Document:

Exhibit 4.47

 

EXECUTION COPY

 

Dated 14 December 2005

 

 

 

US$200,000,000

 

FACILITY AGREEMENT

 

For

 

CLOSED
JOINT STOCK COMPANY “UKRAINIAN MOBILE COMMUNICATIONS”

 

arranged by

 

CITIBANK, N.A.

ING BANK N.V.

 

as Bookrunner

 

CITIBANK, N.A.

ING BANK N.V.

RAIFFEISEN
ZENTRALBANK ÖSTERREICH AG

 

as Mandated Lead
Arrangers

 

with

 

CITIBANK
INTERNATIONAL PLC

acting as Agent

 

 

Paveletskaya sq. 2, bld. 2

Moscow 115054

 

Telephone (7-095) 797 9797

Facsimile (7-095) 797 9798

 

Ref MK/TP

 

 

	
  CLAUSE

  	
   

  	
  

  	
       CONTENTS     

  	
   

  	
   

  	
  PAGE

  
	
  SECTION 1 INTERPRETATION

  	
   

  
	
  1   DEFINITIONS AND INTERPRETATION

  	
   

  
	
  SECTION 2 THE FACILITIES

  	
   

  
	
  2   THE FACILITIES

  	
   

  
	
  3   PURPOSE

  	
   

  
	
  4   CONDITIONS OF UTILISATION

  	
   

  
	
  SECTION 3 UTILISATION

  	
   

  
	
  5   UTILISATION

  	
   

  
	
  SECTION 4 REPAYMENT, PREPAYMENT AND CANCELLATION

  	
   

  
	
  6   REPAYMENT

  	
   

  
	
  7   PREPAYMENT AND CANCELLATION

  	
   

  
	
  SECTION 5 COSTS OF UTILISATION

  	
   

  
	
  8   INTEREST

  	
   

  
	
  9   INTEREST PERIODS

  	
   

  
	
  10   CHANGES TO THE CALCULATION OF INTEREST

  	
   

  
	
  11   FEES

  	
   

  
	
  SECTION 6 ADDITIONAL PAYMENT OBLIGATIONS

  	
   

  
	
  12   TAX GROSS-UP AND INDEMNITIES

  	
   

  
	
  13   INCREASED COSTS

  	
   

  
	
  14   OTHER INDEMNITIES

  	
   

  
	
  15   MITIGATION BY THE LENDERS

  	
   

  
	
  16   COSTS AND EXPENSES

  	
   

  
	
  SECTION 7
  REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT

  	
   

  

 

 i
 

 

 

	
  17   REPRESENTATIONS

  	
   

  
	
  18   INFORMATION UNDERTAKINGS

  	
   

  
	
  19   FINANCIAL COVENANTS

  	
   

  
	
  20   GENERAL UNDERTAKINGS

  	
   

  
	
  21   EVENTS OF DEFAULT

  	
   

  
	
  SECTION 8
  CHANGES TO PARTIES

  	
   

  
	
  22   CHANGES TO THE LENDERS

  	
   

  
	
  23   CHANGES TO THE BORROWER

  	
   

  
	
  SECTION 9 THE
  FINANCE PARTIES

  	
   

  
	
  24   ROLE OF THE AGENT AND THE MANDATED LEAD
  ARRANGERS

  	
   

  
	
  25   CONDUCT OF BUSINESS BY THE FINANCE PARTIES

  	
   

  
	
  26   SHARING AMONG THE FINANCE PARTIES

  	
   

  
	
  SECTION 10
  ADMINISTRATION

  	
   

  
	
  27   PAYMENT MECHANICS

  	
   

  
	
  28   SET-OFF

  	
   

  
	
  29   NOTICES

  	
   

  
	
  30   CALCULATIONS AND CERTIFICATES

  	
   

  
	
  31   PARTIAL INVALIDITY

  	
   

  
	
  32   REMEDIES AND WAIVERS

  	
   

  
	
  33   AMENDMENTS AND WAIVERS

  	
   

  
	
  34   COUNTERPARTS

  	
   

  
	
  SECTION 11
  GOVERNING LAW AND ENFORCEMENT

  	
   

  
	
  35   GOVERNING LAW

  	
   

  
	
  36   ARBITRATION

  	
   

  
	
  37   JURISDICTION

  	
   

  

 

 ii
 

 

 

	
  SCHEDULE 1 The Original
  Lenders

  	
   

  
	
  SCHEDULE 2
  Conditions precedent

  	
   

  
	
  SCHEDULE 3
  Utilisation Request

  	
   

  
	
  SCHEDULE 4
  Mandatory Cost formula

  	
   

  
	
  SCHEDULE 5 Form
  of Transfer Certificate

  	
   

  
	
  SCHEDULE 6 Form
  of Compliance Certificate

  	
   

  
	
  SCHEDULE 7
  Selection Notice

  	
   

  
	
  SCHEDULE 8
  Parent Guarantee

  	
   

  
	
  SCHEDULE 9
  Amended and Restated Parent Guarantee

  	
   

  

 

 iii

 

 

THIS
AGREEMENT is dated 14 December 2005 and made between:

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

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

(3)                              CITIBANK, N.A., ING
BANK N.V. and RAIFFEISEN
ZENTRALBANK ÖSTERREICH AG as Mandated
Lead Arrangers (the “Mandated Lead Arrangers”);

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

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

IT IS
AGREED as follows:

SECTION 1

INTERPRETATION

1                                      DEFINITIONS AND INTERPRETATION

1.1                            Definitions

In this
Agreement:

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

“Affiliate” means, in relation to any
person, a Subsidiary of that person or a Holding Company of that person or any
other Subsidiary of that Holding Company.

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

“Annualised Consolidated EBITDA” has the
meaning given to it in Clause 19 (Financial
Covenants).

“Authorisation” means an authorisation,
consent, approval, resolution, licence, exemption, filing, notarisation or
registration.

“Availability Period” means the period from
and including the Signing Date to and including the date which is 60 days after
the Signing Date.

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

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

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

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

 4
 

 

 

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

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

“Break Costs” means the amount (if any) by
which:

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

exceeds:

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

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

“Commitment” means a Facility 1 Commitment
or a Facility 2 Commitment.

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

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

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

“Consolidated Total Debt” has the meaning
given to it in Clause 19 (Financial
Covenants).

“Consolidated Total Net Worth” has the
meaning given to it in Clause 19 (Financial
Covenants).

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

“Default” means an Event of Default or any
event or circumstance specified in Clause 21 (Events
of Default) which would (with the expiry of a grace period, the
giving of notice, the making of any determination under the Finance Documents
or any combination of any of the foregoing) be an Event of Default.

“Environment” means living organisms
including the ecological systems of which they form part and the following
media:

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

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

 5
 

 

 

(c)                                land
(including land under water).

“Environmental Law” means all laws and
regulations of any relevant jurisdiction which:

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

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

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

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

“Event of Default” means any event or
circumstance specified as such in Clause 21 (Events
of Default).

“Facilities” means Facility 1 and Facility
2, and “Facility” means either of
them.

“Facility 1” means the term loan facility
made available under this Agreement as described in paragraph (a) of
Clause 2.1 (The Facilities).

“Facility 1 Commitment” means:

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

(b)                               in relation
to any other Lender, the amount of any Facility 1 Commitment transferred to it
under this Agreement,

to the extent not
cancelled, reduced or transferred by it under this Agreement.

“Facility 1 Loan” means a loan made or to be
made under Facility 1 or the principal amount outstanding for the time being of
that loan.

“Facility 2” means the term loan facility
made available under this Agreement as described in paragraph (b) of
Clause 2.1 (The Facilities).

“Facility 2 Commitment” means:

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

(d)                               in relation
to any other Lender, the amount of any Facility 2 Commitment transferred to it
under this Agreement,

to the extent not
cancelled, reduced or transferred by it under this Agreement.

“Facility 2 Loan” means a loan made or to be
made under Facility 2 or the principal amount outstanding for the time being of
that loan.

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

 6
 

 

written
notice) as the office or offices through which it will perform its obligations
under this Agreement.

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

“Final Maturity Date” means the date which
is 12 Months after the Signing Date.

“Finance Document” means this Agreement, any
Fee Letter, the Mandate Letter, the Parent Guarantee, the Amended and Restated
Parent Guarantee and any other document designated as such by the Agent and the
Borrower.

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

“Financial Indebtedness” means any indebtedness for or in
respect of:

(a)                                moneys
borrowed;

(b)                               any amount
raised by acceptance under any acceptance credit facility or dematerialised
equivalent;

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

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

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

(f)                                  any amount
raised under any other transaction (including any forward sale or purchase
agreement) having the commercial effect of a borrowing;

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

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

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

(j)                                   the amount
of any liability in respect of any guarantee or indemnity for any of the items
referred to in paragraphs (a) to (i) above.

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

“Group” means the Parent and its
Subsidiaries for the time being.

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

“IFRS” means the International Financial
Reporting Standards issued by the International Accounting Standards Committee,
London.

 7
 

 

 

“Interest Period” means, in relation to a
Loan, each period determined in accordance with Clause 9 (Interest Periods) and, in relation to an
Unpaid Sum, each period determined in accordance with Clause 8.3 (Default interest).

“Lender” means:

(a)                                any Original
Lender; and

(b)                               any bank,
financial institution, trust, fund or other entity which has become a Party in
accordance with Clause 22 (Changes to the
Lenders),

which
in each case has not ceased to be a Party in accordance with the terms of this
Agreement.

“LIBOR” means, in relation to any Loan:

(a)                                the
applicable Screen Rate; or

(b)                               (if no
Screen Rate is available for Dollars or the Interest Period of that Loan) the
arithmetic mean of the rates (rounded upwards to four decimal places) as
supplied to the Agent at its request quoted by the Reference Banks to leading
banks in the London interbank market,

as of
11:00 a.m. on the Quotation Day for the offering of deposits in Dollars
for a period comparable to the Interest Period for that Loan.

“LMA” means the Loan Market Association.

“Loan” means a Facility 1 Loan or a Facility
2 Loan.

“Majority Lenders” means:

(a)                                if there are
no Loans then outstanding, a Lender or Lenders whose Commitments aggregate more
than 662/3% of the Total Commitments (or, if the
Total Commitments have been reduced to zero, aggregated more than 662/3% of the Total Commitments immediately
prior to the reduction); or

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

“Mandate Letter” means the letter between
the Mandated Lead Arrangers and the Borrower dated on or about the date of this
Agreement.

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

“Margin” means:

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

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

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

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

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

 8
 

 

 

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

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

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

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

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

(b)                               if there is
no numerically corresponding day in the calendar month in which that period is
to end, that period shall end on the last Business Day in that calendar month.

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

“NBU” means the National Bank of Ukraine.

“Obligor” means the Borrower or the Parent.

“Original Financial Statements” means:

(a)                                the Parent
Audited Original Financial Statements;

(b)                               the Borrower
Audited Original Financial Statements; and

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

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

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

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

“Participating Member State” means any
member state of the European Communities that adopts or has adopted the euro as
its lawful currency in accordance with legislation of the European Community
relating to Economic and Monetary Union.

“Party” means a party to this Agreement.

“Permitted Security” means:

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

 9
 

 

 

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

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

(d)                               any Security
arising by operation of law, including any Security (i) arising in the
ordinary course of business with respect to amounts not yet delinquent or being
contested by the Parent or a Subsidiary of the Parent in good faith in
appropriate proceedings or (ii) for taxes, assessments, government charges
or claims, including without limitation those in favour of Russian governmental
fiscal authorities;

(e)                                any Security
on the assets of any Subsidiary of the Parent securing intercompany Financial
Indebtedness of such Subsidiary owing to the Parent or another Subsidiary of
the Parent;

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

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

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

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

“Quotation Day” means, in relation to any
period for which an interest rate is to be determined, two Business Days before
the first day of that period unless market practice differs in the London
interbank market, in which case the Quotation Day will be determined by the
Agent in accordance with market practice in the London interbank market (and if
quotations for that currency and period would normally be given by leading
banks in the London interbank market on more than one day, the Quotation Day
will be the last of those days).

 10
 

 

 

“RAS” means generally accepted accounting
principles, standards and practices in the Russian Federation.

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

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

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

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

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

“Screen Rate” means the British Bankers
Association Interest Settlement Rate for Dollars for the relevant period
displayed on the appropriate page of the Telerate screen. If the agreed page is
replaced or service ceases to be available, the Agent may specify another page or
service displaying the appropriate rate after consultation with the Borrower
and the Lenders.

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

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

“Significant Subsidiary” means:

(a)                                any
Subsidiary of the Parent to which (i) the Parent sells, leases or
otherwise transfers its GSM 900 or 1800 licences or (ii) any such licence
is re-issued; and

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

“Signing Date” means the date of this
Agreement.

“Sistema JSFC” means Joint Stock Financial
Corporation Sistema.

 11
 

 

 

“Specified Time” means 10.00 a.m. on
the Business Day which is three Business Days before the relevant Utilisation
Date or, as the case may be, before the first day of the relevant Interest
Period.

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

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

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

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

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

“Total Assets” means the book value of the
consolidated total assets of the Parent as determined by reference to the
Parent’s most recent annual consolidated balance sheet delivered in accordance
with paragraph (a) of Clause 18.1 (Financial
statements) or, prior to the first delivery, to the Parent Audited
Original Financial Statements.

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

“Total Facility 1 Commitments” means the
aggregate of the Facility 1 Commitments, being $103,000,000 at the Signing
Date.

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

“Transfer Certificate” means a certificate
substantially in the form set out in Schedule 5 (Form of Transfer Certificate) or any other form agreed
between the Agent and the Borrower.

“Transfer Date” means, in relation to a
transfer, the later of:

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

(b)                               the date on
which the Agent executes the Transfer Certificate.

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

“Ukrainian Servicing Bank” means JSCB
Citibank (Ukraine)..

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

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

 12
 

 

 

“Utilisation” means a utilisation of a
Facility.

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

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

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

1.2                            Construction

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

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

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

(iii)                             “control” means the possession, directly or
indirectly, of the power to direct or cause the direction of the management
polices of a person, whether through the ownership of voting securities, by
contract or credit arrangement, as trustee or executor, or otherwise;

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

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

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

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

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

(ix)                              a time of
day is a reference to London time.

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

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

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

1.3                            Third Party Rights

A
person who is not a Party has no right under the Contracts (Rights of Third
Parties) Act 1999 to enforce or to enjoy the benefit of any term of this
Agreement.

 13
 

 

 

1.4                            Governing Language

This
Agreement is entered into in both English and Ukrainian language counterparts. In
the event of any inconsistency between the English language text and the
Ukrainian language text, the English language text shall prevail.

1.5                            Term of the Agreement

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

 

 14

 

SECTION 2

THE FACILITIES

2                                      THE FACILITIES

2.1                            The Facilities

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

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

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

2.2                            Finance Parties’ rights and obligations

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

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

(c)                               A Finance
Party may, except as otherwise stated in the Finance Documents, separately
enforce its rights under the Finance Documents.

3                                      PURPOSE

3.1                            Purpose

The
Borrower shall apply all amounts borrowed by it under the Facilities towards
its general corporate purposes, including towards the financing of capital
expenditure and the refinancing of existing indebtedness.

3.2                            Monitoring

No
Finance Party is bound to monitor or verify the application of any amount
borrowed pursuant to this Agreement.

4                                      CONDITIONS OF UTILISATION

4.1                            Initial conditions precedent

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

(b)                              The Borrower
may not deliver the first Utilisation Request in respect of Facility 1 unless
the Agent has received all of the documents and other evidence listed in Part I
and Part II of 

 15
 

 

Schedule 2 (Conditions
precedent) in form and substance satisfactory to the Agent. The
Agent shall notify the Borrower and the Lenders promptly upon being so
satisfied.

4.2                            Further conditions precedent

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

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

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

(iii)                             the
Registration Certificate has not been cancelled or amended and remains in full
force and effect.

 16
 

 

 

SECTION 3

UTILISATION

5                                      UTILISATION

5.1                            Delivery of a Utilisation Request

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

5.2                            Completion of a Utilisation Request

(a)                               Each
Utilisation Request is irrevocable and will not be regarded as having been duly
completed unless:

(i)                                   it
identifies the Facility to be utilised;

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

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

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

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

5.3                            Currency and amount

(a)                               The currency
specified in a Utilisation Request must be Dollars.

(b)                              The amount
of the proposed Loan must be:

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

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

5.4                            Lenders’ participation

(a)                               If the
conditions set out in this Agreement have been met, each Lender shall make its
participation in each Loan available by the Utilisation Date through its
Facility Office.

(b)                              The amount
of each Lender’s participation in each Loan will be equal to the proportion
borne by its Available Commitment to the relevant Available Facility
immediately prior to making that Loan.

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

 17
 

 

 

SECTION 4

REPAYMENT, PREPAYMENT AND CANCELLATION

6                                      REPAYMENT

(a)                               The Borrower
shall repay the Loans in four equal instalments, by paying on each Repayment
Date an amount equal to one quarter of the amount of the Loans outstanding at
the close of business on the last day of the Availability Period for the
Facilities.

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

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

7                                      PREPAYMENT AND CANCELLATION

7.1                            Illegality

If it
becomes unlawful in any applicable jurisdiction for a Lender to perform any of
its obligations as contemplated by this Agreement or to fund or maintain its
participation in any Loan:

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

(b)                               upon the
Agent notifying the Borrower, the Commitment of that Lender will be immediately
cancelled; and

(c)                                the Borrower
shall repay that Lender’s participation in the Loans on the last day of the
Interest Period for each Loan occurring after the Agent has notified the
Borrower or, if earlier, the date specified by the Lender in the notice
delivered to the Agent (being no earlier than the last day of any applicable
grace period permitted by law).

7.2                            Voluntary cancellation

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

7.3                            Voluntary prepayment of Loans

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

(b)                              A Loan in
respect of a Facility may only be prepaid after the last day of the
Availability Period (or, if earlier, the day on which the relevant Available
Facility is zero).

(c)                               Each
prepayment shall be applied in satisfaction of the Borrower’s obligations under
Clause 6 (Repayment) in the
inverse order of maturity of the Loans (or, at the option of the Borrower, pro rata to the remaining principal
instalments thereof).

7.4                            Mandatory Prepayment — Change of Control

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

 18
 

 

 

(i)                                   the Parent
ceases to be the legal and beneficial owner of not less than 99% of the issued
shares of the Borrower or ceases to own or control of not less than 99% of the
voting interests of the share capital of the Borrower; or

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

(b)                              If there is
a Change of Control:

(i)                                   the Borrower
shall, or (if applicable) shall procure that the Parent shall, promptly notify
each Lender (through the Agent) upon the Borrower or (if applicable) the Parent
becoming aware of that event;

(ii)                                the Borrower
may not make a Utilisation; and

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

7.5                            Right of repayment and cancellation in relation
to a single Lender

If:

(a)                                any sum
payable to any Lender by the Borrower is required to be increased under
paragraph (c) of Clause 12.2 (Tax
gross-up); or

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

the
Borrower may, whilst the circumstance giving rise to the requirement or
indemnification continues, give the Agent notice of cancellation of the
Commitments of that Lender and its intention to procure the repayment of that
Lender’s participation in the Loans on the last day of the Interest Period
ending after the date of such notice (or, if earlier, on such other date as
specified by the Borrower in that notice) (the “Cancellation Date”). Before the Cancellation Date, the Lender
and the Borrower shall consult with each other for a period of 5 Business Days
with respect to the transfer of that Lender’s rights and obligations under this
Agreement to 

 19
 

 

another
reputable international bank or financial institution nominated by the Borrower
(but which is not an Affiliate of the Borrower) in accordance with Clause 22.5
(Procedure for transfer). If no
such transfer has been effected on or before the Cancellation Date, then (x) the
Borrower shall repay that Lender’s participations in the Loans (together with
accrued interest) in full on the Cancellation Date and (y) the Commitments
of that Lender shall be reduced to zero on that date.

7.6                            Restrictions

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

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

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

(d)                              The Borrower
shall not repay or prepay all or any part of the Loans or cancel all or any
part of the Commitments except at the times and in the manner expressly
provided for in this Agreement.

(e)                               No amount of
the Total Commitments cancelled under this Agreement may be subsequently
reinstated.

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

 20
 

 

 

SECTION 5

COSTS OF UTILISATION

8                                      INTEREST

8.1                            Calculation of interest

The
rate of interest on each Loan for each Interest Period is the percentage rate
per annum which is the aggregate of the applicable:

(a)                                Margin;

(b)                               LIBOR; and

(c)                                Mandatory
Cost, if any.

8.2                            Payment of interest

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

8.3                            Default interest

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

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

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

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

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

8.4                            Notification of rates of interest

The
Agent shall promptly notify the Lenders and the Borrower of the determination
of a rate of interest under this Agreement.

8.5                            Adjustment of Margin

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

 21
 

 

 

(b)                              No
adjustment shall be made to the Margin under paragraph (a) above until
receipt by the Agent of evidence satisfactory to it that the terms of Clause
20.17 (Parent Guarantee in respect of
Facility 2) have been fully complied with, including (for the
avoidance of doubt) evidence that the requisite corporate approvals have been
correctly obtained.

(c)                               Any adjustment
to the Margin under paragraph (a) above shall take effect on the date
falling two Business Days after receipt by the Agent of the evidence referred
to in paragraph (b) above.

9                                      INTEREST PERIODS

9.1                            Selection of Interest Periods

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

(b)                              Each
Selection Notice for a Loan is irrevocable and must be delivered to the Agent
by the Borrower not later than the Specified Time.

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

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

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

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

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

9.2                            Non-Business Days

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

10                               CHANGES TO THE CALCULATION OF INTEREST

10.1                     Absence
of quotations

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

10.2                     Market
disruption

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

(i)                                   the Margin;

 22
 

 

 

(ii)                                the rate
notified to the Agent by that Lender as soon as practicable and in any event
before interest is due to be paid in respect of that Interest Period, to be
that which expresses as a percentage rate per annum the cost to that Lender of
funding its participation in that Loan from whatever source it may reasonably
select; and

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

(b)                              In this
Agreement “Market Disruption Event”
means:

(i)                                   at or about
noon on the Quotation Day for the relevant Interest Period the Screen Rate is
not available and none or only one of the Reference Banks supplies a rate to
the Agent to determine LIBOR for Dollars for the relevant Interest Period; or

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

10.3                     Alternative
basis of interest or funding

(a)                               If a Market
Disruption Event occurs and the Agent or the Borrower so requires, the Agent
and the Borrower shall enter into negotiations (for a period of not more than
30 days) with a view to agreeing a substitute basis for determining the rate of
interest.

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

10.4                     Break
Costs

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

(b)                              Each Lender
shall, as soon as reasonably practicable after a demand by the Agent, provide a
certificate confirming the amount of its Break Costs for any Interest Period in
which they accrue.

11                                FEES

11.1                      Commitment fee

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

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

11.2                      Arrangement fee

The
Borrower shall pay to the Mandated Lead Arrangers an arrangement fee in the
amount and at the times agreed in the Fee Letter.

 23
 

 

 

11.3                      Agency fee

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

 24
 

 

 

SECTION 6

ADDITIONAL PAYMENT OBLIGATIONS

12                               TAX GROSS-UP AND INDEMNITIES

12.1                     Definitions

(a)                               In this
Agreement:

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

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

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

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

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

12.2                     Tax
gross-up

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

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

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

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

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

 25
 

 

 

12.3                     Tax
indemnity

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

(b)                              Paragraph (a) above
shall not apply:

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

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

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

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

(ii)                                to the
extent a loss, liability or cost is compensated for by an increased payment
under Clause 12.2 (Tax gross-up).

