Document:

Exhibit 4.52

	
  EXECUTION COPY

  	
  Operation Number 35648

  
	
  Dated 8
  December 2004

  
	
   

  
	
   

  
	
   

  
	
   

  
	
  US$150,000,000

   

  FACILITY
  AGREEMENT

   

  between

   

  MOBILE
  TELESYSTEMS OPEN JOINT STOCK COMPANY

   

  as Borrower

   

   

  and

   

  EUROPEAN
  BANK FOR RECONSTRUCTION AND DEVELOPMENT

   

  as Lender

   

   

   

   

  
	
   

  
	
  

  
	
   

  
	
  Paveletskaya sq. 2, bld. 2

  Moscow 115054

  
	
   

  
	
  Telephone (7-095) 797 9797

  
	
  Facsimile (7-095) 797 9798

  
	
   

  
	
  Ref MIYB

  

   

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

  	
   

  	
  11

  
	
   

  	
  5

  	
  UTILISATION

  	
   

  	
  11

  
	
  SECTION 4 REPAYMENT,
  PREPAYMENT AND CANCELLATION

  	
   

  	
  12

  
	
   

  	
  6

  	
  REPAYMENT

  	
   

  	
  12

  
	
   

  	
  7

  	
  PREPAYMENT AND
  CANCELLATION

  	
   

  	
  12

  
	
  SECTION 5 COSTS OF
  UTILISATION

  	
   

  	
  15

  
	
   

  	
  8

  	
  INTEREST

  	
   

  	
  15

  
	
   

  	
  9

  	
  INTEREST PERIODS

  	
   

  	
  16

  
	
   

  	
  10

  	
  CHANGES TO THE
  CALCULATION OF INTEREST

  	
   

  	
  16

  
	
   

  	
  11

  	
  FEES

  	
   

  	
  17

  
	
  SECTION 6 ADDITIONAL
  PAYMENT OBLIGATIONS

  	
   

  	
  18

  
	
   

  	
  12

  	
  TAX GROSS-UP AND
  INDEMNITIES

  	
   

  	
  18

  
	
   

  	
  13

  	
  INCREASED COSTS

  	
   

  	
  20

  
	
   

  	
  14

  	
  OTHER INDEMNITIES

  	
   

  	
  21

  
	
   

  	
  15

  	
  MITIGATION BY THE
  LENDER

  	
   

  	
  22

  
	
   

  	
  16

  	
  COSTS AND EXPENSES

  	
   

  	
  22

  
	
  SECTION 7
  REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT

  	
   

  	
  23

  
	
   

  	
  17

  	
  REPRESENTATIONS

  	
   

  	
  23

  
	
   

  	
  18

  	
  INFORMATION
  UNDERTAKINGS

  	
   

  	
  27

  
	
   

  	
  19

  	
  FINANCIAL COVENANTS

  	
   

  	
  30

  
	
   

  	
  20

  	
  GENERAL UNDERTAKINGS

  	
   

  	
  31

  
	
   

  	
  21

  	
  EVENTS OF DEFAULT

  	
   

  	
  36

  
	
  SECTION 8 CHANGES TO
  PARTIES

  	
   

  	
  41

  
	
   

  	
  22

  	
  CHANGES TO THE LENDER

  	
   

  	
  41

  
	
   

  	
  23

  	
  CHANGES TO THE BORROWER

  	
   

  	
  42

  
	
  SECTION 9 THE LENDER

  	
   

  	
  43

  

 (i)
 

   

 

	
  

  	
  24

  	
  CONDUCT OF BUSINESS BY
  THE LENDER

  	
   

  	
  43

  
	
  SECTION 10 ADMINISTRATION

  	
   

  	
  44

  
	
   

  	
  25

  	
  PAYMENT MECHANICS

  	
   

  	
  44

  
	
   

  	
  26

  	
  SET-OFF

  	
   

  	
  45

  
	
   

  	
  27

  	
  NOTICES

  	
   

  	
  45

  
	
   

  	
  28

  	
  CALCULATIONS AND
  CERTIFICATES

  	
   

  	
  46

  
	
   

  	
  29

  	
  PARTIAL INVALIDITY

  	
   

  	
  46

  
	
   

  	
  30

  	
  REMEDIES AND WAIVERS

  	
   

  	
  46

  
	
   

  	
  31

  	
  AMENDMENTS AND WAIVERS

  	
   

  	
  47

  
	
   

  	
  32

  	
  COUNTERPARTS

  	
   

  	
  47

  
	
  SECTION 11 GOVERNING
  LAW AND ENFORCEMENT

  	
   

  	
  48

  
	
   

  	
  33

  	
  GOVERNING LAW

  	
   

  	
  48

  
	
   

  	
  34

  	
  ARBITRATION AND
  JURISDICTION

  	
   

  	
  48

  
	
   

  	
  35

  	
  IMMUNITIES

  	
   

  	
  49

  
	
  SCHEDULE 1 Conditions
  precedent

  	
   

  	
  50

  
	
  SCHEDULE 2 Utilisation
  Request

  	
   

  	
  52

  
	
  SCHEDULE 3 Form of
  Compliance Certificate

  	
   

  	
  53

  

 

 

 (ii)

   

THIS AGREEMENT is dated 8 December 2004
and made between:

(1)                              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, as borrower (the “Borrower”); and

(2)                              EUROPEAN BANK FOR RECONSTRUCTION AND
DEVELOPMENT as lender (the “Lender”
or “EBRD”).

IT IS AGREED as follows:

SECTION 1

INTERPRETATION

1                                      DEFINITIONS AND
INTERPRETATION

1.1                            Definitions

In this Agreement:

“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 30 November 2005.

“Available
Commitment” means the 
Commitment minus:

(a)                                the
amount of any outstanding Loans; and

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

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

exceeds:

(b)                               the
amount which the 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 London, Moscow and New York City.

 1
 

   

 

“Commitment”
means a commitment of $150,000,000, to the extent such commitment is not
cancelled or reduced in accordance with the terms of this Agreement.

“Compliance
Certificate” means a certificate substantially in the form set out
in Schedule 3 (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 Lender.

“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.

“Due
Diligence Materials” means written information provided in
connection with the due diligence meeting between the Lender and the Borrower
on 10 November 2004 relating to Telecommunications Authorisations held by
the Borrower, capital expenditures by the Borrower in selected licence areas,
the Borrower’s procurement procedures and certain insurances maintained by the
Borrower.

“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 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.

“EUR”
means the lawful currency of the European Union for the time being.

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

“Facility
Office” means the office of the Lender located at One Exchange
Square, London EC2A 2JN, United Kingdom, or the office or offices notified
by the Lender to the Borrower (by not less than 5 Business Days’ written
notice) as the office or offices through which it will perform its obligations
under this Agreement.

 2
 

   

 

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

“Final
Maturity Date” means 15 December 2011.

“Finance
Document” means this Agreement 
and any other document designated as such by the Lender and the
Borrower.

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

(a)                                moneys
borrowed;

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

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

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

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

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

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

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

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

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

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

“Group”
means the Borrower 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.

“Information
Memorandum” means the information memorandum prepared in relation to
the facility agreement dated 26 July 2004 between the Borrower, ING Bank
N.V., London Branch as Agent and the lenders named therein, and as provided to
the Lender by the Borrower prior to the Signing Date for the purpose of this
Agreement.

“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).

