Document:

Exhibit 4.48.1

 

SUPPLEMENTAL
CREDIT AGREEMENT

Dated 12 April 2005

between

OJSC Mobile
TeleSystems, Russian Federation

as borrower

and

HSBC Bank plc

and

BHF-BANK
Aktiengesellschaft

as arrangers and
lenders

HSBC Bank plc

as facility agent

BHF-BANK Aktiengesellschaft

as Hermes agent

 

 

INDEX OF
CLAUSES AND APPENDICES

 

	
  Clause No

  	
   

  	
  Heading

  	
   

  	
  Page No

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  Interpretation

  	
   

  	
  2

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
  Amendments to the Credit Agreement

  	
   

  	
  2

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
  General Provisions

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4

  	
   

  	
  Continuing Effectiveness of the Credit Agreement 

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature Page

  	
   

  	
  13

  

 

 

 

SUPPLEMENTAL CREDIT AGREEMENT

This Supplemental Credit Agreement (the “Supplemental
Credit Agreement”) is made by and between OJSC Mobile TeleSystems, Moscow,
Russian Federation (the “Borrower”) and HSBC Bank plc, London, United Kingdom
and BHF-BANK Aktiengesellschaft (as legal successor of ING BHF-BANK
Aktiengesellschaft), Frankfurt am Main, Federal Republic of Germany (each a “Lender”
and together the “Lenders”) and is a supplement to the Credit Agreement dated
11 October 2004 between the Borrower and the Lenders (the “Credit
Agreement”).

WHEREAS

(1)                                  The
Exporter and the Borrower have entered into a supplemental export contract
dated 3 December 2004 for the supply of additional equipment and software
licenses (the “Supplemental Export Contract”).

(2)                                  The
Lenders have agreed to lend to the Borrower the additional sum of
USD28,286,000.00 to assist the financing of the additional equipment and
software licenses as mentioned in Recital (1) above and 85% of the
Supplemental Insurance Premium paid or payable by the Lenders through the
Facility Agent to Hermes on the terms and conditions hereinafter appearing.

NOW THEREFORE it is
hereby agreed by and between the parties hereto as follows:

 1
 

 

 

1.                                       INTERPRETATION

1.1                                 Unless otherwise defined in this
Supplemental Credit Agreement all expressions defined in the Credit Agreement
shall have the same meanings when used herein.

1.2                                 Where the context of this Supplemental
Credit Agreement so allows words importing the singular include the plural and
vice versa.

1.3                                 Unless otherwise indicated reference to a
specified clause recital or appendix shall be construed as reference to that
specified clause of or recital or appendix to the Credit Agreement.

1.4                                 Clause and appendix headings are for ease
of reference only and do not form part of this Supplemental Credit Agreement.

2.                                       AMENDMENTS  TO THE CREDIT AGREEMENT

List of Annexes to
the Credit Agreement
to be amended as follows:

	
  “2

  	
   

  	
  Confirmation of Coming into Force of the Export
  Contract / Additional Export Contract / Supplemental Export Contract”

  
	
   

  	
   

  	
   

  
	
  “3a-3b-3c

  	
   

  	
  Confirmation of Mean-weighted Acceptance of
  Equipment and Software in relation to the Export Contract / in relation to
  the Additional Export Contract / in relation to the Supplemental Export
  Contract”

  

 

The addition of
the following Articles to the Preamble:

I.                                         The Borrower and the Exporter have also
entered into a supplemental contract on 3 December 2004 for the supply of
additional equipment (the “Supplemental Export Contract”), the financing of
which will provide for additional payments partially being made under the terms
of this Credit Agreement.

J.                                        The total supplemental contract value of further deliveries to be made
and services to be rendered under the Supplemental Export Contract amounts to
USD 31,000,000 (the “Total Supplemental Contract Value”).

K.                                    The terms of the Supplemental Export Contract enable deliveries/services
to be made/rendered through a further series of purchase orders to be issued
between December 2004  to August 2005.

L.                                      The Total Supplemental Contract Value consists of 15% down payments and
a portion of 85% as partial supplemental contract value (the “Partial
Supplemental Contract Value”) to be financed hereunder at the option of the
Borrower, subject to the agreement of Hermes and the Lenders.

 2
 

 

 

1.                                       Definitions
and Interpretations

	
  The addition of the following Definitions and Interpretations:-

  
	
   

  	
   

  	
   

  
	
  Credit C

  	
   

  	
  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 5 and Tranche 6

  
	
   

  	
   

  	
   

  
	
  Partial Supplemental

  	
   

  	
   

  
	
  Contract Value

  	
   

  	
  means the part of the Total Supplemental Contract
  Value as defined in Article L of the Preamble

  
	
   

  	
   

  	
   

  
	
  Second Supplement

  	
   

  	
   

  
	
  Insurance Agreement

  	
   

  	
  means the second supplemental agreement as per
  Clause 11.1

  
	
   

  	
   

  	
   

  
	
  Supplemental Export

  	
   

  	
   

  
	
  Contract

  	
   

  	
  means a supplement contract which has been entered
  into between the Borrower and the Exporter as defined in Article I of
  the Preamble

  
	
   

  	
   

  	
   

  
	
  Supplemental

  	
   

  	
   

  
	
  Insurance Premium

  	
   

  	
  means the premium as defined in Clause 11.4

  
	
   

  	
   

  	
   

  
	
  Supplemental

  	
   

  	
   

  
	
  Repayment Date

  	
   

  	
  means the date(s) as defined in Clause 5.1 d)

  
	
   

  	
   

  	
   

  
	
  Total Supplemental

  	
   

  	
   

  
	
  Contract Value

  	
   

  	
  means the aggregate price agreed upon in the
  Supplemental Export Contract for deliveries made and services rendered
  thereunder as defined in Article J of the Preamble

  
	
   

  	
   

  	
   

  
	
  Tranche 5

  	
   

  	
  means the part of Credit C as defined in Clause
  2.2.e) hereof

  
	
   

  	
   

  	
   

  
	
  Tranche 6

  	
   

  	
  means the part of Credit C as defined in Clause
  2.2.f) hereof

  
	
   

  	
   

  	
   

  
	
  The amendment to the following Definitions and
  Interpretations:-

  
	
   

  	
   

  	
   

  
	
  Tranches

  	
   

  	
  means, collectively, Tranche 1, Tranche 2, Tranche
  3, Tranche 4, Tranche 5 and Tranche 6 as defined in Clause 2.2

  
	
   

  	
   

  	
   

  
	
  The deletion of the following Definition and
  Interpretation:-

  
	
   

  	
   

  	
   

  
	
  Reference Banks

  	
   

  	
  means the London offices of HSBC Bank plc and ING
  BHF-Bank Aktiengesellschaft.