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

(d)                              A Protected
Party shall, on receiving a payment from the Borrower under this
Clause 12.3, notify the Agent.

12.4                     Tax Credit

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

(a)                                a Tax Credit
is attributable to that Tax Payment; and

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

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

12.5                     Stamp
taxes

The
Borrower shall pay and, within three Business Days of demand, indemnify each
Finance Party against any cost, loss or liability that Finance Party incurs in
relation to all stamp duty, registration and other similar Taxes payable in
respect of any Finance Document.

12.6                     Value
added tax

(a)                               All
consideration expressed to be payable under a Finance Document by any Party to
a Finance Party shall be deemed to be exclusive of any VAT. If VAT is
chargeable on such consideration, that Party shall pay to the Finance Party (or
directly to the appropriate tax authority, if so required by law) (in addition
to and at the same time as paying the consideration) an amount equal to the
amount of the VAT.

 26
 

 

 

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

12.7                     Tax
forms

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

(b)                              At the
request of the Borrower (acting reasonably), each Lender shall use its
reasonable efforts to provide any other documentation or information to the
Borrower that may be reasonably necessary for the Borrower to establish a
complete exemption from Ukrainian withholding tax in relation to payments of
interest under this Agreement.

13                               INCREASED COSTS

13.1                     Increased
costs

(a)                               Subject to
Clause 13.3 (Exceptions) the
Borrower shall, within three Business Days of a demand by the Agent, pay for
the account of a Finance Party the amount of any Increased Costs incurred by
that Finance Party or any of its Affiliates as a result of (i) the
introduction of or any change in (or in the interpretation, administration or
application of) any law or regulation or (ii) compliance with any law or
regulation made after the Signing Date.

(b)                              In this
Agreement “Increased Costs” means:

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

(ii)                                an
additional or increased cost; or

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

which
is incurred or suffered by a Finance Party or any of its Affiliates to the
extent that it is attributable to that Finance Party having entered into its
Commitment or funding or performing its obligations under any Finance Document.

13.2                     Increased
cost claims

(a)                               A Finance
Party intending to make a claim pursuant to Clause 13.1 (Increased costs) shall notify the Agent of
the event giving rise to the claim, following which the Agent shall promptly
notify the Borrower.

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

13.3                     Exceptions

(a)                               Clause 13.1
(Increased costs) does not apply
to the extent any Increased Cost is:

 27
 

 

 

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

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

(iii)                             compensated
for by the payment of the Mandatory Cost; or

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

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

14                               OTHER INDEMNITIES

14.1                     Currency
indemnity

(a)                               If any sum
due from the Borrower under the Finance Documents (a “Sum”), or any order, judgment or award
given or made in relation to a Sum, has to be converted from the currency (the “First Currency”) in which that Sum is
payable into another currency (the “Second
Currency”) for the purpose of:

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

(ii)                                obtaining or
enforcing an order, judgment or award in relation to any litigation or arbitration
proceedings,

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

(b)                              The Borrower
waives any right it may have in any jurisdiction to pay any amount under the
Finance Documents in a currency or currency unit other than that in which it is
expressed to be payable.

14.2                     Other
indemnities

The
Borrower shall, within three Business Days of demand, indemnify each Finance
Party against any cost, loss or liability incurred by that Finance Party as a
result of:

(a)                                the
occurrence of any Event of Default;

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

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

(d)                               a Loan (or
part of a Loan) not being prepaid in accordance with a notice of prepayment
given by the Borrower.

 28
 

 

 

14.3                     Indemnity
to the Agent

The
Borrower shall promptly indemnify the Agent against any cost, loss or liability
incurred by the Agent (acting reasonably) as a result of:

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

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

15                               MITIGATION BY THE LENDERS

15.1                     Mitigation

(a)                               Each Finance
Party shall, in consultation with the Borrower, take all reasonable steps to
mitigate any circumstances which arise and which would result in any amount
becoming payable under or pursuant to, or cancelled pursuant to, any of Clause
7.1 (Illegality), Clause 12 (Tax gross-up and indemnities) or Clause 13.1
(Increased costs) including (but
not limited to) transferring its rights and obligations under the Finance
Documents to another Affiliate or Facility Office.

(b)                              Paragraph (a) above
does not in any way limit the obligations of the Borrower under the Finance
Documents.

15.2                     Limitation
of liability

(a)                               The Borrower
shall indemnify each Finance Party for all costs and expenses reasonably
incurred by that Finance Party as a result of steps taken by it under Clause
15.1 (Mitigation).

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

16                               COSTS AND EXPENSES

16.1                     Transaction
expenses

The
Borrower shall within 15 Business Days of demand pay the Agent, the Bookrunners
and the Mandated Lead Arrangers the amount of all reasonable out-of-pocket
costs and legal expenses incurred by any of them in connection with the
negotiation, preparation, delivery, execution, administration and syndication
of:

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

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

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

16.2                     Amendment
costs

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

 29
 

 

 

16.3                     Enforcement
costs

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

 

 30

 

SECTION 7

REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT

17                               REPRESENTATIONS

The
Borrower makes the representations and warranties set out in this Clause 17 to
each Finance Party on the date of this Agreement.

17.1                     Status

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

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

17.2                     Binding
obligations

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

17.3                     Non-conflict
with other obligations

The
entry into and performance by it of, and the transactions contemplated by, the
Finance Documents do not and will not conflict with:

(a)                                any law or
regulation applicable to it;

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

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

17.4                     Power
and authority

Each
Obligor has the power to enter into, perform and deliver, and has taken all
necessary action to authorise its entry into, performance and delivery of, the
Finance Documents and the transactions contemplated by those Finance Documents.

17.5                     Validity
and admissibility in evidence

All
Authorisations required:

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

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

(c)                                to make the
Finance Documents to which each Obligor is a party admissible in evidence in
its jurisdiction of incorporation,

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

 31
 

 

 

17.6                     Governing
law and enforcement

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

(b)                              Any
arbitration award obtained in England in relation to a Finance Document will be
recognised and enforced in its jurisdiction of incorporation in accordance with
the 1958 New York Convention on Recognition and Enforcement of Foreign Arbitral
Awards.

17.7                     No
bankruptcy proceedings

Neither
the Borrower, the Parent nor any Significant Subsidiary has taken any corporate
action nor have any other steps been taken or legal proceedings been started
or, to the best of its knowledge and belief (after due inquiry), threatened
against any Obligor or any Significant Subsidiary for:

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

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

(c)                                a
composition, assignment or arrangement with any creditor of any Obligor or any
Significant Subsidiary or the convening of a meeting of creditors for the
purposes of considering an amicable settlement (as defined in the Ukrainian
Insolvency Law or the Russian Insolvency Law, as applicable);

(d)                               the
appointment of a liquidator, judicial manager, receiver and/or manager,
administrator, administrative receiver, compulsory manager, provisional
supervisor, supervisor, bankruptcy manager or other similar officer in respect
of any Obligor or any Significant Subsidiary; or

(e)                                any
analogous act in respect of any Obligor or any Significant Subsidiary in any
jurisdiction.

17.8                     No
filing or stamp taxes

Under
the law of its jurisdiction of incorporation it is not necessary that the
Finance Documents be filed, recorded, enrolled or registered with any court or
other authority in that jurisdiction, except for the registration of this
Agreement with the NBU, or that any stamp, registration or similar tax be paid
on or in relation to the Finance Documents or the transactions contemplated by
the Finance Documents, except for any fees in connection with the registration
of this Agreement with the NBU and court registration fees in connection with
any enforcement proceedings in such court.

 32
 

 

 

17.9                     Payment
of Taxes

Neither
any Obligor nor any Significant Subsidiary has overdue Tax liabilities, other
than Tax liabilities (a) whose amount, applicability or validity is being
contested in good faith by appropriate proceedings and for which adequate
reserves or other appropriate provision has been made or (b) whose amount,
together with all such other unpaid or undischarged Taxes, does not in
aggregate exceed $25,000,000 in relation to the Parent or $10,000,000 in
relation to the Borrower or any Significant Subsidiary (or its equivalent in
any other currency or currencies).

17.10              No
default

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

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

17.11               Financial
statements

(a)                               The Original
Financial Statements were prepared in accordance with GAAP consistently
applied.

(b)                              The Borrower
Audited Original Financial Statements were audited by reputable international
auditors and fairly represent the Borrower’s financial condition and operations
as at the end of and for the relevant financial year.

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

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

17.12              Pari passu ranking

Each
Obligor’s payment obligations under the Finance Documents rank at least pari passu with the claims of all its
other unsecured and unsubordinated creditors, except for obligations
mandatorily preferred by law applying to companies generally.

17.13              No
proceedings pending or threatened

Other
than:

(a)                                the Borrower
Litigation; and

(b)                               litigation
relating to assets which the Parent acquired between 1 November 2005 and
the date of this Agreement (provided that the amount claimed (if quantified by
the claimant) or otherwise the value of the claim as determined by the Agent
(acting reasonably after consultation with the Borrower) (as applicable) does
not exceed $330,000,000),

no
litigation, arbitration or administrative proceedings of or before any court,
arbitral body or agency (including but not limited to, investigative proceedings)
have, to the best of its knowledge and belief (after due inquiry), been started
or threatened against any Obligor or any Significant Subsidiary which, if
adversely determined would be reasonably likely to have a Material Adverse
Effect.

 33
 

 

 

17.14              Environmental
laws and licences

Except
as disclosed in writing to the Agent before the date hereof, each member of the
Group has:

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

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

(c)                                complied
with the terms of those Environmental Licences,

in each
case where failure to do so would be reasonably likely to have a Material
Adverse Effect.

17.15              Telecommunications
laws and licences

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

(i)                                   complied in
all material respects with all Telecommunications Laws to which it may be
subject;

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

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

in each
case other than where failure to do so would not reasonably be expected to have
a Material Adverse Effect.

(b)                              There has
been no act, omission or event which might reasonably be expected to give rise
to the material amendment, revocation, suspension, cancellation, withdrawal or
termination of any provision of any Telecommunications Authorisation. To the
best of its knowledge and belief (after due inquiry), no Telecommunications
Authorisation is the subject of any pending or threatened proceedings which, if
adversely determined, would reasonably be expected to have a Material Adverse
Effect.

17.16              Compliance
with laws

Each of
the Borrower, the Parent and the Significant Subsidiaries is conducting its
business and operations in compliance with all laws and regulations and all
directives of any government agency having legal force applicable or relevant
to it, excluding any such non-compliance which would not reasonably be expected
to have a Material Adverse Effect.

17.17              No
Immunity

(a)                               The
execution by the Borrower of the Finance Documents constitutes, and its
exercise of its rights and performance of its obligations thereunder will
constitute, private and commercial activities done and performed for private
and commercial purposes (rather than public and governmental purposes).

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

 34
 

 

 

17.18              Repetition

The
Repeating Representations are deemed to be made by the Borrower by reference to
the facts and circumstances then existing on the date of each Utilisation
Request and the first day of each Interest Period, provided that:

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

(b)                               from the
date of the Parent Guarantee until such time as the obligations of the Parent
thereunder have been discharged, the Repeating Representations (other than the
Repeating Representation in Clause 17.13 (No
Proceedings Pending or Threatened) shall be deemed to be made only
in respect of the Borrower and its Subsidiaries and not, for the avoidance of
doubt, the Parent or any other member of the Group.

18                               INFORMATION UNDERTAKINGS

The
undertakings in this Clause 18 remain in force from the date of this Agreement
for so long as any amount is outstanding under the Finance Documents or any
Commitment is in force.

18.1                     Financial
statements

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

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

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

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

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

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

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

(b)                              From the
date of the Parent Guarantee until such time as the obligations of the Parent
thereunder have been discharged, the obligation to supply (or, where
applicable, to procure to supply) the financial statements referred to in
sub-paragraphs (i) and (ii) above shall be limited to the obligation
to supply financial statements in respect of the Borrower and not, for the
avoidance of doubt, in respect of the Parent.

18.2                     Compliance
Certificate

(a)                               The Borrower
shall supply to the Agent with each set of financial statements delivered
pursuant to Clause 18.1 (Financial
statements), a Compliance Certificate setting out (in reasonable
detail)

 35
 

 

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

(b)                              Each
Compliance Certificate shall be signed by an authorised officer of the Borrower
and, if required to be delivered with the financial statements delivered
pursuant to paragraph (a) of Clause 18.1 (Financial
statements), shall be reported on by the Borrower’s auditors in the
form set out in Schedule 6 (Form of
Compliance Certificate).

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

18.3                     Requirements
as to financial statements

(a)                               Each set of
financial statements delivered by the Borrower or the Parent pursuant to Clause
18.1 (Financial statements) shall
be certified by an authorised officer of the Borrower or an authorised officer
of the Parent in respect of financial statements of the Parent as fairly
representing its (or, as the case may be, its consolidated) financial condition
and operations as at the end of and for the period in relation to which those
financial statements were drawn up.

(b)                              The Borrower
shall procure that each set of consolidated financial statements delivered
pursuant to Clause 18.1 (Financial
statements) is prepared using GAAP accounting practices and financial reference periods consistent with
those applied in the preparation of the Original Financial Statements unless,
in relation to any set of financial statements, it notifies the Agent that
there has been a change in GAAP, the accounting practices or reference periods
and its auditors deliver to the Agent:

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

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

(c)                               Any
reference in this Agreement to those financial statements shall be construed as
a reference to those financial statements as adjusted to reflect the basis upon
which the Original Financial Statements were prepared.

(d)                              The Borrower
shall procure that each set of non-consolidated financial statements delivered
pursuant to Clause 18.1 (Financial
statements):

(i)                                   in respect
of the Parent, is prepared using RAS accounting practices and financial
reference periods; and

(ii)                                in respect
of the Borrower, is prepared using GAAP accounting practices and financial
reference periods.

18.4                     Information:
miscellaneous

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

 36
 

 

 

(i)                                   all
documents dispatched by the Borrower and the Parent to their respective
shareholders (or any class of them) or their respective creditors generally at
the same time as they are dispatched;

(ii)                                promptly
upon becoming aware of them, the details of any litigation, arbitration or
administrative proceedings which are current, threatened or pending against any
member of the Group, and which would, if adversely determined, be reasonably
likely to have a Material Adverse Effect;

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

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

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

18.5                     Notification
of Default

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

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

18.6                     Know
your customer checks

(a)                               If:

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

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

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

obliges
the Agent or any Lender (or, in the case of paragraph (iii) above, any
prospective new Lender) to comply with “know your customer” or similar
identification procedures in circumstances where the necessary information is
not already available to it, the Borrower shall promptly upon the request of
the Agent or any Lender supply, or procure the supply of, such documentation
and other evidence as is reasonably requested by the Agent (for itself or on
behalf of any Lender) or any Lender (for itself or, in the case of the event
described in paragraph (iii) above, on behalf of any prospective new
Lender) in order for the Agent, such Lender or, in the case of the event
described in paragraph (iii) above, any prospective new Lender to carry
out and be satisfied it has complied with all necessary “know your customer” or
other similar

 37
 

 

checks
under all applicable laws and regulations pursuant to the transactions
contemplated in the Finance Documents.

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

19                               FINANCIAL COVENANTS

The
financial undertakings in this Clause 19 shall remain in force from the Signing
Date for so long as any amount is outstanding under the Finance Documents or
any Commitment is in force.

19.1                     Financial
condition

The
Borrower shall ensure that:

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

(b)                               the ratio of
Consolidated Total Debt to Consolidated Total Net Worth will not exceed 1:1 at
any time;

(c)                                for each
Measurement Period, the ratio of aggregate Consolidated EBITDA for that
Measurement Period and the previous Measurement Period to aggregate Debt
Service for that Measurement Period and the previous Measurement Period will
not be less than 1.75:1; and

(d)                               during any
financial year of the Borrower, the ratio of aggregate Consolidated EBITDA for
that financial year to aggregate Debt Service for that financial year will not
be less than 1.75:1.

19.2                     Financial
covenant calculations

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

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

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

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

19.3                     Definitions

In this
Clause 19:

 38
 

 

 

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

“Consolidated EBITDA” means the consolidated
net pre-taxation profits of the UMC Group for a Measurement Period, all as
adjusted by:

(i)                                   adding back
consolidated interest payable;

(ii)                                subtracting
any consolidated interest receivable;

(iii)                             taking no
account of any exceptional or extraordinary item;

(iv)                            excluding any amount attributable to
minority interests;

(v)                               adding back
depreciation and amortisation;

(vi)                            adding back unrealised FX losses;

(vii)                         subtracting unrealised FX gains; and

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

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

(a)                                the
outstanding principal amount of any moneys borrowed;

(b)                               the
outstanding principal amount of any acceptance under any acceptance credit;

(c)                                the
outstanding principal amount of any bond, note, debenture, loan stock or other
similar instrument;

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

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

(f)                                  the
outstanding principal amount of any indebtedness arising from any deferred
payment agreements arranged primarily as a method of raising finance or
financing the acquisition of an asset;

(g)                               any fixed or
minimum premium payable on the repayment or redemption of any instrument referred
to in paragraph (c) above;

(h)                               the
outstanding principal amount of any indebtedness arising in connection with any
other transaction (including any forward sale or purchase agreement) which has
the commercial effect of a borrowing; and

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

“Consolidated Total Net Worth” means at any
time the aggregate of:

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

 39
 

 

 

(b)                               the amount
standing to the credit of the consolidated capital and revenue reserves of the
UMC Group,

based
on the consolidated balance sheet of the Borrower as reported in its financial
statements delivered at the end of each Measurement Period but adjusted by:

(i)                                   deducting
any dividend or other distribution declared, recommended or made by any member
of the UMC Group; and

(ii)                                excluding
any amount attributable to minority interests.

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

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

“UMC Group” means the Borrower and its
Subsidiaries, if any.

20                               GENERAL UNDERTAKINGS

Subject
to Clause 20.18 (Undertakings in respect of
members of the Group), the undertakings in this Clause 20 remain in
force from the date of this Agreement for so long as any amount is outstanding
under the Finance Documents or any Commitment is in force.

20.1                     Authorisations
and registration

(a)                               The Borrower
shall promptly:

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

(ii)                                supply
certified copies to the Agent of,

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

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

20.2                     Compliance
with laws

The
Borrower shall, and shall procure that the Parent shall, comply in all respects
with all laws to which it may be subject, if failure so to comply would
materially impair its ability to perform its obligations under the Finance
Documents.

20.3                     Maintenance
of existence

The
Borrower shall, and shall ensure that the Parent shall, maintain its corporate
existence.

 40
 

 

 

20.4                     Negative
pledge

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

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

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

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

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

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

in
circumstances where the arrangement or transaction is entered into primarily as
a method of raising Financial Indebtedness or of financing the acquisition of
an asset.

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

20.5                     Disposals

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

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

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

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

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

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

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

When
calculating the Parent’s Total Assets under sub-clause (v) above, if the
annual consolidated balance sheet of the Borrower for the immediately preceding
financial year of the Parent is not available, the Parent’s Total Assets shall
be calculated by reference to the draft audit report then available for that
financial year and any other evidence reasonably requested by, and reasonably
satisfactory to, the Agent.

 41
 

 

 

20.6                     Merger

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

(b)                              The Borrower
shall, and shall ensure that no Significant Subsidiary will, enter into or
become subject to any consolidation or reorganisation, whether by way of merger
(sliyaniye obschestva/ zlittya tovaristva),
company accession (prisoedinyeniye
obschestva/priyednannya tovarystva), company division (razdeleyeniey obschestva/podil tovarystva),
company separation (vydelyeniye
obschestva/vydil tovarystva), company transformation (preobrazovaniye  obschestva/peretvorennya tovarystva), company liquidation (likvidatsiya obschestva/likvidatisya tovarystva) or any other company reorganisation
(reorganizatsiya obschestva/reorganizaciya
tovarystva) (as these terms are construed by applicable law) or
otherwise, or any analogous transaction in any jurisdiction if such
reorganisation or transaction would, in the opinion of the Agent (acting
reasonably), have a Material Adverse Effect.

20.7                     Change
of business

The
Borrower shall procure that no substantial change is made to the general nature
of the business of the Parent or the Group from that carried on at the Signing
Date.

20.8                     Conduct
of business

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

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

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

(c)                                the terms of
all relevant Telecommunications Authorisations.

20.9                     Asset
maintenance

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

20.10              Insurance

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

 42
 

 

 

20.11               Transactions
with Related Parties

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

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

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

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

(b)                              Paragraph (a) above
does not apply to:

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

(ii)                                transactions
between members of the Group.

(c)                               For the
purposes of this Clause 20.11 only, a “Related
Party” means, with respect to any specified person:

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

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

For
purposes of the definition of “Related Party”
only, “control” (including, with
correlative meanings, the terms “controlling,”
“controlled by” and “under common control with”), as used with
respect to any person, shall mean the possession, directly or indirectly, of
the power to direct or cause the direction of the management or policies of
such person, whether through the ownership of voting securities, by agreement
or otherwise; provided that beneficial ownership of 10 per cent. or more of any
class, or any series of any class, of equity securities of a person, whether or
not voting, shall be deemed to be control.

20.12              Restriction on acquisitions

The
Borrower shall ensure that the Parent shall not establish or acquire any
Subsidiary or invest in any other entity without the consent of the Majority
Lenders (such consent not to be unreasonably withheld), provided that this
Clause 20.12 shall not apply to (i) any investment in connection with
the acquisition of certain assets from Telsim Mobil Telekomunikasyon Hizmetleri
A.S. in accordance with the process outlined in the tender document dated on or
around June 2005 and issued by the Savings Deposit Insurance Fund and (ii) any
such acquisition or investment where:

(a)                                such
acquisition or investment relates to a Subsidiary or entity whose principal
business is telecommunications or the provision of data services or related or
ancillary businesses; and

 43
 

 

 

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

20.13              Prompt
payment of Taxes

The
Borrower shall (and shall ensure that the Parent and each Significant
Subsidiary will) duly pay all Taxes payable by it, other than (a) those
taxes which are being contested in good faith and by appropriate proceedings
and in respect of which adequate reserves or other appropriate provisions have
been made; or (b) whose amount does not exceed $25,000,000 (or its
equivalent in any other currencies).

20.14              Pari passu

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

20.15              Loans
and guarantees

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

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

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

(b)                              The
restrictions in paragraph (a) above do not apply to (i) loans,
credits, financial accommodation, guarantees, indemnities, bonds and letters of
credit expressly permitted by the Finance Documents or for normal trade credit
on arm’s length terms and in the ordinary course of business or granted by a
member of the Group to another member of the Group, provided that the aggregate
amount of such loans, credits, financial accommodation, guarantees,
indemnities, bonds and letters of credit does not at any time exceed 10 per
cent. of the Parent’s Total Assets; (ii) guarantees by the Parent in
relation to the obligations of any other member of the Group; or (iii) the
arrangements permitted under Clause 20.11 (Transactions
with Related Parties).

20.16              Parent
Guarantee in respect of Facility 1

The
Borrower shall procure that as soon as practicable, but in any event no later
than 21 December 2005, the Parent shall enter into the Parent Guarantee.

20.17              Parent
Guarantee in respect of Facility 2

(a)                               The Borrower
shall ensure that the agenda of the Parent’s next general shareholders’ meeting
following the date of this Agreement shall include as an item, in a form
satisfactory to the Agent,

 44
 

 

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

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

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

20.18              Undertakings
on behalf of other members of the Group

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

21                               EVENTS OF DEFAULT

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

21.1                     Non-payment

An
Obligor does not pay on the due date any amount payable pursuant to a Finance
Document at the place at and in the currency in which it is expressed to be
payable unless:

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

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

21.2                     Financial
covenants

Any
requirement of Clause 19 (Financial
Covenants) is not satisfied.