 3
 

   

 

“Investment
Period” means the period commencing on 22 October 2004 and
ending on the date falling 12 Months after the first Utilisation Date.

“Investments”
means investments, local works, capital expenditures not covered by export
credit agency financing, working capital and acquisitions by members of the
Group in the Russian Federation with an emphasis on regions other than Moscow
and St. Petersburg (including any fees relating thereto, and any
refinancing or recapitalisation in connection therewith, in whole or in part).

“Kuban
GSM” means CJSC Kuban GSM, a
joint-stock company organized under the laws of the Russian Federation that is
a Subsidiary of the Borrower.

“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 Lender 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 for
the time being of that loan.

“London
Business Day” means a day (other than a Saturday or Sunday) on which
banks are open for general business in London.

“Mandate Letter”
means the letter agreement dated 19 October 2004 between the Lender and
the Borrower.

“Margin”
means 3.10 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 Borrower
or the consolidated financial condition, operations, assets, prospects or
business of the Group;

(b)                               the
ability of the Borrower to perform and comply with its obligations under any
Finance Document; or

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

 4
 

   

 

“Original
Financial Statements” means the audited consolidated financial
statements of the Group for the financial year ended 31 December 2003.

“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 Borrower or any Subsidiary of the
Borrower or becomes a Subsidiary of the Borrower and not created in
contemplation of such event, provided that no such Security shall extend to any
other assets;

(b)                               any
Security existing on any assets prior to the acquisition thereof by the
Borrower or any Subsidiary of the Borrower 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 Borrower or
Financial Indebtedness of any Subsidiary of the Borrower 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 Borrower or a Subsidiary of the Borrower 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 Borrower securing intercompany
Financial Indebtedness of such Subsidiary owing to the Borrower or another
Subsidiary of the Borrower;

(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 Borrower or the business of any Subsidiary of
the Borrower, 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 

 5
 

   

 

                                              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 Borrower’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 Lender in accordance with market
practice in the London interbank market (and if quotations for that currency
and period would normally be given by leading banks in the London interbank
market on more than one day, the Quotation Day will be the last of those days).

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

“Reference
Banks” means in relation to LIBOR the principal London offices of
ABN AMRO Bank N.V., ING Bank N.V., HSBC Bank Plc, Raiffeisen Zentralbank
Österreich AG and Citibank, N.A.

“Relevant
Contract” means a contract:

(a)                                relating
to an Investment;

(b)                               with
a value in excess of EUR1,000,000 (or the equivalent thereof in another
currency at the rate of exchange on the date of that contract); and

(c)                                which
is awarded either by the Borrower or by another member of the Group established
under the laws of the Russian Federation.

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

“Repayment
Date” means 15 December 2005, 15 June 2006, 15 December 2006,
15 June 2007, 15 December 2007, 15 June 2008, 15 December 2008,
15 June 2009, 15 December 2009, 15 June 2010, 15 December 2010,
15 June 2011 and the Final Maturity Date.

“Repeating
Representations” means each of the representations set out in
Clauses 17.1 (Status), 17.2 (Binding obligations), 17.3 (Non-conflict with other obligations), 17.4
(Power and authority), 17.6 (Governing law and enforcement), 17.11 (No default), 17.14 (Pari Passu Ranking), 17.15 (No proceedings pending or threatened),
17.16 (Environmental laws and licences)
and 17.17 (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 Lender may specify another page or service displaying
the appropriate rate after consultation with the Borrower.

“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.

 6
 

   

 

“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)                               Telecom
XXI;

(c)                                Kuban
GSM;

(d)                               any
Subsidiary of the Borrower to which (i) the Borrower, UMC, Telecom XXI or
Kuban GSM sells, leases or otherwise transfers its GSM 900 or 1800 licences or (ii) any
such licence is re-issued; and

(e)                                any
Subsidiary of the Borrower (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 Borrower’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 Borrower’s gross annual consolidated revenues in
the year for which the Borrower’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.

“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).

“Telecom
XXI” means Telecom XXI, an open
joint stock company that is a wholly-owned Subsidiary of the Borrower.

“Telecommunications Authorisation” means any Authorisation from any
governmental or other regulatory authority necessary in order for each of the
Borrower 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
Borrower 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
Borrower as determined by reference to the Borrower’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 Original Financial Statements.

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

 7
 

   

 

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

“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.

1.2                            Construction

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

(i)                                   the
“Lenders”, 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.

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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

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

3                                      PURPOSE

(a)                               The
Borrower shall apply all amounts borrowed by it under the Facility towards the
Investments, and shall use its best efforts to complete such process by the end
of the Investment Period.

(b)                              The
Borrower shall use its best efforts to make Investments in regions in which it
did not have operations prior to the start of the Investment Period. However,
nothing in this Agreement shall oblige the Borrower to make any Investment
which would not be, in the opinion of the Borrower, in its best interests.

4                                      CONDITIONS OF
UTILISATION

4.1                            Initial conditions precedent

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

4.2                            Further conditions precedent

The Lender will only be obliged to
comply with Clause 5.4 (Availability of
Loans) 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 to be made by the Borrower are true in all material
respects.

4.3                            Suspension and cancellation

From time to time, EBRD may, by
notice to the Borrower, suspend or cancel the right of the Borrower to make any
Utilisation if the Board of Governors of EBRD has decided in accordance with Article 8,
paragraph 3, of the Agreement Establishing the European Bank of Reconstruction
and Development that access by the Russian Federation to EBRD resources should
be suspended or otherwise modified.

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SECTION 3

UTILISATION

5                                      UTILISATION

5.1                            Delivery of a Utilisation Request

The Borrower may utilise the Facility
by delivery to the Lender of a duly completed Utilisation Request not later
than 5:00 p.m. on the day falling 6 London Business Days before the
proposed Utilisation Date.

5.2                            Completion of a Utilisation Request

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

(i)                                   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 $30,000,000 or, if less, the Available Commitment; or

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

5.4                            Availability of Loans

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

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SECTION 4

REPAYMENT, PREPAYMENT AND CANCELLATION

6                                      REPAYMENT

6.1                            Repayment of  Loans

(a)                               The
Borrower shall repay the Loans in 13 equal instalments, by paying on each
Repayment Date an amount equal to one thirteenth of the amount of the Loans
outstanding at the close of business on the last day of the Availability
Period.

(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 the Lender to perform any of its obligations as
contemplated by this Agreement or to fund or maintain any Loan:

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

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

(c)                                the
Borrower shall repay the Loans on the last day of the Interest Period for each
Loan occurring after the Lender has notified the Borrower or, if earlier, the
date specified by the Lender in the notice delivered to the Borrower (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
Lender not less than 10 Business Days’ (or such shorter period as the Lender may
agree) prior written notice, cancel the whole or any part (being a minimum
amount of $10,000,000) of the Available Commitment.

7.3                            Voluntary prepayment of Loans

(a)                               The
Borrower may, if it gives the Lender not less than 10 Business Days’ (or such
shorter period as the Lender 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 Commitment is zero).

