, which have the sequential numbers below or equal to j, shall be
established as equal to the first coupon interest rate.  The Issuer shall communicate the above
information including sequential numbers of the coupons, for which interest
rate was established as equal to the first coupon interest rate, and sequential
number of the coupon period (j), in which owners of the Notes shall be able to
demand repurchase of the Notes prior to potential Notes buyers by publishing
the below announcements within the below time period from the date of the
meeting protocol of the Issuer’s authorized body that has taken decision on
purchasing the Notes:


 


· on news lines
(AK&M or Interfax or ANO “AZIPI”) – within 1 (One) day;


· on Internet
website - www.mts.ru - within 2 (Two) days.


 


This
information shall be published not later than the 1 (First) working day before
the Notes Placement Opening.


Should the
Issuer fail to take such decision, interest rates for all coupons starting from
the second one, shall be established as equal to the first coupon interest
rate.


 


2) For the
coupons, for which the Issuer failed to establish an interest rate (procedures
for establishing interest rate) prior to the Notes Placement Opening
(i=(j+1),.,20), the interest rate shall be established as a numerical figure at
the Date of Establishing the “i” coupon, which occurs not later than 7 (Seven)
working days before payment of coupon (i-1). 
At the date of establishing “i” coupon, the Issuer shall be able to set
the rates of any quantity of undefined coupons following “i” coupon (where k –
is the number of the last of the coupons being defined). The Issuer shall
informs the Notes owners of the interest rate on “i” coupon within 5 (Five)
working days before opening of i coupon period on the Notes by publishing a
relevant announcement under the procedures set out in clause 11. of the
Decision on issuance of securities and clause 2.9. of the Securities Issuance
Prospectus.


 


3) If after
announcement of coupon interest rates (as set out in the previous subclauses)
there still exist undefined rates of at least one of subsequent coupons, then
together with the announcement of rates for i coupon and other coupons of the
Notes being defined, the Issuer shall be required to ensure the Notes owners’
right to demand that the Issuer purchase the Notes in the last 5 (Five) working
days of k coupon period (if the Issuer defines the rate for only one i coupon,
i=k).  The above information including
sequential numbers of the coupons, for which interest rate was defined on the
Date of Establishing i coupon, and sequential numbers of coupon period (k), in
which the notes shall be purchased, shall be communicated to potential buyers
of the Notes by way of publishing in accordance with the procedures set out in
clause 11. of the Decision on issuance of securities and clause 2.9. of the
Securities Issuance Prospectus.


 


The Issuer
shall inform MICES Stock Exchange of decisions taken in accordance with
subclauses (2) and (3) of the above Decision on issuance of
securities and subclauses (2) and (3) clause 9.1.2. (a) of the
Securities Issuance Prospectus, including interest rates within 5 (Five)
working days prior to completion of (i-1) coupon period (the period in which
interest rate is defined for i coupon and subsequent coupons).


 


9.4.
Procedures and timeframe of income payment under the Notes including the
procedures and timeframe of income payment under each coupon


 


	
  Coupon (interest-bearing)
  period

  	
   

  	
  Time (date) of coupon
  (interest)

  	
   

  	
  Date of production of a list
  of Notes

  owners for coupon (interest) income

  
	
  Opening date

  	
   

  	
  Closing date

  	
   

  	
  income payment

  	
   

  	
  payment

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


1. Coupon: Interest rate on the
first coupon - C1 – shall be established through the tender of potential buyers
of the Notes in the first day of the Notes placement.  The 


 


12

















 


procedures and terms of the tender have been set out
in clause 9.3. of the Decision on issuance of securities and in clause 9.1.2. (д)  of the Securities Issuance Prospectus


 


	
  The coupon period Opening date of the first coupon
  of the issue is the Opening date of the Notes placement.

  	
   

  	
  The Closing date of the first coupon period is the
  date of repayment of this coupon.

  	
   

  	
  Coupon income on the first coupon shall be paid on
  182nd day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  



 


Procedures for payment of coupon
(interest) income:


 


Income on the Notes shall be paid by the Payment Agent
on account and on behalf of the Issuer.


 


Income on the Notes shall be paid in the Russian
Federation currency by way of a bank transfer to benefit of the Notes owners. It is presumed that nominal holders – depositors of NDC are authorized
to receive the sums of income on the Notes. An NDC depositor that has not been
authorized by its customers to receive income on the Notes no later than 1 p.m.
Moscow time on the third working day preceding the Date of Income Payment under
the Notes shall submit to NDC the list of owners including data referred to
below as required for inclusion in the list of Owners and/or Nominal Holders of
the Notes.


 


Income on the Notes shall be paid to the Notes owners
that retain such status as at the end of NDC’s operating day preceding the
third working day prior to the date of income payment under the Notes (hereinafter, The Date of the Note Owners and/or Nominal Holders List
Production).


 


Obligations
fulfilled towards an owner included in the list of the note owners and/or
nominal holders shall be recognized as properly fulfilled, including in case of
the Notes disposal after the Date of the Note Owners and/or Nominal Holders
List Production.


If
rights of an owner of the Notes are accounted for by a nominal holder, and the
nominal holder is authorized to receive the sums of income of the Notes, then
the person authorized to receive the sums of income on the Notes shall be the
nominal holder.  If rights of an owner of
the Notes are not accounted for by a nominal holder, and/or the nominal holder
has not been authorized to receive the sums of income on the Notes, then the
person authorized to receive the sums of income on the Notes shall be the Notes
owner (for an individual the list should include the owner’s full name).


 


Not
later than on the 2nd (Second) working day before the Date of Income Payment on
the Notes, NDC shall deliver to the Issuer and/or the Payment Agent a list of
Note owners or nominal holders produced as at the Date of the Note Owners
and/or Nominal Holders List for the purposes of income payment, including the
following information:


 


a) full
name (Surname, first, patronymic name) of the person authorized to receive the
sums of income on the Notes.


 


b)
quantity of the Notes recorded to depo account of the person authorized to
receive the sums of income on the Notes;


 


c)
location and postal address of the person authorized to receive the sums of
income on the Notes;


 


г) banking information of the
person authorized to receive the sums of income on the Notes, including:


 


·              #
of account with the bank;


·              name
of the bank (and the city where the bank is located) with which the account was
opened;


·              corresponding
account of the bank, with which the account was opened;


·              bank’s
identification code of the bank, with which the account was opened (BIC);


·              taxpayer’s
identification # (TIN) of the payment recipient;


·              code
of reason for registration (CPP) of the person authorized to receive the sums
of income on the Notes.


 


d) tax
status of the person authorized to receive the sums of income on the Notes
(resident, non-resident with a permanent establishment in the Russian
Federation, non-resident without a permanent establishment in the Russian
Federation).


 


In
addition to the above, a nominal holder is required to file with NDC, and NDC
is obliged to include in the list of Notes owners and/or nominal holders for
receiving coupon income, the following information on individual and corporate
Note owners that are not tax residents of the Russian Federation, irrespective
of nominal holder’s authority to receive coupon income under the Note or
absence of such authority:


 


a) if
owner of the Notes is a corporate non-resident entity:


 


·  individual
identification number (IIN) – if applicable;


 


b) if
owner of the Notes is an individual:


 


·  kind, #, date and
place of issuance of the individual’s identification document, name of the
issuing agency;


·  the owner’s birth
day, month and year;


·  the owner’s place of
registration and postal address including zip code;


·  the owner’s tax
status;


·  the owner’s # of
state pension security certificate (if applicable);


·  the owner’s TIN (if
applicable).


·  code of reason for
registration (CPP) of the person authorized to receive the sums of coupon
income under the Note (if applicable).


 


The
Issuer’s obligations shall be considered fulfilled from the moment of writing
off respective cash funds from account of the Payment Agent.


 


The
Note owners, their authorized persons including NDC depositors shall themselves
be responsible for ensuring completeness and relevancy of information submitted
by them to NDC (information required to perform the obligations under the
Notes) including but not limited to banking data and information on the persons
authorized to receive the sums of income on the Notes.  In case of failure to submit such information
to NDC or failure to submit it in a timely manner, the above obligations shall
be executed towards the person who presented a claim on fulfillment of
obligations, and who is the Notes owner as at the date of presenting the
claim.  The Issuer shall in this case
fulfill the obligations under the Notes on the basis of data available to
NDC.  And in this case the Issuer’s obligations
shall be recognized fulfilled in full scope and in due manner.  If banking and other information provided by
owner or nominal holder or available to NDC and required by the Issuer to
perform its obligations under the Notes, prevent the Payment Agent from transferring
cash funds in a timely manner, such delay cannot be viewed as delinquency of
obligations under the Notes, and the Notes owner shall not be able to demand
accrual of interest or any other compensation for such delay of payment.


 


The
Issuer shall transfer the required cash funds for redemption of the Note to
account of the Payment Agent within the timeframe and under the procedures set
out in the Contract between the Issuer and the Payment Agent.


 


The Payment Agent shall compute the sum of cash
funds payable to each of the persons in the list of owners and/or nominal
holders of the Notes.


 


As at the Date of Income Payment on the Notes, the Payment Agent
shall transfer the required cash funds to accounts of the persons authorized to
receive the sums of income on the Notes and included in the List of
the Note Owners and/or Nominal Holders.


 


If one
person is authorized
to receive the sums of income on the Notes by several Note owners, such person
shall receive an aggregate amount not broken down by each Note owner.


 


If the Date of
Coupon Income Payment under the Notes is a non-working day, be it a day off
established by the state or a day off with respect of settlement transactions,
the relevant sum shall be paid on the first working day following such day
off.  Owner of the Notes shall not be
entitled to demand accrual of interest or any other compensation for such delay
of payment.


 


13

















 


2. Coupon:  Interest rate on the second coupon - C2 - shall be
established in accordance with the procedures set out in clause 9.3. of the
Decision on issuance of Securities and clause 9.1.2. of the Securities Issuance
Prospectus.


 


	
  The coupon period Opening date of the second coupon
  of the issue is the182nd day from the Opening date of the Notes placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the second coupon shall be paid on
  364th day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  
	
  The procedures for coupon income payment on the
  second coupon are the same and the procedures for coupon income payment on
  the first coupon.

  
	
   

  
	
  3. Coupon: Interest rate on the
  third coupon – C3 - shall be established in accordance with the procedures
  set out in clause 9.3. of the Decision on issuance of Securities and clause
  9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the third coupon
  of the issue is the364th day from the Opening date of the Notes placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the third coupon shall be paid on
  546th day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  
	
  The procedures for coupon income payment on the
  third coupon are the same and the procedures for coupon income payment on the
  first coupon.

  
	
   

  
	
  4. Coupon: Interest rate on the
  fourth coupon – C4 - shall be established in accordance with the procedures
  set out in clause 9.3. of the Decision on issuance of Securities and clause
  9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the fourth coupon
  of the issue is the546th day from the Opening date of the Notes placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the fourth coupon shall be paid on
  728th day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  
	
  The procedures for coupon income payment on the
  fourth coupon are the same and the procedures for coupon income payment on
  the first coupon.

  
	
   

  
	
  5. Coupon: Interest rate on the
  fifth coupon – C5 - shall be established in accordance with the procedures
  set out in clause 9.3. of the Decision on issuance of Securities and clause
  9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the fifth coupon
  of the issue is the728th day from the Opening date of the Notes placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the fifth coupon shall be paid on
  910th day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  
	
  The procedures for coupon income payment on the
  fifth coupon are the same and the procedures for coupon income payment on the
  first coupon.

  
	
   

  
	
  6. Coupon: Interest rate on the
  sixth coupon – C6 - shall be established in accordance with the procedures
  set out in clause 9.3. of the Decision on issuance of Securities and clause
  9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the sixth coupon
  of the issue is the910- day from the
  Opening date of the Notes placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the sixth coupon shall be paid on
  1092nd day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  
	
  The procedures for coupon income payment on the
  sixth coupon are the same and the procedures for coupon income payment on the
  first coupon.

  
	
   

  
	
  7. Coupon: Interest rate on the
  seventh coupon – C7 - shall be established in accordance with the procedures
  set out in clause 9.3. of the Decision on issuance of Securities and clause
  9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the seventh coupon
  of the issue is the1092nd day from the Opening date of the Notes placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the seventh coupon shall be paid on
  1274th day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  
	
  The procedures for coupon income payment on the
  seventh coupon are the same and the procedures for coupon income payment on
  the first coupon.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8. Coupon: Interest rate on the
  eighth coupon – C8 - shall be established in accordance with the procedures
  set out in clause 9.3. of the Decision on issuance of Securities and clause
  9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the eighth coupon
  of the issue is the1274th day from the Opening date of the Notes placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the eighth coupon shall be paid on
  1456th day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The procedures for coupon income payment on the
  eighth coupon are the same and the procedures for coupon income payment on
  the first coupon.