21.3                     Other
obligations

(a)                               An Obligor
does not comply with any provision of the Finance Documents (other than those
referred to in Clause 21.1 (Non-payment)
and Clause 21.2 (Financial Covenants)).

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

21.4                     Misrepresentation

Any
representation or statement made or deemed to be made by an Obligor in the
Finance Documents or any other document delivered by or on behalf of the
Borrower under or in connection with any Finance Document is or proves to have
been incorrect or misleading in any material respect when made or deemed to be
made, and such representation or statement shall

 45
 

 

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

21.5                     Cross
default

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

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

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

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

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

21.6                     Insolvency

(a)                               An Obligor
or a Significant Subsidiary is unable or admits its inability to pay its debts
as they fall due, suspends making payments on its debts generally or, by reason
of actual or anticipated financial difficulties, commences negotiations with
one or more of its creditors with a view to rescheduling its indebtedness
generally.

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

(c)                               A moratorium
is declared in respect of the indebtedness of an Obligor or a Significant
Subsidiary.

21.7                     Insolvency
proceedings

Any
corporate action, legal proceedings or other procedures are taken in relation
to:

(a)                                the
bankruptcy, winding-up, insolvency, dissolution, administration, reorganisation
or liquidation of an Obligor or a Significant Subsidiary, including, but not
limited to, institution of supervision (nablyudenie),
bankruptcy administration (rozporyadjennya),
financial rehabilitation (finansovoe
ozdorovlenie) or any other rehabilitation procedure

 46
 

 

(sanatsiya),
external management (vneshneye upravlenie),
bankruptcy management (konkursnoye
upravlenie) or liquidation procedure (likvidatsiyna procedura) (and such legal proceedings
continue for at least 14 days);

(b)                               the
suspension of payments, composition, assignment or arrangement with any
creditor, or a moratorium of any indebtedness, of an Obligor or a Significant
Subsidiary (and such suspension continues for at least 14 days);

(c)                                the
presentation or filing of a petition (or similar document) in respect of an
Obligor or a Significant Subsidiary in any court, state arbitration court (arbitrazhnyi sud), commercial court (gospodarskyi sud) or before any other
authority in respect of the bankruptcy, winding-up, insolvency, dissolution,
administration, reorganisation, provisional supervision, supervision or liquidation
of an Obligor or a Significant Subsidiary (and such petition has not been
discharged within 14 days);

(d)                               the
appointment of a liquidator (likvidator)
or a liquidation commission (likvidatsionnaya
komissiya/likvidatsiyna komisiya),
temporary manager (vremenniy upravlaushiy),
assets manager (rozporyadnyk mayna),
external manager (konkursniy upravlaushiy),
sanation manager (keruyuchyi sanatsieyu),
administrative manager (administrativniy
upravlaushiy), bankruptcy manager (konkursniy
upravlaushiy/arbitrajnyi keruyuchyi),
receiver, administrator, administrative receiver, compulsory manager,
provisional supervisor, supervisor or other similar officer in respect of an
Obligor or a Significant Subsidiary or any of its assets (and such appointment
continues for at least 14 days); or

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

or any
analogous procedure or step is taken in any jurisdiction.

21.8                     Creditors’
process

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

21.9                     Judgment

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

21.10              Loss of
Licence

(a)                                  Any action
results in the suspension for more than 30 days or the loss, revocation or
termination of any of:

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

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

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

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

except
where, within 30 days of any such event, the relevant licence is re-issued on
substantially the same terms to any member of the Group and during the period
falling before

 47
 

 

such
re-issuance there is no material interruption to, or other material adverse
effect on, the operations permitted by such licence as a direct result of such
prior loss, revocation or termination.

(b)                              Any of the
Parent’s or the Borrower’s GSM 900 or
1800 licences are amended (or any conditions are imposed with respect to any
such licence) in a manner that, in the reasonable opinion of the Majority
Lenders, has or is reasonably likely to have a Material Adverse Effect.

(c)                               Any of the
Parent’s or the Borrower’s assigned
spectrum allocations are reassigned to other users (other than a Significant
Subsidiary of the Parent), cancelled or otherwise lost, and such event, in the
reasonable opinion of the Majority Lenders, has or is reasonably likely to have
a Material Adverse Effect.

(d)                              The Parent
sells, leases or otherwise transfers any of its GSM 900 or 1800 licences for
the Moscow licence area.

(e)                               Any of the
Parent’s GSM 900 or 1800 licences (other than its GSM 900 and 1800 licences for
the Moscow licence area) is sold, leased or transferred to any person that is
not (directly or indirectly) a wholly-owned Subsidiary of the Parent.

(f)

(i)                                   Any of the
GSM 900 or 1800 licences of the Borrower is sold, leased or transferred to any
person that is not (directly or indirectly) a wholly-owned Subsidiary of the
Parent.

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

21.11               Cessation
of Business

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

21.12              Expropriation

(a)                               By or under
the authority of any government:

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

(ii)                                the
management of any member of the Group is wholly or partially displaced or the
authority of any member of the Group in the conduct of its business is wholly
or partially curtailed; or

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

21.13              Russian
or Ukrainian Foreign Exchange Restrictions

Any
foreign exchange law is enacted or introduced in the Russian Federation or
Ukraine which has the effect of prohibiting, restricting or delaying any
payment by the Borrower or any member of the Group under the Finance Documents.

 48
 

 

 

21.14              Moratorium

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

21.15              The
Russian Federation

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

21.16              Ukraine

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

21.17              Unlawfulness

It is
or becomes unlawful for an Obligor to perform any of its obligations under the
Finance Documents.

21.18              Repudiation

An
Obligor repudiates a Finance Document or evinces an intention to repudiate a
Finance Document.

21.19              Borrower
Litigation

The
Borrower Litigation is adversely determined and, in the reasonable opinion of
the Majority Lenders, such adverse determination has or is reasonably likely to
have a Material Adverse Effect.

21.20              Material
adverse change

The
Majority Lenders determine that a Material Adverse Effect exists, has occurred
or is reasonably likely to occur.

21.21              Acceleration

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

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

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

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

 

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SECTION 8

CHANGES TO PARTIES

22                               CHANGES TO THE LENDERS

22.1                     Assignments
and transfers by the Lenders

(a)                               Subject to
this Clause 22, a Lender (the “Existing
Lender”) may:

(i)                                   assign any
of its rights; or

(ii)                                transfer by
novation any of its rights and obligations,

to
another bank or financial institution or to a trust, fund or other entity which
is regularly engaged in or established for the purpose of making, purchasing or
investing in loans, securities or other financial assets (the “New Lender”).

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

22.2                     Conditions
of assignment or transfer

(a)                               An
assignment will only be effective on:

(i)                                   receipt by
the Agent of written confirmation from the New Lender (in form and substance
satisfactory to the Agent) that the New Lender will assume the same obligations
to the other Finance Parties as it would have been under if it was an Original
Lender; and

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

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

22.3                     Assignment
or transfer fee

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

22.4                     Limitation
of responsibility of Existing Lenders

(a)                               Unless
expressly agreed to the contrary, an Existing Lender makes no representation or
warranty and assumes no responsibility to a New Lender for:

(i)                                   the
legality, validity, effectiveness, adequacy or enforceability of the Finance
Documents or any other documents;

(ii)                                the
financial condition of any Obligor;

 50
 

 

 

(iii)                             the
performance and observance by any Obligor of its obligations under the Finance
Documents or any other documents; or

(iv)                            the accuracy of any statements (whether
written or oral) made in or in connection with any Finance Document or any
other document,

and any
representations or warranties implied by law are excluded.

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

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

(ii)                                will
continue to make its own independent appraisal of the creditworthiness of each
Obligor and its related entities whilst any amount is or may be outstanding
under the Finance Documents or any Commitment is in force.

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

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

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

22.5                     Procedure
for transfer

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

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

(c)                               On the
Transfer Date:

(i)                                   to the
extent that in the Transfer Certificate the Existing Lender seeks to transfer
by novation its rights and obligations under the Finance Documents the Obligors
and the Existing Lender shall be released from further obligations towards one
another under the Finance Documents and their respective rights against one
another under the Finance Documents shall be cancelled (being the “Discharged Rights and Obligations”);

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

 51
 

 

 

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

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

22.6                     Disclosure
of information

Any
Lender may disclose to any of its Affiliates and any other person:

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

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

(c)                                to whom, and
to the extent that, information is required to be disclosed by any applicable
law or regulation,

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

23                               CHANGES TO THE BORROWER

The
Borrower may not assign any of its rights or transfer any of its rights or
obligations under the Finance Documents.

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SECTION 9

THE FINANCE PARTIES

24                               ROLE OF THE AGENT AND THE MANDATED LEAD
ARRANGERS

24.1                     Appointment
of the Agent

(a)                               Each other
Finance Party appoints the Agent to act as its agent under and in connection
with the Finance Documents.

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

24.2                     Duties
of the Agent

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

(b)                              Except where
a Finance Document specifically provides otherwise, the Agent is not obliged to
review or check the adequacy, accuracy or completeness of any document it
forwards to another Party.

(c)                               If the Agent
receives notice from a Party referring to this Agreement, describing a Default
and stating that the circumstance described is a Default, it shall promptly
notify the Finance Parties.

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

(e)                               The Agent’s
duties under the Finance Documents are solely mechanical and administrative in
nature.

24.3                     Role of
the Mandated Lead Arrangers

Except
as specifically provided in the Finance Documents, the Mandated Lead Arrangers
have no obligations of any kind to any other Party under or in connection with
any Finance Document.

24.4                     No
fiduciary duties

(a)                               Nothing in
this Agreement constitutes the Agent or any Mandated Lead Arranger as a trustee
or fiduciary of any other person.

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

24.5                     Business
with the Group

The
Agent and the Mandated Lead Arrangers may accept deposits from, lend money to
and generally engage in any kind of banking or other business with any member
of the Group.

24.6                     Rights
and discretions of the Agent

(a)                               The Agent
may rely on:

 53
 

 

 

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

(ii)                                any
statement made by a director, authorised signatory or employee of any person
regarding any matters which may reasonably be assumed to be within his
knowledge or within his power to verify.

(b)                              The Agent
may assume, unless it has received notice to the contrary in its capacity as
agent for the Lenders, that:

(i)                                   no Default
has occurred (unless it has actual knowledge of a Default arising under Clause
21.1 (Non-payment)); and

(ii)                                any right,
power, authority or discretion vested in any Party or the Majority Lenders has
not been exercised.

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

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

(e)                               The Agent
may disclose to any other Party any information it reasonably believes it has
received as agent under this Agreement.

(f)                                 Notwithstanding
any other provision of any Finance Document to the contrary, neither the Agent
nor any Mandated Lead Arranger is obliged to do or omit to do anything if it
would or might in its reasonable opinion constitute a breach of any law or
regulation or a breach of a fiduciary duty or duty of confidentiality.

24.7                     Majority
Lenders’ instructions

(a)                               Unless a
contrary indication appears in a Finance Document, the Agent shall (i) exercise
any right, power, authority or discretion vested in it as Agent in accordance
with any instructions given to it by the Majority Lenders (or, if so instructed
by the Majority Lenders, refrain from exercising any right, power, authority or
discretion vested in it as Agent) and (ii) not be liable for any act (or
omission) if it acts (or refrains from taking any action) in accordance with an
instruction of the Majority Lenders.

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

(c)                               The Agent
may refrain from acting in accordance with the instructions of the Majority
Lenders (or, if appropriate, the Lenders) until it has received such security
as it may require for any cost, loss or liability (together with any associated
VAT) which it may incur in complying with the instructions.

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

(e)                               The Agent is
not authorised to act on behalf of a Lender (without first obtaining that
Lender’s consent) in any legal or arbitration proceedings relating to any
Finance Document.

24.8                     Responsibility
for documentation

Neither
the Agent nor any Mandated Lead Arranger:

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

(b)                               is
responsible for the legality, validity, effectiveness, adequacy or
enforceability of any Finance Document or any other agreement, arrangement or
document entered into, made or executed in anticipation of or in connection
with any Finance Document.

24.9                     Exclusion
of liability

(a)                               Without
limiting paragraph (b) below, the Agent will not be liable for any action
taken by it under or in connection with any Finance Document, unless directly
caused by its gross negligence or wilful misconduct.

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

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

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

24.10              Lenders’
indemnity to the Agent

Each
Lender shall (in proportion to its share of the Total Commitments or, if the
Total Commitments are then zero, to its share of the Total Commitments
immediately prior to their reduction to zero) indemnify the Agent, within three
Business Days of demand, against any cost, loss or liability incurred by the
Agent (otherwise than by reason of the Agent’s gross negligence or wilful
misconduct) in acting as Agent under the Finance Documents (unless the Agent
has been reimbursed by an Obligor pursuant to a Finance Document).

24.11               Resignation
of the Agent

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

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

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

 55
 

 

 

(d)                              The retiring
Agent shall, at its own cost, make available to its successor such documents
and records and provide such assistance as its successor may reasonably request
for the purposes of performing its functions as Agent under the Finance
Documents.

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

(f)                                 Upon the
appointment of a successor, the retiring Agent shall be discharged from any
further obligation in respect of the Finance Documents but shall remain
entitled to the benefit of this Clause 24. Its successor and each of the other
Parties shall have the same rights and obligations amongst themselves as they
would have had if such successor had been an original Party.

(g)                              After
consultation with the Borrower, the Majority Lenders may, by notice to the
Agent, require it to resign in accordance with paragraph (b) above. In
this event, the Agent shall resign in accordance with paragraph (b) above.

24.12              Confidentiality

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

(b)                              If information
is received by another division or department of the Agent, it may be treated
as confidential to that division or department and the Agent shall not be
deemed to have notice of it.

24.13              Relationship
with the Lenders

(a)                               The Agent
may treat each Lender as a Lender, entitled to payments under this Agreement
and acting through its Facility Office unless it has received not less than
five Business Days prior notice from that Lender to the contrary in accordance
with the terms of this Agreement.

(b)                              Each Lender
shall supply the Agent with any information required by the Agent in order to
calculate the Mandatory Cost in accordance with Schedule 4 (Mandatory Cost  formula).

24.14              Credit
appraisal by the Lenders

Without
affecting the responsibility of the Borrower for information supplied by it or
on its behalf in connection with any Finance Document, each Lender confirms to
the Agent and the Mandated Lead Arrangers that it has been, and will continue
to be, solely responsible for making its own independent appraisal and
investigation of all risks arising under or in connection with any Finance
Document including but not limited to:

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

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

(c)                                whether that
Lender has recourse, and the nature and extent of that recourse, against any
Party or any of its respective assets under or in connection with any Finance
Document, the transactions contemplated by the Finance Documents or any other
agreement, arrangement or document entered into, made or executed in anticipation
of, under or in connection with any Finance Document; and

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

 56
 

 

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

24.15              Reference
Banks

If a
Reference Bank (or, if a Reference Bank is not a Lender, the Lender of which it
is an Affiliate) ceases to be a Lender, the Agent shall (in consultation with
the Borrower) appoint another Lender or an Affiliate of a Lender to replace
that Reference Bank.

24.16              Deduction
from amounts payable by the Agent

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

25                               CONDUCT OF BUSINESS BY THE FINANCE PARTIES

No
provision of this Agreement will:

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

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

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

26                               SHARING AMONG THE FINANCE PARTIES

26.1                     Payments
to Finance Parties

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

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

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

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

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26.2                     Redistribution
of payments

The
Agent shall treat the Sharing Payment as if it had been paid by the Borrower
and distribute it between the Finance Parties (other than the Recovering
Finance Party) in accordance with Clause 27.5 (Partial
payments).

26.3                     Recovering
Finance Party’s rights

(a)                               On a
distribution by the Agent under Clause 26.2 (Redistribution
of payments), the Recovering Finance Party will be subrogated to the
rights of the Finance Parties which have shared in the redistribution.

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

26.4                     Reversal
of redistribution

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

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

(b)                               that
Recovering Finance Party’s rights of subrogation in respect of any
reimbursement shall be cancelled and the Borrower will be liable to the
reimbursing Finance Party for the amount so reimbursed.

26.5                     Exceptions

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

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

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

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

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SECTION 10

ADMINISTRATION

27                               PAYMENT MECHANICS

27.1                     Payments
to the Agent

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

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

27.2                     Distributions
by the Agent

Each
payment received by the Agent under the Finance Documents for another Party
shall, subject to Clause 27.3 (Distributions
to  the  Borrower) and Clause 27.4 (Clawback), be made available by the Agent
as soon as practicable after receipt to the Party entitled to receive payment
in accordance with this Agreement (in the case of a Lender, for the account of
its Facility Office), to such account as that Party may notify to the Agent by
not less than five Business Days’ notice with a bank in the principal financial
centre of the country of that currency.

27.3                     Distributions
to the Borrower

The
Agent may (with the Borrower’s consent or in accordance with Clause 28 (Set-off)) apply any amount received by it
for the Borrower in or towards payment (on the date and in the currency and
funds of receipt) of any amount due from the Borrower under the Finance
Documents or in or towards purchase of any amount of any currency to be so
applied.

27.4                     Clawback

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

(b)                              If the Agent
pays an amount to another Party and it proves to be the case that the Agent had
not actually received that amount, then the Party to whom that amount (or the
proceeds of any related exchange contract) was paid by the Agent shall on
demand refund the same to the Agent together with interest on that amount from
the date of payment to the date of receipt by the Agent, calculated by the
Agent to reflect its cost of funds.

27.5                     Partial
payments

(a)                               If the Agent
receives a payment that is insufficient to discharge all the amounts then due
and payable by the Borrower under the Finance Documents, the Agent shall apply
that payment towards the obligations of the Borrower under the Finance
Documents in the following order:

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

 59
 

 

 

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

(iii)                             thirdly, in
or towards payment pro rata of any principal due but unpaid under this
Agreement; and

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

(b)                              The Agent
shall, if so directed by the Majority Lenders, vary the order set out in
paragraphs (a)(ii) to (iv) above.

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

27.6                     No
set-off by the Borrower

All
payments to be made by the Borrower under the Finance Documents shall be calculated
and be made without (and free and clear of any deduction for) set-off or
counterclaim.

27.7                     Business
Days

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

(b)                              During any
extension of the due date for payment of any principal or Unpaid Sum under this
Agreement interest is payable on the principal or Unpaid Sum at the rate
payable on the original due date.

27.8                     Currency
of account

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

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

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

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

(e)                               Any amount
expressed to be payable in a currency other than Dollars shall be paid in that
other currency.

27.9                     Change
of currency

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

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

 60
 

 

 

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

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

28                               SET-OFF

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

29                               NOTICES

29.1                     Communications
in writing

Any
communication to be made under or in connection with the Finance Documents
shall be made in writing and, unless otherwise stated, may be made by fax or
letter.

29.2                     Addresses

The
address and fax number (and the department or officer, if any, for whose
attention the communication is to be made) of each Party for any communication
or document to be made or delivered under or in connection with the Finance
Documents is:

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

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

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

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

29.3                     Delivery

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

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

(ii)                                if by way of
letter, when it has been left at the relevant address or five Business Days
after being deposited in the post postage prepaid in an envelope addressed to
it at that address,

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

 61
 

 

 

(b)                              Any
communication or document to be made or delivered to the Agent will be
effective only when actually received by the Agent and then only if it is
expressly marked for the attention of the department or officer identified with
its signature below (or any substitute department or officer as it shall
specify for this purpose).

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

29.4                     Notification
of address and fax number

Promptly
upon receipt of notification of an address and fax number or change of address
or fax number pursuant to Clause 29.2 (Addresses)
or changing its own address or fax number, the Agent shall notify the other
Parties.

29.5                     Electronic
communication

(a)                               Any
communication to be made between the Agent and a Lender under or in connection
with the Finance Documents may be made by electronic mail or other electronic
means, if the Agent and the relevant Lender:

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

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

(iii)                             notify each
other of any change to their address or any other such information supplied by
them.

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

29.6                     English
language

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

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

(i)                                   in English;
or

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

30                               CALCULATIONS AND CERTIFICATES

30.1                     Accounts

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

 62
 

 

 

30.2                     Certificates
and Determinations

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

30.3                     Day
count convention

Any
interest, commission or fee accruing under a Finance Document will accrue from
day to day and is calculated on the basis of the actual number of days elapsed
and a year of  360 days or, in any case
where the practice in the London interbank market differs, in accordance with
that market practice.

31                               PARTIAL INVALIDITY

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

32                               REMEDIES AND WAIVERS

No
failure to exercise, nor any delay in exercising, on the part of any Finance
Party, any right or remedy under the Finance Documents shall operate as a
waiver, nor shall any single or partial exercise of any right or remedy prevent
any further or other exercise or the exercise of any other right or remedy. The
rights and remedies provided in this Agreement are cumulative and not exclusive
of any rights or remedies provided by law.

33                               AMENDMENTS AND WAIVERS

33.1                     Required
consents

(a)                               Subject to
Clause 33.2 (Exceptions) any term
of the Finance Documents may be amended or waived only with the consent of the
Majority Lenders and the Borrower and any such amendment or waiver will be
binding on all Parties.

(b)                              The Agent
may effect, on behalf of any Finance Party, any amendment or waiver permitted
by this Clause.

33.2                     Exceptions

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

(i)                                   the definition
of “Majority Lenders” in Clause
1.1 (Definitions);

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

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

(iv)                            an increase in or an extension of any
Commitment;

(v)                               a change to
an Obligor;

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

 63
 

 

 

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

shall not be made
without the prior consent of all the Lenders.

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

34                               COUNTERPARTS

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

 

 64

 

SECTION 11

GOVERNING LAW AND ENFORCEMENT

35                               GOVERNING LAW

This
Agreement is governed by English law.

36                               ARBITRATION

36.1                     Arbitration

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

36.2                     Procedure
for arbitration

(a)                               The arbitral
tribunal shall consist of three arbitrators. The claimant(s), irrespective of
number, shall nominate jointly one arbitrator; the respondent(s), irrespective
of number, shall nominate jointly the second arbitrator; and a third
arbitrator, who shall serve as Chairman (who shall be a lawyer currently
qualified in England and Wales and be admitted to the Bar of England and
Wales), shall be appointed by the LCIA Court within 15 days of the appointment
of the second arbitrator.

(b)                              In the event
the claimant(s) or the respondent(s) shall fail to nominate an
arbitrator within the time limits specified in the Rules, such arbitrator shall
be appointed by the LCIA Court within 15 days of such failure. In the event
that both the claimant(s) and the respondent(s) fail to nominate an
arbitrator within the time limits specified in the Rules, all three arbitrators
shall be appointed by the LCIA Court within 15 days of such failure who shall
designate one of them as chairman.

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

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

36.3                     Recourse
to courts

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

36.4                     Agent’s
option

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

 65
 

 

 

37                               JURISDICTION

37.1                     Jurisdiction
of English courts

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

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

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

37.2                     Service
of process

Without
prejudice to any other mode of service allowed under any relevant law, the
Borrower:

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

(b)                               agrees that
failure by a process agent to notify the Borrower of the process will not
invalidate the proceedings concerned.

37.3                     Waiver
of immunity

The
Borrower irrevocably agrees that, should any party take any proceedings
anywhere (whether for an injunction, specific performance, damages or
otherwise), no immunity (to the extent that it may at any time exist, whether
on the grounds of sovereignty or otherwise) from those proceedings, from
attachment (whether in aid of execution, before judgment or otherwise) of its
assets or from execution of judgment shall be claimed by it or on behalf of it
or with respect to its assets, any such immunity being irrevocably waived. The
Borrower irrevocably agrees that it and its assets are, and shall be, subject
to such proceedings, attachment or execution in respect of its obligations
under the Finance Documents.