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

7.4                            Mandatory Prepayment — Change of
Control

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

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                                             acquire
ownership of or control over more than 50% of the voting interests in the share
capital of the Borrower; or (z) obtain the power (whether or not
exercised) to elect not less than half of the directors of the Borrower;
(provided, however, that any acquisition by Sistema JSFC, T-Mobile
International AG or any of their respective 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 promptly notify the Lender upon becoming aware of that event;

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

(iii)                             if
the Lender (in its sole discretion) so requires, it may, within 5 Business Days
of its receipt of the Borrower’s notification under sub-clause (i) above,
direct the Borrower to repay the Loans (together with accrued interest) in full
on the day (the “Early Repayment Date”)
falling 30 days after the date of the Borrower’s 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 the
Lender’s rights and obligations under this Agreement to another reputable
international bank or financial institution nominated by the Borrower in
accordance with Clause 22 (Changes to the
Lender). If no such transfer has been effected on or before the
Early Repayment Date, then (x) the Borrower shall repay the Loans
(together with accrued interest) in full on the Early Repayment Date and (y) the
Commitment 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 the Lender by the Borrower is required to be increased under
paragraph (c) of Clause 12.2 (Tax
gross-up); or

(b)                               the
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 Lender
notice of cancellation of the Commitment and its intention to procure the
repayment of  the Loans on the last day
of the Interest Period ending after the date of such notice (or, if earlier, on
such other date as specified by the Borrower in that notice) (the “Cancellation Date”). Before the
Cancellation Date, the Lender and the Borrower shall consult with each other
for a period of 5 Business Days with respect to the transfer of the Lender’s
rights and obligations under this Agreement to another reputable international
bank or financial institution nominated by the Borrower in accordance with
Clause 22 (Changes to the Lender).
If no such transfer has been effected on or before the Cancellation Date, then (x) the
Borrower shall repay the Loans (together with accrued interest) in full on the
Cancellation Date and (y) the Commitment 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.

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(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 Commitment except at the times and in the manner expressly
provided for in this Agreement.

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

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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:

(a)                                the
Margin; and

(b)                               LIBOR.

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 Lender (acting
reasonably). Any interest accruing under this Clause 8.3 shall be immediately
payable by the Borrower on demand by the Lender.

(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 Lender shall promptly notify the
Borrower of the determination of a rate of interest under this Agreement.

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9                                      INTEREST PERIODS

9.1                            Duration of Interest Periods

(a)                               Save
as otherwise provided herein, each Interest Period shall have a duration of 6
Months (or such other period as may be agreed between the Borrower and the
Lender) and shall commence on the day on which the preceding Interest Period
expires.

(b)                              The
first Interest Period for the first Loan shall begin on the Utilisation Date
for that Loan and shall have a duration of 6 Months, and the first Interest
Period for each Loan made thereafter shall begin on the Utilisation Date for
that Loan and end on the last day of the Interest Period applicable to that
first Loan. At the end of the first Interest Period for each Loan, such Loan
shall be consolidated with all other Loans (if any) then outstanding such that
all Loans under shall then be treated as a single Loan.

(c)                               No
Interest Period shall extend beyond a Repayment Date, and if an Interest Period
would otherwise overrun a Repayment Date, such Interest Period shall be
shortened so that it ends on that Repayment Date.

(d)                              An
Interest Period for a Loan shall not extend beyond the Final Maturity 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 that Loan for the Interest Period shall be the
rate per annum which is the sum of:

(i)                                   the
Margin; and

(ii)                                the
rate notified to the Borrower by the 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 the Lender
of funding that Loan from whatever source it may reasonably select.

(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 Lender to determine LIBOR for Dollars for the relevant Interest
Period; or

 16
 

   

 

(ii)                                before
close of business in London on the Quotation Day for the relevant Interest
Period, the Borrower receives notification from the Lender 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 Lender or the Borrower so requires,
the Lender 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 the Lender and the Borrower, be binding on all Parties.

10.4                     Break Costs

(a)                               The
Borrower shall, within three Business Days of demand by the Lender, pay to the
Lender 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)                              The
Lender shall, as soon as reasonably practicable after a demand by the Borrower,
provide a certificate confirming the amount of its Break Costs for any Interest
Period in which they accrue.

11                                FEES

11.1                      Commitment fee

(a)                               The
Borrower shall pay to the Lender a commitment fee in respect of the Facility,
calculated on a daily basis at the rate of 0.50 per cent. per annum of the
Available Commitment.

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

11.2                      Front-end commission

The Borrower shall pay to the Lender
a front-end commission, in the amount of 1 per cent. of the Commitment
($1,500,000). Such front-end commission shall be due and payable on the earlier
of (i) the first Utilisation Date and (ii) the date falling 15 days
after the Signing Date.

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SECTION 6

ADDITIONAL PAYMENT OBLIGATIONS

12                               TAX GROSS-UP AND
INDEMNITIES

12.1                     Definitions

(a)                               In
this Agreement:

“Qualifying
Lender” means a Lender which is situated for tax purposes in the
Russian Federation or in a Tax Treaty Jurisdiction, or is otherwise entitled to
receive interest free and clear of Russian withholding tax from a source within
the Russian Federation.

“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 the
Lender under Clause 12.2 (Tax gross-up)
or a payment under Clause 12.3 (Tax
indemnity).

“Tax
Treaty Jurisdiction” means a jurisdiction which has in force a
double tax treaty with the Russian Federation (or with the Union of Soviet
Socialist Republics to which the Russian Federation has succeeded) which
provides for full exemption from Russian withholding tax on interest derived
from a source within the Russian Federation payable to a resident of such
jurisdiction.

(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 Lender accordingly. Similarly, the Lender shall notify the Borrower
on becoming so aware in respect of a payment payable to the Lender.

(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 the Lender under
paragraph (c) above if, on the date on which the payment falls due, the
Borrower could have made such a payment to the Lender without a Tax Deduction
if the Lender was a Qualifying Lender, but on that date the Lender is not, or
has ceased to be, a Qualifying Lender (other than as a result of any change
after the date it became the Lender under this Agreement in (or in the
interpretation, administration, or application of) any law or treaty, or any
published practice or concession of any relevant taxing authority).

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

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

(i)                                   with
respect to any Tax assessed on the Lender:

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

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

if that Tax is imposed on or
calculated by reference to the net income received or receivable (but not any
sum deemed to be received or receivable) by the Lender; 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)                               If
the Lender makes, or intends to make,  a
claim under paragraph (a) above, it shall promptly notify the Borrower of
the event which will give, or has given, rise to the claim.

12.4                     Tax Credit

If the Borrower makes a Tax Payment
and the Lender determines that:

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

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

the Lender shall pay promptly an
amount to the Borrower which the Lender determines will leave it (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.

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12.5                     Stamp taxes

The Borrower shall pay and, within
three Business Days of demand, indemnify the Lender  against any cost, loss or liability the
Lender 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
the Lender shall be deemed to be exclusive of any VAT. If VAT is chargeable on
such consideration, that Party shall pay to the Lender (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 the Lender for any costs or
expenses, that Party shall also at the same time pay and indemnify the
Lender  against all VAT incurred by the
Lender in respect of the costs or expenses to the extent that the Lender
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 Lender, pay the
amount of any Increased Costs incurred by the Lender 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 the Lender’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 the
Lender or any of its Affiliates to the extent that it is attributable to the
Lender having entered into the Commitment or funding or performing its
obligations under any Finance Document.

13.2                     Increased cost claims

(a)                               If
the Lender intends to make a claim pursuant to Clause 13.1 (Increased costs), it shall notify the
Borrower of the event giving rise to the claim.