  



 


14

















 


9. Coupon: Interest rate on the
ninth coupon – C9 - shall be established in accordance with the procedures set
out in clause 9.3. of the Decision on issuance of Securities and clause 9.1.2.
of the Securities Issuance Prospectus.


 


	
  The coupon period Opening date of the ninth coupon
  of the issue is the1456th day from the Opening date of the Notes placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the ninth coupon shall be paid on
  1638th day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The procedures for coupon income payment on the
  ninth coupon are the same and the procedures for coupon income payment on the
  first coupon.

  
	
   

  
	
  10. Coupon: Interest rate on the
  tenth coupon – C10 - shall be established in accordance with the procedures
  set out in clause 9.3. of the Decision on issuance of Securities and clause
  9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the tenth coupon
  of the issue is the1638th day from the Opening date of the Notes placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the tenth coupon shall be paid on
  1820th day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon (interest)
  income:

  
	
   

  
	
  The procedures for coupon income payment on the
  tenth coupon are the same and the procedures for coupon income payment on the
  first coupon.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11. Coupon: Interest rate on the
  eleventh coupon – C11 - shall be established in accordance with the
  procedures set out in clause 9.3. of the Decision on issuance of Securities
  and clause 9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the eleventh
  coupon of the issue is the1820th day from the Opening date of the Notes
  placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the eleventh coupon shall be paid
  on 2002nd day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income: 

  
	
   

  
	
  The procedures for coupon income payment on the
  eleventh coupon are the same and the procedures for coupon income payment on
  the first coupon.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12. Coupon: Interest rate on the
  twelfth coupon – C12 - shall be established in accordance with the procedures
  set out in clause 9.3. of the Decision on issuance of Securities and clause
  9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the twelfth coupon
  of the issue is the2002nd day from the Opening date of the Notes placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the twelfth coupon shall be paid on
  2184th day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income: 

  
	
   

  
	
  The procedures for coupon income payment on the
  twelfth coupon are the same and the procedures for coupon income payment on
  the first coupon.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13. Coupon: Interest rate on the
  thirteenth coupon – C13 - shall be established in accordance with the
  procedures set out in clause 9.3. of the Decision on issuance of Securities
  and clause 9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the thirteenth
  coupon of the issue is the2184th day from the Opening date of the Notes
  placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the thirteenth coupon shall be paid
  on 2366th day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income: 

  
	
   

  
	
  The procedures for coupon income payment on the
  thirteenth coupon are the same and the procedures for coupon income payment
  on the first coupon.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14. Coupon: Interest rate on the
  fourteenth coupon – C14 - shall be established in accordance with the
  procedures set out in clause 9.3. of the Decision on issuance of Securities
  and clause 9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the fourteenth
  coupon of the issue is the2366th day from the Opening date of the Notes
  placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the fourteenth coupon shall be paid
  on 2548th day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income: 

  
	
   

  
	
  The procedures for coupon income payment on the
  fourteenth coupon are the same and the procedures for coupon income payment
  on the first coupon.

  
	
   

  
	
  15. Coupon: Interest rate on the
  fifteenth coupon – C15 - shall be established in accordance with the
  procedures set out in clause 9.3. of the Decision on issuance of Securities
  and clause 9.1.2. of the Securities Issuance Prospectus.

  
	
   

  
	
  The coupon period Opening date of the fifteenth
  coupon of the issue is the2548th day from the Opening date of the Notes
  placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the fifteenth coupon shall be paid
  on 2730th day from placement opening of
  the Notes issue.

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The procedures for coupon income payment on the
  fifteenth coupon are the same and the procedures for coupon income payment on
  the first coupon.

  
									



 


15

















 


	
  16. Coupon: Interest rate on the
  sixteenth coupon – C16 - shall be established in accordance with the
  procedures set out in clause 9.3. of the Decision on issuance of Securities
  and clause 9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the sixteenth
  coupon of the issue is the2730th day from the Opening date of the Notes
  placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the sixteenth coupon shall be paid
  on 2912th day from placement opening of
  the Notes issue. 

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  
	
  The procedures for coupon income payment on the
  sixteenth coupon are the same and the procedures for coupon income payment on
  the first coupon.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  17. Coupon: Interest rate on the
  seventeenth coupon – C17 - shall be established in accordance with the
  procedures set out in clause 9.3. of the Decision on issuance of Securities
  and clause 9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the seventeenth
  coupon of the issue is the2912th day from the Opening date of the Notes
  placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the seventeenth coupon shall be
  paid on 3094th day
  from placement opening of the Notes issue. 

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  
	
  The procedures for coupon income payment on the
  seventeenth coupon are the same and the procedures for coupon income payment
  on the first coupon.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  18. Coupon: Interest rate on the
  eighteenth coupon – C18 - shall be established in accordance with the
  procedures set out in clause 9.3. of the Decision on issuance of Securities
  and clause 9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the eighteenth
  coupon of the issue is the3094th day from the Opening date of the Notes
  placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the eighteenth coupon shall be paid
  on 3276th day from placement opening of
  the Notes issue. 

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  
	
  The procedures for coupon income payment on the
  eighteenth coupon are the same and the procedures for coupon income payment
  on the first coupon.

  
	
   

  
	
  19. Coupon: Interest rate on the
  nineteenth coupon – C19 - shall be established in accordance with the
  procedures set out in clause 9.3. of the Decision on issuance of Securities
  and clause 9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the nineteenth
  coupon of the issue is the3276th day from the Opening date of the Notes
  placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the nineteenth coupon shall be paid
  on 3458th day from placement opening of
  the Notes issue. 

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  
	
  The procedures for coupon income payment on the
  nineteenth coupon are the same and the procedures for coupon income payment
  on the first coupon.

  
	
   

  
	
  20. Coupon: Interest rate on the
  twentieth coupon – C20 - shall be established in accordance with the
  procedures set out in clause 9.3. of the Decision on issuance of Securities and
  clause 9.1.2. of the Securities Issuance Prospectus.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The coupon period Opening date of the twentieth
  coupon of the issue is the3458th day from the Opening date of the Notes
  placement.

  	
   

  	
  The coupon period Closing date shall be the date of
  payment of this coupon.

  	
   

  	
  Coupon income on the twentieth coupon shall be paid
  on 3640th day from placement opening of
  the Notes issue. 

  	
   

  	
  Income on the Notes shall be paid to the Notes
  owners that retain such status as at the end of NDC’s operating day preceding
  the third working day prior to the date of income payment under the Notes.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Procedures for payment of coupon
  (interest) income:

  
	
   

  
	
  The procedures for coupon income payment on the
  twentieth coupon are the same and the procedures for coupon income payment on
  the first coupon.

  
	
   

  
	
  For the purposes of income payment on the
  twentieth coupon the List of Notes owners and/or nominal holders produced for
  the Notes redemption shall be used.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Income on the twentieth coupon
  shall be paid simultaneously with redemption of the Notes.

  



 


9.5.
Availability and terms of premature redemption of the Notes


 


The Notes can be
redeemed prematurely on request of their owners.


 


The earliest possible date for claiming premature
redemption of the Notes:


 


Premature redemption
of the Notes shall not be possible before state registration of the Report on
the Securities Issuance Results, or after filing with the
registering body of a notice on the issuance results, provided that under the
Federal Law “On the Securities Market” and other federal laws, the Notes
issuance does not require state registration of a report on the securities
issuance results.


 


In case of premature
redemption of the Notes, the buy-out shall be executed at their nominal value.
Accrued coupon income (ACI) as at the Date of the Notes Premature Redemption
shall be additionally paid.


 


Owner of the Notes
shall be able to demand repayment of the Notes nominal value and accrued coupon
income on the Notes due to it in the following circumstances:


 


·  delisting of the Notes by all stock exchanges that included the Notes
in their quoting lists, provided that under the Federal Law “On the Securities Market” and other
federal laws, the Notes issuance does not require state registration of a
report on the securities issuance results;


·  delay for more than 7 (Seven) days of execution
by the Issuer of its obligations of coupon income payment on the Notes, after
the due date of the respective coupon income payment as per the Decision on
issuance of Securities and the Securities Issuance Prospectus;


·  declaration by the Issuer of its default on the financial obligations
towards owners of the Notes of the issue.


 


Owner of the Notes shall be able to demand repayment of the Notes
nominal value and accrued coupon income on the Notes due to it assessed in
accordance with clause 15. of the Decision on issuance of Securities and clause
10.10 of the Securities Issuance Prospectus.


 


16

















 


Last date
of presenting the Notes for premature redemption:


 


The
Premature Redemption Date – The Notes can be prematurely redeemed on demand of
their owners within 60 (Sixty) working days from the moment of disclosure by
the Issuer of the fact of the above circumstances in accordance with the
procedures set out in clauses 9.5. and 11(u) of the Decision on Issuance of
Securities, or from the date when of the fact of the above circumstances became
known or should have become known to owners of the Notes.


 


Terms and procedures for
premature redemption of the Notes:


 


Premature
redemption of the Notes shall be carried out on behalf of and on account of the
Issuer by a Payment Agent (hereinafter, The Payment Agent).  Functions of the Payment Agent shall be
performed by:


 


Full corporate name: Non-Commercial
Partnership “National Depository Centre”


Abbreviated corporate name: NDC


Location: Moscow
City, Middle Kislovskiy per., 1/13, building 4


 


If the date
of premature redemption of the Notes is a day off, be it a day off established
by the state or a day off with respect of settlement transactions, the relevant
sums shall be paid on the first working day following the day off.  Owner of the Notes shall not be entitled to
demand accrual of interest or any other compensation for such delay of payment.


 


In case of
premature redemption the Notes shall be repurchased at their nominal value. In
addition, the Issuer shall pay to the Notes owners the sums of accrued coupon
income as at the date of execution by the Issuer of its obligations wit respect
of premature redemption of the Notes assessed in accordance with clause 15. of
the Decision on issuance of Securities and clause 10.10 of the Securities
Issuance Prospectus.


 


Nominal
value of the Notes and accrued coupon income in connection with their premature
redemption shall be repaid as a bank transfer in RUR.


 


The Notes
prematurely redeemed by the Issuer cannot be put on the market.


 


In order to exercise
its right for premature redemption of the Notes, owner of the Notes that is an
NDC depositor, or nominal holder that is an NDC depositor authorized by the
Notes owner to act towards premature redemption of the Notes, shall perform the
following mandatory actions:


 


·  submit to the Issuer a request (application) in
a written form for premature redemption of the Notes (in accordance with the
requirements specified in the Decision on issuance of Securities and in the
Securities Issuance);


·   submit to
NDC an order issued in accordance with NDC requirements for transfer of the
Notes subject to premature redemption to the depo account section designated
for recording the Notes subject to premature redemption.


 


Request
(application) for premature redemption of the Notes shall be delivered to the
Issuer against its signature from 9 a.m. to 5 p.m. (Moscow time)
within 30 (Thirty) working days after the moment when the Notes obtained the
right to demand premature redemption of the Notes, or delivered by registered
mail with a return receipt to the Issuer’s postal address.


 


Request (application)
in a written form for premature redemption of the Notes shall be submitted with
the following attachments:


 


·               if the request is
signed by other person than the Notes owner, a document is to be attached
supporting the powers of the person who signed the request on behalf of the
Notes owner;


·               notarized sample of
signature of the person who signed the request on behalf of the Notes owner;


·               a copy of NDC report
certified by NDC on transfer of the Notes to the depo account section
designated for blocking securities at redemption.


 


Request (application)
for premature redemption of the Notes shall include the following:


 


·               statement of the
circumstance based on which the Note owner became entitled to demand premature
redemption;


·               for a corporate
Notes owner – name of the legal entity, location, TIN;


·               for an individual
Notes owner – surname, first, middle name, residential address, other passport
data, TIN (if assigned in accordance with applicable procedures;


·               quantity of the
Notes;


·               payment information
of income recipient:


 


1. full name (surname,
first, patronymic name) of the person authorized to receive the sums of income
on the Notes.