This Agreement has been entered
into on the date stated at the beginning of this Agreement.

 66
 

 

 

SCHEDULE 1

The Original Lenders

 

	
  Name of Original Lender

  	
   

  	
  Facility 1

  Commitment

  (US$)

  	
   

  	
  Facility 2

  Commitment

  (US$)

  	
   

  
	
  Citibank, N.A.

  	
   

  	
  34,333,333.34

  	
   

  	
  32,333,333.33

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ING Bank N.V.

  	
   

  	
  34,333,333.33

  	
   

  	
  32,333,333.34

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Raiffeisen
  Zentralbank Österreich
  AG

  	
   

  	
  34,333,333.33

  	
   

  	
  32,333,333.33

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL:

  	
   

  	
  103,000,000

  	
   

  	
  97,000,000

  	
   

  

 

 67
 

 

 

SCHEDULE 2

Conditions precedent

Part I

1                                      Finance Documents

Executed
originals of:

(a)                                this
Agreement;

(b)                               the Fee
Letter; and

(c)                                the Mandate
Letter.

2                                      The Borrower

(a)                               Certified
copies of the Borrower’s duly registered constitutional documents and the
certificates of state registration of the Borrower.

(b)                              Certified
copy of the most recent certificate from the Unified State Register of
Enterprises and Organisations of Ukraine.

(c)                               Certified
copies of all corporate resolutions necessary to authorise the Borrower to
execute and perform the Finance Documents and any documents referred to therein
and the transactions contemplated thereunder (including but not limited to any
major transaction approvals or interested party transaction approvals, if
applicable).

(d)                              Evidence of
the authority of the relevant signatories of the Borrower (including, but not
limited to, its Chief Accountant and Chairman) to execute each Finance Document
to which it is a party and any documents referred to therein and the
transactions contemplated thereunder.

(e)                               A certified
copy of the most recent balance sheet of the Borrower and the Parent by
reference to the date of each Finance Document.

(f)                                 a certified
copy of each of the Original Financial Statements.

(g)                              A
certificate executed on behalf of each of the Borrower:

(i)                                   certifying
the sample signature and office of each person that signed the relevant Finance
Document and any documents referred to therein and the transactions
contemplated thereunder on behalf of the Borrower and certifying that such
signatories hold the positions in which capacity they executed such documents;
and

(ii)                                certifying
that each copy document relating to it specified in this Schedule 2 Part I
is correct, complete and in full force and effect as at a date no earlier than
the date of this Agreement.

3                                      Legal opinions

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

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

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

(d)                              An in-house
legal opinion of the Borrower.

 68
 

 

 

4                                      Other documents and evidence

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

(b)                              A copy of
any other Authorisation or other document, opinion or assurance which the Agent
considers to be necessary or desirable (if it has notified the Borrower
accordingly) in connection with the entry into and performance of the transactions
contemplated by any Finance Document or for the validity and enforceability of
any Finance Document.

(c)                               The Original
Financial Statements.

(d)                              Evidence
that the fees, costs and expenses then due from the Borrower pursuant to Clause
11 (Fees) and 16 (Costs and expenses) have been paid or will
be paid by the first Utilisation Date.

(e)                               The
Registration Certificate of the NBU confirming the registration of this
Agreement as required by Ukrainian law.

(f)                                 Evidence
that the relevant accounts with the Ukrainian Servicing Bank has been
established.

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

 69
 

 

 

Part II

1                                      Parent Guarantee

Executed
original of the Parent Guarantee

2                                      The Parent

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

(b)                              Certified
copies of all corporate resolutions necessary to authorise the Parent to
execute and perform the Finance Documents and any documents referred to therein
and the transactions contemplated thereunder (including but not limited to any
major transaction approvals or interested party transaction approvals, if
applicable).

(c)                               Evidence of
the authority of the relevant signatories of the Parent (including, but not
limited to, its Chief Accountant) to execute each Finance Document to which it
is a party and any documents referred to therein and the transactions
contemplated thereunder.

(d)                              A certified
copy of the most recent balance sheet of the Parent by reference to the date of
each Finance Document.

(e)                               A
certificate executed on behalf of the Parent:

(i)                                   certifying
the sample signature and office of each person that signed the relevant Finance
Document and any documents referred to therein and the transactions
contemplated thereunder on behalf of the Parent and certifying that such
signatories hold the positions in which capacity they executed such documents;
and

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

3                                      Legal opinions

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

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

(c)                               An in-house
legal opinion of the Parent.

4                                      Other documents and evidence

(a)                               Evidence
that the process agent referred to in Clause 16.2 (Service of process) of the Parent Guarantee has accepted its
appointment.

(b)                              A copy of
any other Authorisation or other document, opinion or assurance which the Agent
considers to be necessary or desirable (if it has notified the Borrower
accordingly) in connection with the entry into and performance of the
transactions contemplated by any Finance Document or for the validity and
enforceability of any Finance Document.

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

 70
 

 

 

SCHEDULE 3

Utilisation Request

From:                  Closed Joint Stock Company “Ukrainian
Mobile Communications”

To:          Citibank International plc as Agent

Dated:

Dear
Sirs

Closed Joint Stock Company “Ukrainian
Mobile Communications” — US$200,000,000 Facility Agreement

dated
[                   ]
(the “Agreement”)

1                                      We refer to
the Agreement. This is a Utilisation Request. Terms defined in the Agreement
have the same meaning in this Utilisation Request unless given a different
meaning in this Utilisation Request.

2                                      We wish to
borrow a Loan on the following terms:

 

	
  Proposed Utilisation Date:

  	
   

  	
  [                   ]
  or, if that is not a Business Day, the next Business Day)

  
	
   

  	
   

  	
   

  
	
  Facility to be
  utilised

  	
   

  	
  [Facility 1]/[Facility 2]*

  
	
   

  	
   

  	
   

  
	
  Amount:

  	
   

  	
  [                   ]
  or, if less, the Available Facility

  
	
   

  	
   

  	
   

  
	
  Interest Period:

  	
   

  	
  [                   ]

  

 

3                                      We confirm
that each condition specified in Clause 4.2 (Further
conditions precedent) is satisfied on the date of this Utilisation
Request.

4                                      The proceeds
of this Loan should be credited to account number [•] held at the
Ukrainian Servicing Bank.

5                                      This
Utilisation Request is irrevocable.

Closed
Joint Stock Company “Ukrainian Mobile Communications”

	
  By:

  	
   

  
	
  Name:

  
	
  Title: General
  Director

  

 

 

*Delete
as appropriate

 71
 

 

 

SCHEDULE 4

Mandatory Cost formula

1                                      The
Mandatory Cost is an addition to the interest rate to compensate Lenders for
the cost of compliance with (a) the requirements of the Bank of England
and/or the Financial Services Authority (or, in either case, any other
authority which replaces all or any of its functions) or (b) the
requirements of the European Central Bank.

2                                      On the first
day of each Interest Period (or as soon as possible thereafter) the Agent shall
calculate, as a percentage rate, a rate (the “Additional
Cost Rate”) for each Lender, in accordance with the paragraphs set
out below. The Mandatory Cost will be calculated by the Agent as a weighted
average of the Lenders’ Additional Cost Rates (weighted in proportion to the
percentage participation of each Lender in the relevant Loan) and will be
expressed as a percentage rate per annum.

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

4                                      The
Additional Cost Rate for any Lender lending from a Facility Office in the
United Kingdom will be calculated by the Agent as follows:

	
  

  	
  per cent. per annum.

  

 

Where:

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

5                                      For the
purposes of this Schedule:

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

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

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

6                                      The
resulting figure shall be rounded to four decimal places.

7                                      If requested
by the Agent, each Reference Bank shall, as soon as practicable after
publication by the Financial Services Authority, supply to the Agent, the rate
of charge payable by that Reference Bank to the Financial Services Authority
pursuant to the Fees Rules in respect of the relevant financial year of
the Financial Services Authority (calculated for this purpose by that 

 72
 

 

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

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

(a)                                the
jurisdiction of its Facility Office; and

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

Each
Lender shall promptly notify the Agent of any change to the information
provided by it pursuant to this paragraph.

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

10                               The Agent
shall have no liability to any person if such determination results in an
Additional Cost Rate which over or under compensates any Lender and shall be
entitled to assume that the information provided by any Lender or Reference
Bank pursuant to paragraphs 3, 7 and 8 above is true and correct in all
respects.

11                                The Agent
shall distribute the additional amounts received as a result of the Mandatory
Cost to the Lenders on the basis of the Additional Cost Rate for each Lender
based on the information provided by each Lender and each Reference Bank
pursuant to paragraphs 3, 7 and 8 above.

12                               Any
determination by the Agent pursuant to this Schedule in relation to a formula,
the Mandatory Cost, an Additional Cost Rate or any amount payable to a Lender
shall, in the absence of manifest error, be conclusive and binding on all
Parties.

13                               The Agent
may from time to time, after consultation with the Borrower and the Lenders,
determine and notify to all Parties any amendments which are required to be
made to this Schedule in order to comply with any change in law, regulation or
any requirements from time to time imposed by the Bank of England, the
Financial Services Authority or the European Central Bank (or, in any case, any
other authority which replaces all or any of its functions) and any such
determination shall, in the absence of manifest error, be conclusive and
binding on all Parties.

 73
 

 

 

SCHEDULE 5

Form of Transfer Certificate

To:          Citibank International plc as Agent

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

Dated:

Closed Joint Stock Company “Ukrainian
Mobile Communications” — US$200,000,000 Facility Agreement

dated
[                   ]
(the “Agreement”)

1                                      We refer to
the Agreement. This is a Transfer Certificate. Terms defined in the Agreement
have the same meaning in this Transfer Certificate unless given a different
meaning in this Transfer Certificate.

2                                      We refer to
Clause 22.5 (Procedure for transfer):

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

(b)                               The proposed
Transfer Date is
[                   ].

(c)                                The Facility
Office and address, fax number and attention details for notices of the New
Lender for the purposes of Clause 29.2 (Addresses)
are set out in the Schedule.

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

4                                      This
Transfer Certificate may be executed in any number of counterparts and this has
the same effect as if the signatures on the counterparts were on a single copy
of this Transfer Certificate.

5                                      This
Transfer Certificate is governed by English law.

 74
 

 

 

THE
SCHEDULE

Commitment/rights and obligations to be transferred

[insert relevant details]

[Facility Office address, fax number and
attention details for notices and account details for payments.]

	
  [Existing Lender]

  	
   

  	
  [New Lender ]

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
  By:

  	
   

  

 

 

This
Transfer Certificate is accepted by the Agent and the Transfer Date is
confirmed as
[                   ].

Citibank
International plc

By:

 75
 

 

 

SCHEDULE 6

Form of Compliance Certificate

	
  To:

  	
   

  	
  Citibank International plc as Agent

  
	
   

  	
   

  	
   

  
	
  From:

  	
   

  	
  Closed Joint Stock Company “Ukrainian Mobile
  Communications”

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  

 

Dear
Sirs

Closed Joint Stock Company “Ukrainian
Mobile Communications” — US$200,000,000 Facility Agreement

dated
[                   ]
(the “Agreement”)

We
refer to the Agreement. This is a Compliance Certificate. Terms defined in the
Agreement have the same meaning in this Compliance Certificate unless given a
different meaning in this Compliance Certificate.

1                                      [We confirm
that no Default is continuing.]*

2                                      We confirm
that the ratio of Consolidated Total Debt to Annualised Consolidated EBITDA was
[•].

3                                      We confirm
that the ratio of Consolidated Total Debt to Consolidated Total Net Worth was
[•].

4                                      We confirm
that for the previous Measurement Period ending on [•], the ratio of
aggregate Consolidated EBITDA for that Measurement Period and the previous
Measurement Period ending on [•] to aggregate Debt Service for that
Measurement Period and the previous Measurement Period ending on [•] was
[•].

5                                      We confirm
that during the previous financial year, the ratio of aggregate Consolidated
EBITDA for that financial year to aggregate Debt Service for that financial
year was never less than 1.75:1.

	
  Signed:

  	
   

  	
   

  
	
  General Director
  of

  
	
  Closed Joint
  Stock Company “Ukrainian Mobile Communications”

  

 

*insert applicable certification language

We have
reviewed the Facility Agreement and audited consolidated financial statements
of Closed Joint Stock Company “Ukrainian Mobile Communications” for the year
ended [                   ].

On the
basis of that review and audit, nothing has come to our attention which would
require any modification to the confirmations in paragraphs 2 or 3 of the above
Compliance Certificate.

 

	
  *

  	
  If this statement cannot be
  made, the certificate should identify any Default that is continuing and the
  steps, if any, being taken to remedy it.

  

 

 76
 

 

 

for and
on behalf of

name of auditors of Closed Joint
Stock Company “Ukrainian Mobile Communications”

 77
 

 

 

SCHEDULE 7

Selection Notice

	
  From:

  	
   

  	
  Closed Joint Stock Company “Ukrainian Mobile
  Communications”

  
	
   

  	
   

  	
   

  
	
  To:

  	
   

  	
  Citibank International plc (as Agent)

  

 

Dated:

Dear Sirs

Closed Joint Stock Company “Ukrainian
Mobile Communications” — US$200,000,000 Facility Agreement 

dated [_______] 2005 (the “Agreement”)

1                                      We refer to
the Agreement. This is a Selection Notice. Terms defined in the Agreement have
the same meaning in this Selection Notice unless given a different meaning in
this Selection Notice.

2                                      We refer to the following Loan[s] with an Interest
Period ending on
[                   ].*

We request that the next Interest Period for the above
Loan[s] is
[                   ].

3                                      This Selection Notice is irrevocable.

Yours faithfully

for and on behalf of

Closed
Joint Stock Company
“Ukrainian Mobile Communications”

	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  
	
   

  
	
  Title: General
  Director

  

 

 

*Insert details of all Loans which have an
Interest Period ending on the same date.

 78
 

 

 

SCHEDULE 8

Parent Guarantee

 79
 

 

 

SCHEDULE 9

Amended and Restated Parent Guarantee

 80
 

 

 

The Borrower

Closed Joint Stock Company “Ukrainian
Mobile Communications”

	
  Address:

  	
   

  	
  Leiptsyzska St. 15,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  City of Kyiv,
  01015,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Ukraine

  

 

 

Fax No:   +380 44
230 02 55

Attention:                           Mark Burden / Antonina Koroliova

	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  
	
   

  
	
  Title: General
  Director

  

 

The Bookrunners

Citibank, N.A.

	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  
	
   

  
	
  Title: 

  

 

Address:                                                                                                                                        Citibank NA Loans Operations Department, 5th
Floor, Citigroup Centre, 33 Canada Square, Canary Wharf, London E14 5 LB

Attn:                                                                                                                                                             UK Loans Processing Unit

Payment Instructions for USD:

Bank
Name:                                           Citibank
NA, New York

SWIFT:                                  CITIUS33

In
favour of:                                          Citibank
NA, London

SWIFT:                                  CITIGB2L

Account
Number:                                10990765

Attn:                                                       UK
Loans Dept

 81
 

 

 

ING Bank N.V.

	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  
	
   

  
	
  Title: 

  

 

	
  Address:

  	
   

  	
  49 St. Stephen’s Green, Dublin 2, Ireland

  
	
   

  	
   

  	
   

  
	
  Tax Address:

  	
   

  	
  Amstelveenseqeg 500, 1081 KL Amsterdam

  
	
   

  	
   

  	
   

  
	
  Telephone:

  	
   

  	
  +353 1 6384016

  
	
   

  	
   

  	
   

  
	
  Fax:

  	
   

  	
  +353 1 6384050

  
	
   

  	
   

  	
   

  
	
  Email:

  	
   

  	
  emma.condon@ie.ing.com

  
	
   

  	
   

  	
   

  
	
  Attention:

  	
   

  	
  Emma Condon

  

 

Payment Instructions for USD:

	
  Name of Bank:

  	
   

  	
  JP Morgan Chase, New York

  
	
   

  	
   

  	
   

  
	
  SWIFT:          CHASUS33

  
	
   

  
	
  ING Bank Dublin Acc. No: 001-1-427457

  
	
   

  
	
  SWIFT:          INGBIE2D

  
	
   

  
	
  Reference:

  	
   

  	
  CJSC “Ukrainian Mobile Communications - USD 200m
  Facility Agreement, attn. Emma Condon

  

 

The Mandated Lead Arrangers

Citibank, N.A.

	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  
	
   

  
	
  Title: 

  

 

ING Bank N.V.

	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  
	
   

  
	
  Title: 

  

 

 82
 

 

 

Raiffeisen Zentralbank Österreich AG

	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  
	
   

  
	
  Title: 

  

 

	
  Address:

  	
   

  	
  Am Stadtpark 9, 1030 Vienna, Austria

  
	
   

  	
   

  	
   

  
	
  Telephone:

  	
   

  	
  +43 1 71707 1398

  
	
   

  	
   

  	
   

  
	
  Fax:

  	
   

  	
  +43 1 71707 2383

  
	
   

  	
   

  	
   

  
	
  E-mail:

  	
   

  	
  Verena.Walter@rzb.at

  
	
   

  	
   

  	
   

  
	
  Attention:

  	
   

  	
  Ms. Verena Walter

  

 

Payment Instructions for USD:

	
  Name of bank:

  	
   

  	
  Citibank N.A.

  
	
   

  	
   

  	
   

  
	
  SWIFT:

  	
   

  	
  CITIUS33

  
	
   

  	
   

  	
   

  
	
  Account No.:

  	
   

  	
  1092 - 0871

  
	
   

  	
   

  	
   

  
	
  Account Name: Raiffeisen
  Zentralbank Österreich AG, Vienna

  
	
   

  	
   

  	
   

  
	
  Reference:

  	
   

  	
  CJSC “Ukrainian Mobile Communications - USD
  112,500,000 Facility Agreement, attn. Verena Walter

  

 

The Original Lenders

Citibank, N.A.

	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  
	
   

  
	
  Title: 

  

 

ING Bank N.V.

	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  
	
   

  
	
  Title: 

  

 

 83
 

 

 

Raiffeisen
Zentralbank Österreich AG

	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  
	
   

  
	
  Title: 

  

 

The Agent

 

Citibank International plc

 

	
  Address:

  	
   

  	
  2nd Floor, 4 Harbour Exchange Square, London E14 9GE

  
	
   

  	
   

  	
   

  
	
  Fax:

  	
   

  	
  +44 20 8636 3824

  
	
   

  	
   

  	
   

  
	
  Attention:

  	
   

  	
  Loans Agency

  

 

	
  By:

  	
   

  	
   

  
	
   

  
	
  Name:

  
	
   

  
	
  Title: 

  

 

Payment Instructions for USD:

	
  Bank Name:

  	
   

  	
  Citibank NA, New York

  
	
   

  	
   

  	
   

  
	
  SWIFT:          CITIUS33

  
	
   

  
	
  In favour of:

  	
   

  	
  Citibank International PLC

  
	
   

  	
   

  	
   

  
	
  SWIFT:          CITTGB2LELA

  
	
   

  
	
  Account Number:

  	
   

  	
  10963054

  
	
   

  	
   

  	
   

  
	
  Attn:

  	
   

  	
  Loans Agency/John Nelson

  

 

 

 84Exhibit 4.48

CREDIT
AGREEMENT

Dated 11 October 2004

between

OJSC Mobile TeleSystems, Russian
Federation

as borrower

and

HSBC Bank plc

and

ING BHF-BANK Aktiengesellschaft

as arrangers and lenders

HSBC Bank plc

as facility agent

ING BHF-BANK Aktiengesellschaft

as Hermes agent

 

 

Table
of Contents

Preamble

Clause

	
  1.

  	
  Definitions and Interpretations

  	
  4

  
	
  2.

  	
  Amount and
  Purpose of the Credits

  	
  7

  
	
  3.

  	
  Disbursements
  / Reimbursements

  	
  10

  
	
  4.

  	
  Conditions
  Precedent to Disbursements / Reimbursements

  	
  12

  
	
  5.

  	
  Interest
  Periods, Interest, Increased Costs

  	
  13

  
	
  6.

  	
  Fees

  	
  15

  
	
  7.

  	
  Calculation
  of Periods

  	
  16

  
	
  8.

  	
  Repayment
  and Prepayment

  	
  16

  
	
  9.

  	
  Payments

  	
  17

  
	
  10.

  	
  Taxes,
  Levies, Duties and Other Costs

  	
  18

  
	
  11.

  	
  Guarantee of
  the Federal Republic of Germany for tied Buyer’s Credits

  	
  21

  
	
  12.

  	
  Suspension
  of Disbursement, Payments Immediately Due (Events of Default)

  	
  22

  
	
  13.

  	
  Representations
  and Warranties

  	
  23

  
	
  14.

  	
  Financial
  Statements, Information and Undertakings

  	
  24

  
	
  15.

  	
  Assignability

  	
  27

  
	
  16.

  	
  Statements
  and Notices

  	
  27

  
	
  17.

  	
  Miscellaneous

  	
  28

  
	
  18.

  	
  Currency
  Indemnity

  	
  28

  
	
  19.

  	
  Applicable
  Law, Place of Performance and Jurisdiction

  	
  28

  
	
  20.

  	
  General
  Provisions

  	
  29

  

 

 2
 

 

 

Annexes to the Credit Agreement

 

	
  1a - 1e

  	
  Certificates
  for Disbursement and Reimbursement

  
	
  2

  	
  Confirmation
  of Coming into Force of the Export Contract / Additional Export Contract

  
	
  3a -
  3b

  	
  Confirmation
  of Mean-weighted Acceptance of Equipment and Software in relation to the
  Export Contract / in relation to the Additional Export Contract

  
	
  4

  	
  Specimen
  Signature List of the Borrower

  
	
  5

  	
  Form for
  Appointment of Agent for Service of Process to the Credit Agreement

  

 

 3
 

 

 

This Agreement is made by and between OJSC
Mobile TeleSystems, Moscow, Russian Federation (the “Borrower”) and HSBC Bank
plc, London, United Kingdom and ING BHF-BANK Aktiengesellschaft, Frankfurt am
Main, Federal Republic of Germany (each a “Lender” and together the “Lenders”).

 

Preamble

 

	
  A.

  	
  On 8 June 2004 the Borrower
  concluded contract number 1909/04-MTC (the “Export Contract”) with
  Siemens Aktiengesellschaft, Berlin-Munich, Federal Republic of Germany (the
  “Exporter”) for the delivery of equipment and provision of software licenses
  for a GSM 900/1800 cellular network.

  
	
   

  	
   

  	
   

  
	
  B.

  	
  The total contract value of the
  deliveries to be made and services to be rendered under the Export Contract
  amounts to USD 83,000,000 (the “Total Contract Value”).

  
	
   

  	
   

  	
   

  
	
  C.

  	
  According to the Export Contract the
  deliveries/services shall be made/rendered through the placement of
  individual purchase orders issued between June 2004 to 31
  December 2004. Installation and commissioning work will be carried out
  by OOO Siemens, Moscow, and is not subject of financing hereunder.

  
	
   

  	
   

  	
   

  
	
  D.

  	
  The Total Contract Value is to be paid,
  according to the terms of the Export Contract, as follows:

  
	
   

  	
  (1)

  	
  15% down payments

  
	
   

  	
   

  	
   

  
	
   

  	
  (2)

  	
  85% (the “Partial Contract Value”)
  provided that a tied buyer’s credit is available for financing thereof, pro
  rata to deliveries made/services rendered within 15 days of such
  deliveries/services.