(b)                              The
Lender shall, as soon as practicable after a demand by the Borrower, 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;

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(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); or

(iii)                             attributable
to the wilful breach by the Lender 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 the Lender 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 the Lender against any cost, loss or
liability incurred by the Lender 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;

(c)                                funding,
or making arrangements to fund, 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 the Lender 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 Lender

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

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

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(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 LENDER

15.1                     Mitigation

(a)                               The
Lender 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 the Lender for all costs and expenses reasonably
incurred by the Lender as a result of steps taken by it under Clause 15.1 (Mitigation).

(b)                              The
Lender is not obliged to take any steps under Clause 15.1 (Mitigation) if, in the opinion of the
Lender (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 Lender the amount of all reasonable out-of-pocket costs and legal
expenses incurred by any of them in connection with the negotiation,
preparation and execution 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 to the terms of the Mandate Letter.

16.2                     Amendment costs

If (a) the Borrower requests an
amendment, waiver or consent or (b) an amendment is required pursuant to
Clause 25.6 (Change of currency),
the Borrower shall, within three Business Days of demand, reimburse the Lender
for the amount of all costs and expenses (including legal fees) reasonably
incurred by the Lender 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 the Lender the amount of all costs and expenses
(including legal fees) incurred by the Lender in connection with the
enforcement of, or the preservation of any rights under, any Finance Document.

 22
 

   

 

SECTION 7

REPRESENTATIONS, UNDERTAKINGS AND EVENTS OF DEFAULT

17                               REPRESENTATIONS

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

17.1                     Status

(a)                               It
is an open joint stock company, duly established, registered and validly
existing under the laws of the Russian Federation.

(b)                              It
and each of its Significant Subsidiaries 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 of its Subsidiaries’ constitutional documents; or

(c)                                any
agreement or instrument binding upon it or any of its Subsidiaries or any of
its or any of its Subsidiaries’ assets.

17.4                     Power and authority

It 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 it lawfully to enter into, exercise its rights and comply with its
obligations in the Finance Documents;

(b)                               for
it and its Significant Subsidiaries to carry on its and their business; and

(c)                                to
make the Finance Documents admissible in evidence in the general jurisdiction
courts or commercial courts (arbitrazhniye
sudi) of the Russian Federation in an original action or action to
enforce a foreign arbitral award, provided that authenticated and notarised
Russian texts are made available to such courts at that time and any other
procedures and formalities regarding presentation of documents to a Russian
court are complied with,

 23
 

   

 

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 the Russian Federation.

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

17.7                     No bankruptcy proceedings

Neither the Borrower nor any of its
Significant Subsidiaries 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 it or any of its
Significant Subsidiaries for (a) its liquidation or bankruptcy or the
appointment of a liquidation commission (likvidatsionnaya
komissiya) or a similar officer of it or any of its Significant
Subsidiaries; (b) the 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 it or any of its Significant
Subsidiaries; (c) the convening of a meeting of creditors for the purposes
of considering an amicable settlement (as defined in the Russian Insolvency
Law); or (d) any analogous act in respect of it or any of its Significant
Subsidiaries in any jurisdiction.

17.8                     Deduction of Tax

It is not required under the law of
the Russian Federation 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 the Russian
Federation it is not necessary that the Finance Documents be filed, recorded or
enrolled with any court or other authority in the Russian Federation or that
any stamp, registration or similar tax be paid on or in relation to the Finance
Documents or the transactions contemplated by the Finance Documents, except for
court registration fees in connection with any enforcement proceedings in such
court.

17.10              Payment of Taxes

Neither it nor any of its Significant
Subsidiaries 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.

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

17.12              No misleading information

(a)                               The
factual information contained in the Information Memorandum was true and
accurate in all material respects as at 26 July 2004.

(b)                              The
financial projections contained in the Information Memorandum were prepared on
the basis of recent historical information and on the basis of reasonable
assumptions.

(c)                               Any
written factual information (other than that contained in the Information
Memorandum) provided by or on behalf of any member of the Group to the Lender
for the purposes of the Due Diligence Materials was true and accurate in all
material respects as at the date it was provided or as at the date (if any) at
which it is stated.

(d)                              Nothing
has occurred or been omitted from the Due Diligence Materials and no
information has been given or withheld that results in the information
contained in the Due Diligence Materials being untrue or misleading in any
material respect.

17.13              Financial statements

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

(b)                              Its
Original Financial Statements fairly represent its, and its consolidated,
financial condition and operations as at the end of and for the relevant
financial year.

(c)                               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 its Original Financial Statements.

17.14              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.

17.15              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 it or any of its Significant Subsidiaries
which, if adversely determined would be reasonably likely to have a Material
Adverse Effect.

17.16              Environmental laws and licences

Except as disclosed in writing to the
Lender before the date hereof, it and each of its Subsidiaries has:

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

(b)                               obtained
all Environmental Licences required in connection with its business where
failure to do so would be reasonably likely to have a Material Adverse Effect;
and

 25
 

   

 

(c)                                complied
with the terms of those Environmental Licences where failure to do so would be
reasonably likely to have a Material Adverse Effect.

17.17              Telecommunications laws and licences

(a)                               Each
of the Borrower and its 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.

17.18              Compliance with laws

(a)                               Neither
the Borrower, nor any of its Significant Subsidiaries, is in material violation
of any law presently in effect that is applicable or relevant to it.

(b)                              The
Borrower and each of its Significant Subsidiaries is in compliance with all
applicable laws concerning money laundering (other than where non-compliance is
caused by administrative or technical error and is remedied within a reasonable
time from the Borrower or the relevant Significant Subsidiary becoming aware of
such non-compliance).

(c)                               Neither
the Borrower nor any of its Significant Subsidiaries, nor (to the best of the
Borrower’s knowledge after due and careful enquiry in accordance with the
Borrower’s internal procedures from time to time) any of the officers,
directors or authorised employees, agents or representatives of the Borrower or
any of its Significant Subsidiaries has:

(i)                                   paid,
promised to pay or offered to pay, or authorized the payment of, any
commission, bribe, pay-off or kickback related to any Investment (each a “Bribe”), which Bribe violates any
applicable law; or

(ii)                                entered
into any agreement pursuant to which any Bribe may or will at any time be paid
and which violates any applicable law; or

(iii)                             offered
or given any thing of value to influence the action of a public official, or
threatened injury to person, property or reputation, in connection with any
Investment, in order to obtain or retain business or other improper advantage
in the conduct of business.

17.19              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 

 26
 

   

 

                                             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.

17.20              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 to the
Lender:

(a)                                as
soon as the same become available, but in any event within 180 days after the
end of each of its financial years, its audited consolidated and
non-consolidated financial statements for that financial year; and

(b)                               as
soon as the same become available, but in any event within 45 days after the
end of each of its financial quarters, its unaudited consolidated and
non-consolidated financial statements for that financial quarter.

18.2                     Compliance Certificate

(a)                               The
Borrower shall supply to the Lender 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 3 (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.

(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 

 27
 

   

 

                                             Statements
unless, in relation to any set of financial statements, it notifies the Lender
that there has been a change in GAAP, the accounting practices or reference
periods and its auditors deliver to the Lender:

(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 Lender,
to enable the Lender 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) is prepared using RAS accounting practices and financial
reference periods.

18.4                     Implementation report

(a)                               The
Borrower shall, within 60 days after the end of the Investment Period, provide
to the Lender a report, in the form agreed between the Borrower and the Lender
before the date hereof, and in substance satisfactory to the Lender, concerning
the Investments made during the Investment Period.