 


2. location and postal
address of the person authorized to receive the sums of income on the Notes;


 


3. banking information
of the person authorized to receive the sums of income on the Notes, including:


 


·               # of account with the bank;


·               corresponding account of the bank, with which
the account was opened;


·               bank’s identification code of the bank, with
which the account was opened (BIC);


·               taxpayer’s identification # (TIN) of the payment
recipient;


·               code of reason for registration (CPP) of the
person authorized to receive the sums of income on the Notes.


 


4. tax status of the
person authorized to receive the sums of redemption under the Notes (resident,
non-resident with a permanent establishment in the Russian Federation,
non-resident without a permanent establishment in the Russian Federation).


 


Non-residents and
individuals are required to provide the following information in the Request:


 


·             full
name/surname, first, patronymic name of the Notes owner;


·             full
name of the person authorized to receive the sums of redemption under the
Notes;


·             location
(or registration for individuals) and postal address including postal zip code
of the Notes owner


·               -             banking
information of the person authorized to receive the sums of redemption under
the Notes


·               taxpayer’s identification # (TIN) of the Notes
owner;


·             tax
status of the Notes owner


 


if owner of the Notes
is a corporate non-resident entity:


 


·             individual
identification number (IIN) – if applicable;


 


if owner of the Notes
is an individual:


 


·             kind,
#, date and place of issuance of the Notes owner’s identification document,
name of the issuing agency;


·             the
Notes owner’s TIN (if applicable);


·             the
Notes owner’s birth day, month and year).


 


Within 5 (Five)
working days from the moment of receiving the documents, the Issuer shall
review them for correctness, and provided that the submitted documents comply
with the terms set out in the Decision on issuance of Securities and the Securities
Issuance Prospectus the Issuer shall make cash transfer to benefit of the Notes
owner.


 


The Issuer shall make
cash transfer to account of the Payment Agent in the sum payable to the Notes
owner, and shall provide the Payment Agent with data required for making a
corresponding payment to benefit of the Notes owner.


 


Together with
notification, the Issuer shall provide copies of NDC reports on transaction on
the depo accounts of the Notes owners (nominal holders) supporting transfer of
the Notes to the depo account sections designated for accounting for the Notes
subject to premature redemption.


 


Within 2 (Two) days
after the date of receiving cash funds from the Issuer and of data required for
making corresponding payments to benefit of the Notes owners, the Payment Agent
shall transfer cash to benefit of the Notes owner, as per the enclosed
information.  Not later than the next
working day after the date of transfer, the Payment Agent shall inform the
Issuer and NDC depositor of the fact of transfer.


 


Obligations of the
Issuer shall be considered fulfilled from the moment of writing the respective
cash funds from account of the Payment Agent.


 


17

















 


If the submitted
documents do not meet the above requirements, the Issuer shall not later than
the fifth working day from the moment of receiving the above documents deliver
to the person who signed the request for the Notes redemption and to NDC a
notice on the reasons for declining the documents. The
Issuer shall submit information to NDC of the refusal to satisfy the Request
for Premature Redemption stating the name, surname, first and patronymic name
of individual owner, quantity of the Notes, and name of the Depository which
opened an account to the owner.


 


Having received such a
notification, the person who signed the request does not loose the right to
resubmit the request for premature redemption of the Notes.


 


After the Issuer
fulfills is obligations of premature redemption of the Notes, NDC shall write
the redeemed Notes off the depositor’s account with NDC and record them to the
respective issuance depo account section designated for accounting for redeemed
Notes with NDC.


 


If the date of
premature redemption of the Notes is a day off, be it a day off established by
the state or a day off with respect of settlement transactions, the relevant
sums shall be paid on the first working day following the day off.  Owner of the Notes shall not be entitled to
demand accrual of interest or any other compensation for such delay of payment.


 


It is presumed that
nominal holders – depositors of NDC are duly authorized to receive the sums
paid in connection with premature redemption of the Notes and/or
conduct other actions required for premature redemption of the Notes to benefit of the Notes owners.


 


The procedures for disclosure
of information on premature redemption of the Notes:


 


on news
lines (AK&M or Interfax or ANO “AZIPI”) – within 1 (One) day;


 


· on Internet website - www.mts.ru -
within 2 (Two) days.


 


This information
shall be published not later than the 1 (First) working day before the Notes
Placement Opening.


 


Should the
Issuer fail to take such decision, interest rates for all coupons starting from
the second one, shall be established as equal to the first coupon interest
rate.


 


Within 1
(One) working day after the date of occurrence of the event that enables the
Notes owner to demand premature redemption of the Notes the Issuer shall
publish information on news lines (AK&M or Interfax or ANO “AZIPI”), and
within 2 (Two) days after the above date the Issuer shall put information on
its Internet website - www.mts.ru, stating the following:


 


· description of
the event enabling the Notes owners to demand premature redemption of the
Notes;


· the date when the
event occurred;


· possible actions
of the Notes owners towards satisfaction of their claims on premature
redemption of the Notes.


 


Publication
on the Internet website shall be done after publication on the news line.


 


After the
Notes were prematurely redeemed by the Issuer, the Issuer shall announce the
time of exercising its obligations.


 


The above
information (including the quantity of redeemed Noted) shall be published
within the following timeframe after the last date of exercising the
obligations:


 


· on news lines
(AK&M or Interfax or ANO “AZIPI”) – within 1 (One) day;


· on Internet
website - www.mts.ru - within 2 (Two) days.


 


Publication
on the Internet website shall be done after publication on the news line.


 


9.6.
Information of payment agents on the notes


 


Coupon
(interest) income and sums of redemption (premature redemption) shall be paid
via the Payment Agent.


 


The Payment Agent:


 


Full
corporate name: Non-Commercial Partnership “National Depository Centre”


 


Abbreviated
corporate name: NDC


 


Location:
Moscow City, Middle Kislovskiy per., 1/13, building 4


 


Postal
address: 105062, Russia, Moscow City, Mashkova street, 13, building. 1.


 


The Payment Agent shall perform the following
functions:


 


1. On behalf and on
account of the Issuer, shall transfer cash funds to the persons included in the
List of Notes owners and/or Nominal Holders entitled to receive coupon
income/sums of redemption (here below in this clause, The List of Notes Owners
and/or Nominal Holders) in the amounts, within the timeframe and under the
procedures established by the Decision on issuance of securities, the
Securities Issuance Prospectus, and the Agreement between the Issuer and the
Payment Agent.


 


The Issuer shall make
preliminary transfer of the cash funds designated for Payments under the Notes
to be executed by the Payment Agent to the bank account indicated by the
Payment Agent under the procedures and within the timeframe specified in the
Agreement between the Issuer and the Payment Agent.


 


2. Provide information
to NDC depositors and to all concerned parties regarding the time and terms of
coupon income payment under the Notes and/or redemption of the Notes by way of
placement of the above information on NDC’s website: www.ndc.ru.


 


3. Ensure
confidentiality of information received by the Payment Agent in the course of
execution of its obligations provided this information is not public and is not
required for disclosure by legal and regulatory acts of the Russian Federation.


 


The Issuer shall be
able to appoint other payment agents or annul such appointments.


 


It is presumes that
the Issuer cannot simultaneously appoint several payment agents.


 


The Issuer
shall publish an official announcement of the above actions within 3 (Three)
working days from the date of such appointments or their annulment on news line
(AK&M or Interfax or ANO “AZIPI”) and in its Internet website – www.mts.ru.


 


9.7.
Information on actions of the Notes owners and on the disclosure procedures in
case of default on the Notes:


 


As required
by Articles 809 and 810 of the RF Civil Code, the Issuer is obliged to repay to
the Notes owners at redemption the nominal value of the Notes and coupon income
within the timeframe and under the procedures established by the Decision on
Issuance of Securities and the Securities Issuance Prospectus.


 


The Issuer’s
failure to fulfill the obligations under the Notes shall represent a material
violation of the loan agreement (default) in case of:


 


· overdue obligation of the next interest income (coupon) payment under
the Notes for over 7 (Seven) days, or refusal to fulfill the above obligation;


· overdue obligation of repayment of the principal on the Notes for over
30 (Thirty) days, or refusal to fulfill the above obligation.


 


Delay in execution of
the respective obligations, but not exceeding the above time limits shall
represent a technical default.


 


In case of default or
technical default on the Notes, together with repayment of overdue sums the
Issuer shall pay interest to the Notes owners, as required by Article 395
of the Russian Federation Civil Code.


 


In the event of
default owners of the Notes shall be entitled to demand that the Issuer repay
the nominal value of the Note and/or income on it, as well as interest for late
redemption of the Notes and/or income on the Notes, as per Articles 395 and 811
of the Russian Federation Civil Code.


 


In the event of
technical default owners of the Notes shall be entitled to demand that the
Issuer repay interest for late execution of obligations under the Notes, as per
Articles 395 and 811 of the Russian Federation Civil Code.


 


In the event of
failure to comply/properly comply with its obligations under the Notes
(including in the event of default and/or technical default) owners and/or
nominal holders shall be entitled to demand that the Warrantor – the party that
provided surety for the Notes in accordance with the procedures defined in
clause 12. of the Decision on Issuance of Securities, and clause 9.1.2 of the
Securities Issuance Prospectus


 


The Warrantor that has
provided surety shall be jointly liable with the Issuer for the Issuer’s
failure to comply (properly comply) with its obligations under the Notes.


 


18

















 


Procedures for
addressing claims to the Issuer:


 


In the event of the Issuer’s default or technical
default on the Notes, owners of the Notes, their authorized representatives
shall be entitled to demand that the Issuer repay the following:


 


1) in the event of
default: the nominal value of the Note and/or income on it, as well as interest
for late redemption of the Notes and/or income on the Notes, as per Articles
395 and 811 of the Russian Federation Civil Code.


2) in the event of technical default: interest for
late execution of obligations under the Notes, as per Articles 395 and 811 of
the Russian Federation Civil Code.


 


Claim should be presented to the Issuer in written
form, under the name “The Claim”, signed by the Notes owner, a person
authorized by the Notes owner, or a person authorized by nominal holder of the
Notes.


 


A Claim should be delivered by registered mail with
return receipt and inventory of contents to the Issuer’s postal address shown
on title page of the Decision on Issuance of Securities, or delivered
against signature to the Issuer’s authorized person.


 


If in connection with technical default on payment of
the next due interest (coupon) the Issuer has repaid the payable sum of coupon
interest within 7 (Seven) days from the due date, but failed to pay interest on
later income payment on the Notes as per Article 395 of the Russian
Federation Civil Code, the Notes owners or the persons authorized by them shall
be entitled to demand that the Issuer make payment of such interest.  In this case within 5 (Five) days after
receiving the Claim of the Notes owners the Issuer shall consider such Claim,
and within 3 (Three) working days from the date of accepting the Claim shall
transfer the payable sums to address of the Notes owners who filed the Claim.


 


The procedures for presenting claims against the
Issuer in case of a delay by the Issuer in execution of its obligations of
coupon income payment on the Notes or its refusal to execute such obligations
exceeding 7 (Seven) days from the date of payment of the respective income
defined in accordance with clause 9.5. of the Decision on Issuance of
Securities, and clause 9.1.2 of the Securities Issuance Prospectus.


 


In case of a delay in execution of the obligation of
repayment of the principal on the Notes or refusal to execute such obligation
the Notes owners or the persons authorized by them shall be entitled to file a
claim demanding repayment of the principal on the Notes and of interest for
late redemption of the Notes, as per Article 395 of the Russian Federation
Civil Code, starting from the day following the due date for execution of the
obligation.  In this case within 5 (Five)
days from the date of receiving the Claim of the Notes owners, the Issuer shall
consider the Claim and shall no later than 30 (Thirty) days from the due date of
execution of the obligation on repayment of the principal transfer the sums
payable to address of the Notes owners who filed the Claim.


 


In case of refusal by the Issuer’s authorized
representative to receive the Claim against signature or if registered mail of
the Claim or letter directed to postal address of the Issuer were not delivered
because of the Issuer’s absence at the specified address, or in case of the
Issuer’s or the Warrantor’s refusal to satisfy the Claim, the Notes owners, the
persons authorized by them shall be entitled to apply to court or to
arbitration with a claim for collection of the respective amounts against the
Issuer or the Warrantor.


 


In case of the Issuer’s failure to transfer or
transfer in full the sums of the principal on the notes and interest for later
redemption of the Notes due to the Notes owners as per Article 395 of the
Russian Federation Civil Code, within 30 (Thirty) days from the due date of
execution of the obligation on repayment of the principal owners of the Notes
or persons authorized by them shall be entitled to apply to court or to
arbitration with a claim for collection of the respective amounts against the
Issuer or the Warrantor.