  
	
   

  	
   

  	
   

  
	
  E.

  	
  The Borrower and the Exporter may also
  agree to enter into a further contract for the supply of additional
  telecommunications equipment (the “Additional Export Contract”), the
  financing terms of which may provide for additional payments partially being
  made under the terms of this Credit Agreement.

  
	
   

  	
   

  	
   

  
	
  F.

  	
  The total additional contract value of
  further deliveries to be made and services to be rendered under the
  Additional Export Contract (if such Additional Export Contract is agreed) is
  expected to amount up to USD 40,000,000 (the “Total Additional Contract
  Value”).

  
	
   

  	
   

  	
   

  
	
  G.

  	
  The terms of the Additional Export
  Contract (if agreed) are expected to enable deliveries/services to be
  made/rendered through a further series of purchase orders to be issued
  between October 2004 to July 2005.

  
	
   

  	
   

  	
   

  
	
  H.

  	
  The Total Additional Contract Value (if
  the Additional Export Contract is agreed) is expected to consist of 15%
  downpayments and a portion of 85% as partial additional contract value (the
  “Partial Additional Contract Value”) to be financed hereunder at the option
  of the Borrower, subject to the agreement of Hermes (as defined below) and
  the Lenders.

  

 

This
being premised, it is hereby agreed as follows:

 

1.                             Definitions and
Interpretations

 

	
  Additional Export Contract

  	
  means an additional contract which
  may be entered into between the Borrower and the Exporter as defined in Article E
  of the Preamble

  
	
   

  	
   

  

 4
 

 

 

	
  Additional Insurance Premium

  	
  means
  the premium as defined in Clause 11.3

  
	
   

  	
   

  
	
  Additional
  Repayment Date

  	
  means the
  date(s) as defined in Clause 5.1 d)

  
	
   

  	
   

  
	
  Affiliate

   

  	
  means, in relation to any person a
  Subsidiary of that person, or a Holding Company of that person, or any other
  Subsidiary of that Holding Company 

  
	
   

  	
   

  
	
  Agent for
  Service of Process

  	
  means the person or entity as
  defined in Clause 19.4

  
	
   

  	
   

  
	
  Agreed
  Currency

  	
  means
  the currency as defined in Clause 18

  
	
   

  	
   

  
	
  Banking Day

  	
  means a day (other than Saturday or
  Sunday) on which banks are generally open for business in London and Frankfurt
  am Main

  
	
   

  	
   

  
	
  Borrower

  	
  means OJSC Mobile TeleSystems, 4
  Marksistskaya Street, Moscow 109147, Russian Federation

  Payment details: foreign currency account No. 40702840500001001817
  with ING Bank (Eurasia) ZAO, Moscow 123022, Krasnaya Presnja Str., 31 SWIFT
  code INGBRUMM

  
	
   

  	
   

  
	
  Credit A

  	
  means the principal amount as
  specified in Clause 2.1 already disbursed and/or still to be disbursed as the
  context requires and shall include each of Tranche 1 and Tranche 2

  
	
   

  	
   

  
	
  Credit B

  	
  means the principal amount as
  specified in Clause 2.1 already disbursed and/or still to be disbursed as the
  context requires and shall include each of Tranche 3 and Tranche 4

  
	
   

  	
   

  
	
  Credit or
  Credits

  	
  means the aggregate principal
  amount as specified in Clause 2.1 already disbursed and/or still to be
  disbursed as the context requires and “Credits” shall include the Tranches 

  
	
   

  	
   

  
	
  Credit
  Agreement

  	
  means this agreement

  
	
   

  	
   

  
	
  Export
  Contract

  	
  means the contract between the
  Borrower and the Exporter defined in Article A of the Preamble

  
	
   

  	
   

  
	
  Exporter

   

  	
  means Siemens Aktiengesellschaft, Hofmannstrasse 51,
  81379 Munich,

  Federal
  Republic of Germany

  
	
   

  	
   

  
	
  Facility
  Agent

   

  	
  means HSBC
  Bank plc, 8 Canada Square, London E14 5HQ, United Kingdom

  
	
   

  	
   

  
	
  Hermes

  	
  means the German export credit
  agency Euler Hermes Kreditversicherungs-AG, Hamburg, Federal Republic of
  Germany

  
	
   

  	
   

  
	
  Hermes Agent

  	
  means ING BHF-BANK
  Aktiengesellschaft, Bockenheimer Landstrasse 10, 60323 Frankfurt am Main,
  Federal Republic of Germany

  
	
   

  	
   

  
	
  Holding
  Company

   

  	
  means,
  in relation to a person, any other person in respect of which it is a
  Subsidiary

  
	
   

  	
   

  

 5
 

 

 

	
  Insurance Agreement

  	
  means
  the agreement as per Clause 11.1

  
	
   

  	
   

  
	
  Insurance
  Premium

  	
  means
  the premium as defined in Clause 11.2

  
	
   

  	
   

  
	
  Interest
  Payment Date

  	
  means
  the date as defined in Clause 5.2.e)

  
	
   

  	
   

  
	
  Interest Period(s)

  	
  means
  the period(s) as defined in Clause 5.1

  
	
   

  	
   

  
	
  Judgement Currency

  	
  means
  the currency as defined in Clause 18

  
	
   

  	
   

  
	
  Lender(s)

  	
  means HSBC Bank plc, 8 Canada
  Square, London E14 5HQ, United Kingdom

  Payment details: SWIFT MRMDUS33,
  account number 000-023868 held with HSBC Bank USA, New York, in favour
  of HSBC Bank plc, London, SWIFT MIDLGB22 account number 36677449 in the name
  of Project and Export Finance quoting ref 53M/FC1046

  and

  ING BHF-BANK
  Aktiengesellschaft, Bockenheimer Landstrasse 10, 60323 Frankfurt am Main,
  Federal Republic of Germany

  Payment details: SWIFT BHFBDEFF,
  account number 8033130377 held with Bank of New York, New York, SWIFT
  IRVTUS3N

  
	
   

  	
   

  
	
  LIBOR

  	
  means
  the interest rate as defined in Clause 5.2.a)

  
	
   

  	
   

  
	
  Margin

  	
  means the margin as defined in
  Clause 5.2.a)

  
	
   

  	
   

  
	
  Partial
  Contract Value

  	
  means the part of the Total
  Contract Value as defined in Article D of the Preamble

  
	
   

  	
   

  
	
  Partial
  Additional Contract Value

  	
  means the part of the Total
  Additional Contract Value as defined in Article H of the Preamble

  
	
   

  	
   

  
	
  Reference
  Banks

  	
  means the London offices of HSBC
  Bank plc and ING BHF-Bank Aktiengesellschaft

  
	
   

  	
   

  
	
  Repayment
  Date(s)

  	
  means the date(s) as defined
  in Clause 5.1.d)

  
	
   

  	
   

  
	
  Passport
  Bank

  	
  means OOO
  HSBC Bank (RR) 9, Dmitrovsky pereulok, Moscow 103031, Russian Federation or
  such other bank as approved by the Facility Agent

  
	
   

  Special
  Payment Procedure

  	
   

  means the special payment procedure
  provided for under a certain disbursement facility agreement to be entered
  into by and between the Borrower, the Facility Agent and the Passport Bank

   

  
	
  Subsidiary

  	
  means an entity from time to time
  of which a person has direct or indirect control or owns directly or
  indirectly more than 50% of the share capital or similar right of ownership

  
	
   

  	
   

  
	
  Supplemental Insurance Agreement

  	
  means
  the supplemental agreement as per Clause 11.1

   

  
	
   

  	
   

  
	
  Total Assets

  	
  means the book value of
  the consolidated total assets of the Borrower as determined by reference to
  the Borrower’s most recent annual 

  

 6
 

 

 

	
  

  	
  consolidated balance sheet
  delivered in accordance with Clause 14 a) 

  
	
   

  	
   

  
	
  Total
  Contract Value

  	
  means the aggregate price agreed
  upon in the Ex­port Contract for deliveries made and services rendered
  thereunder as defined in Article B of the Preamble

  
	
   

  	
   

  
	
  Total Additional
  Contract Value

  	
  means the aggregate price agreed
  upon in the Additional Ex­port Contract for deliveries to be made and
  services to be rendered thereunder as defined in Article F of the
  Preamble

  
	
   

  	
   

  
	
  Tranche 1

  	
  means the part of Credit A as
  defined in Clause 2.2.a) hereof

  
	
   

  	
   

  
	
  Tranche 2

  	
  means the part of Credit A as
  defined in Clause 2.2.b) hereof

  
	
   

  	
   

  
	
  Tranche 3

  	
  means the part of Credit B as
  defined in Clause 2.2.c) hereof

  
	
   

  	
   

  
	
  Tranche 4

  	
  means the part of Credit B as
  defined in Clause 2.2.d) hereof

  
	
   

  	
   

  
	
  Tranches

   

  	
  means, collectively, Tranche 1 and
  Tranche 2 and, if applicable Tranche 3 and Tranche 4 as defined in Clause 2.2

  
	
   

  	
   

  
	
  UMC

   

  	
  means Ukrainian-German-Dutch-Danish
  Joint Venture “Ukrainian Mobile Communications” in Ukraine 

  
	
   

  	
   

  
	
  UMC
  Litigation

  	
  means any of the claims,
  proceedings (present of future) and causes of action involving the Borrower,
  and/or any Affiliate thereof (including UMC) relating to or arising out of
  the sale of UMC to the Borrower, or the acquisition, reorganization or
  ownership of UMC by the Borrower.

  
	
   

  	
   

  
	
  USD

  	
  means the lawful currency of the
  United States of America

  

 

2.                             Amount and Purpose of
the Credits

 

	
  2.1   

  	
  The Lenders grant to the Borrower a
  credit in an aggregate amount of up to: 

  
	
   

  	
   

  
	
   

  	
  USD 75,748,000.00

  (in
  words: United States Dollars seventy five million seven hundred forty eight
  thousand)

  (“Credit A”)

   

  
	
   

  	
  With reference to the
  Additional Export Contract, and subject to the agreement of Hermes, the
  Lenders may elect in their absolute and free discretion to grant to the
  Borrower upon its written request a further credit in an aggregate amount of
  up to:

  
	
   

  	
   

  

 7
 

 

 

	
  

  	
  USD 36,514,000.00

  (in
  words: United States Dollars thirty six million five hundred fourteen
  thousand)

  (“Credit B”)

   

  It is hereby agreed and
  understood by the Borrower and the Lenders that the Lenders, by entering into
  this Credit Agreement, do not assume any commitment  to grant Credit B but that the granting of
  such Credit B is at their sole discretion and will only materialise upon the
  Lenders written approval.

   

  Credit A and Credit B shall
  hereinafter be referred to individually as a “Credit” or collectively as “Credits”.

   

  
	
  2.2   

  	
  Credits shall consist of: 

  
	
   

  	
   

  
	
   

  	
  a)        Tranche 1 in an amount of USD
  70,550,000.00 (in words: United States Dollars seventy million five hundred
  and fifty thousand) which shall be available for the financing of the Partial
  Contract Value either (i) still due and payable to the Exporter
  resulting from deliveries made/services rendered under the Export Contract, or
  (ii) payable to the Borrower resulting from deliveries made / services
  rendered under the Export Contract for which payment has been made, directly
  by the Borrower to the Exporter; and

   

  b)       Tranche 2 in an amount of USD
  5,198,000.00 (in words: United States Dollars five million one hundred ninety
  eight thousand) which shall be available for the financing of up to 85% of
  the Insurance Premium for cover of the Lenders’ payment claims under the
  Insurance Agreement as per Clause 11.1 paid or payable by the Lenders through
  the Facility Agent to Hermes; and if so applicable

   

  c)        Tranche 3 in an amount of up to USD
  34,000,000.00 (in words: United States Dollars thirty four million) which
  shall be available for the financing of the Partial Additional Contract Value
  either (i) still due and payable to the Exporter resulting from
  deliveries made/services rendered under the Additional Export Contract, or (ii) payable
  to the Borrower resulting from deliveries made / services rendered under the
  Additional Export Contract for which payment has been made directly by the
  Borrower to the Exporter; and

   

  d)       Tranche 4 in an
  amount of USD 2,514,000.00 (in words: United States Dollars two million five
  hundred fourteen thousand) which shall be available for the financing of up
  to 85% of the Additional Insurance Premium for cover of the Lenders’ payment
  claims under the Supplemental Insurance Agreement as per Clause 11.1 paid or
  payable by the Lenders through the Facility Agent to Hermes;

  
	
   

  	
   

  
	
   

  	
  unless otherwise stipulated
  hereinafter, any reference in this Credit Agreement to the Credit shall
  include the Tranches applicable to that Credit, and to Credits or to credit
  amounts or to any other similar term shall include the Tranches. 

  
	
   

  	
   

  

 8
 

 

 

	
  

  2.3

  	
  The amounts borrowed under this
  Credit Agreement are exclusively available (i) provided that payment of
  the Partial Contract Value for deliveries made/services rendered has been
  effected by the Borrower to the Exporter prior to fulfilment of all
  conditions precedent to disbursements / reimbursements under this Credit
  Agreement or waiver thereof by the Lenders by means of payment from sources
  other than this Credit Agreement, for reimbursement thereof to the Borrower; (ii) with
  effect from the date of fulfilment of all conditions precedent to
  disbursements / reimbursements under this Credit Agreement or waiver thereof
  by the Lenders, for reimbursement to the Borrower in the amount of the
  Partial Contract Value resulting from deliveries made/services rendered under
  the Export Contract for which payment 
  has been made directly by the Borrower to the Exporter; (iii) with
  effect from the date of fulfilment of all conditions precedent to
  disbursements / reimbursements under this Credit Agreement or waiver thereof
  by the Lenders, for the payment of sums due to the Exporter in the amount of
  the Partial Contract Value resulting from deliveries made/services rendered
  under the Export Contract; (iv) for reimbursement to the Borrower of up
  to 85% of the Insurance Premium paid by the Borrower to the Lenders through
  the Facility Agent; (v) in respect of the additional financing of Credit
  B if so required by the Borrower, and subject to the agreement of Hermes and
  the Lenders, for reimbursement to the Borrower in the amount of the Partial
  Additional Contract Value resulting from further deliveries made/services
  rendered under the Additional Export Contract for which payment has been made
  directly by the Borrower to the Exporter; (vi) in respect of the
  optional financing of Credit B if so required by the Borrower, and subject to
  the agreement of Hermes and the Lenders, for the payment of sums due to the
  Exporter in the amount of the Partial Additional Contract Value resulting
  from deliveries made/services rendered under the Additional Export Contract;
  and (vii) in respect of the additional financing of Credit B if so
  required by the Borrower, and subject to the agreement of Hermes and the
  Lenders, for reimbursement to the Borrower of up to 85% of the Additional
  Insurance Premium paid by the Borrower to the Lenders through the Facility
  Agent.

  
	
   

  	
   

  
	
  2.4   

  	
  Upon and subject to the terms and
  conditions of this Credit Agreement each of the Lenders shall participate in
  each disbursement or reimbursement of the Credits in the proportion of its
  maximum liability mentioned in this Clause 2.4 as percentage of the maximum
  credit amounts mentioned in Clause 2.1 hereof.

   

  HSBC
  Bank plc                                                 
  Credit A

  8
  Canada Square                                                
  50%, max. USD 37,874,000.00

  London
  E14 5HQ                                              
  (in words: United States Dollars thirty seven million

  United
  Kingdom                                                
  eight hundred seventy four thousand)

  

  Credit B (optional financing)

  50%, max. USD 18,257,000.00

  (in words: United States Dollars 
  eighteen million two hundred fifty seven thousand)

   

  ING BHF-BANK Aktiengesellschaft                 Credit A

  Bockenheimer Landstrasse 10                            50%, max. USD
  37,874,000.00

  60323
  Frankfurt am Main                                  (in words:
  United States Dollars thirty seven million

  Federal
  Republic of Germany                             eight hundred
  seventy four thousand)

  

  Credit B (optional financing)

  50%, max. USD 18,257,000.00

  (in words: United States Dollars 
  eighteen million two hundred fifty seven thousand)

   

  
	
   

  	
   

  

 9
 

 

 

	
  2.5

  	
  The Credit
  shall be made available under exclusion of any joint liability. Therefore,
  each of the Lenders shall only be responsible for the fulfilment of its
  obligation and shall not be liable for the fulfilment of the obligations of
  the other Lender under this Credit Agreement. The failure of any of the
  Lenders to provide funds according to its obligation under this Credit Agreement
  shall neither release the other Lender nor the Borrower from any of their
  respective obligations towards each other hereunder.

  

 

3.                             Disbursements / Reimbursements

 

	
  3.1   

  	
  Tranche 1 (and if applicable,
  Tranche 3) shall be disbursed in credit portions directly to the Borrower or,
  as the case may be, the Exporter to such account and to such financial
  institution as specified by the Borrower or, as the case may be, the Exporter
  to the Facility Agent.

   

  The Borrower hereby irrevocably
  agrees that - under Clause 3.2.b) below - only the Exporter shall have the
  exclusive right to request payments under Tranche 1 (and if applicable,
  Tranche 3) and that such direct payments to the Exporter will constitute
  disbursements of Tranche 1 (and if applicable, Tranche 3) to the Borrower
  under this Credit Agreement.

  
	
   

  	
   

  
	
  3.2   

  	
  a)        In the event that prior
  to or after fulfilment of the conditions precedent to disbursements /
  reimbursements under the Credit Agreement or the waiver thereof by the
  Facility Agent acting on behalf of the Lenders, payments are made by the
  Borrower to the Exporter in the amount or amounts of the respective Partial
  Contract Value (or Partial Additional Contract Value) out of funds other than
  out of this Credit Agreement in and towards satisfaction and fulfilment of
  sums due to the Exporter resulting from the Export Contract, then
  reimbursements under Tranche 1 (and if applicable, Tranche 3) will be made by
  the Lenders through the Facility Agent against presentation by the Borrower
  to the Facility Agent of a certificate as per Annex 1a or 1d hereto in an
  amount or amounts equal to the aggregate principal amount or amounts of such
  payments in the maximum amount of the respective Partial Contract Value (or
  Partial Additional Contract Value) to the Borrower to such account as
  specified by the Borrower to the Facility Agent.

   

  The
  Borrower and the Lenders acknowledge and agree to the Exporter’s intent to
  provide the Facility Agent, upon any delivery having been made/service having
  been rendered under the Export Contract for which the Borrower shall make
  direct payment to the Exporter out of other funds than of this Credit
  Agreement before being reimbursed in accordance with this Clause 3.2.a), with
  copies of the respective delivery documents or invoice, as the case may be.
  It is the common understanding of the parties hereto that the dispatch of
  such copies to the Facility Agent shall be for information purposes only;
  therefore shall neither the failure of the Exporter to send such copies prevent
  the Lenders in any way from making reimbursements, nor shall the delivery of
  such copies oblige the Lenders to make reimbursements under this Clause
  3.2.a), in particular not in case of any of the conditions precedent for
  disbursement / reimbursement not being fulfilled.

   

  b)    With
  effect from the date of fulfilment of all conditions precedent to
  disbursements / reimbursements under this Credit Agreement or the waiver
  thereof by the Facility Agent acting on behalf of the Lenders, Tranche 1 (and
  if applicable, Tranche 3) shall be disbursed  
  directly to the Exporter on a pro rata basis against deliveries
  made/services rendered in an amount equal to 85% of the value of such
  deliveries/services only upon presentation by the Exporter to the Facility
  Agent of a certificate as per Annex 1b hereof and of the following documents:  
  

   

  

 10
 

 

 

	
  

  	
  In
  case of equipment deliveries

  -       a copy of the commercial
  invoice issued by the Exporter;

  -       a copy of the
  international waybill relating to such equipment.

   

  In case of licenses

  -       a copy of the commercial
  invoice issued by the Exporter;

  -       a copy of the acceptance
  certificate, signed by the Borrower and the Exporter.

   

  The Facility Agent shall accept and
  make disbursements against the aforementioned documents as they are being
  presented to it without any obligation of examination thereof; in particular
  the Facility Agent shall not be obliged to verify whether or not any
  documents delivered to it under this Clause 3.2.b) are in compliance with the
  Uniform Customs and Practices for Documentary Credits, 1993 Revision, ICC
  Publication No. 500.

   

  
	
  3.3   

  	
  Disbursements / reimbursements
  under Tranche 1 (and if applicable, Tranche 3) as per Clause 3.2 shall be
  made in minimum amounts of USD 1,000,000.00 provided, however, that, in the
  event that 85% of the value of any documents presented to the Facility Agent
  during a calendar month for disbursements under Tranche 1 (and if applicable,
  Tranche 3) or the amount mentioned in a reimbursement certificate as per
  Annex 1a or 1d, as the case may be, is less than the aforementioned minimum
  amount, disbursements or reimbursements under Tranche 1 (and if applicable,
  Tranche 3) will be made at the end of the relevant calendar month in one
  amount equal to 85% of the aggregate value of all documents or equal to the
  aggregate value of all certificates, as the case may be, received by the
  Lenders during that month in relation to which disbursement or reimbursement
  under Tranche 1 (and if applicable, Tranche 3) has not previously been made.

  
	
   

  	
   

  
	
  3.4   

  	
  Disbursement under Tranche 2 (and
  if applicable, Tranche 4) for the financing of up to 85% of the Insurance
  Premium (or as the case may be, the Additional Insurance Premium) shall in
  either event,  whether the Insurance
  Premium has become due and payable prior to or after the fulfilment of all
  conditions precedent to disbursements / reimbursements under this Credit
  Agreement or the waiver thereof by the Facility Agent, acting on behalf of
  the Lenders, and provided that the Borrower has paid the total amount of the
  Insurance Premium (or the Additional Insurance Premium) to the Facility Agent
  as per Clause 11.2 hereof, be made without any request or action by the
  Borrower upon fulfilment of the conditions precedent to disbursements /
  reimbursements or waiver thereof by the Lenders through the Facility Agent to
  the Borrower to such account as will be specified by the Borrower to the
  Facility Agent. 

  

 

	
  3.5

  	
  Each disbursement or reimbursement
  of the Credits under this Credit Agreement shall be made at the latest on the
  5th Banking Day after all conditions precedent
  applicable to such disbursement or reimbursement pursuant to Clause 4 hereof
  have been fulfilled or waived, as the case may be, and provided that the
  Lenders through the Facility Agent have not exercised any of their rights
  under Clause 12 hereof.

   

  
	
  3.6

  	
  Unless otherwise
  instructed by Hermes, the Lenders may (but are not obliged to do so) refuse
  to disburse the Credits or any portion thereof after the due date of the first
  repayment instalment laid down in Clause 8 hereof. The Credits will then be
  reduced by the corresponding amount.

  
	
   

  	
   

  
	
  3.7

  	
  The Borrower may - in case of
  disbursements according to Clause 3.2.b) - only waive disbursement of the
  Credits, in full or in part, with the prior written consent of the Lenders
  and the Exporter.