(b)                              Until
such time as the aggregate amount of Investments made is equal to the principal
amount of all outstanding Loans, in relation to each Relevant Contract the
Borrower shall provide to the Lender information as to the identity and
nationality of the contractor and the amount and date of such Relevant
Contract.

18.5                     Environmental health and safety
report

As soon as available but, in any
event, within 60 days after the end of each financial year, the Borrower shall
furnish to the Lender a report, in form and in substance satisfactory to the
Lender (acting reasonably), on environmental, health and safety issues arising
in relation to the Borrower or the Investments 
during such financial year, including:

(a)                                information
on compliance by the Borrower with applicable Environmental Law and with
applicable environmental standards, including the status of any Environmental
Licences required for the Borrower’s operations, the results of any inspections
carried out by environmental authorities, any material violations of applicable
Environmental Law by the Borrower and remedial action relating thereto and any
fines imposed for any such violations;

(b)                               a
summary of any material notices, reports and other communications on
environmental matters submitted by the Borrower to any environmental
authorities;

(c)                                information
on the health and safety record of the Borrower, including the rate of
accidents which are likely to have a material adverse effect on health and
safety (as referred to in Clause 18.6 (Notification
of accident)) and any initiatives in relation to health and safety
matters which have been implemented or planned by the Borrower;

 28
 

   

 

(d)                               a
summary of any changes in applicable Environmental Law which may have a
material adverse effect on the Borrower’s operations; and

(e)                                copies
of environmental information periodically submitted by the Borrower to its
shareholders or the general public.

18.6                     Notification of accident

Promptly following the occurrence of
any incident or accident relating to the Borrower which is likely to have a
material adverse effect on the environment, health or safety, the Borrower
shall give the Lender notice thereof by facsimile transmission or telex
specifying the nature of such incident or accident and any steps the Borrower
is taking to remedy the same. Without limiting the generality of the foregoing,
an incident or accident is deemed to be likely to have a material adverse
effect on the environment, health or safety if any applicable law requires
notification of such incident or accident to any governmental authority, such
incident or accident involves fatality or multiple serious injuries requiring
hospitalisation or such incident or accident has become public knowledge
(whether through media coverage or otherwise) and the Borrower is aware that it
has become public knowledge.

18.7                     Information: miscellaneous

The Borrower shall supply to the
Lender:

(a)                                all
documents dispatched by the Borrower to its shareholders (or any class of them)
or its 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 Lender (including
relevant figures from management accounts) to ascertain whether any Subsidiary
of the Borrower 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 the Lender may reasonably request.

18.8                     Notification of Default

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

(b)                              Promptly
upon a request by the Lender, the Borrower shall supply to the Lender 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).

18.9                     Know your customer checks

If:

(a)                                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;

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

 29
 

   

 

(c)                                a
proposed assignment or transfer by the Lender of any of its rights and
obligations under this Agreement,

obliges the Lender (or, in the case
of paragraph (c) 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 Lender supply, or procure the supply of, such
documentation and other evidence as is reasonably requested by the Lender (for
itself or, in the case of the event described in paragraph (c) above, on
behalf of any prospective new Lender) in order for the Lender or, in the case
of the event described in paragraph (c) 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.

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.

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 Original Financial Statements of the Borrower
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;

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(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:

(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 Lender of,

any Authorisation required under any
law or regulation of its jurisdiction of incorporation to enable it to perform
its obligations under the Finance Documents and to ensure the legality,
validity, 

 31
 

   

 

enforceability or admissibility in
evidence in its jurisdiction of incorporation of any Finance Document.

20.2                     Compliance with laws

The Borrower 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 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;

(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 Borrower) 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 Borrower’s Total
Assets in any financial year of the Borrower and (y) 25% of the Borrower’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 Lender (any such request to be made no more than once per
calendar quarter, unless a Default is continuing), the 

 32
 

   

 

                                              Borrower
shall provide a certificate to the Lender 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 Borrower’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 Lender
under Clause 21.18 (UMC Litigation)).

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

20.6                     Merger

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

20.8                     Conduct of business

The Borrower shall, and shall procure
that each of its Significant Subsidiaries 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.

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20.9                     Asset maintenance

The Borrower shall, and shall procure
that each of its Significant Subsidiaries 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:

(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.

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20.12              Restriction on acquisitions

The Borrower shall not establish or
acquire any Subsidiary or invest in any other entity without the consent of the
Lender (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 Borrower in relation to such acquisition or
investment, when aggregated with the consideration paid by the Borrower in
relation to each other acquisition or investment permitted under this paragraph
(b), does not exceed (i) 20 per cent. of the Borrower’s Total Assets in
the financial year of the Borrower ending 31 December 2004; and (ii) 15
per cent. (or such higher amount not exceeding 20 per cent. as the Lender may
agree (acting reasonably)) of the Borrower’s Total Assets in any other
financial year of the Borrower.

20.13              Prompt payment of Taxes

The Borrower shall (and shall ensure
that 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 Borrower’s Total Assets; (ii) guarantees by the Borrower 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).

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20.16              Environment, health and safety

The Borrower shall conduct its
business with due regard to the environment and public and occupational health
and safety. The Borrower shall conduct its business in accordance with
applicable Environmental Law and with environmental standards existing in the
European Union on the date hereof (or, in the event that such standards do not
exist in the European Union, as set forth in the applicable environmental
guidelines of the World Bank Group).

21                               EVENTS OF DEFAULT

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

21.1                     Non-payment

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

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

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

21.2                     Financial covenants

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

21.3                     Other obligations

(a)                               The
Borrower 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
Lender giving notice to the Borrower or the Borrower becoming aware of the
failure to comply.

21.4                     Misrepresentation

Any representation or statement made
or deemed to be made by the Borrower 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 Lender giving notice to the Borrower or the Borrower
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 

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

(b)                              The
value of the assets of the Borrower 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 the Borrower 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 the Borrower 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 or a moratorium of any indebtedness of the Borrower 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 the
Borrower 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 or liquidation of the Borrower 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 or other
similar officer in respect of the Borrower or a Significant Subsidiary or any
of its assets (and such appointment continues for at least 14 days); or

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(e)                                the
enforcement of any Security over any asset or assets of the Borrower 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 the
Borrower 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 the Borrower or
any Subsidiary of the Borrower 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 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
Borrower’s GSM 900 or 1800 licences for the Moscow licence area;

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

(iii)                             Kuban
GSM’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 Borrower’s, Telecom XXI’s, Kuban GSM’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 Lender, has or is reasonably likely to have a Material Adverse
Effect.

(c)                               Any
of the Borrower’s, Telecom XXI’s, Kuban GSM’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 Lender, has or is
reasonably likely to have a Material Adverse Effect.

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

(e)                               Any
of the Borrower’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
Borrower.

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

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(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 Lender under Clause 21.18 (UMC Litigation)).

21.11               Cessation of Business

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

21.12              Expropriation

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

(i)                                   any
seizure, compulsory acquisition, expropriation, nationalisation 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 Borrower’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 Lender 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 Lender, has or is reasonably likely to have a
Material Adverse Effect.

21.16              Unlawfulness

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

21.17              Repudiation

The Borrower repudiates a Finance
Document or evidences an intention to repudiate a Finance Document.

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21.18              UMC Litigation

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

21.19              Material adverse change

The Lender determines 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 Lender may,  by notice to the Borrower:

(a)                                cancel
the Commitment whereupon it 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 Lender.