  

 

2.                                       Amounts
and Purpose of the Credits

2.1                                 After
Credit B before the final paragraph, the addition of Credit C as follows:-

 3
 

 

 

“USD
28,286,000

(in words: twenty eight
million two hundred eighty six thousand) (“Credit C”)”

The final paragraph of Clause 2.1 to be amended to read as follows:-

“Credit A, Credit B and
Credit C shall hereinafter be referred to individually as a “Credit” or
collectively as “Credits”.”

2.2                                 The
addition of the word “and” at the end of sub-clause (d) and the addition
of the following paragraphs:-

“e)                                Tranche
5 in an amount of up to USD 26,350,000.00 (in words: United States Dollars
twenty six million three hundred fifty thousand) which shall be available for
the financing of the Partial Supplemental Contract Value either (i) still
due and payable to the Exporter resulting from deliveries made/services
rendered under the Supplemental Export Contract, or (ii) payable to the
Borrower resulting from deliveries made/services rendered under the
Supplemental Export Contract for which payment has been made directly by the Borrower
to the Exporter; and

f)                                        Tranche
6 in an amount of USD 1,936,000.00 (in words: United States Dollars one million
nine hundred thirty six thousand) which shall be available for the financing of
up to 85% of the Supplemental Insurance Premium for cover of the Lenders’
payment claims under the Second Supplemental Insurance Agreement as per Clause
11.1 paid or payable by the Lenders through the Facility Agent to Hermes;”

2.3                                 In
line two, line eight and line twelve after the words “Partial Contract Value”,
the addition of the words “or Partial Supplemental Contract Value, as
applicable”.

In line nine and line thirteen after the words “Export Contract” the
addition of the words “or Supplemental Export Contract respectively”.

In line fourteen after the words “Insurance Premium” the addition of
the words “or Second Supplemental Insurance Agreement, as applicable”.

2.4                                 In
relation to HSBC Bank plc’s participation, the addition of Credit C as
follows:-

“Credit C

50%, max. USD 14,143,000

(in words: United States Dollars fourteen million one hundred forty
three thousand)

In relation to BHF-BANK Aktiengesellschaft’s participation, the
addition of Credit C as follows:-

“Credit C

 4
 

 

 

50%, max. USD 14,143,000

(in words: United States Dollars fourteen million one hundred forty
three thousand)

2.5                                 In
the first line of this clause the word “Credit” to be amended to read “Credits”.

3.             Disbursement / Reimbursement

3.1                                 In
the first paragraph, after the words “(and if applicable, Tranche 3)”, the
addition of the words “and Tranche 5”.

In line two and line four of the second paragraph, after the words “(and
if applicable, Tranche 3)”, the addition of the words “and Tranche 5”.

3.2 a)                    In line four and five of the first
paragraph, after the words “(or Partial Additional Contract Value), the
addition of the words “or Partial Supplemental Contract Value”.

In line seven of the first paragraph, after the words “(and
if applicable, Tranche 3)” the addition of the words “and Tranche 5”.

In line eleven of the first paragraph, after the words
“(or Partial Additional Contract Value), the addition of the words “or Partial
Supplemental Contract Value”.

In line three of the second paragraph, after the words
“Export Contract” the addition of the words “, the Additional Export Contract
(if agreed) and the Supplemental Export Contract”.

3.2 b)                   In line three of the first
paragraph, after the words “(and if applicable, Tranche 3)” the addition of the
words “and Tranche 5”.

3.3                                 In
line one, line four, line seven and line ten, after the words “(and if applicable,
Tranche 3)”, the addition of the words “and Tranche 5”.

In line nine, the word “disbursement” to be amended to read “disbursements”.

In line ten, the word “reimbursement” to be amended to read “reimbursements”.

In line ten the word “has” to be amended to read “have”.

3.4                                 In
line one, after the words “(and if applicable, Tranche 4)”, the addition of the
words “and Tranche 6”.

In line two, after the words “(or as the case may be, the Additional
Insurance Premium)”, the addition of the words “or the Supplemental Insurance
Premium”.

 5
 

 

 

In line three, after the words “Insurance Premium”, the addition of the
words “(or as the case may be, the Additional Insurance Premium) or the
Supplemental Insurance Premium”.

In line six, after the words “(or the Additional Insurance Premium)”,
the addition of the words “or the Supplemental Insurance Premium”.

4.             Conditions Precedent to Disbursements /
Reimbursements

4.1                                 The
addition at the end of this clause of the following Conditions Precedent to
Disbursement / Reimbursement in relation to Credit C:-

“In relation to Credit C

The first disbursement under Credit C 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 C, such confirmation stating inter alia that all necessary
permits, authorisations in the Russian Federation have been obtained;

b)                                     a
copy of the Supplemental Export Contract;

c)                                      a
written confirmation in accordance with Annex 2 hereof certifying that the
Supplemental Export Contract has come into force;

d)                                     an
undertaking by the Exporter in favour of the Lenders with regards to certain
risks and obligations not covered by the Second Supplemental Insurance
Agreement;

e)                                      evidence
that the down payment referred to in Article L of the Preamble has been
made to the Exporter by the Borrower.

4.2                                 In
line one, after the words “Credit B”, the addition of the words “or Credit C”.

In 4.2 a), after the words “Credit B”, the addition of the words “and
payment of the supplemental fees pursuant to Clause 6.5 hereof in case of
Credit C”.

In 4.2 b), after the words “Additional Insurance Premium”, the addition
of the words “and 100% of the Supplemental Insurance Premium”.

4.4                                 In
line one, after the words “or Tranche 3”, the addition of the words “or Tranche
5”.

 6
 

 

 

In line three, after the words “or the Additional Export Contract”, the
addition of the words “or the Supplemental Export Contract”.

4.5                                 In
line two, after the words “Supplemental Insurance Agreement”, the addition of
the words “and Second Supplemental Insurance Agreement”.

5.             Interest Periods, Interest, Increased Costs 

5.1                                 In
5.1 b) line three, after the words “or Credit B”, the addition of the words “or
Credit C”.