  

 

 11
 

 

 

4.                             Conditions Precedent
to Disbursements / Reimbursements

 

	
  4.1

  	
  In relation to Credit A

  

  The first disbursement or reimbursement under Credit A of this Credit Agreement
  shall be conditional upon the Facility Agent having received the following
  documents free of expense in form and substance satisfactory to the Lenders:

  
	
   

  	
   

  
	
   

  	
  a)

  	
  a legal opinion to be issued by
  Freshfields Bruckhaus Deringer, Moscow, Russian Federation as Lenders’
  counsel confirming the validity and enforceability of this Credit Agreement;

  
	
   

  	
   

  	
   

  
	
   

  	
  b)

  	
  a written confirmation in
  accordance with Annex 2 hereof certifying that the Export Contract has come
  into force;

  
	
   

  	
   

  	
   

  
	
   

  	
  c)

  	
   a specimen signatures list as per Annex 4
  hereof with the specimen signatures of such persons authorised by the
  Borrower to act on its behalf in connection with this Credit Agreement and
  such other documents which, pursuant to mandatory provisions under German or
  English law, are required by the Lenders and/or the Facility Agent to open
  and to maintain a credit account on behalf of the Borrower such documents to
  be specified by the Lenders and/ or the Facility Agent without any undue
  delay in writing;

  
	
   

  	
   

  	
   

  
	
   

  	
  d)

  	
  a copy of the Export Contract;

  
	
   

  	
   

  	
   

  
	
   

  	
  e)

  	
  an undertaking by the Exporter in
  favour of the Lenders with regard to certain risks and obligations not
  covered by the Insurance Agreement as per Clause 11.1 hereof;

  
	
   

  	
   

  	
   

  
	
   

  	
  f)

  	
  a certificate as per Annex 1a, 1b,
  1c, 1d or 1e , as the case may be; and

  
	
   

  	
   

  	
   

  
	
   

  	
  g)

  	
   confirmation issued by the Passport Bank
  certifying its nomination by the Borrower as Passport Bank.

  
	
   

  	
   

  	
   

  
	
   

  	
  h)

  	
  evidence that the down payment
  referred to in Article D of the Preamble has been made to the Exporter
  by the Borrower.

  
	
   

  	
   

  	
   

  
	
   

  	
  In relation
  to Credit B (if applicable)

  
	
   

  	
   

  
	
   

  	
  The first disbursement or
  reimbursement under Credit B of this Credit Agreement shall be conditional
  upon the Facility Agent having received the following documents free of
  expense in form and substance satisfactory to the Lenders:

  
	
   

  	
   

  	
   

  
	
   

  	
  a)

  	
  a written confirmation issued by
  Freshfields Bruckhaus Deringer, Moscow, as Lenders’ counsel confirming that
  the original legal opinion rendered under Clause 4.1.a) above is applicable
  mutatis mutandis to this Credit Agreement as increased by Credit B, such
  confirmation stating inter alia that all necessary permits, authorisations
  and registrations in the Russian Federation have been obtained;

  

 

	
   

  	
   

  	
   

  
	
   

  	
  b)

  	
  a copy of the Additional Export
  Contract;

  
	
   

  	
   

  	
   

  
	
   

  	
  c)

  	
  a written confirmation in accordance
  with Annex 2 hereof certifying that the Additional Export Contract has come
  into force; and

  
	
   

  	
   

  	
   

  
	
   

  	
  d)

  	
  an
  undertaking by the Exporter in favour of the Lenders with regard to certain
  risks and obligations not covered by the Supplemental Insurance Agreement as
  per Clause 11.1 hereof.

  
	
   

  	
   

  	
   

  
	
   

  	
  Furthermore, the first disbursement
  or reimbursement under Credit A or, if applicable Credit B, is conditional
  upon receipt by the Lenders of the following payments:

   

  

 12
 

 

 

	
   

  	
  a)

  	
  payment of
  the fee as per Clause 6.2 hereof in the case of Credit A and, payment of  additional fees pursuant to Clause 6.4
  hereof in the case of Credit B;

  
	
   

  	
   

  	
   

  
	
   

  	
  b)

  	
  payment of 100% of the Insurance
  Premium and, as the case may be, 100% of the Additional Insurance Premium.

  
	
  

  	
  a)
  

   

  b)
  

   

  
	
  4.3

  	
  Moreover,
  the first disbursement under this Credit Agreement by way of direct
  disbursement to the Exporter as per Clause 3.2.b) is subject to such
  disbursement procedure being in full and strict compliance with the Russian
  laws (in particular but not limited to the Law on Currency Regulation and
  Currency Control dated 10 December 2003); such compliance to be
  evidenced to the Lenders in form and substance satisfactory to the Lenders.

  
	
   

  	
   

  
	
  4.4

  	
  Each
  reimbursement under Tranche 1 or Tranche 3 as per Clause 3.2. a) hereof is
  furthermore subject to evidence satisfactory to the Lenders that payments
  were made by the Borrower for deliveries made/services rendered under the
  Export Contract or the Additional Export Contract, as the case may be, and have
  been received by the Exporter in amounts corresponding to those mentioned in
  the relevant reimbursement certificate in form and substance as per Annex 1a
  or 1d, as the case may be, hereto.

  
	
   

  	
   

  
	
  4.5

  	
  Each
  disbursement or reimbursement under this Credit Agreement is subject to the
  condition that the Insurance Agreement and, as the case may be, the
  Supplemental Insurance Agreement, as per Clause 11.1 is in full force and
  effect and covers the Lenders’ claims under this Credit Agreement.

  
	
   

  	
   

  
	
  4.6

  	
  The Lenders
  through the Facility Agent shall be entitled to waive any one or more of the
  aforementioned conditions precedent to disbursements / reimbursements as the
  Lenders at their sole discretion deem fit, whereupon — unless otherwise
  notified in writing by the Facility Agent to the Borrower - any such
  condition precedent shall be deemed to constitute a condition subsequent
  which the Borrower undertakes to satisfy within such period of time which the
  Facility Agent may reasonably determine.

  
	
   

  	
   

  
	
  4.7

  	
  The Facility
  Agent will notify the Borrower and the Exporter without delay in writing of
  the fulfilment of the conditions precedent to first disbursement or
  reimbursement and, if applicable, 
  conditions subsequent.

   

  
				

5.                             Interest
Periods, Interest, Increased Costs

 

	
  5.1

  	
  For the purpose
  of periodical calculation of interest and its pay­ment by the Borrower as
  determined hereinafter, each interest period (the “Interest Period”) shall be
  of a duration of 6 months, provided that:

  
	
   

  	
   

  	
   

  
	
   

  	
  a)

  	
  the first
  Interest Period in respect of the first disburse­ment or reimbursement shall
  commence on the date of that disburse­ment or reimbursement and end 6 months
  after the date of that disburse­ment or reimbursement;

  
	
   

  	
   

  	
   

  
	
   

  	
  b)

  	
  the first
  Interest Period in respect of any subsequent disbursement or reimbursement
  shall commence on the date of that disbursement or reimbursement and end upon
  expiry of the then current Interest Period relating to the respective Credit
  A or Credit B, as the case may be;

  
	
   

  	
   

  	
   

  
	
   

  	
  c)

  	
  each
  subsequent Interest Period shall commence on the expiry of the preceding
  Interest Period;

  
	
   

  	
   

  	
   

  
	
   

  	
  d)

  	
  any Interest
  Period which would otherwise extend be­yond the due date of any repayment
  instalment pursu­ant to Clause 8.1 of this Credit Agreement (any such
  repayment date hereinafter re­ferred to as a “Repayment Date” or “Additional
  Repayment Date”, if applicable) shall be shortened to the extent necessary to
  end upon such Repayment Date or Additional

  

 13
 

 

 

	
   

  	
   

  	
  Repayment
  Date, as the case may be;

  
	
   

  	
   

  	
   

  
	
   

  	
  e)

  	
  any Interest
  Period which would otherwise end on a day which is not a Banking Day shall
  end on the next Banking Day unless the result of such extension would be to
  carry such Interest Period over into another calendar month, in which event
  such Interest Period shall end on the preceding Banking Day.

  

 

	
  5.2

  	
  a)                       Subject to Clause 5.2 d) below, for as long as any principal
  amounts repayable under this Credit Agreement remain outstanding, the
  Borrower shall pay to the Lenders through the Facility Agent for each
  Interest Period on each credit amount outstanding interest at a rate per
  annum to be the aggregate of (i) a margin of 0.425% p.a. (in words zero
  point four two five per cent per annum) (the “Margin”) and (ii) the
  London Interbank Offered Rate (“LIBOR”) relating to such Interest Period
  (rounded upwards - if necessary - to a full month).

   

                                   LIBOR shall mean, in relation to such Interest Period, the rate
  per annum determined by the Facility Agent to be equal to the arithmetic mean
  (rounded upwards, if necessary, to five decimal places) of the London
  interbank offered rates for deposits of USD for a period equal to such period
  at or about 11.00 a.m. (London time) on the second Banking Day for such
  period as are displayed on the relevant page on the Reuter Monitor Money
  Rates Services (or such other page as may replace such page on such
  service for the purpose of displaying London interbank offered rates of
  leading banks for deposits of USD) or, if on such date the offered rates for
  the relevant period of fewer banks than two leading banks are so displayed,
  as quoted to the Facility Agent by each of the Reference Banks at the request
  of the Facility Agent and calculated on the above mentioned basis.

   

  b)                      The Facility Agent shall promptly advise the Borrower by letter or
  means of tele­communication of the rate of interest determined from time to
  time as per Clause 5.2.a) hereof and of the amount of interest to be paid at
  the end of the respective Interest Period, provided that no failure by the
  Facility Agent to so advise the Borrower shall relieve the Borrower from its
  payment obligations here­under.

   

  c)                       The rate of interest as stipulated in Clause 5.2.a) shall always
  apply without any further request, communication or whatsoever as far and as
  long as no rate of interest is appli­cable in accordance with Clause 5.2.d)
  hereof.

   

  d)                      For all amounts outstanding under this Credit Agreement the
  Lenders shall, upon the Borrower’s request, offer a fixed interest rate (the
  Lenders using their best efforts to ensure that such rate is commercially
  reasonable) for the whole remaining amount and lifetime of the Credits
  provided that:

   

  
	
   

  	
   

  	
  (i)

  	
  the last
  disbursement or reimbursement under the Credit Agreement has been effected,
  in the case of either Credit A or Credit B,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  the exact
  Repayment Dates for the repayment instal­ments of the Credits stand firm in
  the case of either Credit A or Credit B,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (iii)

  	
  the
  Borrower’s request has been received by the Facility Agent at the latest 15
  Banking Days prior to the next Repayment Date and,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (iv)

  	
  corresponding
  funds in like amounts and for a duration equivalent to the term of the
  Credits under this Agreement  are
  available to the Lenders.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
                                   Such fixed interest rate takes binding effect for the period
  starting with the next Repayment Date and ending on the last Repayment Date
  for the Credits, in the case of either Credit A or Credit B, provided that
  the Facility Agent has received the Borrower’s agreement to the fixed rate
  offered by the Lenders through the Facility Agent within the validity period
  of such offer.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  e)                       Interest on any credit amounts outstanding shall accrue from day
  to day and be calculated on 

  

 

 14
 

 

 

	
  

  	
  a per
  annum basis from the date of each disbursement or reimbursement until the
  date on which the respective repayment instalment is unconditionally credited
  on the account specified in or to be indicated by the Facility Agent in
  accordance with Clause 9.1 hereof. Interest on any credit amounts outstanding
  shall be paid by the Borrower in arrears on 
  each Interest Payment Date (each “Interest Payment Date” being,
  (i) in the case of an interest rate applicable as per Clause 5.2 a), the
  last day of any and each Interest Period; and (ii) in case of  a fixed interest rate applicable as per
  Clause 5.2 d) hereof each Repayment Date). 

  
	
   

  	
   

  
	
  5.3

  	
  Subject
  to Clause 5.5 (Exceptions), if by reason of any change occurring after the
  date of this Credit Agreement in any law, regulation, treaty or official
  directive (whether or not having the force of law) or the interpretation or
  application thereof (including but not limited to any reserve, deposit or
  similar requirements) and for compliance by the Lenders and/or the Facility
  Agent with any legally binding requirement of any central bank or other
  governmental or monetary authority arising after the date of this Credit
  Agreement any of the Lenders incur any Increased Costs (as defined
  hereinafter), then, in any such case, the Borrower shall pay to the Facility
  Agent for account of the Lenders within thirty days of a demand by the
  Facility Agent such amounts of the Increased Costs as the Lenders through the
  Facility Agent shall specify to be necessary to compensate the Lenders for
  such increase or such reduction.

   

  In this Agreement “Increased Costs” means:

   

  (i)             a reduction in
  the rate of return from the Credits or on a Lender’s overall capital;

  (ii)            an additional or
  increased cost; or

  (iii)           a reduction of
  any amount due and payable under the Credits,

   

  which
  is incurred or suffered by a Lender to the extent that it is attributable to
  that Lender having entered into this Credit Agreement or funding or
  performing its obligations under it.

   

  
	
  5.4.

  	
  A Lender intending to make a claim pursuant to
  Clause  5.3 (Increased Costs) shall notify the Facility Agent of the
  event giving rise to the claim, following which the Facility Agent shall
  promptly notify the Borrower.

   

  Each Lender shall, as soon as practicable after a
  demand by the Facility Agent, provide a certificate confirming the amount of
  its Increased Costs and the circumstances giving rise to the claim.

   

  
	
  5.5

  	
  Clause  5.3 (Increased
  Costs) does not apply to the extent any Increased Cost is:

   

  (i)  compensated
  for under another Clause or would have been but for an exception to

        that Clause;

   

   (ii)  a tax, levy, duty, charge or fee
  of whatever nature  on the overall net
  income of a

         Lender or attributable to any
  deduction or withholding for or on account of any tax,

         Levy, duty, charge or fee of whatever
  nature required by law to be made by the

         Borrower (provided that nothing in
  this sub-clause 5.5 (ii) reduces the Borrower’s

         Liability to make any payment on
  account of any tax, levy, duty, charge or fee

         required pursuant to Clause 10); or

   

   (iii) attributable to a Lender being
  grossly negligent or wilfully failing to comply with

                     any law or regulation or
  official administration order or court decision. 

  
	
   

  	
   

  

6.                             Fees

 

	
  6.1

  	
  From the
  date of this Credit Agreement until disbursement of Credit A in full, the
  Borrower shall pay to the Lenders through the Facility Agent a commitment fee
  at a rate of 0.20% p.a. (in words: zero point two per cent per annum)
  calculated on a daily basis on such portion of the maximum 

  

 15
 

 

 

	
  

  	
  amount of
  Credit A not yet disbursed at any time. The commitment fee is payable pro
  rata in arrears (i) prior to the first disbursement or reimbursement on
  June 30 and December 30 of each year; and (ii) with effect
  from the first disbursement or reimbursement on each Interest Payment Date.

  
	
   

  	
   

  
	
  6.2

  	
  The Borrower
  will pay to the Lenders (in their capacity as mandated lead arrangers)
  through the Facility Agent an arrangement fee of 0.25% flat (in words: zero
  point two five per cent flat) calculated on the maximum amount of Credit A
  mentioned in Clause 2.1 hereof.

  The
  arrangement fee is due prior to the first disbursement or reimbursement under
  the Credit Agreement, at the latest however, within 30 days after the date of
  this Credit Agreement.

  
	
   

  	
   

  
	
  6.3

  	
  From the
  date of this Credit Agreement until all monies owing by the Borrower are
  fully repaid to the Lenders, the Borrower shall pay to the Facility Agent an
  agency fee of USD 10,000 per annum on the date of signature of this Credit
  Agreement and annually thereafter on the anniversary date of this Credit
  Agreement.

  
	
   

  	
   

  
	
  6.4

  	
  Clauses 6.1
  and 6.2 shall apply mutatis mutantis in case of Credit B being made available
  by the Lenders to the Borrower whereas calculation of the additional
  commitment fee shall start on the date on which the Lenders will have
  approved the granting of Credit B to the Borrower in writing; the additional
  arrangement fee shall be paid within 30 days after the date of such approval
  , at the latest, however, prior to disbursement or reimbursement under Credit
  B. 

  

 

7.                             Calculation of Periods

 

	
  

  	
  For the
  purpose of calculating interest, commitment fee and other pay­ment
  obligations based on periods of time, a year will be calculated on the basis
  of the actual number of days elapsed and a year of 360 days. 

  

 

8.                             Repayment and Prepayment

 

	
  8.1

  	
  Credit A

   

  The credit
  amounts disbursed under Credit A are to be repaid in 17 equal and consecutive
  semi-annual repayment instalments; the first of which will be due on the
  earlier of (i) the date falling 6 months after the date of the
  mean-weighted acceptance of equipment and software to be evidenced by a
  certificate in accordance with Annex 3a hereof; and (ii) 30 September 2005.
  Credit amounts disbursed after the first Repayment Date under Credit A shall
  be repaid in equal amounts on the remaining Repayment Dates; the repayment
  instalments which then have not yet become due will be increased accordingly
  and the Facility Agent shall promptly, upon its drawing up thereof  however, at the latest 10 Business Days
  prior to the next Repayment Date, deliver an updated repayment schedule to
  the Borrower showing the amounts of repayment instalments due on each
  subsequent Repayment Date, provided that no failure by the Facility Agent to
  so advise the Borrower shall relieve the Borrower from its payment
  obligations under this Credit Agreement.

   

  Credit B

   

  If
  applicable, the credit amounts disbursed under Credit B will be repaid in 17
  equal and consecutive semi-annual repayment instalments; the first of which
  will, depending on the respective Hermes approval, either be due on the
  earlier of (i) the date falling 6 months after the date of the
  mean-weighted acceptance of equipment and software relating to the deliveries
  made/services rendered under the Additional Export Contract, to be evidenced
  by a certificate in accordance with Annex 3b hereof, or (ii) a certain
  latest date still to be agreed upon prior to the first disbursement under
  Credit B, subject to Hermes approval, in each such case as advised to the
  Borrower by the Facility Agent. Credit amounts disbursed after the first
  Additional Repayment Date under Credit B shall be repaid in equal amounts on
  the remaining Additional Repayment Dates; the repayment instalments which
  then have not yet become due will be increased 

  

 16
 

 

 

	
  

  	
  accordingly and the Facility
  Agent shall promptly, upon its drawing up thereof, however, at the latest 10
  Business Days prior to the next Repayment Date, deliver an updated repayment
  schedule to the Borrower showing the amounts of repayment due on each
  subsequent Additional Repayment Date, provided that no failure by the
  Facility Agent to so advise the Borrower shall relieve the Borrower from its
  payment obligations under this Credit Agreement. 

  

 

	
  8.2

  	
  Where the
  interest rate defined in Clause 5.2 a) applies, the Borrower shall be
  entitled upon 30 days’ prior notice to the Facility Agent to prepay on any
  Interest Payment Date, in full or in part, any credit amounts outstanding
  together with interest accrued thereon and any other amounts then due under
  the Credit Agreement. Any such notice of the Borrower shall be irrevocable
  and binding and obliges the Borrower to repay the credit amounts in
  accordance with its notice of prepayment.

  In case of
  partial prepayments, any partial amount repaid may be applied by the Facility
  Agent in the inverse order of their maturities.

  Any amount
  prepaid in accordance with this Clause 8.2 may not be reborrowed.

  
	
   

  	
   

  
	
  8.3

  	
  Where the
  interest rate in Clause 5.2 d) applies, prepayment of any amounts not yet due
  according to this Credit Agreement is not permitted.

  
	
   

  	
   

  
	
  8.4

  	
  Prior to the
  first Repayment Date the Facility Agent shall furnish the Borrower with a
  repayment schedule which sets out the Repayment Dates and the amount of
  repayment instalments to be paid on each such Repayment Date or Additional
  Repayment Date, if applicable, provided that no failure by the Facility Agent
  to so advise the Borrower shall relieve the Borrower from its obligations
  hereunder. In case of the granting of Credit B and if a repayment schedule in
  relation to Credit A has already been delivered at such time, the Lenders
  shall furnish the Borrower with a revised repayment schedule or an additional
  repayment schedule, as the case may be. All other stipulations of the
  preceding sentence shall apply mutatis mutandis to such revised or additional
  schedule.

   

  

9.          Payments

 

	
  9.1

  	
  All payments to be made by the Borrower to the
  Lenders through the Facility Agent under this Credit Agreement shall be made
  in USD without any deduction not later than 10.00 a.m. London time on
  the respective due date at the Facility Agent’s free disposal to the account
  of the Facility Agent held with HSBC Bank USA, New York, SWIFT MRMDUS33
  account number 000-023868, in favour of HSBC Bank plc London, SWIFT
  MIDLGB22, account number 36677449 in the name of Project and Export Finance,
  quoting reference 53M/FC1046 or such other account with such other financial
  institution as notified by the Facility Agent to the Borrower.

  
	
   

  	
   

  
	
  9.2

  	
  The Borrower
  shall not be entitled to exercise any right of reten­tion or to set off any
  counterclaims against claims arising from this Credit Agreement against any
  Lender unless such counterclaims exist against the Lender that the Borrower
  exercises the right of retention or set off against, and such counterclaims
  have been accepted by that Lender in writing, or have otherwise been adopted
  or consistently relied upon. 

  
	
   

  	
   

  
	
  9.3

  	
  If
  the Facility Agent receives a payment insufficient to discharge all the
  amounts then due and payable by the Borrower under this Credit Agreement, the
  Facility Agent on behalf of the Lenders shall, notwithstanding any converse
  instruction given by the Borrower, apply incoming payments in the following
  order:

  
	
   

  	
  (i)

  	
  firstly, in
  or towards any costs and expenses due and payable hereunder;

  
	
   

  	
  (ii)

  	
  secondly, in
  or towards payment of any fees due and payable hereunder;

  
	
   

  	
  (iii)

  	
  thirdly, in
  or towards payment of any default interest and/ or indemnification then due
  and payable as provided for in Clauses 9.4 and 9.5;

  
	
   

  	
  (iv)

  	
  fourthly, in
  or towards payment of any contractual interest due and payable hereunder;

  
	
   

  	
  (v)

  	
  fifthly, in
  or towards repayment of any principal amount due and payable hereunder;

  
	
   

  	
  (vi)

  	
  sixthly, in
  or towards payment of any other amount (including any indemnification other
  than 

  
	
   

  	
   

  

 

 17
 

 

 

	
  

  	
  such
  as under Clause 9.5) due and payable hereunder.

  
	
   

  	
   

  
	
  9.4

  	
  The Lenders
  through the Facility Agent shall be entitled to demand on repayment
  instalments overdue default interest at a rate which is the sum of 2% p.a.
  (in words: two per cent per annum) and the rate which would have been payable
  if such overdue amount had, during the period of non payment, constituted a
  Credit for successive periods of any duration as the Lenders (acting
  reasonably) through the Facility Agent may determine from time to time, each
  calculated from the due date until receipt of payment according to Clause 9.1
  hereof.

  
	
   

  	
   

  
	
  9.5

  	
  The Lenders
  through the Facility Agent shall be entitled to demand on amounts overdue
  other than repayment instalments, a lump sum indemnification which is the sum
  of 2% p.a. (in words: two per cent per annum) and the rate which would have
  been payable if such overdue amount had, during the period of non payment,
  constituted a Credit for successive periods of any duration as the Lenders
  (acting reasonably) through the Facility Agent may determine from time to
  time calculated from the due date until receipt of payment according to
  Clause 9.1 hereof.

  
	
   

  	
   

  
	
  9.6

  	
  All payments
  owed by the Borrower as per Clauses 9.4 and 9.5 shall be made immediately
  upon the Facility Agent’s first demand. 

  
	
   

  	
   

  
	
  9.7

  	
  If a due
  date on which a payment of the Borrower must have been received at the free
  disposal of the Facility Agent is not a Bank­ing Day, the next succeeding
  Banking Day shall be the due date, unless such Banking Day falls into a new
  calendar month in which event the due date shall be the preceding Banking
  Day. The obligations of the Borrower to pay interest and fees shall accrue
  accordingly.