 


Procedures
for filing a claim with a court or an arbitration.


 


If owners of the Notes
are unable to obtain satisfaction of their claims with respect of the Notes
owned by them and presented to the Issuer and/or the Warrantor, owners of the
Notes shall be able to file a claim against the Issuer and/or the Warrantor
with a court or arbitration.


 


Individual owners of
the Notes shall be entitled to apply to general jurisdiction court at location
of the respondent, and legal entities and individual businessmen that own the
Notes shall be entitled to apply to arbitration at location of the respondent.


 


Statute of
limitation for filing claims with an arbitration or court of general
jurisdiction against the Issuer by the Note owners, persons authorized by them,
including nominal holders of the Notes shall be 3 (Three) years (Article 196 of
the Russian Federation Civil Code).


 


Statute of limitation for filing
claims with an arbitration or court of general jurisdiction against the
Warrantor by the Note owners, persons authorized by them shall be 1 (One) year from the Date of the
Notes Redemption and (or) the date of coupon repayment (Article 367.4 of
the Russian Federation Civil Code).


 


Statute of limitation shall be
counted from the Date of the Notes Redemption and (or) the date of coupon
repayment (Article 200.2 of the Russian Federation Civil Code).


 


Civil cases shall be under competence of courts
of general jurisdiction in accordance with Article 22 of the Russian Federation Civil Practice Code.  As provided for in the above
Article, courts of general jurisdiction
shall consider and resolve the claims related to protection of violated or
disputed rights, freedoms and lawful interests, disputes arising from civil,
family, labor, housing, land, environments and other legal relations, where
citizens, organizations, governmental authorities, local administrations act as
a party.


 


Competence of arbitration over cases was
established by Article 27 of the Russian Federation Arbitration Practice Code. 
As provided for in the above Article, arbitration shall have competence
over cases of economic disputes and other cases related to entrepreneurial and
other activities.


 


Arbitration shall resolve
economic disputes and consider other cases where a party is represented by
organizations being legal entities, individuals conducting entrepreneurial
activities without a legal entity and having the status of individual
businessman obtained in accordance with the established legal procedure
(hereinafter, “individual businessmen”), and in the cases specified in the Russian Federation Arbitration Practice Code and other federal laws, by the
Russian Federation, Russian Federation constituents, municipalities, state
authorities, local administrations, other agencies, officials, bodies having no
legal entity status, and citizens having no status of an individual
businessman.


 


Procedures for disclosure on failure to comply or
properly comply with obligations on the notes:


 


If the Notes owners are unable to
get satisfaction of the claims with respect of the Notes owned by them and
addressed to the Issuer and/or the Warrantor, the Notes owners shall be entitled to apply to
court or to arbitration with a claim against the
Issuer and/or the Warrantor.


 


Individual Note owners shall in
this case be able to apply to court of general jurisdiction at location of the
defendant, and corporate Note owners and individual businessmen – Note owners
shall be able to apply to arbitration at location of the defendant.


 


If the
Issuer fails to execute and/or properly execute its obligations under the Notes
(including in case of default or technical default), the Issuer shall publish
an announcement of its failure to execute and/or properly execute its
obligations to the Notes owners, stating:


 


·      the volume of defaulted obligations;


·      the reason for the default;


·      the list of actions that the Notes owners may
potentially take to satisfy their claims.


 


The Issuer
shall publish the above information within the following timeframe from the
date of failure to execute and/or properly execute The Issuer’s obligations
under the Notes:


 


· on news line
(AK&M or Interfax or ANO “AZIPI”) – within 1 (One) day;


 


19

















 


· on
its Internet website – www.mts.ru– within 2 (Two) days.


 


The
announcement in Internet shall be published after the publication on the news
line.


 


10.
Information on repurchase of the notes


 


The procedures for repurchasing the Notes on
demand of their owner(s) with subsequent trade operations with the Notes;
the timeframe of applications for such repurchase:


 


It is presumed that
the Issuer shall repurchase the Notes on demand of their owners and further
shall be able to trade them until maturity, in accordance with the terms
specified in this clause. The Issuer shall be able to repurchase the Notes of
this issuance after registration of
the Report on the Securities Issuance with governmental authorities, or after
filing with the registering body of a notice on the issuance results, provided
that under the Federal Law “On the Securities Market” and other federal laws,
the Notes issuance does not require state registration of a report on the
securities issuance results.


 


The Issuer is obliged
to ensure the Notes owners’ right to demand repurchase by the Issuer of the
Notes within the last 5 (Five) working days of the Notes coupon period
preceding the coupon period for which the rate of interest was established by
the Issuer (hereinafter, The Period of Filing for Repurchase of the Notes by
the Issuer) after opening of the Notes placement.  Owners of the Notes shall be able to demand
that the Issuer repurchase the Notes in the situations described in clause 9.3.
of the Decision on Issuance of Securities, and clause 9.1.2. of the Prospectus.


 


The procedures for repurchase
of the Notes:


 


The Issuer shall
repurchase the notes via MICEX Stock Exchange (hereinafter, The Market Maker)
in accordance with the regulatory documents applicable to activities of the
securities market maker


 


In case of
reorganization or liquidation of the Market Maker, or if repurchase by the
Issuer of the Notes through the Market Maker under the procedures established
by the Decision on Issuance of Securities, and the Securities Issuance
Prospectus does not comply with the RF legislation, the Issuer shall have to
select another securities market maker through which the Issuer shall make the
Notes repurchase deals.


 


In this case the
Issuer shall repurchase the Notes in accordance with the regulations applicable
to activities of such securities market maker, and the Issuer shall in addition
to announcement of the coupon interest rate (starting from the second coupon)
publish information of the securities market maker through which the Issuer
shall make the Notes repurchase deal. 
The above information shall include:


 


· full and abbreviated name of the securities
market maker;


· its location;


· license information: #, Date of issuance,
Validity period, the body that issued the license;


 


The Issuer’s
agent acting on behalf and on account of the Issuer for repurchasing the Notes
on request of their owners (hereinafter, The Agent for Repurchasing the Notes
on Request of Their Owners) shall be the Underwriter.


 


The Issuer
can reassign the functions of the Agent for Repurchasing the Notes on Request
of Their Owners to another person that will be able to exercise all actions
required for the repurchase, as per this clause and the RF legislation.  In this case, the Issuer shall be obliged to
publish an announcement providing the following information:


 


·             full and abbreviated name of the
person, to which the functions of the Agent for Repurchasing the Notes on
Request of Their Owners were reassigned;


·             its location, and also address and
fax.# for delivery the applications in accordance with the procedures provided
here below;


·             information of the license for
conducting professional activities on the securities market: #, Date of
issuance, Validity period, the body that issued the license;


·             confirmation of the fact that the
appointed Agent for Repurchasing the Notes on Request of Their Owners is a
trade participant of the Market Maker, through which the repurchase shall be
carried out.


 


This information
announcement shall be published not later than 30 (Thirty) days before the
Repurchase Date established in accordance with the procedures provided here
below in the following sources of information:


 


·              on news line of information agencies AK&M or Interfax
or ANO “AZIPI”;


·              on the website in Internet (www.mts.ru);


 


The announcement in
Internet shall be published after the publication on the news line.


 


In order to implement
its right to sell the Notes, the trade participant that owns the Notes and wishes
to sell the Notes, or the person authorized by its client being the Notes owner
to sell the Notes at its account and on its behalf (hereinafter, The Acceptant)
shall perform two actions:


 


1) submit to the Agent
for Repurchasing the Notes on Request of Their Owners an application signed by
the Acceptant (hereinafter, The Application). The Application can be accepted
in any working day, but exclusively within the Submission Period (as defined
here above), and should include the following information:


 


·              full name of the Acceptant;


·              state registration # and date of state
registration of the Notes;


·              quantity of the Notes, which the Acceptant
intends to sell to the Issuer (in figures and words);


·              location u postal address of the Acceptant.


 


2) From 11 a.m.
to 1 p.m. Moscow time on the Repurchase Date (as defined here below), the
Acceptant that previously transferred the above Application to the Agent for
Repurchasing the Notes on Request of Their Owners shall submit an addressed
applications for sale of a specified quantity of the Notes via the Market Maker’s
Trading System in accordance with Rules of Securities Trading and/or other
rules of the Market Maker which regulate its activities.  The Application shall be address to the Agent
for Repurchasing the Notes on Request of Their Owners that is a Trade
Participant, and shall indicate a Purchasing Price, as defined here below, in
percentage of nominal value of the Notes, and settlement code T0.


 


Quantity of the Notes
stated in the application should not exceed the Notes quantity previously
stated in the Application submitted by the Acceptant to the Agent for
Repurchasing the Notes on Request of Their Owners.


 


The Application should
be received in any of the working days within the Submission Period.


 


The Application shall
be addressed to postal address of the Agent for Repurchasing the Notes on
Request of Their Owners.


 


The Application shall
be deemed received by the Agent for Repurchasing the Notes on Request of Their
Owners from the moment of its handling to the addressee, or refusal by the
addressee to receive it supporting by a relevant document.  The Issuer shall not have any obligations of
repurchasing the Notes from owners and/or the Acceptants that have not submitted
their Applications within the applicable timeframe, or have submitted the
Applications that do not comply with the above requirements.


 


The Issuer shall
accept an extract from the register of applications as an adequate confirmation
of submission by the Acceptant of an application for sale of the Notes in
accordance with the terms for repurchasing the Notes.  The extract shall be made in the form of a
relevant application to the Rules of the Market Maker for Conducting Trade
in Securities and/or Other Papers, certified by signature of an authorized
person.


 


The Issuer undertakes
that in the period from 4 p.m. to 6 p.m. Moscow time on the
Repurchasing Date it shall make deals via the Agent for Repurchasing the Notes
on Request of Their Owners with all Acceptants by way of submitting addressed counter
applications to the ones submitted in accordance with action 2, and maintained
in the trading system as at the moment of making the deal.


 


The addressed counter
applications submitted in accordance with action 2 by the Acceptants that have
earlier submitted the Applications under the applicable procedures, shall be
satisfied by the Agent for Repurchasing the Notes on Request of Their Owners
within the Notes quantity indicated in the addressed applications submitted by
the Acceptants, and at the price established by the Decision on Issuance of
Securities, and the Prospectus. 
Obligations of the parties (The Notes Issuer and the Acceptant) for
repurchasing the Notes shall be considered fulfilled from the moment of
transfer of title to the repurchased Notes to the Issuer (recording of the
Notes to issuance account of the Issuer) and repayment for the Notes by the
Issuer (fulfillment of the condition “delivery against payment” in accordance
with CJSC MICEX Rules for Conducting Clearing Activities on the Stock
Market).


 


If the Issuer’s deal
or several deals of purchasing its own Notes is recognized as major deals or
deals with interest, such deals should be approved as required by the Russian
Federation law.


 


The Notes repurchased
by the Issuer shall be received to the depo account with NDC.  Subsequently, the Notes repurchased by the
Issuer may be again submitted for trade operations at secondary market
(provided that the Issuer complies with the Russian Federation law).


 


On expiry of the
period established for repurchasing the Notes by the Issuer, the Issuer shall
publish information on the timeframe for execution of its liabilities.


 


The above
information (including quantity of repurchased notes) shall be published within
the following timeframe from the moment of occurrence of the material fact:


 


20














 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


·              on the website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


Information on
repurchase of the notes on demands of their owners shall be disclosed together
with information on the interest rates defined for coupons:


 


Information on
the interest rates defined by the Issuer for coupons of the Notes starting from
the second coupon shall be communicated to potential purchasers by way of an
announcement of material facts in accordance with the procedures and timeframe
set in clause 11 of the Decision on Issuance of Securities, and in clause 2.9.
of the Securities Issuance Prospectus.


 


Timeframe for repurchasing the notes and the
procedures for establishing it:


 


2nd (Second) working day
from the completion date of the Period for Submission of the Notes for
Repurchase by the Issuer


 


Purchasing price of the Notes:


 


100% (One
hundred per cent) of the Notes nominal value.


 


If a purchase
and sale deal is made on the Date of Purchasing the Notes, the Issuer shall
additionally pay to the Owners the accrued coupon income on the Notes (ACI).