In 5.1 d) line three, after the words “Additional Repayment Date”, the
addition of the words “or Supplemental Repayment Date”.

In 5.1 d) line five, after the words “Additional Repayment Date”, the
addition of the words “or Supplemental Repayment Date”.

5.2           The second paragraph
of 5.2 a) to be deleted in its entirety and replaced with the following:-

“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 as are
displayed at or about 11.00 a.m. (London time) on the second Banking Day
prior to the commencement of such period 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 no quotation for USD
and the relevant period is displayed on the Reuter Monitor Money Rates Services
or an alternative service, LIBOR shall mean the rate per annum reasonably
determined by the Facility Agent to be equal to the arithmetic mean (rounded
upwards, if necessary, to five decimal places) of the rates per annum at which
deposits in USD are being offered to the Lenders in the London interbank market
for such period at or about 11.00 a.m. (London time) on the second Banking
Day prior to the commencement of the respective Interest Period. “

In 5.2 b) line two, after the word “determined”, the addition of the
words “, and if requested by the Borrower the method of such determination”.

In 5.2 d) (i) line two, after the words “or Credit B”, the
addition of “or Credit C”.

In 5.2 d) (ii) line two, after the words “or Credit B”, the
addition of “or Credit C”.

In line three of the final paragraph of Clause 5.2.d), after the words “or
Credit B”, the addition of “or Credit C”.

6.             Fees

 7
 

 

 

6.5                                 The
addition of a new Clause 6.5 to read as follows:-

“Clause 6.1 and 6.2 shall apply mutatis mutandis to Credit C whereas
calculation of the supplemental commitment fee shall start from the date of the
Supplemental Credit Agreement; the supplemental arrangement fee shall be paid
within 30 days after the date of such Supplement Credit Agreement, at the
latest, however, prior to disbursement or reimbursement under Credit C.”

8.             Repayment and Prepayment

8.1                                 The
addition of wording relevant to Credit C after the last paragraph as follows:-

“Credit C

The credit amounts disbursed under Credit C 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 3c hereof; and (ii) 28 February 2006.
Credit amounts disbursed after the first Supplemental Repayment Date under
Credit C shall be repaid in equal amounts on the remaining Supplemental
Repayment Dates; the repayment instalments which 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 due on each subsequent Supplemental 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 Agreement.

8.4                                 In
line three, after the words “or Additional Repayment Date”, the addition of the
words “or Supplemental Repayment Date”.

In line five, after the words “Credit B”, the addition of the words “and
Credit C”.

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

11.1                           At the
end of the first paragraph, the addition of the words “Credit C will also be
made available on the basis of insurance cover provided by Hermes which has
been applied for by the Hermes Agent on behalf of the Lenders in the form of a
second supplemental insurance agreement (“Second Supplemental Insurance
Agreement”) and the terms and conditions governing it.”

11.4                           The
existing Clause 11.4 to be renumbered 11.5 and the addition of a new Clause
11.4 to read as follows:-

 8
 

 

 

“The Borrower undertakes to reimburse and indemnify the Lenders through
the Facility Agent in full for and against the aggregate amount of supplemental
premiums and charges (the “Supplemental Insurance Premium”) payable by the
Lenders through the Facility Agent to Hermes under the Second Supplemental
Insurance Agreement for insurance cover of their payment claims arising from
Credit C of this Credit Agreement. The second paragraph of Clause 11.2 shall
apply mutatis mutandis hereto.”

11.5                           In line
four and six of the first paragraph, after the words “(or as applicable, the
Additional Insurance Premium)”, the addition of the words “or Supplemental
Insurance Premium”

In line eight of the first paragraph, after the words “Clause 11.3”,
the addition of the words “or Clause 11.4”.

In line two, five and six of the second paragraph, after the words “(or
if applicable, the Additional Insurance Premium)”, the addition of the words “or
Supplemental Insurance Premium”.

14.           Financial Statements, Information
and Undertakings

14. c)                    In line two and three, after the
words “or Additional Export Contract”, the addition of the words “or
Supplemental Export Contract”.

17.                                 Miscellaneous

17.1                           In line
two, four, seven and nine, after the words “the Additional Export Contract”,
the addition of the words “and Supplemental Export Contract”.

Annex 1a                                              The
first paragraph to be amended as follows: “ Credit Agreement dated 11 October 2004
in the amount of USD 75,748,000 as increased by USD 36,514,000 and as amended
by the Supplemental Credit Agreement dated                                     in
the amount of USD 28,286,000”.

In line three of the second paragraph, after
the words “Additional Export Contract”, the addition of the words “/
Supplemental Export Contract”.

Annex 1b                                             The
first paragraph to be amended as follows: “ Credit Agreement dated 11 October 2004
in the amount of USD 75,748,000 as increased by USD 36,514,000 and as amended
by the Supplemental Credit Agreement dated                                     in
the amount of USD 28,286,000”.

In line three of the second paragraph, after
the words “Additional Export Contract”, the addition of the words “/
Supplemental Export Contract”.

 9
 

 

 

In line one of the third paragraph, after the words “Additional Export
Contract”, the addition of the words “/ Supplemental Export Contract”.

Annex 1c                                              The
first paragraph to be amended as follows: “ Credit Agreement dated 11 October 2004
in the amount of USD 75,748,000 as increased by USD 36,514,000 and as amended
by the Supplemental Credit Agreement dated                                     in
the amount of USD
28,286,000”.

In line two of the second paragraph, after the words “Additional
Insurance Premium”, the addition of the words “/ Supplemental Insurance Premium”.

In line three of the second paragraph, after “11.3”, the addition
of  “/ 11.4”.

In line six of the second paragraph, after the words “Additional
Insurance Premium”, the addition of the words “/ Supplemental Insurance Premium”.

Annex 1d                                             The
first paragraph to be amended as follows: “ Credit Agreement dated 11 October 2004
in the amount of USD 75,748,000 as increased by USD 36,514,000 and as amended
by the Supplemental Credit Agreement dated                                     in
the amount of USD 28,286,000”.

In line two of the second paragraph, after
the words “Additional Export Contract”, the addition of the words “/
Supplemental Export Contract”.

Annex 1e                                              The
first paragraph to be amended as follows: “ Credit Agreement dated 11 October 2004
in the amount of USD 75,748,000 as increased by USD 36,514,000 and as amended
by the Supplemental Credit Agreement dated                                     in
the amount of USD 28,286,000”.