  

 

10.                       Taxes,
Levies, Duties and Other Costs

 

10.1                          Definitions

 

a)                                      In this Credit Agreement

 

“Protected
Party” means a Lender which is or will be subject to any liability, or required
to make any payment, for or on account of Tax in relation to a sum received or
receivable (or any sum deemed for the purposes of Tax to be received or
receivable) under this Credit Agreement.

 

“Qualifying
Lender” means a Lender which is situated for tax purposes in (i) the
Russian Federation, (ii) in a Tax Treaty Jurisdiction or (iii) in the
United Kingdom or the Federal Republic of Germany.

 

“Tax” means
any tax, levy, duty or other charge or withholding of a similar nature
(including any penalty or interest payable in connection with any failure to
pay or any delay in paying any of the same).

 

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

 

“Tax Deduction”
means a deduction or withholding for or on account of Tax from a payment under
this Credit Agreement.

 

“Tax Payment”
means an increased payment made by the Borrower to a Lender under
Clause 10.2 or a payment under Clause 10.3.

 

“Tax Treaty
Jurisdiction” means a jurisdiction which has in force a double tax treaty with
the Russian Federation (or with the Union of Soviet Socialist Republics to which
the Russian Federation has succeeded) which provides for full exemption from
Russian withholding tax on interest derived from a source within the Russian
Federation payable to a resident of such jurisdiction.

 18
 

 

 

b)                                     Unless
a contrary indication appears, in this Clause 10 a reference to “determines”
or “determined” means a determination made in the absolute discretion of the
person making the determination.

 

	
  10.2

  	
  Tax Gross up

   

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

   

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

   

  c)                                     Subject to paragraph d) below, if a Tax Deduction is required by
  law to be made by the Borrower, the amount of the payment due from the
  Borrower to the Lenders shall be increased to an amount which (after making
  any Tax Deduction) leaves an amount equal to the payment which would have
  been due if no Tax Deduction had been required.

   

  d)                                    The Borrower is not required to make an increased payment to a
  Lender under paragraph c) above if, on the date on which the payment falls
  due, the Borrower could have made such a payment to that Lender without a Tax
  Deduction if that Lender was a Qualifying Lender, but on that date that
  Lender is not, or has ceased to be, a Qualifying Lender (other than as a
  result of any change after the date it became a Lender under the Credit
  Agreement in (or in the interpretation, administration, or application of)
  any law or treaty, or any published practice or concession of any relevant
  taxing authority).

   

  e)                                     If the Borrower is required to make a Tax Deduction, it shall make
  that Tax Deduction and any payment required in connection with that Tax
  Deduction within the time allowed and in such amount as required by law.

   

  f)                                       The Borrower shall pay to the relevant taxation or other
  authorities within the period for payment permitted by applicable law the
  full amount of the deduction or withholding (including but without prejudice
  to the generality of the foregoing, the full amount of any deduction or
  withholding from any additional amount paid pursuant to this sub-clause).

   

  g)                                    Promptly upon making either a Tax Deduction or any payment
  required in connection with that Tax Deduction, the Borrower shall deliver to
  the Facility Agent for a Lender entitled to the payment an original receipt
  (or certified copy thereof) demonstrating that the Tax Deduction has been
  made or (as applicable) any appropriate payment paid to the relevant taxing
  authority.

   

  
	
  10.3

   

  	
  Tax
  Indemnity

   

  a)            The
  Borrower shall (within three Business Days of demand by the Facility Agent)
  pay to a Protected Party through the Facility Agent an amount equal to the
  loss, liability or cost which that Protected Party determines has been
  suffered for or on account of Tax by that  Protected Party in respect of this Credit
  Agreement.

   

  b)            Paragraph
  (a) above shall not apply:

   

  (i)            with respect to any Tax assessed
  on a Lender:

   

  (A)          under
  the law of the jurisdiction in which that Lender is incorporated or, if
  different, the jurisdiction (or jurisdictions) in which that Lender is
  treated as resident for tax purposes; or

  

 19
 

 

 

	
  

  	
   

  (B)          under
  the law of the jurisdiction in which that Lender’s facility office is located
  in respect of amounts received or receivable in that jurisdiction,

   

  if
  that Tax is imposed on or calculated by reference to the net income received
  or receivable (but not any sum deemed to be received or receivable) by that
  Lender; or

   

  (ii)           to
  the extent a loss, liability or cost:

   

  (C)          is
  compensated for by an increased payment under Clause 10.2; or

   

  (D)          would
  have been compensated for by an increased payment under Clause 10.2 but was
  not so compensated solely because one of the exclusions in paragraph d) of
  Clause 10.2 applied.

   

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

   

  d)            A
  Protected Party shall, on receiving a payment from the Borrower under this
  Clause 10.3, notify the Facility Agent.

  
	
   

  	
   

  
	
  10.4

  

  	
  Tax Credit

   

  If the
  Borrower makes a Tax Payment and the relevant Lender determines that:

   

  (a)           A Tax Credit is attributable to
  that Tax Payment; and

  

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

   

  the Lender shall pay through the Facility Agent
  promptly an amount to the Borrower which that Lender determines will leave
  the Lender (after that payment) in the same after-tax position as it would
  have been in had the Tax Payment not been made by the Borrower.

  
	
   

  	
   

  
	
   

  	
  However, if
  the relevant Lender should be obliged by any law, regulation or court or any
  other official decision to repay any Tax Credit obtained by such Lender and
  paid to the Borrower pursuant to the preceding paragraph, or if any such Tax
  Credit should otherwise be officially revoked, the Borrower shall promptly
  upon demand of such Lender and against reasonable evidence of such repayment
  obligation or revocation, as the case may be, refund the respective Lender
  through the Facility Agent of such amount.

  
	
   

  	
   

  
	
  10.5

  	
  Without
  prejudice to the Borrower’s obligations/the Lenders’ rights accord­ing to
  Clause 10.2 and 10.3, in the event of withholding taxes being imposed in the
  Russian Federation on payments due under this Credit Agreement that are
  eligible for exemption and provided that the Borrower and/or the Lenders can
  claim such exemption with the result that they are released from any
  obligation to pay such taxes, the Borrower hereby undertakes to apply with
  the competent authorities in the Russian Federation to be exempted and
  released from such taxes and to provide the Facility Agent with a tax
  exemption certificate or any other evidence of such tax exemption, all in
  form and substance as reasonably may be required by the Lenders through the
  Facility Agent. In turn, in order to enjoy the benefits of an applicable
  convention on avoidance of double taxation each Lender undertakes to the
  extent reasonably feasible to it to submit to the Borrower a certificate of
  its residence in the form and in the manner required by Russian Law, provided
  that any expenses incurred by a Lender in doing so shall be borne by the
  Borrower. The form of the certificate as well as its main items shall be
  advised by the Borrower to the Facility Agent reasonably in advance.

  
	
   

  	
   

  
	
  10.6

  	
  Without
  prejudice to the Lenders’ rights under this Credit Agreement, in particular
  under this Clause 10, the Borrower shall pay to the Lenders through the
  Facility Agent upon demand (i) any 

   

  

 20
 

 

 

	
  

  	
  stamp
  duties, registration fees and similar taxes and charges in connection with
  this Credit Agreement and (ii) all legal fees (including VAT) and
  out-of-pocket expenses incurred by the Lenders and/or the Facility Agent in
  connection with the negotiation, preparation, documentation and execution of
  this Credit Agreement provided that all such fees and expenses shall not
  exceed USD 15,000.00 (plus VAT and disbursements, plus costs for required
  translation of any of the finance documents related to this Credit Agreement
  into the Russian language) and (iii) any costs, including lawyer’s fees
  and taxes arising thereon, in connection with the preservation and
  enforcement of the Lenders’ rights under this Credit Agreement.

   

  

11.                       Guarantee of
the Federal Republic of Germany for tied Buyer’s Credits

 

	
  11.1

  	
  The Hermes
  Agent on behalf of the Lenders has applied for insurance cover of the Lenders’
  claims arising from this Credit Agreement by the Federal Republic of Germany,
  represented by Hermes by means of an insurance agreement (the “Insurance
  Agreement”). Credit A will be made available on the basis of such Insurance
  Agreement and the terms and conditions governing it. In the event that
  additional insurance cover is provided by Hermes for the purposes of
  financing being made available for Credit B hereunder, then Credit B will be
  made available on the basis of such supplemental insurance (“Supplemental
  Insurance Agreement”) and the terms and conditions governing it. Lenders are
  entitled to give information on the Credit Agreement and the transactions
  contemplated thereby to the competent authorities of the Federal Republic of
  Germany and the European Union and to allow such authorities perusal of all
  records that may be connected with this Credit Agreement and to furnish them
  with copies thereof.

   

  
	
  11.2

  	
  The Borrower
  undertakes to reimburse and indemnify the Lenders through the Facility Agent
  in full for and against the aggregate amount of premiums and charges (the “In­surance
  Premium”) payable by the Lenders through the Facility Agent to Hermes under
  the Insurance Agreement for insurance cover of their payment claims arising
  from Credit A of this Credit Agreement.

   

  The
  Insurance Premium shall be paid by the Borrower immediately upon written
  demand by the Facility Agent in accordance with Annex 1c or Annex 1e, as the
  case may be, provided that the insurance premium is payable (and is either
  already due or will become due shortly) by the Lenders to Hermes under the
  Insurance Agreement.

   

  
	
  11.3

  	
  In the event
  that additional financing in the form of Credit B is made available to the
  Borrower, the Borrower undertakes to reimburse and indemnify the Lenders
  through the Facility Agent in full for and against the additional amount of
  premiums and charges (the “Additional Insurance Premium”) payable by the
  Lenders through the Facility Agent to Hermes under the Supplemental Insurance
  Agreement for additional insurance cover of their payment claims arising from
  Credit B of this Credit Agreement. The second paragraph of Clause 11.2 shall
  apply mutatis mutandis hereto.

  

 

	
  11.4

  	
  Prior to the
  first Repayment Date under this Credit Agreement or - in case of
  disbursements or reimbursements after such date - upon disbursement in full
  of the Credits, the Facility Agent will recalculate the amount of Insurance
  Premium (or as applicable, the amount of Additional Insurance Premium)
  payable to Hermes and will provide the Borrower with reasonable evidence of
  the correctness of such recalculation if the Insurance Premium (or as
  applicable, the Additional Insurance Premium) payable for cover with respect
  to this Credit Agreement does not equal the aggre­gate amounts which the
  Borrower has paid to the Facility Agent as per Clause 11.2 or, as the case
  may be, Clause 11.3 hereof towards reimbursement against such Insurance
  Premium (or as applicable the Additional Insurance Premium).

   

  If the
  aggregate amount reimbursed by the Borrower is more than the re­spective
  Insurance Premium (or if applicable, the Additional Insurance Premium), the
  Lenders through the Facility Agent will forthwith refund the excess amount to
  the Borrower. If the aggregate amount paid by the Borrower towards
  reimbursement against the respective Insurance Premium (or if applicable, the
  Additional Insurance Premium) was less than the Insurance Premium (or if
  applicable, the Additional Insurance Premium) payable by the Lenders, the
  Borrower undertakes upon request of 

  

 21
 

 

 

	
  

  	
  the Facility
  Agent within 30 calendar days to pay to the Facility Agent the balance in
  favour of the Lenders. 

  

 

12.                       Suspension
of Disbursement, Payments Immediately Due (Events of Default)

 

	
  12.1

  	
  The
  Lenders acting through the Facility Agent shall be entitled to suspend each
  and/or any future disbursement of the Credits in whole or in part, and/or to
  terminate this Credit Agreement, and/or to demand immediate repayment of all
  credit amounts outstand­ing, as well as the payment of all interest and fees
  accrued thereon, any charges and other claims incidental thereto, if:

   

  a)        the
  Borrower fails to fulfil any payment obligation whether in respect of
  principal, interest or any other amount under this Credit Agreement when due
  and payable unless

   

  (i) its failure to pay is caused by administrative or technical
  error; and

  (ii) payment is made within three Banking Days
  of the due date;

   

  or

   

  b)       the
  Borrower breaches or fails to fulfil any other obligation under this Credit
  Agreement and in case of any such breach or failure capable of being
  remedied, such failure or breach is not remedied within 10 Banking Days after
  the Facility Agent has notified the Borrower in writing of such failure or
  breach;

   

  or

   

  c)        any
  representation, warranty or statement in this Credit Agreement or any other
  document (including the legal opinion rendered as per Clause 4 hereof) is or
  proves to be or to have been incorrect or untrue in any material respect when
  made or deemed to be made at any time during the term of this Credit
  Agreement and in case that such incorrectness is capable of being remedied -
  whereas the determination of such capability shall be upon the sole discretion
  of the Lenders - such incorrectness is not cured within 15 Banking Days after
  the Facility Agent has notified the Borrower in writing of such
  incorrectness;

   

  or

   

  d)       the
  Borrower shall fail to pay when due or within any applicable period of grace
  any indebtedness owed to any of the Lenders or to any other creditor,
  provided, however, that in relation to any such indebtedness owed by the
  Borrower to any creditor other than any of the Lenders (including any of
  their Affiliates) such failure by the Borrower shall not constitute an event
  of default under this sub-clause if (i) the overdue amounts in relation
  to the Borrower in aggregate do not exceed USD 10,000,000.00 or the
  equivalent thereof in any other currency, or (ii) in the event of any
  such failure by the Borrower exceeding the aforementioned amount any such
  default is remedied (including by waiver or amendment) within 15 calendar
  days after the due date of the respective payment obligation or after lapse
  of any applicable period of grace unless the respective creditor accelerates
  the relevant indebtedness before;

   

  or

   

  e)        at
  any time it shall become unlawful for the Borrower to perform any or all of
  its obligations under this Credit Agreement (including, without limitation,
  any governmental or other consent, licence or authorisation required to make
  this Credit Agreement legal, valid, binding and enforceable, or required at
  any time to enable the Borrower to perform its obligations under this Credit
  Agreement, ceasing to be in full force and effect);

   

  or

   

  f)        any
  material provision of this Credit Agreement is or becomes invalid or
  unenforceable;

   

  

 22
 

 

 

	
  

  	
   

  or

   

  g)       the
  Borrower shall enter into voluntary suspension of payments, bankruptcy,
  liquidation or dissolution, or shall become insolvent, or a receiver or
  liquidator shall be appointed on all or any material part of the under­taking
  or assets of the Borrower or proceedings are commenced by or against the
  Borrower under any law or regulation providing for any reorganisation,
  arrangement, readjustment of debts, dissolution or liquidation or any act
  shall be done or event shall occur which under the laws of the relevant
  jurisdiction has a substantially similar effect to any of the fore­going act
  or event, provided that an event of default will not occur under this
  sub-clause g) in respect of any petition or application being initiated or
  commenced by any person other than the Borrower if the petition or
  application is - in the sole discretion of the Lenders - frivolous or
  vexatious and is withdrawn or rejected within 30 calendar days from the date
  of such application and before a court order for the commencement of any such
  procedure has been made;

   

  or

   

  h)       the Borrower admits its inability to meet its payment
  obligations to any of the Lenders or to any other creditor or to convert the
  funds necessary to effect such payments into the currency payable under
  agreements with parties domiciled out­side of its country or to transfer such
  payments, or the Borrower admits - towards any of the Lenders - its
  unwillingness with regard to any of the aforementioned actions;

   

  or

   

  i)         any
  material adverse change shall occur in the financial condition or operations,
  assets, prospects, business or the legal status of the Borrower such that it
  is reasonably likely that the Borrower may not, or will be unable to perform
  or ob­serve its obligations under this Credit Agreement,

   

  provided,
  however, that in case of the occurrence of any of the events as stipulated in
  sub-clauses a), b), c) and d) of this Clause 12.1, for so long as such events
  are continuing the Lenders through the Facility Agent shall be entitled to
  suspend disbursements / reimbursements under this Credit Agree­ment prior to
  the expiry of the grace period for remedy of the relevant events of default.

  
	
   

  	
   

  
	
  12.2

  	
  Insofar as
  any statements made by the Facility Agent according to Clause 12.1 are sent
  by airmail (with a copy by fax), these state­ments shall be deemed to have
  been received not later than on the 10th Banking Day after their dispatch. If
  such statements are made by means of telecommunication, the day following
  their dispatch shall be deemed as the date of receipt.

  

 

13.                       Representations and Warranties

The Borrower hereby represents and warrants
to the Lenders that

a)                            the Borrower is a corporation duly incorporated under the laws of
the Russian Federation, validly existing and in good standing;

b)                           the Borrower has the power to own its assets and carry on its
business as it is being conducted;

c)                            the Borrower is not entitled to claim immunity from suit, execution,
attachment or other legal process in any proceedings taken in the Russian
Federation in relation to this Credit Agreement;

d)                           the Borrower has full power and legal right to execute, deliver and
to perform this Credit Agreement;

 23
 

 

 

e)                            the execution, delivery and performance of this Credit Agreement
will not violate any provisions of, and have duly and validly been authorised
under, the laws, regulations, orders and decrees of the Russia Federation or
any other competent Russian authority and all consents, licences, approvals,
authorisations and instrumentalities of, and registrations and/or declarations
with any authority within the Russian Federation required in connection with
the valid execution, delivery, performance or enforceability of this Credit
Agreement (including without limitation the obtaining and transfer in USD of
all amounts due under this Credit Agreement) have been obtained and made and
are in full force and effect;

f)                              each action necessary under the statutes of the Borrower or under
any other agreement or instrument binding on the Borrower to authorise the
execution, delivery and/or performance of this Credit Agreement has been duly
taken and the execution, delivery and performance of this Credit Agreement will
not conflict with, or constitute a breach of the statutes of the Borrower or
any such agreement or instrument binding upon the Borrower;

g)                           the Borrower is not in default under any agreement or instrument
constituting present or future payment obligations as debtor or guarantor;

h)                           other than the UMC Litigation no litigation, administration or
insolvency proceedings are pending or, to the knowledge of the Borrower are
threatened, which adversely determined, would reasonably be expected to have a
material adverse effect on the assets or financial condition of the Borrower or
on its right or ability to perform its obligations hereunder or would affect
the legality, validity or enforceability of this Credit Agreement; and

i)                               all its payment obligations in connection with this Credit Agreement
rank at least pari passu in point of preference and security with all other
unsecured and subordinated existing and future indebtedness owed to any
creditor other than the Lenders, except for any preference being due to
mandatory law.

The representations and warranties set out
in this Clause 13 shall be deemed to be repeated by the Borrower, without any
notification or other action by the Borrower, on the first day of each Interest
Period mutatis mutandis in relation to the facts and circumstances then
existing.

14.        Financial Statements, Information and
Undertakings

Until such date as all obligations incurred
under this Credit Agreement have been fulfilled in full, the Borrower shall:

a)                            furnish the Facility Agent within 6 months from the end of its
financial year with audited annual financial statements (including profit and
loss accounts and ex­planatory notes) prepared in accordance with US GAAP (US
Generally Accepted Accounting Principles, Standards and Practices) and provide
the Facility Agent with such additional financial information as the Facility
Agent may from time to time reasonably request. In the event that completion
and adoption of the financial statements should be delayed, the Borrower shall
furnish the Facility Agent with provisional balance sheet figures within 6
months after the end of its financial year;

b)                           inform the Facility Agent without delay of the occurrence of any of
the events mentioned in Clause 12 hereof;

c)        only with the prior written consent of the Lenders agree upon any
modification and/or amendment to the Export Contract or, as the case may be,
the Additional Export Contract, which represents a material change to the
Export Contract or Additional Export Contract, including but not limited to
changes in the price/currency, terms of payment, country of origin, delivery
and/or installation periods etc.;

 24
 

 

 

d)                           obtain and keep in full force all authorisations, licenses,
approvals and permits (governmental or otherwise) which are required for the
validity and enforceability of this Credit Agreement;

e)                            comply with all applicable laws, rules, regulations and orders
including all environmental laws and all applicable restrictions imposed by all
governmental authorities (including but not limited to the central bank of the
Russian Federation) and do all such acts and things which are required
thereunder, if failure so to comply will or in the reasonable opinion of the
Lenders may, materially impair the ability of the Borrower to perform its
obligations, whether in respect of any payment of principal, interest, fees,
costs or expenses or otherwise, under this Credit Agreement in strict
compliance with its terms;

f)                              procure that no substantial change is made to the general nature or
scope of its business from that carried out on the date of this Credit
Agreement and forthwith inform the Facility Agent of any circumstances which
might result in such change provided that the Borrower may amalgamate, merge,
demerge or consolidate with any Affiliate as part of any corporate restructuring
unless any such action would result in a material adverse change which falls
within the scope of application of Clause 12.1.i) hereof;

g)                           immediately upon the Borrower’s knowledge or awareness thereof
inform the Facility Agent of any forthcoming amalgamation, demerger, merger,
consolidation or corporate reconstruction of the Borrower;

h)                           ensure that neither in a single transaction nor in a series of
transactions, whether related or not, all or any substantial part of its assets
are sold, transferred, granted or leased or otherwise disposed of unless such
sale, transfer, grant, lease or disposal is;

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

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

(iii)                               made by the Borrower to any Affiliate of the Borrower unless any
such transaction would result in a material adverse change which falls within
the scope of application of Clause 12.1.i) hereof;

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

(v)                                 where the book value of such asset (when aggregated with the book
value of each other asset disposed of under this sub-clause (v)) (in each case
as calculated in accordance with US GAAP) does not exceed 25% of the Borrower’s
Total Assets in any financial year of the Borrower and provided that at all
times the disposal of such assets will be made for full consideration and will
not lead to any material adverse change which would fall within the scope of
Clause 12.1 i). At the request of the Facility Agent (any such request to be
made no more than once per calendar quarter, unless an Event of Default is
continuing), the Borrower shall provide a certificate to the Agent setting out
in reasonable detail the book value of any assets disposed of under this
sub-clause (v) (calculated in accordance with US GAAP); or

(vi)                              involving the transfer of any or all of the Borrower’s shares in UMC
pursuant to the UMC Litigation to a person that is not the Borrower or any of
its Subsidiaries.