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SECTION 8

CHANGES TO PARTIES

22                               CHANGES TO THE LENDER

22.1                     Assignments and transfers by the
Lender

(a)                               Subject
to this Clause 22, the Lender (the “Existing
Lender”) may sell, transfer,
assign, novate or otherwise dispose of all or part of its rights or obligations
under this Agreement and the other Finance Documents to another bank or
financial institution or to a trust, fund or other entity which is regularly
engaged in or established for the purpose of making, purchasing or investing in
loans, securities or other financial assets (the “New Lender”).

(b)                              Unless
an Event of Default has occurred, any assignment or transfer shall require the
consent of the Borrower, provided that (1) such consent shall not be
unreasonably withheld or delayed; and (2) unless the Borrower has notified
the Lender to the contrary within 5 Business Days of receiving notice of the
intended assignment or transfer, the Borrower will be deemed to have given its
consent to that assignment or transfer.

22.2                     Conditions of assignment or transfer

If:

(i)                                   the
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                     Disclosure of information

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

(a)                                to
(or through) whom the 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 the 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 Group and the Finance Documents as the 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.

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22.4                     Limitation of responsibility of
Existing Lenders

(a)                               Unless
expressly agreed to the contrary, the 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 the Borrower;

(iii)                             the
performance and observance by the Borrower 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 that it:

(i)                                   has
made (and shall continue to make) its own independent investigation and
assessment of the financial condition and affairs of the Borrower 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 the
Borrower and its related entities whilst any amount is or may be outstanding
under the Finance Documents or the Commitment is in force.

(c)                               Nothing
in any Finance Document obliges the 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 the Borrower of its obligations under the Finance Documents
or otherwise.

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 without the prior written consent of the Lender.

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SECTION 9

THE LENDER

24                               CONDUCT OF BUSINESS BY
THE LENDER

No provision of this Agreement will:

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

(b)                               oblige
the Lender 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
the Lender to disclose any information relating to its affairs (tax or
otherwise) or any computations in respect of Tax.

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SECTION 10

ADMINISTRATION

25                               PAYMENT MECHANICS

25.1                     Payments to the Lender

(a)                               On
each date on which the Borrower is required to make a payment under a Finance
Document, the Borrower  shall make the
same available to the Lender (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 Lender 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 Lender specifies.

25.2                     Partial payments

(a)                               If
the Lender receives a payment that is insufficient to discharge all the amounts
then due and payable by the Borrower under the Finance Documents, the Lender
shall apply that payment towards the obligations of the Borrower under the
Finance Documents any order selected by the Lender.

(b)                              Paragraph
(a) above will override any appropriation made by the Borrower.

25.3                     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.

25.4                     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.

25.5                     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.

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

25.6                     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 Lender
(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 Lender
(acting reasonably).

(b)                              If a
change in any currency of a country occurs, this Agreement will, to the extent
the Lender (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.

26                               SET-OFF

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

27                               NOTICES

27.1                     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.

27.2                     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 that identified with its
name below, or any substitute address, fax number or department or officer as a
Party may notify to the other Party by not less than five Business Days’
notice.

27.3                     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

 45
 

   

 

(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 27.2
(Addresses), if addressed to that
department or officer.

(b)                              Any
communication or document to be made or delivered to the Lender will be
effective only when actually received by the Lender 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).

27.4                     English language

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

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

(i)                                   in
English; or

(ii)                                if
not in English, and if so required by the Lender, 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.

28                               CALCULATIONS AND
CERTIFICATES

28.1                     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 the Lender are prima facie evidence
of the matters to which they relate.

28.2                     Certificates and Determinations

Any certification or determination by
the Lender 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.

28.3                     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.

29                               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.

30                               REMEDIES AND WAIVERS

No failure to exercise, nor any delay
in exercising, on the part of the Lender, 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 

 46
 

   

 

remedy. The rights and remedies
provided in this Agreement are cumulative and not exclusive of any rights or
remedies provided by law.

31                               AMENDMENTS AND WAIVERS

No term of the Finance Documents may
be amended or waived without the consent of the Lender and the Borrower and any
such amendment or waiver will be binding on all Parties.

32                               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.

 47
 

   

 

SECTION 11

GOVERNING LAW AND ENFORCEMENT

33                               GOVERNING LAW

This Agreement is governed by English
law.

34                               ARBITRATION AND
JURISDICTION

34.1                     Arbitration

Any dispute, controversy or claim
arising out of or relating to this Agreement, or the breach, termination or
invalidity hereof, shall be settled by arbitration in accordance with the UNCITRAL
Arbitration Rules as in force on the Signing Date. There shall be one
arbitrator and the appointing authority shall be the London Court of
International Arbitration. The seat and place of arbitration shall be London,
England and the English language shall be used throughout the arbitral
proceedings. The parties hereby waive any rights under the Arbitration Act 1996
or otherwise to appeal any arbitration award to, or to seek determination of a
preliminary point of law by, the courts of England. The arbitral tribunal shall
not be authorised to take or provide, and the Borrower agrees that it shall not
seek from any judicial authority, any interim measures of protection or
pre-award relief against EBRD, any provisions of the UNCITRAL Arbitration Rules notwithstanding.
The arbitral tribunal shall have authority to consider and include in any
proceeding, decision or award any further dispute properly brought before it by
EBRD (but no other party) insofar as such dispute arises out of any Finance
Document, but, subject to the foregoing, no other parties or other disputes
shall be included in, or consolidated with, the arbitral proceedings. In any
arbitral proceeding, the certificate of EBRD as to any amount due to it under
any Finance Document shall, in the absence of manifest error, be prima facie
evidence of such amount.

34.2                     Recourse to Courts

Notwithstanding Clause 34.1 above,
this Agreement and the other Finance Document, and any rights of EBRD arising
out of or relating to this Agreement or any other Financing Agreement, may, at
the option of EBRD, be enforced by EBRD in the courts of England or in any
other courts having jurisdiction. For the benefit of EBRD, the Borrower hereby
irrevocably submits to the non-exclusive jurisdiction of the courts of England
with respect to any dispute, controversy or claim arising out of or relating to
this Agreement or any other Finance Document, or the breach, termination or
invalidity hereof or thereof. The Borrower hereby irrevocably designates,
appoints and empowers Law Debenture Corporate Services Limited at its
registered office (being, on the date hereof, at 5th floor, 100 Wood Street, London EC2V 1EX,
England) to act as its authorised agent to receive service of process and any
other legal summons in England for purposes of any legal action or proceeding
brought by EBRD in respect of any Finance Document. The Borrower hereby
irrevocably consents to the service of process or any other legal summons out
of such courts by mailing copies thereof by registered airmail postage prepaid
to its address specified herein. The Borrower covenants and agrees that, so
long as it has any obligations under this Agreement, it shall maintain a duly
appointed agent to receive service of process and any other legal summons in
England for purposes of any legal action or proceeding brought by EBRD in
respect of any Finance Document and shall keep the Lender advised of the
identity and location of such agent. Nothing herein shall affect the right of
EBRD to commence legal actions or proceedings against the Borrower in any
manner authorised by the laws of any relevant jurisdiction. The commencement by
EBRD of legal actions or proceedings in one or more jurisdictions shall not 

 48
 

   

 

preclude EBRD from commencing legal
actions or proceedings in any other jurisdiction, whether concurrently or not.
The Borrower irrevocably waives any objection it may now or hereafter have on
any grounds whatsoever to the laying of venue of any legal action or proceeding
and any claim it may now or hereafter have that any such legal action or
proceeding has been brought in an inconvenient forum.