 


The procedures for repurchase by the Issuer of the
Notes under agreement with the Notes owners:


 


The Issuer may
be able to repurchase the Notes under agreement with their owner(s) and
further use the Notes for trading until expiry of the redemption period on the
terms set by the Decision on Issuance of Securities and the Securities Issuance
Prospectus.


 


The Issuer may
be able to repurchase the Notes of this issue after registration of the Report
on the securities issuance, or after filing with the registering body of a
notice on the issuance results, provided that under the Federal Law “On the
Securities Market” and other federal laws, the Notes issuance does not require
state registration of a report on the securities issuance results.


 


The Issuer shall
repurchase the Notes under the terms set by the Decision on Issuance of
Securities, the Securities Issuance Prospectus, and individual decisions by the
Issuer regarding purchase of the Notes taken by the Issuer’s authorized body in
accordance with the Charter.


 


The Issuer shall
take decision on repurchasing the Notes on the basis of provisions of the
Decision on Issuance of Securities, and the Securities Issuance
Prospectus.  Several decisions on
repurchasing the Notes can be taken.


 


Decisions on
repurchasing the Notes shall be taken by the Issuer’s authorized body and shall
specify the price, timeframe, and procedures for repurchasing the Notes.


 


Decision of the
Issuer’s authorized body on repurchase of the Notes under agreement with the
Notes owners shall include the following:


 


·             quantity of the Notes to be
repurchased;


·             time period within which the Notes
owners can accept the Issuer’s offer of repurchasing the Notes;


·             date of repurchasing the Notes;


·             purchasing price of the Notes or
procedures for defining it;


·             full and abbreviated corporate names,
location of the agent for repurchase of the notes under agreement with their
owners; #, date of issuance and validity period of the license for brokerage
operations, the body that issued the above license.


 


The Notes shall
be repurchased under agreement with their owners by an agent for repurchasing
the notes under agreement with their owners acting on the Issuer’s behalf and
account (hereinafter, The Agent for Repurchasing the Notes Under Agreement with
Their Owners).


 


Owner of the
Notes or a person authorized by the owner including nominal holder of the Notes
shall send a letter by registered mail with return receipt and inventory of
contents to postal address of the Agent for Repurchasing the Notes Under
Agreement with Their Owners, or shall deliver against signature of authorized
person of the Agent for Repurchasing the Notes Under Agreement with Their
Owners a written notification of its intension to sell a certain amount of
Notes to the Issuer (hereinafter, The Notification”).


 


The Notification
should be accepted by the Agent for Repurchasing the Notes Under Agreement with
Their Owners or delivered to authorized person of the Agent for Repurchasing
the Notes Under Agreement with Their Owners within the period for accepting the
Issuer’s offer of repurchasing the Notes by the Notes owners.


 


The Notification
shall be deemed received by the Agent for Repurchasing the Notes Under
Agreement with Their Owners , provided that:


 


·             the return receipt for the postal
delivery is market as mail accepted by the Agent for Repurchasing the Notes
Under Agreement with Their Owners;


·             the notice of postal delivery is
marked as mail delivery rejected by the Agent for Repurchasing the Notes Under
Agreement with Their Owners;


·             the Notification was not delivered to
the Agent for Repurchasing the Notes Under Agreement with Their Owners because
of its absence at the address to which the post correspondence was directed.


 


The Notification
shall be deemed received by an authorized person of the Agent for Repurchasing
the Notes Under Agreement with Their Owners , provided that:


 


·             a copy of the Notification retained
by the Notes owner or by a person authorized by the owner including nominal
holder of the Notes is signed off as received by the authorized person of the
Agent for Repurchasing the Notes Under Agreement with Their Owners;


·             the Notification bears a mark that
the authorized person of the Agent for Repurchasing the Notes Under Agreement
with Their Owners refused to accept the Notification, and such mark is certified
as true by unrelated persons.


 


The Notification
shall be produced in the following form:


 


“Hereby we
                                        
(Surname, first and middle names of individual Notes owners, full name
(corporate name) and State Registration # (OGRN) of corporate Notes owner;
Surname, first and middle names of individual Notes owners, full name
(corporate name) and State Registration # of authorized person of the Notes
owner, including nominal holder of the Notes), TIN                           ,
form of our intention to sell to Open Joint Stock Company Mobile TeleSystems
documentary interest-bearing non-convertible bearer Notes of series 01 with
mandatory centralized storage, state registration # of the issue
                        
of                 ,
owned by
                                    
(Surname, first and middle names of individual Notes owners, full name
(corporate name) and State Registration # (OGRN) of corporate Notes owner)
under the terms and conditions of clause 10. of the Decision on Issuance of
Securities, and clause 9.1.2. of the Securities Issuance Prospectus.


 


Quantity of the Notes offered for
sale (in figures and its letters):


 


                                                                                                                        .


Name of the Trade Participant
that on the date of Purchasing the Notes on behalf and on account of the Notes
owner shall put in MICEX Stock Exchange Trading System an offer of Notes for
sale addressed to the Agent for Repurchasing the Notes Under Agreement with
Their Owners (of owner of the Notes is not a Trade Participant):


 


                                                                                                                        .


 


                                             


[Signature of the individual
Notes owner, its authorized person, including authorized person of nominal
holder of the Notes, authorized person of corporate Notes owner including
authorized person of nominal holder of the Notes]   

[Seal of corporate Notes owner; or nominal holder of the Notes]”


 


The Notification
is supplemented by Power of Attorney or other documents supporting posers of
the authorized persons of the Notes owner, including nominal holder, for
signing the Notification.


 


21

















 


The Issuer shall
not be required to purchase the Notes under agreement with the Notes owners
that have not ensured timely delivery of the Notifications to the Agent for
Repurchasing the Notes Under Agreement with Their Owners or handling to
authorized person of the Agent for Repurchasing the Notes Under Agreement with
Their Owners, have not produced the Notification in accordance with the
established form.


 


If owners of the
Notes accept the Issuer’s offer of repurchasing the Notes in larger quantity of
the Notes than the one indicated in the above offer, the Issuer shall
repurchase the notes from the Notes owners proportionally to the presented
claims, provided that only whole quantity of the Notes shall be purchased.


 


The Notes shall
be purchased under agreement with the Notes owners during MICEX Stock Exchange
trading sessions in accordance with MICEX Stock Exchange Rules of Trade
and other regulatory documents of MICEX Stock Exchange and regulatory documents
of CJSC MICEX.


 


From
11 a.m. to 1 p.m. Moscow time on the Notes Repurchase Date owner of
the Notes that is a Trade Participant or a Trade Participant acting on behalf
and on account of the Notes owner that is not a Trade Participant shall submit
an applications for sale of the Notes via MICEX Stock Exchange Trading System
in accordance with MICEX Stock Exchange Rules of Trading addressed to the
Agent for Repurchasing the Notes Under Agreement with Their Owners and
indicating a Purchasing Price and settlement code T0.


 


The fact of
existence of an offer for sale of the Notes shall be supported by extract from
the register of applications made in the form established by regulatory
documents of MICEX Stock Exchange and certified by signature of authorized
representative of MICEX Stock Exchange


 


From 4 to
6 p.m. Moscow time on the Date of Repurchasing the Notes, the Agent for
Repurchasing the Notes Under Agreement with Their Owners shall on the Issuer’s
behalf and in the Issuer’s name make deals of purchasing the Notes under
agreements with the Notes owners, with the Notes owners who are Trade
Participants, or with Trade Participants acting on behalf and on account of the
Notes owners, by way of submitting counter applications for purchasing the
Notes via MICEX Stock Exchange Trading System to the Notes owners who are Trade
Participants, or with Trade Participants acting on behalf and on account of the
Notes owners.


 


If the deal of
purchasing the Notes under agreement with Notes owners shall have the features
of a major deal and/or a deal with interest, such deals should be approved as
required by the Russian Federation law.


 


On expiry of the
period established for repurchasing the Notes by the Issuer, the Issuer shall
publish information on the timeframe for execution of its liabilities.


 


The Issuer’s
obligation of repurchasing the Notes under agreement with Notes owners shall be
deemed fulfilled at the moment when cash funds are received in the amount equal
to the Notes purchasing price of the relevant quantity of the Notes and ACI on
the Notes to account of the Notes owner that is a Trade Participant, or of the
Trade Participant acting on behalf and on account of the Notes owner in
accordance with the terms of clearing operations conducted by CJSC MICEX.


 


Obligations of
the Notes owner shall be exercised on the terms “delivery against payment” and
shall be deemed fulfilled at the moment of recording the relevant number of the
Notes indicated in the offer for sale of the Notes to the Issuer’s depo account
with NDC.


 


The Notes
purchased under agreement with the Notes owners shall be received to the
Issuer’s depo account with NDC, and subsequently, may be again submitted for
trade operations until the Date of the Notes Redemption.


 


Timeframe for repurchasing the notes by the Issuer,
and the procedures for defining it:


 


The Issuer shall
not be able to repurchase the Notes before registration of the Report on the
securities issuance results by authorized federal regulator of the securities
market, or filing with the registering body of a notice on the Notes issuance
results.


 


The procedures for disclosure by the Issuer of
information on repurchase of the notes:


 


The Issuer shall be required to publish an announcement for owners of
the notes on the Issuer’s decision on repurchase of the Notes under agreement
with their owners within the following time from the date when authorized
Issuer’s body issued minutes of its meeting that took such decision (expiration
date of the period established by the Russian Federation law for issuing
minutes), but not later than 7 (Seven) days for the opening date of acceptance
of the offers on repurchase of the notes:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


The announcement to owners of the notes regarding the decision on
repurchase of the Notes shall include the following information:


 


·               the
date when the decision on repurchase (redemption) of the Notes of the issue
under agreement with their owners, was taken;


·               series
and from of the Notes, state registration # and date of state registration of
the Notes of the issue;


·               quantity
of the Notes to be repurchased;


·               time period during
which owners of the Notes can accept the Issuer’s offer to purchase the Notes;


·               date
of repurchase by the Issuer of the Notes of the issue;


·               repurchasing
price of the Notes of the issue or the procedures for defining it;


·               full
and abbreviated corporate names, location of the Agent for Repurchasing the
Notes Under Agreement with Their Owners, #, date of issuance, and validity
period of the license for brokerage activities, the body that issued the above
license.


 


The above
information on the Issuer’s decision to repurchase the Notes under agreement
with their owners shall constitute an irrevocable public offer for a purchase
and sale contract regarding the Notes, including all material terms of the
purchase and sale contract for the Notes of the issue, which makes it clear
that the Issuer wishes to repurchase the Notes on the terms specified in the
publication from any Notes owner that expressed its wish to accept the offer.


 


In connection
with repurchasing by the Issuer of its own Notes under agreements with the
Notes owners, the Issuer shall publish information on repurchase of the Notes
(stating, in particular, the quantity of repurchased Notes) in the form of an
announcement of a material fact within the following period after the closing
date of the Notes repurchase defined in accordance with the Decision on
Issuance of Securities and the Securities Issuance Prospectus:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


11.
The procedures for disclosure by the Issuer of information on issuance of
securities


 


The Issuer shall
disclose information on the issuance in accordance with provisions of the
Russian Federation legislation on securities under the procedures and terms
specified in the Decision on Issuance of Securities and the Securities Issuance
Prospectus.  Should at the moment of
occurrence of an event that is to be disclosed by the Issuer, other
requirements on the procedures and terms of disclosure have been established by
effective federal laws and regulatory acts issued by federal executive body on
the securities market than those set out in the Decision on Issuance of
Securities and the Securities Issuance Prospectus, then disclosure of such
event shall be carried out in accordance with the procedures and terms required
by federal laws and regulatory acts issued by federal executive body on the
securities market having effect at the moment of occurrence of such event.


 


a) The Issuer
shall announce the fact of decision taken on placement of the Notes in the form
of announcement of a material fact “information on phases of the securities
issuance procedure” within the following timeframe from the date of production
of the relevant minutes (expiry date established by the Russian Federation law
regarding production of minutes) of the meeting of the Issuer’s authorized body
that has taken such decision:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


22

















 


b) The Issuer
shall publish information on issue of the Notes in the form of an announcement
of a material fact “information on phases of the securities issuance procedure”
within the following timeframe from the date of production of the relevant
minutes (expiry date established by the Russian Federation law regarding
production of minutes) of the meeting of the Issuer’s authorized body that has
taken such decision:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


c) The Issuer
shall disclose information on issue of the Notes in the form of an announcement
of a material fact “information on phases of the securities issuance procedure”
(information of state registration of the securities issuance) within the
following time period, counting from the date of publication by the Issuer of
an announcement of state registration of the Notes issue on website of the
registering authority, or from delivery to the Issuer of a written notice of
the registering authority supporting the fact of state registration of the
Notes issue sent via mail, facsimile, e-mail, delivery against signature,
depending on what takes place first:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


The Issuer shall
publish the text of the registered Decision on Issuance of Securities on its
website: www.mts.ru within 2 (Two) days from the date of publication by the
Issuer of the announcement of state registration of the Notes issue on website
of the registering authority, or from delivery to the Issuer of a written
notice of the registering authority supporting the fact of state registration
of the Notes issue sent via mail, facsimile, e-mail, delivery against
signature, depending on what takes place first.