In the first line of the second paragraph, after the words “Insurance
Premium”, the addition of the words “/ Additional Insurance Premium /
Supplemental Insurance Premium”.

In the first line of the third paragraph, after “11.2”, the addition of
“11.3 / 11.4”.

In line three of the third paragraph, after the words “Insurance
Premium”, the addition of the words “/ Additional Insurance Premium /
Supplemental Insurance Premium”.

 10
 

 

 

Annex 2                                                    In
the heading, after the words “Additional Export Contract*”, the addition of the
words “/ Supplemental Export Contract*”.

The first paragraph to be amended as follows: “ Credit Agreement dated
11 October 2004 in the amount of USD 75,748,000 as increased by USD
36,514,000 and as amended by the Supplemental Credit Agreement dated                                     in
the amount of USD 28,286,000”.

The second paragraph to be amended as follows: “ We hereby confirm to
you that the has 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 25 October 2004 for USD 40,000,000 has come into force on                                     .*
/ We hereby confirm to you that the Supplemental Export Contract between OJSC
Mobile TeleSystems in the Russian Federation and Siemens Aktiengesellschaft
dated 3 December 2004 for USD 31,000,000 has come into force on                                     .*”

 11
 

 

 

The addition of a new annex “Annex 3c” as follows:

 

Annex 3c

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 Supplemental Export Contract

Credit Agreement
dated 11 October 2004 in the amount of USD 75,748,000 as increased by USD
36,514,000 and as amended by the Supplemental Credit Agreement dated                                     in the amount of USD 28,286,000 .

We hereby confirm
to you that in respect of the Supplemental 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)

  

 12
 

 

 

All other terms
and conditions of the Credit Agreement shall remain unchanged and in full force
and effect.

3.                                       GENERAL PROVISIONS

3.1.                              This
Supplemental 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 Supplemental Credit
Agreement shall not be regarded as a waiver of these rights or as acquiescence
in any conduct contravening the terms of this Supplemental 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.

3.2.                              In
the event of any provisions laid down in this Supplemental Credit Agreement
being or becoming wholly or partially ineffective in law, the other provisions
of this Supplemental 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 Supplemental Credit Agreement.

3.3.                              Without
prejudice to the Lenders’ rights under this Supplemental Credit Agreement, the
Borrower shall pay to the Lenders through the Facility Agent upon demand (i) any
stamp duties, registration fees and similar taxes and charges in connection
with this Supplemental 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 Supplemental Credit Agreement provided that all such fees and
expenses shall not exceed USD 7,000.00 (plus VAT and disbursements, plus costs
for required translation of any of the finance documents related to this
Supplemental 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 Supplemental
Credit Agreement.

3.4.                              This
Supplemental Credit Agreement shall be governed and construed in accordance
with the laws of the Federal Republic of Germany. Clauses 19.2 to 19.4 of the
Credit Agreement shall apply mutatis mutandis to this Supplemental Credit
Agreement.

3.5.                              This
Supplemental Credit Agreement shall be executed in the English language.

4              CONTINUING EFFECTIVENESS OF THE
CREDIT AGREEMENT

Upon signature of this
Supplemental Agreement the Credit Agreement and this Supplemental Credit
Agreement shall be read and construed as one document and thereafter any
reference in the Credit Agreement to “this Agreement” “the Agreement” or “the
Credit Agreement” shall be read and construed as a reference to

 13
 

 

 

the Credit Agreement
amended by this Supplemental Credit Agreement.

 

	
  

  	
   

  	
  OJSC Mobile TeleSystems

  
	
  Moscow,

  	
   

  	
   

  	
   

  
	
  (place, date)

  	
   

  	
  (legally binding signature(s))

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  HSBC Bank plc

  
	
  London,

  	
   

  	
   

  	
   

  
	
  (place, date)

  	
   

  	
  (legally binding signature(s))

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BHF-BANK Aktiengesellschaft

  
	
  Moscow,

  	
   

  	
   

  	
   

  
	
  (place, date)

  	
   

  	
  (legally binding signature(s))

  

 

 

 14Exhibit 4.49

EXECUTION COPY

 

Dated 16 November 2005

 

 

 

US$150,000,000

FACILITY
AGREEMENT

 

for

MOBILE
TELESYSTEMS FINANCE S.A.

arranged by

ING BANK N.V.

as Mandated Lead Arranger

with

ING
BANK N.V., LONDON BRANCH

acting as Agent

Paveletskaya sq.
2, bld. 2

Moscow 115054

Telephone (7-095)
797 9797

Facsimile (7-095) 797 9798

Ref MK/TP

 

 

CONTENTS

	
  CLAUSE

  	
   

  	
  PAGE

  
	
  SECTION 1
  INTERPRETATION

  	
  1

  
	
   

  	
  1

  	
  DEFINITIONS AND
  INTERPRETATION

  	
  1

  
	
  SECTION 2 THE
  FACILITY

  	
  10

  
	
   

  	
  2

  	
  THE FACILITY

  	
  10

  
	
   

  	
  3

  	
  PURPOSE

  	
  10

  
	
   

  	
  4

  	
  CONDITIONS OF UTILISATION

  	
  10

  
	
  SECTION 3
  UTILISATION

  	
  12

  
	
   

  	
  5

  	
  UTILISATION

  	
  12

  
	
  SECTION 4
  REPAYMENT, PREPAYMENT AND CANCELLATION

  	
  13

  
	
   

  	
  6

  	
  REPAYMENT

  	
  13

  
	
   

  	
  7

  	
  PREPAYMENT AND
  CANCELLATION

  	
  13

  
	
  SECTION 5 COSTS OF
  UTILISATION

  	
  16

  
	
   

  	
  8

  	
  INTEREST

  	
  16

  
	
   

  	
  9

  	
  INTEREST PERIODS

  	
  17

  
	
   

  	
  10

  	
  CHANGES TO THE CALCULATION
  OF INTEREST

  	
  17

  
	
   

  	
  11

  	
  ARRANGEMENT FEE

  	
  18

  
	
  SECTION 6
  ADDITIONAL PAYMENT OBLIGATIONS

  	
  19

  
	
   

  	
  12

  	
  TAX GROSS-UP AND
  INDEMNITIES

  	
  19

  
					

 i
 

 

 

	
   

  	
  13

  	
  INCREASED COSTS

  	
  19

  
	
   

  	
  14

  	
  OTHER INDEMNITIES

  	
  19

  
	