35                               IMMUNITIES

35.1                     Privileges and Immunities of EBRD

Nothing in this Agreement shall be
construed as a waiver, renunciation or other modification of any immunities,
privileges or exemptions of EBRD accorded under the Agreement Establishing the
European Bank for Reconstruction and Development, international convention or
any applicable law.

35.2                     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.

 49
 

   

 

SCHEDULE
1

Conditions precedent

1                                      Finance
Documents

An executed original of this
Agreement.

2                                      The
Borrower

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

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

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

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

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

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

(ii)                                certifying
that each copy document relating to it specified in this Schedule 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)                               An
in-house legal opinion of the Borrower.

4                                      Other
documents and evidence

(a)                               Evidence
that the process agent referred to in Clause 34 (Recourse to Courts) has accepted its appointment.

(b)                              A
copy of any other Authorisation or other document, opinion or assurance which
the Lender 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.

 50
 

   

 

(e)                               A
copy of the deal passport of the
Borrower (in the form established by Instruction No. 117-I of the
Central Bank of the Russian Federation dated 15 June 2004) accepted and
duly certified by a Russian authorised bank and copies of all other documents
submitted by the Borrower to the Russian authorised bank in accordance with
applicable Russian currency control regulations, as the Lender may reasonably
require (or written confirmation from ING Bank (Eurasia) ZAO that all documents
required to obtain such deal passport have
been duly submitted to it by or on behalf of the Borrower).

(f)                                 Such
other documents or evidence which the Lender may reasonably require.

 51
 

   

 

SCHEDULE
2

Utilisation Request

From:                  Mobile
TeleSystems Open Joint Stock Company

To:         European
Bank for Reconstruction and Development

Dated:

Dear Sirs

Mobile TeleSystems Open Joint Stock Company — 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 Commitment 

  

 

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 [specify bank account of the
Borrower].

5                                      This
Utilisation Request is irrevocable.

Mobile TeleSystems Open Joint Stock
Company

 

	
  By: __________________

  	
   

  	
  By: __________________

  
	
  Name:    

  	
   

  	
  Name:    

  
	
  Title:      

  	
   

  	
  Title:      Chief
  Accountant

  

 

 52
 

   

 

SCHEDULE
3

Form of Compliance Certificate

To:                        European
Bank for Reconstruction and Development

From:                    Mobile
TeleSystems Open Joint Stock Company

Dated:

Dear Sirs

Mobile TeleSystems Open Joint Stock Company — 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 Open Joint Stock Company

  	
   

  

 

*insert applicable certification language

We have reviewed the Facility
Agreement and audited consolidated financial statements of the Mobile
TeleSystems Open Joint Stock Company 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
Open Joint Stock Company

 

*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.

 53
 

   

 

The Borrower

Mobile TeleSystems Open Joint Stock Company

Address:                                   Ul.
Vorontsovskaya 5, Bld. 2

109147 Moscow

Russian Federation

Fax No:               +7 095 911 6531

Attention:                           Tatiana Evtoushenkova

Vice President for Investments and

Corporate Development

 

	
  By: 

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

The Lender

European Bank for Reconstruction and Development

Address:                                   One
Exchange Square

London EC2A 2JN

United Kingdom

Fax No:               +44 20 7338 6100

Attention:                           Operation Administration Unit

	
  By: 

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

 54Exhibit 4.53

CREDIT
AGREEMENT

Dated October 18th, 2005

between

OJSC Mobile TeleSystems, Russian Federation

as Borrower

and

HSBC Bank plc

ING Bank Deutschland AG

Commerzbank Aktiengesellschaft

as
Mandated Lead Arrangers and Lenders

and

HSBC
Bank plc

as
Facility Agent

and

BHF-BANK Aktiengesellschaft

as Hermes Agent

 1
 

 

 

Table
of Contents

Preamble

Clause

	
  1.

  	
  Definitions and Interpretations

  	
  5

  
	
  2.

  	
  Amount and Purpose of
  the Credits

  	
  8

  
	
  3.

  	
  Disbursements /
  Reimbursements

  	
  11

  
	
  4.

  	
  Conditions Precedent to
  Disbursements / Reimbursements

  	
  13

  
	
  5.

  	
  Interest Periods,
  Interest, Increased Costs

  	
  15

  
	
  6.

  	
  Fees

  	
  18

  
	
  7.

  	
  Calculation of Periods

  	
  18

  
	
  8.

  	
  Repayment and
  Prepayment

  	
  18

  
	
  9.

  	
  Payments

  	
  19

  
	
  10.

  	
  Taxes, Levies, Duties
  and Other Costs

  	
  20

  
	
  11.

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

  	
  23

  
	
  12.

  	
  Suspension of
  Disbursement, Payments Immediately Due (Events of Default)

  	
  24

  
	
  13.

  	
  Representations and
  Warranties

  	
  26

  
	
  14.

  	
  Financial Statements,
  Information and Undertakings (Covenants)

  	
  27

  
	
  15.

  	
  Assignability

  	
  29

  
	
  16.

  	
  Statements and Notices

  	
  30

  
	
  17.

  	
  Miscellaneous

  	
  30

  
	
  18.

  	
  Currency Indemnity

  	
  31

  
	
  19.

  	
  Applicable Law, Place
  of Performance and Jurisdiction

  	
  31

  
	
  20.

  	
  General Provisions

  	
  32

  

 

 2
 

 

 

Annexes
to the Credit Agreement

 

	
  1a – 1f

  	
  Certificates for Disbursement and Reimbursement and
  Request for a fixed interest rate

  
	
  2

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

  
	
  3a - 3b

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

  
	
  4

  	
  Specimen Signature List
  of the Borrower

  
	
  5

  	
  Form for
  Appointment of Agent for Service of Process to the Credit Agreement

  

 

 3
 

 

This Agreement is made by and between:

 

OJSC Mobile TeleSystems, Moscow, Russian Federation (the “Borrower”)

 

and

HSBC Bank plc., London, United Kingdom

and

ING Bank Deutschland AG, Frankfurt am Main,
Federal Republic of Germany

and

Commerzbank Aktiengesellschaft Frankfurt am
Main, Federal Republic of Germany

(each a “Lender” and together the “Lenders”)

and

HSBC Bank plc. as Facility Agent (“the
Facility Agent”)

and

BHF-BANK Aktiengesellschaft, Frankfurt am
Main, Federal Republic of Germany as Hermes Agent (the “Hermes Agent”).

Preamble

 

	
  A.

  	
   

  	
  On 17 December 2004 the Borrower concluded
  contract number 4825/04-MTC (the “Export Contract”) with Siemens
  Aktiengesellschaft, Berlin-Munich, Federal Republic of Germany (the
  “Exporter”) for the delivery of telecommunication equipment and provision of
  software licenses for a GSM 900/1800 cellular network.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  B.

  	
   

  	
  The total contract value of the deliveries that may
  be made and services that may be rendered under the Export Contract amounts
  to USD 166,381,200 (the “Total Contract Value”).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  C.