 


The text of the
Decision on Issuance of Securities shall be published on the website together
with state registration number of the Notes issue, date of state registration
and name of the registering body that provided state registration of the Notes
issue.


 


The text of the
registered Decision on Issuance of the Notes shall be available from Internet
from the date of its publication in Internet and to the redemption date of the
Notes of the issue.


 


The Issuer shall
publish the text of the registered Securities Issuance Prospectus on its
website: www.mts.ru within 2 (Two) days from the date of publication by the
Issuer of the announcement of state registration of the Notes issue on website
of the registering authority, or from delivery to the Issuer of a written notice
of the registering authority supporting the fact of state registration of the
Notes issue sent via mail, facsimile, e-mail, delivery against signature,
depending on what takes place first.  The
text of the Securities Issuance Prospectus shall be published on the website
together with state registration number of the Notes issue for which the
Securities Issuance Prospectus was registered, the date of its registration and
the name of the registering body that has registered the Securities Issuance
Prospectus.


 


The text of the
registered Securities Issuance Prospectus shall be available from Internet
starting from the date of its publication in Internet and until expiry of no
less than 6 (Six) months from the date of publication in Internet of the text
of registered report on results of the securities issue; or, if under the
Federal Law “On the Securities Market” and other federal laws, the Notes
issuance does not require state registration of a report on the securities
issuance results, within 6 (Six) months from the date of publication in
Internet of the text of the notice on the issuance results filed with the
registering body.


 


From the date of
state registration of the Notes issue, all concerned parties shall be able to
make themselves familiar with the Decision on Issuance of Securities and the
Securities Issuance Prospectus, and receive their copies at the following
address: Russian Federation, 109147, Moscow City, Marksistskaya street, 4.


 


The Issuer shall
be required to provide copies of the above documents to owners of the Issuer’s
securities and to other concerned parties on their request and for a fee not
exceeding the costs of production of such copy, within 7 (Seven) days from the
date of presenting the request.


 


d) At the Phase
of the Notes placement the Issuer shall be required to disclose information in
the following form:


 


· announcement of the opening date of the securities
placement;


· announcement of changing the opening date of the securities
placement;


· announcement of suspension of the securities placement;


· announcement of renewal of the securities placement;


· announcement of material facts “information of the phases
of the securities issuance procedure”.


 


1. The Issuer
shall publish information on the placement opening date in the form of an
announcement of the placement opening date within the following timeframe:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” not later than 5 (Five) working days before
the placement opening date;


·              on the Issuer’s website in Internet
(www.mts.ru) not later than 4 (Four) working days before the placement opening
date.


 


The announcement
in Internet shall be published after the publication on the news line.


 


2. Should the
Issuer take decision on changing the placement opening date, the Issuer shall
be required to publish an announcement of changing the placement opening date
on news line and on the Issuer’s website in Internet (www.mts.ru) not later
than 1 (One) day before such date.


 


The announcement
in Internet shall be published after the publication on the news line.


 


3. The Issuer
shall publish information on launch of the Notes placement in the form of
announcement of a material fact “information on phases of the securities
issuance procedure” within the following time period from the date of which the
Notes placement is launched:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


4. Should the Issuer’s
authorized body take decision on making amendments and/or additions to the
Decision on Issuance of Securities and/or the Securities Issuance Prospectus,
or should the Issuer receive a written order (instruction, assessment) from the
federal securities market regulator, the Issuer shall be required to suspend
placement of the Notes and publish information on suspension of the placement
within the following time from the date of production of the relevant minutes
(expiry date established by the Russian Federation law regarding production of
minutes) of the meeting of the Issuer’s authorized body that has taken the
decision on making amendments and/or additions to the Decision
on Issuance of Securities and/or the Securities Issuance Prospectus, or from
the date when the Issuer receives
a written order (instruction, assessment) from the federal securities market
regulator on suspension of the securities placement via mail, facsimile, email,
delivery against signature, depending on what takes place first:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


If placement of
securities is suspended in connection with decision taken by the registering
authority on suspension of the securities issue, the Issuer shall disclose the
information on suspension of the securities issue in the form of announcement
of a material fact “information on suspension and renewal of the securities
issue”.


 


5. The Issuer
shall publish information on renewal of the securities issue within the
following timeframe from the date of publication of information on registration
of amendments and/or additions to the Decision on Issuance of Securities and/or
additions to the Decision on Issuance (Additional Issuance) of Securities and/or
to the Securities Issuance Prospectus or information on decline of registration
of the above amendments and/or additions on the website of the registering
authority in Internet, or from delivery to the Issuer of a written notice of
the registering authority on renewal of the securities issue (discontinuation
of the events supporting suspension of the securities placement procedure) via
mail, facsimile, e-mail, delivery against signature, depending on what takes
place first::


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


 


23

















 


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


If placement of
securities is renewed in connection with decision taken by the registering
authority on renewal of the securities issue, the Issuer shall disclose the
information on suspension of the securities issue in the form of announcement
of a material fact “information on suspension and renewal of the securities
issue”.


 


Renewal of the
securities placement shall not be possible before publication of information on
renewal of the securities placement on news line and on the Internet website.


 


6. The Issuer
shall disclose the information on completion of the Notes placement in the form
of announcement of a material fact “information on phases of the securities
issuance procedure” within the following time period from the date of which the
Notes placement is completed:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


e) After state
registration of the Report on the Securities Issuance Results, the Issuer shall
publish information on state registration of the Report on the Securities
Issuance Results in the form of announcement of a material fact “information on
phases of the securities issuance procedure” within the following timeframe
from the date of publication of information on state registration of the Report
on the Securities Issuance Results on the Internet website of the registering
authority, or from the date of delivery to the Issuer of a written notice of
the registering authority on state registration of the Report on the Securities
Issuance Results via mail, facsimile, e-mail, delivery against signature,
depending on which of the above dates takes place first:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


Within 2 (Two)
days from the date of publication of information on state registration of the
Issuer’s Report on the Securities Issuance Results on the Internet website of
the registering authority, or from the date of delivery to the Issuer of a
written notice of the registering authority on state registration of the Report
on the Securities Issuance Results via mail, facsimile, e-mail, delivery
against signature, depending on which of the above dates takes place first, the
Issuer shall publish the text of the registered Report on the Securities
Issuance Results on its Internet website: www.mts.ru.


 


The text of the
registered Report on the Securities Issuance Results should be available from
Internet from the date of its publication in Internet and further on within no
less than 6 (Six) months from the date of its publication in Internet.


 


From the date of
state registration of the Report on the Securities Issuance Results, all
concerned parties shall be able to make themselves familiar with the Report on
the Securities Issuance Results and receive copies at the following address:
Russian Federation, 109147, Moscow City, Marksistskaya street, 4.


 


The Issuer shall
be required to provide copies of the Report on the Securities Issuance Results
to owners of the Issuer’s securities and to other concerned parties on their
request and for a fee not exceeding the costs of production of such copy,
within 7 (Seven) days from the date of presenting the request.


 


f) If under
Federal Law “On the Securities Issuance” and other federal law, the securities
issuance does not require state registration of the Issuer’s Report on the
Securities Issuance Results, provisions of clause 11.) of the Decision on Issuance of the
Securities shall not apply.


 


In this case
information shall be disclosed at the phase of submission to the registering
authority of a notification of the Securities Issue Results in the form of
announcement of a material fact “information on phases of the securities
issuance procedure” within the following timeframe from the date of submission
(direction) to the registering authority of the notification of the Securities
Issue Results:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The Issuer shall
publish the text of notification of the Securities Issue Results submitted to
the registering authority in Internet within 2 (Two) days from the date of
submission (direction)of the above notification to the registering authority.


 


The text of the
notification of the Securities Issue Results submitted to the registering
authority should be available from Internet website: www.mts.ru within no less
than 6 (Six) months from the date of its publication in Internet.


 


If the Issuer
provided additional means of access to information contained in the Securities
Issuance Prospectus, the Issuer shall be required to provide the same
additional means of access to information contained in the notification of the
Securities Issue Results that ensured access to information of the Securities
Issuance Prospectus.


 


From the date of
submission (direction)of the notification of the Securities Issue Results to
the registering authority, all concerned parties shall be able to make
themselves familiar with the notification of the Securities Issue Results and
receive copies at the following address: Russian Federation, 109147, Moscow
City, Marksistskaya street, 4.


 


The Issuer shall
be required to provide copies of the notification of the Securities Issue
Results to owners of the Issuer’s securities and to other concerned parties on
their request and for a fee not exceeding the costs of production of such copy,
within 7 (Seven) days from the date of presenting the request.


 


g) The Issuer
shall disclose the information in the form of announcements of material facts
in accordance with the procedures established by the applicable RF legislation
including regulatory acts of the federal executive authority for the securities
market.


 


The Issuer shall
disclose the information in the form of announcements of material facts by
publishing an announcement of a material fact within the following time period
from the date of occurrence of such material fact:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


Texts of
announcements of material facts should be available from the Issuer’s website:
www.mts.ru within no less than 6 (Six) months from the date of their
publication.


 


In addition, the
Issuer shall submit information on material facts to the registering authority
within 5 (Five) days from the moment of occurrence of the material facts.


 


h) The Issuer
shall disclose information in the form of a quarterly report under the procedures
established by the applicable RF legislation including regulatory acts of the
federal executive authority for the securities market.


 


Quarterly report
shall compile results of each quarter and shall be submitted to the federal
executive authority for the securities market within 45 (Forty Five) days from
the last date of the reporting quarter.


 


Within 45 (Forty
Five) days from the last date of the reporting quarter, the Issuer shall
publish the text of the quarterly report on the Issuer’s prospectus-based
securities on the Internet website — www.mts.ru.


 


The text of the
quarterly report on the Issuer’s prospectus-based securities shall be available
from the Issuer’s Internet website during no less than 3 (Three) years from the
date of its publication.


 


Not later than 1
(One) day from the date of publication of the quarterly report in Internet, the
Issuer shall publish on the news line an announcement of the procedures of
access to the information included in the quarterly report.


 


24

















 


i) Within 1
(One) working day from the date of occurrence of the event entitling the Notes
owners to submit the Notes for premature redemption on news line of information
agencies (AK&M or Interfax or ANO “AZIPI”), and within 2 (Two) working days
from the above date on the Issuer’s website in Internet (www.mts.ru), the
Issuer shall publish the following information:


 


· name of the event entitling the
Notes owners to exercise premature redemption of the Notes;


· the date of occurrence of the event;


· the actions that the Notes owners
may potentially take to satisfy their claims for premature redemption of the
Notes.


 


The announcement
in Internet shall be published after the publication on the news line.


 


After premature
redemption of the Notes by the Issuer, the Issuer shall publish an announcement
on the timeframe of execution of its obligations.


 


The above
information (including the quantity of the redeemed Notes) shall be published
within the following timeframe after the final date of execution of the
obligation:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


j) If the Issuer
fails to execute and/or properly execute its obligations under the Notes
(including in case of default or technical default), the Issuer shall publish
an announcement of its failure to execute and/or properly execute its
obligations to the Notes owners, stating:


 


·      the volume of defaulted obligations;


·      the reason for the default;


·      the list of actions that the Notes owners may
potentially take to satisfy their claims.


 


The Issuer shall
publish the above information within the following timeframe from the date of
failure to execute and/or properly execute The Issuer’s obligations under the
Notes:


 


· on news line (AK&M or Interfax
or ANO “AZIPI”) — within 1 (One) day;


· on its Internet website —
www.mts.ru— within 2 (Two) days.


 


The announcement
in Internet shall be published after the publication on the news line.


 


k) In addition
to disclosure of the placement opening date, the Issuer shall disclose
information on the Underwriter, to which MICEX Stock Exchange Trade
Participants shall submit applications for purchasing the Notes in the course
of tender conducted by CJSC MICEX Stock Exchange among potential buyers on the
opening date of the Notes placement.