When calculating the Borrower’s Total Assets under
sub-clause (v) above, if the annual consolidated balance sheet of the
Borrower for the immediately preceding financial year of the Borrower is not
available, the Borrower’s Total Assets shall be calculated by reference to the
draft audit report then available for that financial year and any other
evidence reasonably requested by, 

 25
 

 

 

and reasonably satisfactory to, the Facility Agent.

i)                               do all such things as are necessary to maintain its corporate
existence and ensure that it has the right and is duly qualified to conduct its
business;

j)                               not create or agree to create any mortgage, charge, pledge, lien or
other security interest on the whole or any part of its assets to secure any
indebtedness owed to any creditor other than the Lenders (for the avoidance of
doubt, any suretyship or guarantee shall not be deemed a security for the
purposes of this paragraph), unless the Credits shall at the same time be
secured equally and rateably therewith to the Lenders’ satisfaction other than
Permitted Lien (as defined hereinafter)

“Permitted
Lien” means:

(i)          any
lien on any property or assets of any person existing at the time such person
is merged or consolidated with or into the Borrower and not created in
contemplation of such event, provided that no such lien shall extend to any
other property or assets;

(ii)       any
lien existing on any property or assets prior to the acquisition thereof by the
Borrower and not created in contemplation of such acquisition, provided that no
such lien shall extend to any other property or assets;

(iii)           any lien on any property or assets
securing indebtedness of the Borrower incurred or assumed for the purpose of
financing all or part of the cost of acquiring or constructing or refurbishing
such property or assets, provided that (a) no such lien shall extend to
any other property or assets, (b) the aggregate principal amount of all
indebtedness secured by liens under this sub-Clause (iii) on such property
or assets shall not exceed the lower of (x) the purchase price of such
property or assets and (y) the fair market value of such property or
assets at the time of acquisition or constructing;

(iv)          any
netting or set-off arrangement entered into in the ordinary course of its
banking arrangements for the purpose of netting debit and credit balances;

(v)         any lien arising by operation of law
either (a) in the ordinary course of business; or (b) in respect of
taxes, assessments, government charges or claims, including without limitation
those in favour of Russian governmental fiscal authorities;

(vi)          any lien on the property or assets
of the Borrower securing inter-company indebtedness;

(vii)       any extension, renewal or
replacement of any lien described in sub-Clauses (i) to (v) above,
provided that (a) such extension, renewal or replacement shall be no more
restrictive in any material respect than the original lien, (b) the amount
of indebtedness secured by such lien is not increased and (c) if the
property, income or assets securing the indebtedness subject to such lien are
changed in connection with such refinancing, extension or replacement, the fair
market value of the property, income or assets is not increased;

(viii)    any other lien, provided that, immediately
after giving effect to such lien, the Borrower’s secured indebtedness in the
aggregate do not exceed 10% of the book value of the aggregate amount of the
Borrower’s total assets, determined by reference to its most recent quarterly
or, as the case may be, audited  annual
unconsolidated balance sheet;

 26
 

 

 

(ix)        easements,
rights-of-way, and any other similar charges and legally binding restrictions
or encumbrances incurred in the ordinary course of business and not interfering
in any material respect with the business of the Borrower or the Business of
any Subsidiary of the Borrower, including any encumbrance with respect to an
equity interest of any joint venture agreement;

k)                            ensure that its payment obligations under this Credit Agreement rank
at least pari passu with all its other present and future unsecured payment
obligations.

15.                       Assignability

The Borrower
may not assign all or any of its rights and claims under this Credit Agreement.

Unless (i) the
assignment is to an Affiliate of a Lender or to another Lender or (ii) an
Event of Default has occurred, any assignment occurring after the date of this
Credit Agreement by any Lender shall require the consent of the Borrower,
provided that (x) such consent shall not be unreasonably withheld or
delayed; and (y) unless the Borrower has notified the Facility Agent to
the contrary within 5 Banking Days of receiving notice of the intended
assignment, the Borrower will be deemed to have given consent to that
assignment .

Any Lender may
also disclose to any person to whom it assigns or intends to assign its rights
and obligations hereunder such information about the Borrower and the Credit
Agreement, as such Lender shall consider necessary.

16.                       Statements
and Notices

 

	
  16.1

  	
  Any
  notices or other communications in connection with this Credit Agreement are
  to be made by letter or by written means of telecommunication, and to be sent
  to the following addresses:

  

 

 

	
  Borrower:

  	
  OJSC Mobile TeleSystems 

  
	
   

  	
  4 Marksistskaya Street

  
	
   

  	
  Moscow 109147

  
	
   

  	
  Russian Federation

  
	
   

  	
   

  
	
   

  	
  Telefax: + 7 095 911 6531

  
	
   

  	
   

  
	
  Facility Agent:

  	
  HSBC Bank plc

  
	
  (for and on behalf of

  	
  Level 17, Project and Export Finance

  
	
  the Lenders)

  	
  8 Canada Square

  
	
   

  	
  London E14 5HQ

  
	
   

  	
  United Kingdom

  
	
   

  	
   

  
	
   

  	
  Telefax:+44 207 992 4428 (Attention of: Mr Alan
  Marshall)

  

 

	
  16.2

  	
  The Borrower
  shall provide the Facility Agent with specimen signatures in form and
  substance as per Annex 4 of those persons who are authorised to act on its
  behalf.

  
	
   

  	
   

  
	
  16.3

  	
  Any
  alteration in the above-mentioned companies’ names, addresses and power of
  representation shall be binding upon the other contracting party only upon
  receipt by such other party of written notification or documents evidencing
  such alteration.

  
	
   

  	
   

  
	
  16.4

  	
  All
  correspondence between the parties hereto shall be conducted and carried out
  in the English lan­guage. Should the wording of any document be in a language
  other than English such document  shall
  be accompanied by a translation certified to be true and accurate that is
  either authorised by the person who produced it or by a sworn translator.

  

 

 27
 

 

 

17.                     Miscellaneous

 

	
  17.1

  	
  This Credit
  Agreement is independent from the Export Contract and, as the case may be,
  the Additional Export Contract. The Borrower is not allowed to raise and
  hereby waives any defences or objections emanat­ing from the Export Contract
  and, if appropriate the Additional Export Contract, and from its legal
  relationship with the Exporter. In particular, the Borrower’s obligation to
  repay the Credits as well as all other payment obligations under this Credit
  Agreement are independent from the legality, validity and enforceability of
  the Export Contract and, as the case may be, the Additional Export Contract
  or from any non-performance, bad performance and/or default by the Exporter
  under the Export Contract and, as the case may be, the Additional Export
  Contract.

  
	
   

  	
   

  
	
  17.2

  	
  In
  satisfaction of the Lenders’ respective obligations under the Money
  Laundering Act, to record the economical beneficiary of borrowing hereunder,
  the Borrower hereby confirms that the borrowing of the Credits is made on its
  own behalf and for its own account.

  

 

18.                       Currency Indemnity

 

In the
event that for the purpose of obtaining judgement in any court of any country
or enforcement of any judgement by the Lenders it becomes necessary to convert
an amount of the currency due hereunder (the “Agreed Currency”), into an amount
of another currency (the “Judgement Currency”), then the amount due hereunder,
expressed in the Judgement Currency, shall be determined on the basis of the rate
of exchange at which the Facility Agent for account of the Lenders is able to
purchase the relevant amount of the Judgement Currency on the Banking Day
immediately before the day on which the judgement is given or on such earlier
date as may be required by the procedural law of the court in which the
judgement is sought (the “Agreed Conversion Date”).

 

In the event
of a change in such rate of exchange between the Agreed Conversion Date and the
date of actual payment, the Borrower shall pay such additional amounts of the
Judgement Currency (or the Lenders through the Facility Agent shall remit to
the Borrower amounts of such currency) as may be appropriate to ensure that the
amounts of the Judgement Currency paid by the Borrower, when converted at the rate
of exchange as defined above prevailing at the date of actual payment, shall
produce in total the amount of the Agreed Currency due hereunder together with
any premium or costs of exchange payable in connection with the purchase or
conversion into the Agreed Currency.

 

Any such
additional amounts due shall be due as a separate debt and shall not be
affected by a judgement being obtained for any other sums due under  or in respect of this Credit Agreement.

 

19.                       Applicable Law, Place of Performance and Jurisdiction

 

	
  19.1

  	
  This Credit
  Agreement, as well as all the rights and obli­gations arising there­from,
  shall be governed by and construed in accor­dance with the laws of the
  Federal Republic of Germany.

  
	
   

  	
   

  
	
  19.2

  	
  Save as
  otherwise stipulated herein, place of performance is Frankfurt am Main,
  Federal Republic of Germany.

  
	
   

  	
   

  
	
  19.3

  	
  Any legal
  action or proceeding with regard to this Credit Agreement shall be brought in
  the District Court (Landgericht) at Frankfurt am Main, Federal Republic of
  Germany, the Lenders reserving to themselves the right to bring any such
  legal action or proceeding in any other court of law having or accepting
  jurisdiction as the Lenders may elect.

   

  Without
  prejudice to and notwithstanding the above, the parties agree that subject to
  the option in favour of the Lenders, any dispute controversy or claim arising
  out of this Credit Agreement or related to its fulfilment, breach,
  termination, or invalidity shall be settled by three arbitrators under the
  arbitration rules of the UNCITRAL (United Nations Commission on
  International Trade Law) 

  

 28
 

 

 

	
  

  	
  Model Law on International Commercial Arbitration.
  The arbitrators shall be appointed in accordance with those rules and be
  qualified to practise as a judge in the Federal Republic of Germany. Place of
  arbitration shall be at Frankfurt am Main, Federal Republic of Germany. The
  parties herewith irrevocably express their consent to have the hearing
  conducted in the English language.

  
	
   

  	
   

  
	
  19.4

  	
  For
  any service which may become necessary in connection with proceedings before
  the courts at Frankfurt/Main, Federal Republic of Germany, the Borrower
  hereby undertakes to irrevocably designate, appoint and empower, such
  appointment to be in form and substance as per Annex 5 to this Credit
  Agreement, Frankfurter Beteiligungs-Treuhand GmbH, Bockenheimer Landstrasse
  10, 60323 Frankfurt am Main, Federal Republic of Germany, as its agent for
  service of process (the “Agent for Service of Process”) authorised to
  receive, for and on behalf of itself, service of process.

   

  In the event
  that the legal capacity of the Agent for Service of Process to act as
  provided in this Clause 19.4 should cease for any reason whatsoever, the
  Borrower hereby undertakes in consultation with the Facility Agent to
  forthwith designate, appoint and empower another person who is acceptable to
  the Lenders to act as the Borrower’s Agent for Service of Process.

  

 

20.        General
Provisions

 

	
  20.1

  	
  This Credit Agreement shall not be capable of being
  waived, modified or varied otherwise than by an express waiver, modification
  or variation in writing. Any delay or failure on the part of the Lenders
  and/or the Facility Agent in exercis­ing any of their rights under this
  Credit Agreement shall not be regarded as a waiver of these rights or as
  acquiescence in any conduct contravening the terms of this Credit Agreement.
  Exer­cise of single rights only, or merely partial exercise of any rights
  shall not preclude the claiming in the future of any rights not yet or only
  partially exercised.

  

 

	
  20.2

  	
  In the event of any provisions laid down in this
  Credit Agreement being or becoming wholly or partially ineffective in law,
  the other provi­sions of this Credit Agreement shall remain in force. Any
  insuffi­ciency thus created shall be filled by a corresponding provision
  consistent with the spirit and purpose of this Credit Agreement.

   

  
	
   

  	
   

  
	
   20.3

  	
  This
  Agreement shall be executed in the English language. 

  

 

 

	
   

  	
  OJSC Mobile TeleSystems 

  
	
   

  	
   

  
	
   

  	
   

  
	
  Moscow,
  ..................................................

  	
  .................................................................

  
	
  (place,
  date)

  	
  (legally
  binding signature(s))

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HSBC Bank
  plc

  
	
   

  	
   

  
	
   

  	
   

  
	
  London,   ....................................

  	
  .................................................................

  
	
  (place,
  date)

  	
  (legally
  binding signature(s))

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ING BHF-BANK
  Aktiengesellschaft

  
	
   

  	
   

  
	
   

  	
   

  
	
  Frankfurt am
  Main, .......................

  	
  ................................................................

  
	
  (place,
  date)

  	
  (legally binding
  signature(s))

  

 

 29
 

 

 

Annex
1a

HSBC Bank plc

Level 17, Project and Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

 

For the attention of: Mr Alan Marshall

 

Certificate for Reimbursement

 

Credit
Agreement dated 1 October 2004 in the amount of USD 75,748,000 [as
increased by USD.......................*]

 

We hereby
confirm to you that we have paid to the Exporter an amount of USD
............................ representing the last 85% of the total value of
deliveries made/services rendered* by the Exporter under the Export Contract /
Additional Export Contract* during the period from
.............................(date) to ......................(date).

 

According to
Clause 3.2.a) of the Credit Agreement, the amount of USD.................... is
thus to be paid to us to our account no. .................. with ...................

 

..................................................................

(place)(date)

 

OJSC
Mobile TeleSystems

 

......................................................................

(legally
binding signature(s) of the Borrower)

 

 

We, the
undersigned, herewith confirm having made/rendered* the above captioned
deliveries/services* and having received the above-mentioned amount(s). We also
confirm having received the 15% down payment associated with the above
captioned deliveries/services*.

 

..............................................................

(place)(date)

 

 

Siemens
Aktiengesellschaft

 

 

 

......................................................................

(legally
binding signature(s) of the Exporter)

 

 

* Please delete as appropriate

 30
 

 

 

Annex
1b

HSBC Bank plc

Level 17, Project and Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

 

For the attention of: Mr Alan Marshall

 

Certificate for Disbursement

 

Credit
Agreement dated 1 October 2004 in the amount of USD 75,748,000 [as
increased by USD ....................*]

 

We hereby
confirm to you that during the period from ............................(date)
to ......................(date) we have made deliveries/rendered services* of
............................ under the Export Contract / Additional Export
Contract* in the total value of USD ......................... and we have
presented to you documents in conformity with Clause 3.2.b) of the Credit
Agreement.

 

At present,
the amount due to us under the Export Contract / Additional Export Contract* on
the basis of the aforementioned deliveries/services amounts to 85% of the
deliveries/services.

 

We confirm
having received the 15% down payment associated with the aforementioned
deliveries/services*.

 

According to
Clause 3.2.b) of the Credit Agreement, the amount of USD ................... is
thus to be paid to us. Please effect payment to us to our account no.
................ with ........................ .

 

.............................               .................................

(place)                                (date)

 

Siemens
Aktiengesellschaft

 

......................................................................

(legally
binding signature(s) of the Exporter)

 

 

 

* Please delete as appropriate

 31
 

 

Annex 1c

 

To

OJSC Mobile TeleSystems

4 Marksistskaya Street

Moscow 109147

Russian Federation

....................................

 

Certificate
for Disbursement

for the Insurance Premium

Credit Agreement dated 1 October 2004 in the amount of USD
75,748,000 [as increased by USD ....................*]

 

Dear Sirs,

As per the attached copy of the invoice of Hermes dated
....................... the Insurance Premium / Additional Insurance Premium* in
the amount of USD .................... was/will become due and payable to
Hermes on .............................. .According to Clause 11.2 / 11.3* of
the Credit Agreement, the amount of USD ........................... is payable
to us/ In order to achieve fulfilment of the condition precedent as per Article 4.2.b)
and your obligations as per Article 11.2 please pay to us the Insurance
Premium / Additional Insurance Premium* calculated by the Facility Agent to
amount to USD................. which will become due and payable to Hermes shortly*.

Please remit the aforementioned amount to SWIFT MRMDUS33, account
number 000-023868 held with HSBC Bank USA, New York, in favour of HSBC
Bank plc, London, SWIFT MIDLGB22 account number 36677449 in the name of Project
and Export Finance quoting ref 53M/FC1046. Reimbursement to you will be made
pursuant to Clause 3.4 of the Credit Agreement.

London, ...........................                                                                      .....................................................
                                                                                                                 HSBC
Bank plc

 

* Please delete as
appropriate

 32
 

 

 

Annex 1d

HSBC Bank plc

Level 17, Project and Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

 

For the
attention of: Mr Alan Marshall

 

Certificate for Reimbursement

in case
of application of the Special Payment Procedure

 

 

Credit Agreement dated 1 October 2004 in the amount of USD
75,748,000 [as increased by USD ........................*]

We hereby confirm to you that the Exporter made deliveries/rendered
services* under the Export Contract / Additional Export Contract* during the
period from ............................(date) to ......................(date)
in the total amount of USD ................. and that we have instructed the Passport
Bank to effect payment of USD ............... to the Exporter representing the last 85%
of the total value of such deliveries made/services rendered*.

According to Clause 3.2.a) of the Credit Agreement, the amount of
USD.................... is thus to be paid to us to our account no.
................... with the Passport Bank.

..................................................................

(place)(date)

OJSC Mobile TeleSystems

......................................................................

(legally binding signature(s) of the Borrower)

* Please delete as appropriate

 

 33
 

 

 

Annex 1e

To

OJSC Mobile TeleSystems

4 Marksistskaya Street

Moscow 109147

Russian Federation

....................................

 

Certificate
for Disbursement for the Insurance Premium

in case of application of the Special Payment Procedure

 

Credit Agreement dated [............] in the amount of USD
45,612,500.00

Dear Sirs,

As per the attached copy of the invoice of Hermes dated
....................... the Insurance Premium in the amount of USD
..................... was/will become due and payable to Hermes on
............................... .

According to Clause 11.2 of the Credit Agreement, the amount of USD
............................ is payable to us/In order to achieve fulfilment of
the condition precedent as per Article 4.2.b) and your obligations as per Article 11.2
please pay to us, through the Passport Bank, the Insurance Premium calculated
by the Facility Agent to amount to USD.................. which will become due and payable
to Hermes shortly*.

Please instruct the Passport Bank to remit the aforementioned amount to
us in accordance with the terms and conditions of the certain disbursement
agreement entered into between you, us and the Passport Bank, and which
provides for the Special Payment Procedure. Reimbursement to you will be made
pursuant to Clause 3.4 of the Credit Agreement.

London, ...........................                                                                      .....................................................
                                                                                                                 HSBC
Bank plc

 

* Please delete as appropriate

 34
 

 

Annex
2

HSBC Bank plc

Level 17, Project and Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

For the
attention of: Mr Alan Marshall

Confirmation of Coming into Force of the Export
Contract* / Additional Export Contract*

Credit Agreement dated 1 October 2004 in the amount of USD
75,748,000 [as increased by USD ....................*]

We
hereby confirm to you that the Export Contract between OJSC Mobile TeleSystems
in the Russian Federation and Siemens Aktiengesellschaft dated 8 June 2004
for USD 83,000,000 has come into force on ................................. . *
/ We hereby confirm to you that the Additional Export Contract between OJSC
Mobile TeleSystems in the Russian Federation and Siemens Aktiengesellschaft
dated [................] for USD [..............] has come into force on .................................
.. *

...........................                 ...........................                                          ..............................                    .............................

(place)                                (date)                                                           (place)                                      (date)

	
  Siemens Aktiengesellschaft

  	
   

  	
  OJSC Mobile TeleSystems

  
	
   

  	
   

  	
  in the Russian Federation

  

 

.....................................................................                                            ...................................................................

(legally binding signature(s) of the Exporter)                                   (legally binding signature(s) of
the Borrower)

 

* Please delete as appropriate

 35
 

 

 

Annex 3a

HSBC Bank plc

Level 17, Project and Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

 

For the
attention of: Mr Alan Marshall

Confirmation
of Mean-weighted Acceptance of Equipment and Software

in relation to the Export Contract

Credit Agreement dated 1 October 2004 in the amount of USD
75,748,000.

We hereby
confirm to you that in respect of the Export Contract as mentioned in the
Preamble of the above-mentioned Credit Agreement the mean-weighted acceptance
of equipment and software and for operation in relation to the several
operation units (starting point) took place on ............................ .

...........................                 ...........................

(place)                                (date)

 

...................................

 

.....................................................................

(legally binding signature(s) of the Exporter)

 36
 

 

 

Annex 3b

HSBC Bank plc

Level 17, Project and Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

For the
attention of: Mr Alan Marshall

Confirmation
of Mean-weighted Acceptance of Equipment and Software

in relation to the Additional Export Contract

Credit Agreement dated 1 October 2004 in the amount of USD
75,748,000 as increased by USD ......................

We hereby
confirm to you that in respect of the Additional Export Contract as mentioned
in the Preamble of the above-mentioned Credit Agreement the mean-weighted
acceptance of equipment and software in relation to the additional operation
units (starting point) took place on ............................ .

...........................                 ...........................

(place)                                (date)

 

 

...................................

 

.....................................................................

(legally binding signature(s) of the Exporter)

 37
 

 

 

Annex 4

HSBC Bank plc

Level 17, Project and Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

For the
attention of: Mr Alan Marshall

Specimen Signature List

 

 

Credit Agreement dated 1 October 2004 in the amount of USD
75,748,000.

 

Dear Sirs,

Pursuant to the provisions of the above Credit
Agreement we are required to provide you with certified specimen signatures of
those persons authorised to act on our behalf in connection with the said
Credit Agreement.

Accordingly, we herewith confirm to you that the persons
listed hereafter are authorised to act on our behalf in connection with the
said Credit Agreement.

 38
 

 

 

A. Persons (if any) authorised to sign singly:

	
  Person

  	
   

  	
  First Name

  	
   

  	
  Surname

  	
   

  	
  Position

  	
   

  	
  Date of Birth

  	
   

  	
  Place of
  Birth

  	
   

  	
  Nationality

  	
   

  
	
  1

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
  Person

  	
   

  	
  Address

  	
   

  	
  Sort and
  Number

  of Identity Card

  	
   

  	
  Identity Card

  Issuing Authority

  	
   

  	
  Specimen
  Signature

  	
   

  
	
  1

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

B. Persons authorised to sign jointly with any person
from Group A or B:

	
  Person

  	
   

  	
  First Name

  	
   

  	
  Surname

  	
   

  	
  Position

  	
   

  	
  Date of Birth

  	
   

  	
  Place of
  Birth

  	
   

  	
  Nationality

  	
   

  
	
  1

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
  Person

  	
   

  	
  Address

  	
   

  	
  Sort and
  Number

  of Identity Card

  	
   

  	
  Identity Card

  Issuing Authority

  	
   

  	
  Specimen
  Signature

  	
   

  
	
  1

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 39
 

 

 

I,
..........................................................(please specify
title), hereby certify that the specimen signatures listed above are the
authentic signatures of persons authorised to act on the Borrower’s behalf in
connection with the Credit Agreement in the amount of USD
........................

.............................               ................................                                     .........................................................

(place)                                (date)                                                           (legally
binding signature of
                                                                                                                 ............................................)

I/We,
........................................................(OOO HSBC Bank (RR),
Moscow), hereby certify the authenticity of the above signature of
.................................... .

.................................           ..................................                                   .......................................(
OOO HSBC Bank (RR), Moscow)

(place)                                (date)

...........................................................

(legally binding signature(s), with name(s) and
position(s))

 40
 

 

Annex 5

[on the letterhead of the Borrower]

Frankfurter Beteiligungs - Treuhand GmbH

Bockenheimer Landstrasse 10

D-60323
Frankfurt am Main

Federal Republic of Germany

Credit Agreement dated 1 October 2004 in the amount of USD
75,748,000.

Dear Sirs,

On ................................ OJSC Mobile TeleSystems , 4
Marksistskaya Street, Moscow 109147 Russian Federation entered into a Credit
Agreement with HSBC Bank plc, 8 Canada Square, London E14 5HQ, United Kingdom
and ING BHF-BANK Aktiengesellschaft, Bockenheimer Landstraße 10, Frankfurt am
Main, Federal Republic of Germany. The provisions of the Credit Agreement
provide for that we shall appoint an agent of process for the purpose of
accepting service of process in the Federal Republic of Germany. We hereby
appoint you as our authorised agent of process for that purpose, limited solely
to service of process in connection with actions which might arise under the
Credit Agreement. We hereby irrevocably authorise you to accept all services of
process in connection with those actions in our name and to receive all
correspondence, documents and declarations related thereto.

Upon receipt of any process served on you or of any
correspondence, document and declaration related thereto, you are hereby
instructed to notify us at the above mentioned address unless we notify you in
writing of another address. If it is deemed necessary by you to do so in the
best of our interest, you are hereby authorised to notify us in your discretion
by telex, telefax or telephone of the contents of the process served on you and
of correspondence, documents or declarations received by you.

Your liability as our authorised agent of process will
be restricted to cases of wilful misconduct and gross negligence. The
relationship between you and our company is governed by the laws of the Federal
Republic of Germany.

Exclusive place of jurisdiction shall be Frankfurt am
Main, Federal Republic of Germany.

Yours sincerely,

____________________________________

(legally binding signature(s) of the Borrower)

Accepted:

Frankfurter Beteiligungs —
Treuhand GmbH

_________________________

(legally binding signature(s)

 

 41

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