   

  	
  15

  	
  MITIGATION BY THE
  LENDERS

  	
  19

  
	
   

  	
  16

  	
  COSTS AND EXPENSES

  	
  19

  
	
  SECTION 7 REPRESENTATIONS,
  UNDERTAKINGS AND EVENTS OF DEFAULT

  	
  19

  
	
   

  	
  17

  	
  REPRESENTATIONS

  	
  19

  
	
   

  	
  18

  	
  INFORMATION
  UNDERTAKINGS

  	
  19

  
	
   

  	
  19

  	
  FINANCIAL COVENANTS

  	
  19

  
	
   

  	
  20

  	
  GENERAL UNDERTAKINGS

  	
  19

  
	
   

  	
  21

  	
  EVENTS OF DEFAULT

  	
  19

  
	
  SECTION 8 CHANGES
  TO PARTIES

  	
  19

  
	
   

  	
  22

  	
  CHANGES TO THE LENDERS

  	
  19

  
	
   

  	
  23

  	
  CHANGES TO THE BORROWER

  	
  19

  
	
  SECTION 9 THE
  FINANCE PARTIES

  	
  19

  
	
   

  	
  24

  	
  ROLE OF THE AGENT AND
  THE MANDATED LEAD ARRANGER

  	
  19

  
	
   

  	
  25

  	
  CONDUCT OF BUSINESS BY
  THE FINANCE PARTIES

  	
  19

  
	
   

  	
  26

  	
  SHARING AMONG THE
  FINANCE PARTIES

  	
  19

  
	
  SECTION 10
  ADMINISTRATION

  	
  19

  
	
   

  	
  27

  	
  PAYMENT MECHANICS

  	
  19

  
	
   

  	
  28

  	
  SET-OFF

  	
  19

  

 ii
 

 

 

	
   

  	
  29

  	
  NOTICES

  	
  19

  
	
   

  	
  30

  	
  CALCULATIONS AND
  CERTIFICATES

  	
  19

  
	
   

  	
  31

  	
  PARTIAL INVALIDITY

  	
  19

  
	
   

  	
  32

  	
  REMEDIES AND WAIVERS

  	
  19

  
	
   

  	
  33

  	
  AMENDMENTS AND WAIVERS

  	
  19

  
	
   

  	
  34

  	
  COUNTERPARTS

  	
  19

  
	
  SECTION 11
  GOVERNING LAW AND ENFORCEMENT

  	
  19

  
	
   

  	
  35

  	
  GOVERNING LAW

  	
  19

  
	
   

  	
  36

  	
  ARBITRATION

  	
  19

  
	
   

  	
  37

  	
  JURISDICTION

  	
  19

  
	
  SCHEDULE 1 Conditions
  precedent

  	
  19

  
	
  SCHEDULE 2 Utilisation
  Request

  	
  19

  
	
  SCHEDULE 3 Mandatory
  Cost formula

  	
  19

  
	
  SCHEDULE 4 Form of
  Transfer Certificate

  	
  19

  
	
  SCHEDULE 5 Form of
  Compliance Certificate

  	
  19

  

 

 iii

 

 

THIS AGREEMENT is dated 16 November 2005 and made between:

(1)                              MOBILE TELESYSTEMS FINANCE S.A., a
société anonyme established and
existing under the laws of Luxembourg registered with number B 84.895 with the
Luxembourg Register of Commerce and Companies and having its registered address
at 3 Avenue Pasteur, L-2311 Luxembourg, as borrower (the “Borrower”);

(2)                              ING BANK N.V. as mandated lead
arranger (the “ Mandated Lead Arranger”);

(3)                              ING (IRELAND) LTD. as lender (the “Original Lender”); and

(4)                              ING BANK N.V., LONDON BRANCH 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 3 (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.

“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 7 days after the Signing Date.

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

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

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

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

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

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

“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 

 1
 

 

 

                                              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 and New York City.

“Commitment” means:

(a)                                in
relation to the Original Lender, US$150,000,000 and the amount of any other
Commitment transferred to it under this Agreement; and

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

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

“Compliance Certificate”
means a certificate substantially in the form set out in Schedule 5 (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.

“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.

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

“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

(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 

 2
 

 

 

                                              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).

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

“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’ 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 Arranger
and the Borrower (or the Agent and the Borrower) setting out the fee referred
to in Clause 11 (Arrangement Fee).

“Final Maturity Date”
means the date which is 6 Months after the first Utilisation Date.

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

“Finance Party” means the
Agent, the Mandated Lead Arranger 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

 3
 

 

(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.

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

“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)                                the
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 loan made or to be made under
the Facility or the principal amount outstanding for the time being of that
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.

“Mandatory Cost” means the
percentage rate per annum calculated by the Agent in accordance with Schedule 3
(Mandatory Cost formula).

 4
 

 

“Margin” means 0.75 per
cent. per annum.

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

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

(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.

“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.

“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).

“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;

 5
 

 

(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.

“Qualifying Lender” has
the meaning given to it in Clause 12 (Tax
gross-up and indemnities).

“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 

 6
 

 

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).

“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 Arranger, ABN AMRO Bank N.V., HSBC Bank PLC or such other banks
as may be appointed by the Agent in consultation with the Borrower.

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

“Repeating Representations”
meanseach 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), 17.11 (No
default), 17.13 (Pari Passu
Ranking), 17.14 (No proceedings
pending or threatened), 17.15 (Environmental
laws and licences) and 17.16 (Telecommunications
law and licences).

“Roubles” or “RUR” means the lawful currency of the
Russian Federation for the time being.

“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.

“Significant Subsidiary” means:

(a)                                UMC
(unless, pursuant to the UMC Litigation, any or all of the Borrower’s shares in
UMC are transferred to a person that is not a member of the Group, with the
result that UMC ceases to be a member of the Group);

(b)                               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

(c)                                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.

“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.

 7
 

 

“Syndication Date” means
(unless otherwise agreed by the Borrower and the Mandated Lead Arranger) the
day specified by the Mandated Lead Arranger as the day on which primary
syndication of the Facility is completed.

“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 Commitment, being $150,000,000 at the Signing Date.

“Transfer Certificate” means
a certificate substantially in the form set out in Schedule 4 (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.

“UMC” means Ukrainian-German-Dutch-Danish Joint Venture “Ukrainian
Mobile Communications” in Ukraine.

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

“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.

“Utilisation” means a
utilisation of the 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 2 (Utilisation  Request).