 


The Issuer shall
disclose information on the Underwriter, to which MICEX Stock Exchange Trade
Participants shall submit applications for purchasing the Notes in the course
of tender conducted by CJSC MICEX Stock Exchange among potential buyers on the
opening date of the Notes placement, using the following procedure:


 


·              on news lines of information
agencies AK&M or Interfax, or other information agencies authorized by
federal regulator of the securities market to execute information disclosure on
the securities market - not later than 5 (Five) working days before the
placement opening date;


·              on the Issuer’s website in Internet
(www.mts.ru) not later than 4 (Four) working days before the placement opening
date.


 


The announcement
should also include information of the bank account to which cash payment on
the Notes shall be transferred.


 


l) If not later
than the 2 (Second) working day before the opening date of the Notes placement
the Issuer takes decision on repurchasing the Notes from their owners during
the last 5 (Five) working days of “j” coupon period (j=1-19), interest rates of
all coupons on the Notes having number of sequence below or equal j shall be
defined as equal to interest rate on the first coupon.  The above information including sequential
numbers of coupons, for which interest rate was defined as equal to interest
rate on the first coupon, and the sequential number of coupon period (j), in
which the Notes owners are entitled to demand repurchase of the Notes by the
Issuer shall be communicated to potential buyers of the Notes by way of an
announcement published within the following time from production of meeting
minutes of the Issuer’s authorized body that has taken decision on repurchasing
the Notes:


 


· on news line (AK&M or Interfax
or ANO “AZIPI”) — within 1 (One) day;


· on Internet website — www.mts.ru—
within 2 (Two) days.


 


This
announcement shall be published no later than 1 (One) working day before of
opening date of the Notes placement.


 


m) The Issuer
shall disclose information on the first coupon interest rate defined through
the Tender as at the opening date of the Notes placement, in the form of an
announcement of material facts within the following timeframe from the moment
of taking decision on the first coupon interest rate:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


The Issuer shall
take decision on the first coupon interest rate and shall inform MICEX Stock
Exchange in writing of the decision taken by the Issuer.  After publication of an announcement by
information agency (AK&M or Interfax or ANO “AZIPI”) on the first coupon
interest rate, the Issuer shall inform the Underwriter of the first coupon
interest rate.


 


The Underwriter
shall communicate the announcement of the first coupon interest rate using
MICEX Stock Exchange Trading System via e-mail to all MICEX Stock Exchange
Trade Participants.


 


n) For those
coupons, for which the Issuer did not define the interest rate (procedures for
defining the interest rate) before the opening date of the Notes placement, the
Issuer shall set the numerical interest rate at the Date of Defining the “i”
Coupon, what cannot be later than 7 (Seven) working days before the date of
payment of (i-1) coupon.  At the Date of
Defining the “i” Coupon the Issuer is entitled to set interest rates for any
number of undefined coupons following “i” coupon (where “k” coupon is the last
of defined coupons).  The Issuer shall
inform the Notes owners of interest rate of “i” coupon not later than 5 (Five)
working days before the opening date of the “i” coupon period on the Notes by way
of publishing a relevant announcement in the form of information of a material
fact within the following timeframe:


 


· on news line (AK&M or Interfax
or ANO “AZIPI”) — within 1 (One) day after the fact has occurred;


· on Internet website — www.mts.ru—
within 2 (Two) days after the fact has occurred.


 


If after
announcement of coupon interest rates in accordance with the procedures
established in clause 9.3. of the Decision on Issuance of Securities, there are
still undefined coupons on the Notes for at least one of subsequent coupons,
then together with the announcement of interest rates of “i” and other coupons
of the Notes, which are being defines, the Issuer shall be required to secure
the rights of the Notes owners to demand that the Issuer repurchase the Notes
during the last 5 (Five) working days of “k” coupon period (if the Issuer
defines interest for only one “i” coupon, then i=k).  The above information including sequential
numbers of the coupons, for which interest rate was defined at the Date of defining
the “i” coupon, and the sequential number of coupon period (k), in which
repurchase of the Notes shall take place shall be communicated to potential
buyers of the Notes by way of publishing an announcement of a material fact:


 


· on news line (AK&M or Interfax
or ANO “AZIPI”) — within 1 (One) day after the fact has occurred;


· on Internet website — www.mts.ru—
within 2 (Two) days after the fact has occurred.


 


The Issuer shall
inform MICES Stock Exchange of the decisions taken in accordance with clauses
9.3.(2) and 9.3.(3) of the Decision on Issuance of Securities, and
clauses 9.1.2.(2) and 9.1.2.(3) of the Securities Issuance
Prospectus, including the defined interest rates, within 5 (Five) working days
before expiry of (i-1) coupon period (the period in which interest rate on the
“i” and following coupons is defined).


 


o) After expiry
of the period established for repurchasing the Notes by the Issuer, the Issuer
shall publish an announcement of the timeframe for execution of the
obligations.


 


The above
information (including the quantity of repurchased Notes) shall be published
within the following time after occurrence of the material fact:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication on the news line.


 


25

















 


p) The Issuer is
entitled to appoint other payment agents and is entitled to revoke such
appointments.


 


It is presumed
that the Issuer cannot appoint several payment agents at a time.


 


The Issuer shall
publish an official announcement of the above actions within 3 (Three) working
days after the date of making such appointment or revoking them on news line
(of AK&M or Interfax or ANO “AZIPI”) and on website —www.mts.ru.


 


The announcement
in Internet shall be published after the publication in the news line.


 


q) The Issuer’s
agent acting on behalf and on account of the Issuer in repurchasing the Notes
on request of their owners (hereinafter, The Agent for Repurchasing the Notes
on Request of Their Owners) is the Underwriter.


 


The Issuer shall
be able to reassign the functions of the Agent for Repurchasing the Notes on
Request of Their Owners to another person that shall be able to perform all
actions required for the repurchase, as per clause 10 of the Decision on
Issuance of Securities and legislation of the Russian Federation.  In this case, the Issuer shall be required to
publish an information announcement including the following data:


 


·              full and abbreviated name of the
person to which the functions of the Agent for Repurchasing the Notes on
Request of Their Owners were reassigned;


·              its location, and also address and
facsimile # for receiving applications in accordance with the procedures
defined in clause 10 of the Decision on Issuance of the Notes;


·              data of the license of a
professional participant of the securities market: #, Date of issuance,
Validity period, the authority that issued the license;


·              confirmation of the fact that the
appointed Agent for Repurchasing the Notes on Request of Their Owners is a
trade participant of the Market Maker, and shall exercise the repurchase
through it.


 


This information
shall be published not later than 30 (Thirty) days prior to the Date of
repurchase established in accordance with the procedures described here below,
in the following sources of information:


 


·              on news line (of AK&M or
Interfax or ANO “AZIPI”);


·              on the website (www.mts.ru).


 


The announcement
in Internet shall be published after the publication in the news line.


 


r) The Issuer shall publish an announcement to owners of the Notes of
the decision taken on repurchase of the Notes by the Issuer under agreement
with their owners within the following timeframe from the date of production of
meeting minutes (expiry of the period established by the Russian Federation
legislation for minutes production) of the Issuer’s authorized body at which
the above decision has been taken, but not later than 7 (Seven) days prior to
the opening date of receiving offers for repurchase of the Notes:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication in the news line.


 


The announcement to owners of the Notes of the decision taken on
repurchase of the Notes shall include the following information:


 


·               the
date when the decision on repurchase (redemption) of the Notes of the issue
under agreement with their owners was taken;


·               series
and from of the Notes, state registration # and date of state registration of
the Notes of the issue;


·               quantity
of the Notes to be repurchased;


·               time
period within which the Notes owners can accept the Issuer’s offer for
repurchasing the Notes;


·               date
of repurchase by the Issuer of the Notes of the issue;


·               repurchasing
price of the Notes of the issue or the procedures for defining it;


·               full
and abbreviated corporate name, location of the Agent for Repurchasing the
Notes Under Agreement with Their Owners, #, date of issuance, and validity
period of the license for conducting brokerage activities, the body that issued
the above license.


 


The above
information on the Issuer’s decision to repurchase the Notes under agreement
with their owners shall constitute an irrevocable public offer for a purchase
and sale contract regarding the Notes, including all material terms of the
purchase and sale contract for the Notes of the issue, which makes it clear
that the Issuer wishes to repurchase the Notes on the terms specified in the
publication from any Notes owner that expressed its wish to accept the offer.


 


s) In case of
repurchasing by the Issuer of its own Notes under agreements with the Notes
owners, the Issuer shall publish information on repurchase of the Notes
(stating, in particular, the quantity of repurchased Notes) in the form of an
announcement of a material fact within the following period after the closing
date of the Notes repurchase defined in accordance with the Decision on
Issuance of Securities and the Securities Issuance Prospectus:


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” within 1 (One) working day;


·              on the Issuer’s website in Internet
(www.mts.ru) within 2 (Two) working days.;


 


The announcement
in Internet shall be published after the publication in the news line.


 


t) Notification
(disclosure) procedures applicable in case of amendment of the surety terms for
execution of obligations under the Notes that occurs because of the reasons
beyond control of the Issuer or of owners of the Notes supported by collateral
(reorganization, liquidation, or bankruptcy of the party that provided the
collateral, other reasons):


 


·              on news lines of information
agencies AK&M or Interfax or ANO “AZIPI” and on the website - www.mts.ru -
within 3 (Three) working days.


 


The announcement
in Internet shall be published after the publication in the news line.


 


The Issuer shall
provide the following documents (within the statutory period of storage of such
documents): copies of each announcement including copies of each announcement
of a material fact, each certified by the Issuer’s authorized person, copies of
the registered decision on the securities issue, of securities issuance
prospectus, and amendments and/or additions to these, of report on the
securities issue results, copy of notification on the securities issue results,
copy of quarterly report, copies of other documents required for disclosure in
accordance with the Russian Federation legislation on securities, to owners of
the Issuer’s securities and to other concerned parties on their request and for
a fee not exceeding the costs of production of such copy within 7 (Seven) days
from the date of submission of the respective claim.


 


The Issuer shall
publish the banking information of the account(s) to be used for repayment
of the costs of production of the above copies and the amount (procedures for
defining the amount) of such costs on the Issuer’s website (www.mts.ru).


 


12. Information on the surety
supporting execution of obligations under the Notes of the issue


 


12.1. Information of the party
that provided the surety supporting execution of obligations under the Notes


 


Full corporate
name: Limited Liability Company “Mobile TeleSystems — Capital”


Abbreviated
corporate name: LLC MTS-Capital”


Location: Russian Federation, Moscow City, Vorontsovskaya street, 5,
building 2.


Location of the Warrantor’s permanent executive body:
Russian Federation,
Moscow City, Vorontsovskaya street, 5, building 2.


 


Data of state registration of the legal entity


Main state registration #: 1037709022735


Data of entry record in the Unified State Register
of Legal Entities: 14.03.2003.


 


The authority that entered the record in the
Unified State Register of Legal Entities: Inspectorate # 9 of Moscow Central Administrative
Region of the Russian Federal Ministry of Taxes


 


Limited
Liability Company “Mobile TeleSystems — Capital” is not responsible for
disclosure of its financial and economic activities, including in the form of
quarterly reports or announcements of material facts (events, actions) related
to the financial and economic activities.


 


12.2. Terms of surety supporting
execution of obligations under the Notes:


 


Type of surety (method of warranty provision): Warranty.


 


26

















 


Amount of surety (RUR): Maximum amount of warranty for the
Notes is equal to total nominal value of the Notes of the issue - RUR 10 000
000 (Ten billion) plus aggregate coupon income on the Notes.


 


Terms of surety provision and procedures for
exercising the rights of the Notes owners for the surety:


 


The Warrantor
shall together with the Issuer respond to the Notes owners in case of the
Issuer’s failure to comply or properly comply with its obligations on the
Notes.


 


The relations of
surety against the Notes shall be governed by Russian Federation
legislation.  All disputes arising from
the Warrantor’s failure to comply or properly comply with its obligations shall
be under jurisdiction of courts of the Russian Federation.


 


If the Notes
owners are unable to get satisfaction of their claims on the Notes owned by
them and submitted to the Issuer and/or Warrantor, owners of the Notes shall be
able to file a claim with a court or arbitration against the Issuer and/or the
Warrantor in accordance with applicable legislation of the Russian Federation.