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

 8
 

 

1.2                            Construction

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

(i)                                   the
“Agent”, the “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.

 9
 

 

SECTION 2

THE FACILITY

2                                      THE FACILITY

2.1                            The Facility

Subject to the terms of this Agreement, the Lenders make available to
the Borrower a term loan facility in Dollars in an aggregate amount equal to
the Commitment.

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 Facility
towards its general corporate purposes, including towards the financing of
acquisitions by any member of the Group.

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

The Borrower may not deliver the first Utilisation Request unless the
Agent has received all of the documents and other evidence listed in Schedule 1
(Conditions precedent) in form
and substance satisfactory to the Agent. The Agent shall notify the Borrower
and the Lenders promptly upon being so satisfied.

 10
 

 

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; and

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

 11
 

 

SECTION 3

UTILISATION

5                                      UTILISATION

5.1                            Delivery of a Utilisation Request

The Borrower may utilise the 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 (or, in relation to the
first Utilisation Request, not later than 10:00 a.m. on the day falling 1
Business Day 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)                                   the
proposed Utilisation Date is a Business Day within the Availability Period;

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

(iii)                             it specifies the account
and bank to which the proceeds of the Utilisation are to be credited.

(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 $50,000,000 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 Available Facility immediately prior
to making the 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 (or, in relation to the
first Loan, not later than 11:00 a.m. on the day falling 1 Business Day
before the first Utilisation Date).

 12
 

 

SECTION 4

REPAYMENT, PREPAYMENT AND CANCELLATION

6                                      REPAYMENT

(a)                               The
Borrower shall repay the Loans in two equal instalments, by paying on each of (i) the
date falling 5 Months after the first Utilisation Date and (ii) the Final
Maturity Date an amount equal to one half of the amount of the Loans
outstanding at the close of business on the last day of the Availability Period
for the Facility.

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

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 10 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
the Available Facility. Any cancellation under this Clause 7.2 shall reduce the
Commitments of the Lenders rateably under the 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 $10,000,000).

(b)                              A
Loan may only be prepaid after the last day of the Availability Period (or, if
earlier, the day on which the 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).

 13
 

 

7.4                            Mandatory Prepayment — Change of Control

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

(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 

 14
 

 

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 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 the 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.

 15
 

 

 

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.

 16
 

 

 

9                                      INTEREST PERIODS

9.1                            Duration of Interest Periods

(a)                               Save
as otherwise provided herein, each Interest Period shall have a duration of 1
Month and shall commence on the day on which the preceding Interest Period
expires.

(b)                              Each
Interest Period shall begin on the Utilisation Date for that Loan or (after the
first Interest Period of the relevant Utilisation) at the end of the last day
of its preceding Interest Period, and end on the last day of the Interest
Period applicable to that Loan.

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

(d)                              Prior
to the Syndication Date each Interest Period shall have a duration of 1 Month
or such other duration as is necessary 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;

(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 

 17
 

 

                                              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                                ARRANGEMENT FEE

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

 18
 

 

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.

“Qualifying Lender” means
any Lender which is situated for tax purposes in Luxembourg or which is a
Treaty Lender.

“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).

“Treaty Lender” means, in
respect of a jurisdiction, a Lender entitled under the provisions of a double
taxation treaty to receive payments of interest from a person resident in that
jurisdiction without a Tax Deduction (subject to the completion of any
necessary procedural formalities).

(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)                               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 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 this Agreement in (or in the
interpretation, 

 19
 

 

                                             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 the minimum amount required by law.

(f)                                 Within
30 days of making either a Tax Deduction or any payment required in connection
with that Tax Deduction, 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.

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:

(A)                           is
compensated for by an increased payment under Clause 12.2 (Tax gross-up); or

(B)                             would
have been compensated for by an increased payment under Clause 12.2 (Tax gross-up) but was not so compensated
solely because one of the exclusions in paragraph (d) of Clause 12.2
(Tax gross-up) applied.

(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,

 20
 

 

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.

(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.

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 the 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.

 21
 

 

(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:

(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);

 22
 

 

(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.

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 promptly on demand pay the Agent and the Mandated
Lead Arranger the amount of all reasonable out-of-pocket costs and legal
expenses incurred by any of them in connection with the negotiation,
preparation, execution 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 Arranger and the Borrower.

 23
 

 

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 three 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.

16.3                     Enforcement costs

The Borrower shall, within three 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.

 24
 

 

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 société anonyme, duly
established, registered and validly existing under the laws of Luxembourg.

(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,

 25
 

 

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).

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 (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, a “concordat
préventif de faillite” or a “gestion
contrôlée” institution of supervision (nablyudeniye), financial rehabilitation (finansovoe ozdorovlenie), external
management (vneshniy upravlayucshiy)
or the appointment of a bankruptcy manager (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 Russian
Insolvency Law);

(d)                               the
appointment of a liquidator, judicial manager, receiver and/or manager,
administrator, administrative receiver, compulsory manager, provisional
supervisor, supervisor 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                     Deduction of Tax

It is not required under the law of its jurisdiction of incorporation
to make any deduction for or on account of Tax from any payment it may make
under any Finance Document to a Qualifying Lender.

17.9                     No filing or stamp taxes

Under the law of its jurisdiction of incorporation it is not necessary
that the Finance Documents be filed, recorded or enrolled with any court or
other authority in that jurisdiction or that any stamp, registration or similar
tax be paid on or in relation to the Finance Documents or the 

 26
 

 

transactions contemplated by the Finance Documents, except for court
registration fees in connection with any enforcement proceedings in such court.

17.10              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 (or its equivalent in any other currency or
currencies).

17.11               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.

17.12              Financial statements

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

(b)                              The
Borrower Audited Original Financial Statements 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.

17.13              Pari passu ranking

Its 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.

17.14              No proceedings pending or threatened

Other than the UMC Litigation, 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.

 27
 

 

17.15              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.

17.16              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.

17.17              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.

17.18              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 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.

 28
 

 

17.19              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
whenever the representation in paragraph (c) of Clause 17.3 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)).

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

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

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

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

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

(b)                               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:

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

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

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) 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 5 (Form of
Compliance Certificate).

18.3                     Requirements as to financial statements

(a)                               Each
set of financial statements delivered by the Borrower pursuant to Clause 18.1 (Financial statements) shall be certified
by an authorised officer of the Borrower 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.

 29
 

 

(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 IFRS accounting practices and
financial reference periods.

18.4                     Information: miscellaneous

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):

(a)                                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;

(b)                               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;

(c)                                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 (e) of the definition of “Significant
Subsidiary”; and

(d)                               promptly,
such further information regarding the financial condition, business and
operations of any member of the Group as any Finance Party (through the Agent)
may reasonably request.

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.

 30
 

 

(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 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 Borrowings as at the end of any Relevant Period to EBITDA in respect
of such Relevant Period will not exceed 3:1; and

(b)                               the
ratio of EBITDA to Interest Expense in respect of any Relevant Period will not
be less than 5:1.

 31
 

 

19.2                     Financial covenant calculations

Borrowings, EBITDA and Interest Expense shall be calculated and
interpreted on a consolidated basis in accordance with the GAAP applicable to
the Parent Audited Original Financial Statements and shall be expressed in
Dollars.

19.3                     Definitions

In this Clause 19.3:

“Borrowings” means, as at
any particular time, the aggregate outstanding principal, capital or nominal
amount (and any fixed or minimum premium payable on prepayment or redemption)
of the Financial Indebtedness of members of the Group (other than any
indebtedness referred to in paragraph (g) of the definition of Financial
Indebtedness and any guarantee or indemnity in respect of that indebtedness).

For this purpose, any amount outstanding or repayable in a currency
other than Dollars shall on that day be taken into account in its Dollars
equivalent at the rate of exchange that would have been used had an audited
consolidated balance sheet of the Group been prepared as at that day in
accordance with the GAAP applicable to the Original Financial Statements of the
Borrower.

“EBITDA” means, in
relation to any Relevant Period, the total consolidated operating profit of the
Group for that Relevant Period:

(a)                                before
taking into account:

(i)                                  Interest
Expense;

(ii)                               Tax;

(iii)                            any share of the profit of
any associated company or undertaking, except for dividends received in cash by
any member of the Group; and

(iv)                           extraordinary
and exceptional items; and

(b)                               after
adding back all amounts provided for depreciation and amortisation for that
Relevant Period,

multiplied by two,

as determined (except as needed to reflect the terms of this Clause 19)
from the financial statements of the Group and Compliance Certificates
delivered under Clause 18.1 (Financial
statements) and Clause 18.2 (Compliance
Certificate).

“Interest Expense” means,
in relation to any Relevant Period, the aggregate amount of interest and any
other finance charges (whether or not paid, payable or capitalised) accrued by
the Group in that Relevant Period in respect of Borrowings including:

(a)                                the
interest element of leasing and hire purchase payments;

(b)                               commitment
fees, commissions, arrangement fees and guarantee fees; and

(c)                                amounts
in the nature of interest payable in respect of any shares other than equity
share capital,

adjusted (but without double counting) by:

 32
 

 

(i)                                   adding
back the net amount payable (or deducting the net amount receivable) by members
of the Group in respect of that Relevant Period under any interest or (so far
as they relate to interest) currency hedging arrangements; and

(ii)                                deducting
interest income of the Group in respect of that Relevant Period to the extent
freely payable in cash,

multiplied by two,

as determined (except as needed to reflect the terms of this Clause 19)
from the financial statements of the Group and Compliance Certificates
delivered under Clause 18.1 (Financial
statements) and Clause 18.2 (Compliance
Certificate).

“Relevant Period” means
each period of 6 consecutive Months ending on the last day of each financial
year and financial quarter of the Borrower.

20                               GENERAL UNDERTAKINGS

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

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,

any 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.

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.

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;

 33
 

 

(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;

(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); or

(vi)                            involving
the transfer of any or all of the Parent’s shares in UMC pursuant to the UMC
Litigation to a person that is not a member of the Group (provided that this
sub-clause (vi) shall not in any way prejudice the rights of the Finance
Parties under Clause 21.18 (UMC Litigation)).

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.

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), 

 34
 

 

                                             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 ensure that no Significant Subsidiary will enter into or become
subject to any consolidation or reorganisation, whether by way of merger (sliyaniye obschestva), company accession (prisoedinyeniye obschestva), company
division (razdeleyeniey obschestva),
company separation (vydelyeniye obschestva),
company transformation (preobrazovaniye
obschestva), company liquidation
(likvidatsiya obschestva) or any
other company reorganisation (reorganizatsiya
obschestva) (as these terms are construed by applicable Russian 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.

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:

 35
 

 

(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 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

(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.

 36

 

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).

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.

 37
 

 

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 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 any 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 any 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 any 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 any 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 $35,000,000 (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 

 38
 

 

                                             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 or legal
proceedings 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),
financial rehabilitation (finansovoe
ozdorovlenie), external management (vneshneye
upravlenie) or bankruptcy management (konkursnoye upravlenie) (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) or before any other
authority in respect of the bankruptcy, winding-up, insolvency, dissolution,
administration, reorganisation, provisional supervision, supervision, a “concordat préventif de faillite”, a “gestion contrôlée” 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), temporary manager (vremenniy
upravlaushiy), administrative manager (administrativniy upravlaushiy), external manager (vneshniy upravlaushiy), bankruptcy manager
(konkursniy upravlaushiy),
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 or order for the payment of money in an amount
in excess of $10,000,000 (or its equivalent in any other currency or 

 39
 

 

currencies) and the continuance of
any such judgment, decree 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)                            UMC’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 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 UMC’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 UMC’s assigned
spectrum allocations are reassigned to other users (other than a Significant
Subsidiary of the Borrower), 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 UMC 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 UMC pursuant to the UMC Litigation (provided that this sub-clause (ii) shall
not in any way prejudice the rights of the Finance Parties under Clause 21.18 (UMC 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:

 40
 

 

(i)                                   any
seizure, compulsory acquisition, expropriation, nationalisation or
renationalisation 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.

(b)                              Paragraph
(a) above does not apply to the transfer of any or all of the Parent’s
shares in UMC pursuant to the UMC Litigation to a person that is not a member
of the Group (provided that this paragraph (b) shall not in any way
prejudice the rights of the Finance Parties under Clause 21.18 (UMC Litigation)).

21.13              Russian Foreign Exchange Restrictions

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

21.14              Moratorium

Any moratorium is declared on the
payment of any external indebtedness of the Russian Federation or of Russian
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              Unlawfulness

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

21.17              Repudiation

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

21.18              UMC Litigation

The UMC 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.