 


Warranty is an
unconditional and irrevocable obligation of the Warrantor before each individual
or corporate entity that owns title to the Notes at the respective moment of
time (acting independently or through a nominal holder if Notes were
transferred by the Notes owner to nominal holding) to respond for The Issuer’s
failure to comply or properly comply with its obligations of payment in full of
all sums payable by the Issuer on each of the Notes to such owner of the Notes
at due moment of payment of such sums, if the Issuer because of any reason
fails to pay and/or properly pay any of the above sums that are payable by it
in accordance with the Issuance Documents (here, and further below through the
text the Issuance Documents are construed as the Decision on Issuance of
Securities and the Securities Issuance Prospectus) to any Notes owner within
the timeframe and under the procedures defined in the Issuance Documents.


 


The Notes with a
surety provide to their owners all rights arising from such surety.


 


A Surety
Agreement shall be made by way of purchasing one or several Notes under the procedures
and on the terms defined in the Issuance Documents.  The fact of purchasing any quantity of the
Notes means that the Notes buyer enters in a surety agreement with the
Warrantor, and under such agreement the Warrantor shall bear responsibility jointly
with the Issuer for the Issuer’s failure to perform or properly perform its
obligations on the Notes with respect of the Notes owners on the terms defined
in the Issuance Documents.


 


A Surety
Agreement shall be construed as made from the moment when the first Notes owner
obtains title to such Notes, and the written form of the agreement shall in
this case be construed as executed. 
Transfer of title to the surety provided in accordance with the Issuance
Documents takes place as result of transfer of title to a Note to a new buyer;
in this case title to the surety passes in the same volume and under the same
terms, which exist at the moment of transfer of title to a Note.  Transfer of title to the surety without transfer
of title to a Note shall be ineffective.


 


The fact of the
Issuer’s failure to comply or properly comply with obligations under the Notes
shall be considered as proven in the following situations:


 


1) The Issuer
coupon income in the form of interest on the Notes nominal value to owners of the
Notes within the timeframe defined in the Issuance Documents;


2) The Issuer
has not paid or paid in full the principal at redemption of the Notes within
the timeframe defined in the Issuance Documents;


3) The Issuer
has not fulfilled or fulfilled in full scope the claims of the Notes owners of
repurchase of the Notes within the timeframe and under the terms defined in the
Issuance Documents.  The moment of
fulfillment of the respective Issuer’s obligations occurs on the days of
repurchase of the Notes by the Issuer defined by the Issuer in accordance with
the Issuance Documents;


4) The Issuer
failed to satisfy or properly satisfy the Notes owner’s claim of premature
redemption and compensation to it of the Notes’ nominal value and repayment of
the accrued coupon income on the Notes due to it as at the date of execution by
the Issuer of its obligations regarding premature redemption of the Notes and
defined in accordance with clause 15. of the Decision on Issuance of Securities
and clause 10.10. of the Securities Issuance Prospectus.  The timeframe of execution of the respective
obligations under the Notes by the Issuer shall be defined in accordance with
the Issuance Documents.


 


In case of the
Issuer’s failure to comply or properly comply with its obligations under the
Notes, the Warrantor shall be liable for the Issuer’s failure to comply or
properly comply with its obligations under the Notes, as, if owners of the
Notes file claims against the Warrantor that meet the conditions defined in the
Issuance Documents (hereinafter — The Claim).


 


If the Issuer
fails to comply or properly comply with the abovementioned obligations on the
Notes, the owners of such Notes shall be entitled to file a written claim
directly against the Warrantor for execution of obligations on the Notes on the
terms and under the timeframe defined in the Issuance Documents.


 


The Claim should
include the following data:


 


(a)           identification features of the Notes
(form, series, type, state registration # of the issue and date of state registration)
and quantity of the Notes in ownership of each relevant owner of the Notes;


(b)           the contents of obligations on the
Notes defaulted/improperly fulfilled by the Issuer;


(c)           sum of obligations before the Notes
owners defaulted/improperly fulfilled by the Issuer, which is payable, but has
not been paid by the Issuer;


(d)           full name (surname, first and middle
names of an individual) of the Notes owner and the person authorized by the
Notes owner to receive payments under the Notes (if applicable);


(e)           location and postal address
(residential address), contact telephone # of the Notes owner and the person
authorized by the Notes owner to receive payments under the Notes (if such
person was appointed);


(f)            bank account information of the
Notes owner and the person authorized by the Notes owner to receive payments
under the Notes (if such person was appointed) and other information required
to transfer cash funds (name of corporate entity or surname, first and middle
names of an individual; address of location (place of residence); TIN (if
applicable); for individuals — series and # of ID, date of issuance, and name
of the authority that issued this ID, for corporate entities — OKPO and OKVED
codes (for banks - BIC);


(g)           tax status of the person authorized
to receive payments under the Notes (resident, non-resident with a permanent
establishment, non-resident without a permanent establishment), indication of
the country where this person is resident.


 


If owner of the
Notes is a legal entity, the Claim shall be signed by its director, chief
accountant, and stamped by the Notes owner’s seal.  If owner of the Notes is an individual,
signature of the Notes owner on the Claim should be notarized as true.


 


The Claim shall
be submitted to the Warrantor at the following address: Russian Federation,
Moscow City, Vorontsovskaya, 5, building 2 in person against signature of the
Warrantor’s representative or via registered mail with return receipt.


 


The Claim shall
be supplemented with:


 


(a)           a copy of extract from the Notes owner’s
depo account certified by Non-Commercial Partnership “National Depository
Centre” (hereinafter - NDC) or by nominal holder —depositor of NDC where the
depo account was opened, including quantity of the Notes owned by the Notes
owner as at the date of submission of the Claim;


(b)           a copy of NDC report on transfer of
the Notes to the depo account section designated for blocking the securities at
redemption certified by NDC or by nominal holder — NDC depositor, in case a
claim is filed presuming repayment of a certain sum in connection with
default/improper fulfillment of the Issuer’s obligations on the Notes
redemption;


(c)           documents supporting powers of the
person who filed a claim on behalf of the Notes owner issued in accordance with
the effective Russian federation law, if it is a representative of the Notes
owner who files the claim;


(d)           notarized copies of statutory
documents and the documents supporting powers of the person who signed the
claim, if an owner of the Notes is a corporate entity;


(f)            a copy of passport certified by the
Notes owner’s signature, if an owner of the Notes is an individual.


 


The Warrantor
shall also accept the documents supporting tax status of the Notes owners as
per the existing legislation, and availability to certain Notes owners of tax
reliefs that allow for full or partial tax exemption of payments.


 


The Documents
issued outside the Russian Federation should be duly legalized (or apostilled),
and should be supplemented by a notarized translation into Russian.


 


Owners or the
Notes can file claims directly against the Warrantor within 60 (Sixty) days
from the due date of the respective Issuer’s obligation on the Notes.  The date of submission of the Claim shall be
the date of delivery to the Warrantor of the respective Claim.


 


The Claims filed
against the Warrantor after expiry of 60 (Sixty) days from the due date of the
respective Issuer’s obligation on the Notes shall not be considered.


 


A Claim against
the Warrantor can be filed by a nominal holder — NDC depositor having accounts
for recording of the Notes and acting to benefit of the Notes owners —
depositors of the above depository, provided that such person is duly
authorized by the Note owner.


 


The Warrantor
shall consider the Claim and the documents attached thereto, and shall review
the data included in them for correctness within 14 (Fourteen) working days
from the moment of delivery of the Claim to the Warrantor.


 


Not later than
on the 5 (Fifth) working day from the date of expiry of the period of the Claim
consideration, the Warrantor shall notify in writing of the decision to satisfy
or refuse to satisfy (specifying the reasons) the Claim of the Notes owner or
of the nominal holder — NDC depositor who filed the Claim.  In case a claim is filed presuming repayment
of a certain sum in connection with default/improper fulfillment of the
Issuer’s obligations on the Notes redemption, the Warrantor shall submit a
notice with NDC on satisfaction/refusal to satisfy the Claim (specifying the
name, surname, first and middle names of the owner, quantity of the Notes, name
of the Depository that opened a depo account to the owner).


 


If a decision is
taken to satisfy the claims of the Notes owner, the Warrantor shall within 10
(Ten) working days from the date of expiry of the period of the Claim 


 


27

















 


consideration
transfer cash funds to bank account of the Notes owner, of nominal holder of
the Notes, or of any other person authorized by the Notes owner the banking
information of which was provided in the Claim.


 


The Warrantor
shall pay to the Notes owner the cash sums on the Notes payable to it within
the amount that was not paid by the Issuer as at the moment when the Warrantor
took the decision to satisfy the Claim.


 


The Warrantor’s
obligations shall be deemed fulfilled from the moment of writing off the
relevant cash funds from the Warrantor’s account.


 


The surety
conditions established by the Issuance Documents shall be discontinued:


 


1) if
Obligations of the Issuer are discontinued. 
If payments on the Notes were made to a Notes owner in full scope, the
surety shall discontinue its effect with respect of such owner, but shall
retain effect with respect of other Notes owners;


2) if
Obligations of the Issuer are amended towards creation of increased liability
or other unfavorable effects for the Warrantor without approval of the latter;


3) in connection
with other reasons established by the effective Russian Federation laws.


 


The Warrantor
shall not be liable for default on its obligations to the Notes owner, if such
default resulted from submission to the Warrantor of unreliable or incomplete
data; in such case any additional expenses that the Warrantor incurs in
connection with execution of its responsibilities of surety provider shall be
reimbursed by the respective Notes owner or nominal Notes holder.


 


The procedures
for notification (disclosure) on amendment of surety terms supporting execution
of obligations under the Notes that takes place because of the reasons beyond
control of the Issuer or of the Notes owners with surety (reorganization,
liquidation, or bankruptcy of the person that provided the surety, etc.):


 


·              on news line of information agencies
AK&M or Interfax or ANO “AZIPI” and on the Issuer’s website in Internet - www.mts.ru
- within 3 (Three) working days;


·              in Vedomosti newspaper - within 5
(Five) working days.


 


The announcement
in Internet and in printed mass media shall be published after the publication
in the news line.


 


13. The Issuer’s obligation to
ensure rights of securities owners in the course of exercising their rights in
accordance with the procedures established by the Russian Federation
legislation:


 


The Issuer
undertakes to ensure rights of the Notes owners in the course of exercising
their rights in accordance with the procedures established by the Russian
Federation legislation.


 


14. Obligations of the persons
that provided surety on the notes supporting fulfillment of the Issuer’s
obligations to the notes owners in case of the Issuer’s default or delay of
execution of the relevant obligations on the notes, as per the terms of the
provided surety


 


The person that
provided surety on the notes  shall be responsible to ensure execution of the
Issuer’s obligations to the notes owners in case of the Issuer’s default or
delay of execution of the relevant obligations on the notes, as per the terms
of the provided surety.


 


15. Other data required by
Securities Issuance Standards and Securities Issuance Prospectus Standards


 


a) The Notes
shall be accepted for free trade at stock exchanges and over-the-counter
markets.


 


Non-residents
shall be able to purchase the Notes in accordance with the Russian Federation
legislation.


 


Sales and
purchase deals of the Notes after completion of their placement shall be
possible only after the date of state registration of the report on the Notes
issue results, or after submission to the registering authority of a notice on
the issue results if in accordance with Federal Law “On the Securities Market”
or other federal laws the issue is executed without state registration of the
report on the Notes issue results.


 


The Notes shall
be traded over-the-counter without restrictions until the Notes maturity date.


 


The Notes shall
be traded by stock exchanges with restrictions defined by securities market
makers.


 


b) The
procedures for defining the amount of accrued coupon income in the period of
the Notes trade.


 


In any day
between the opening date of the Notes placement and the redemption date the
accrued coupon income (ACI) is computed with the following formula:


 


ACI = Cj * Nom *
(T - T(j -1))/ 365/ 100 %, where


Nom — nominal
value of one Note,


Cj — interest
rate of “j” coupon period (in per cent annual),


j — sequential
number of the coupon period, j=1...20,


T(j -1) -
Opening date of the j coupon period,


T — current
date.


 


ACI is computed
to one kopeck, truncation of figures in the calculation is based on the
rules of mathematical rounding.  The
rules of mathematical rounding shall mean the method of rounding where the
amount of equal kopeck(s) does not change if the first figure following
the figure, which is rounded up is within the interval from 0 to 4, and
increases for one, if the first figure following the figure, which is rounded
up is within the interval from 5 to 9.


 


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