 41
 

 

21.19              Material adverse change

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

21.20              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.

 42
 

 

SECTION 8

CHANGES TO PARTIES

22                               CHANGES TO THE LENDERS

22.1                     Assignments and transfers by the
Lenders

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”).

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.

(c)                               If:

(i)                                   a
Lender assigns or transfers any of its rights or obligations under the Finance
Documents or changes its Facility Office; and

(ii)                                as
a result of circumstances existing at the date the assignment, transfer or
change occurs, the Borrower would be obliged to make a payment to the New
Lender or Lender acting through its new Facility Office under Clause 12 (Tax gross-up and indemnities) or Clause
13.1 (Increased Costs),

then the New Lender or Lender acting
through its new Facility Office is only entitled to receive payment under those
Clauses to the same extent as the Existing Lender or Lender acting through its
previous Facility Office would have been if the assignment, transfer or change
had not occurred.

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.

 43
 

 

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;

(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:

 44
 

 

(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;

(iii)                             the
Agent, the Mandated Lead Arranger, 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 Arranger 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.

 45
 

 

SECTION 9

THE FINANCE PARTIES

24                               ROLE OF THE AGENT AND
THE MANDATED LEAD ARRANGER

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 Arranger) 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 Arranger

Except as specifically provided in
the Finance Documents, the Mandated Lead Arranger 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 the Mandated Lead Arranger as a
trustee or fiduciary of any other person.

(b)                              Neither
the Agent nor the Mandated Lead Arranger 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
Arranger may accept deposits from, lend money to and generally engage in any
kind of banking or other business with any member of the Group.

 46
 

 

24.6                     Rights and discretions of the Agent

(a)                               The
Agent may rely on:

(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
the 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.

 47
 

 

24.8                     Responsibility for documentation

Neither the Agent nor the Mandated
Lead Arranger:

(a)                                is
responsible for the adequacy, accuracy and/or completeness of any information
(whether oral or written) supplied by the Agent, the Mandated Lead Arranger,
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 Arranger 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 Arranger 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 Arranger.

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.

 48
 

 

(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.

(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 3 (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 Arranger 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 

 49
 

 

                                              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
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 

 50
 

 

                                              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).

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

 51
 

 

(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.

 52
 

 

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.

 53
 

 

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 Arranger under the Finance Documents;

(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.

 54
 

 

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

(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.

 55
 

 

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.

(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

 56
 

 

(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.

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.

 57
 

 

(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

(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 Arranger may not be effected without the consent of the Agent
or the Mandated Lead Arranger.

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.

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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).

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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 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.

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SCHEDULE
1

Conditions precedent

1                                      Finance
Documents

Executed originals of:

(a)                                this
Agreement;

(b)                               the
Parent Guarantee; and

(c)                                the
Fee Letter.

2                                      The
Borrower and the Parent

(a)                               Certified
copies of the Borrower’s and the Parent’s duly registered constitutional
documents and articles of association or certificates of registration (as applicable).

(b)                              In
respect of the Borrower, a non-bankruptcy certificate issued by the Clerk’s
office of the Luxembourg District Court.

(c)                               Certified
copies of all corporate resolutions necessary to authorise the Borrower and 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).

(d)                              Evidence
of the authority of the relevant signatories of the Parent (including, but not
limited to, its Chief Accountant) and the Borrower 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 and 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 Borrower or the Parent (as applicable)
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 1 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 Linklaters Loesch as to matters of Luxembourg law.

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

 61
 

 

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

 62
 

 

SCHEDULE
2

Utilisation Request

From:                  Mobile
TeleSystems Finance S.A.

To:         ING
Bank N.V., London Branch as Agent

Dated:

Dear Sirs

Mobile TeleSystems Finance S.A.— US$150,000,000 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)

  
	
   

  	
   

  	
   

   

  
	
  Amount:

  	
   

  	
  [                   ]
  or, if less, the Available Facility

  

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 [•].

5                                      This
Utilisation Request is irrevocable.

Mobile TeleSystems Finance S.A.

 

	
  By: 

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  

 

 63
 

 

 

SCHEDULE
3

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:

	
   

  	
  Ex0.01

  	
   

  	
  per cent. per annum.

  
	
   

  	
  300

  	
   

  	
   

  

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 

 64
 

 

                                             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.

 65
 

 

SCHEDULE
4

Form of Transfer Certificate

To:         ING
Bank N.V., London Branch as Agent

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

Dated:

Mobile TeleSystems Finance S.A.— US$150,000,000 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.

 66
 

 

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 [                   ].

ING Bank N.V., London Branch

By:

 67
 

 

SCHEDULE
5

Form of Compliance Certificate

To:                        ING
Bank N.V., London Branch as Agent

From:                    Mobile
TeleSystems Finance S.A.

Dated:

Dear Sirs

Mobile TeleSystems Finance S.A.— US$150,000,000 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 Borrowings as at the end of the Relevant Period
ending on [•] to EBITDA in respect of such Relevant Period, was
[•].

3                                      We
confirm that the ratio of EBITDA to Interest Expense for  the Relevant Period ending on [•], was
[•].

 

	
  Signed: . . . . . . . . . .
  . . . . . . . . . . . . . . . . . . . . . . . . . .

  	
   

  
	
   

  	
   

  
	
  [Chief Financial
  Officer] of
 Mobile TeleSystems Finance S.A.

  	
   

  
	
   

  	
   

  

 

*insert applicable certification language

We have reviewed the Facility
Agreement and audited consolidated financial statements of Mobile TeleSystems
Finance S.A. 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.

..............................

for and on behalf of

name of auditors of Mobile TeleSystems
Finance S.A.

*                                      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.

 68
 

 

The Borrower

Mobile TeleSystems Finance S.A.

Address:

Fax No:

Attention:

 

	
  By: 

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  

 

The Mandated Lead Arranger

ING Bank
N.V.

	
  By: 

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  

 

The Original Lender

ING
(Ireland) Ltd.

	
  By: 

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  

 

 69
 

 

The Agent

ING Bank
N.V., London Branch

	
  Address:

  	
   

  	
  60 London Wall

  	
   

  
	
   

  	
   

  	
  London EC2M 5TQ

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Fax:

  	
   

  	
  +44 207 767 7324

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Attention:

  	
   

  	
  David Hobbs/Craig Baker

  	
   

  
	
   

  	
   

  	
  Agency Operations

  	
   

  

 

	
  By: 

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  

 

 70

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