  	
   

  	
  According to the Export Contract the
  deliveries/services shall be made/rendered through the placement of
  individual purchase orders issued between February 1st, 2005 to December 31st, 2005. Installation and
  commissioning work will be carried out by OOO Siemens, Moscow, and is not
  subject of financing hereunder.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  D.

  	
   

  	
  The value of the orders expected to be made by the
  Borrower under the Export Contract until December 31st, 2005 amounts to USD
  135,785,732 and is to be paid, according to the terms of the Export Contract,
  as follows:

  
	
   

  	
   

  	
  (1) 

  	
   

  	
  15% down payments 

  
	
   

  	
   

  	
  (2)

  	
   

  	
  85% of the value of each delivery or service (the
  “Partial Contract Value”) provided that a tied buyer’s credit is available
  for financing of the Partial Contract Value, pro rata to deliveries made/services
  rendered within 15 days of such deliveries/services.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  E.

  	
   

  	
  The Borrower and the Exporter may also agree to
  enter into a further contract for the supply of additional telecommunications
  equipment or to make additional orders under the Export Contract (in either
  case the “Additional Export Contract”) up to the Total Contract Value, the
  financing terms of which may provide for additional payments partially being
  made under the terms of this Credit Agreement.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
							

 4
 

 

 

	
  F.

  	
   

  	
  The total additional contract value of further
  deliveries to be made and services to be rendered under the Additional Export
  Contract (if such Additional Export Contract is agreed) is expected to amount
  up to USD 30,595,468 (the “Total Additional Contract Value”).

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  G.

  	
   

  	
  The terms of the Additional Export Contract (if
  agreed) are expected to enable deliveries/services to be made/rendered
  through a further series of purchase orders beginning on January 1st, 2006

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  H.

  	
   

  	
  The Total Additional Contract Value (if the
  Additional Export Contract is agreed) is expected to consist of 15% down
  payments and a portion of 85% as partial additional contract value (the
  “Partial Additional Contract Value”) to be financed hereunder at the option
  of the Borrower, subject to the agreement of Hermes (as defined below) and
  the Lenders.

  

 

This being premised, it is hereby agreed as
follows:

1.                             Definitions and
Interpretations

	
  Additional Export Contract

  	
  means an additional contract which may be entered
  into between the Borrower and the Exporter or additional deliveries or
  services rendered under the Export Contract as defined in Article E of
  the Preamble

  
	
   

  	
   

  
	
  Additional
  Insurance Premium

  	
  means the premium as defined in Clause 11.3

  
	
   

  	
   

  
	
  Additional
  Repayment Date

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

  
	
   

  	
   

  
	
  Affiliate

  	
  means, in relation to any person a Subsidiary of
  that person, or a Holding Company of that person, or any other Subsidiary of
  that Holding Company

  
	
   

  	
   

  
	
  Agent for
  Service of Process

  	
  means the person or entity as defined in Clause 19.4

  
	
   

  	
   

  
	
  Agreed Currency

  	
  means the currency as defined in Clause 18

  
	
   

  	
   

  
	
  Banking Day

  	
  means a day (other than Saturday or Sunday) on which
  banks are generally open for business in London, Amsterdam, Moscow and
  Frankfurt am Main

  
	
   

  	
   

  
	
  Borrower

  	
  means OJSC Mobile TeleSystems, 4 Marksistskaya
  Street, Moscow 109147, Russian Federation Payment
  details: foreign currency account No. 40702840500001001817 with ING Bank
  (Eurasia) ZAO, Moscow 123022, Krasnaya Presnja Str., 31 SWIFT code INGBRUMM.

  
	
   

  	
   

  
	
  Credit A

  	
  means the principal amount as specified in Clause
  2.1 already disbursed and/or still to be disbursed as the context requires
  and shall include each of Tranche 1 and Tranche 2

  
	
   

  	
   

  
	
  Credit B

  	
  means the principal amount as specified in Clause
  2.1 already disbursed and/or still to be disbursed as the context requires
  and shall include each of Tranche 3 and Tranche 4

  
	
   

  	
   

  
	
  Credit or
  Credits

  	
  means the aggregate principal amount as specified in
  Clause 2.1 already disbursed and/or still to be disbursed as the context
  requires and “Credits” shall include Credit A and Credit B

  
	
   

  	
   

  

 5
 

 

 

	
  Credit Agreement

  	
  means this agreement

  
	
   

  	
   

  
	
  Export Contract

  	
  means the contract between the Borrower and the
  Exporter defined in Article A of the Preamble

  
	
   

  	
   

  
	
  Exporter

  	
  means Siemens
  Aktiengesellschaft, Hofmannstrasse 51, 81379 Munich, Federal Republic of
  Germany

  
	
   

  	
   

  
	
  Facility Agent

  	
  means HSBC Bank plc, 8 Canada Square, London E14
  5HQ, United Kingdom

  
	
   

  	
   

  
	
  Hermes

  	
  means the German export credit agency Euler Hermes
  Kreditversicherungs-AG, Hamburg, Federal Republic of Germany

  
	
   

  	
   

  
	
  Hermes Agent

  	
  means BHF-BANK
  Aktiengesellschaft, Bockenheimer Landstrasse 10, 60323 Frankfurt am Main,
  Federal Republic of Germany

  
	
   

  	
   

  
	
  Holding Company

  	
  means, in relation to a person, any other person in
  respect of which it is a Subsidiary

  
	
   

  	
   

  
	
  Insurance
  Agreement

  	
  means the agreement as per Clause 11.1

  
	
   

  	
   

  
	
  Insurance
  Premium

  	
  means the premium as defined in Clause 11.2

  
	
   

  	
   

  
	
  Interest Payment
  Date

  	
  means the date as defined in Clause 5.2.e)

  
	
   

  	
   

  
	
  Interest
  Period(s)

  	
  means the period(s) as defined in Clause 5.1

  
	
   

  	
   

  
	
  Judgement
  Currency

  	
  means the currency as defined in Clause 18

  
	
   

  	
   

  
	
  Lender(s)

  	
  means HSBC Bank plc, 8 Canada Square, London E14
  5HQ, United Kingdom 

  Payment details: SWIFT MRMDUS33, account number 000-023868
  held with HSBC Bank USA, New York, in favour of HSBC Bank plc, London, SWIFT
  MIDLGB22 account number 36677449 in the name of Project and Export Finance
  quoting ref 53M/FC1072 

   

  and 

  ING Bank Deutschland AG,
  Hahnstrasse 49, 60606 Frankfurt am Main, Germany 

  Payment details SWIFT CHASUS33, account number ING
  Belgium / Swift BBBRUBEBB in favour of ING Bank Deutschland AG / SWIFT
  INGBDEFF quoting ref. SEF/MTS-Siemens 

   

  and 

  Commerzbank Aktiengesellschaft,
  Munich branch, Postbox, D-80791 Munich, Germany 

  Payment details: SWIFT COBADEFF700 via COBAUS3XXXX,
  account number 213219900 USD held with Commerzbank Aktiengesellschaft, New
  York branch in the name of Mobile Telesystems OJSC quoting ref. LCO München

  

 6
 

 

 

	
  LIBOR

  	
  means the interest rate as defined in Clause 5.2.a)

  
	
   

  	
   

  
	
  Margin

  	
  means the margin as defined in Clause 5.2.a)

  
	
   

  	
   

  
	
  Partial Contract
  Value

  	
  means the part of the value of the deliveries made
  or services rendered as defined in Article D of the Preamble

  
	
   

  	
   

  
	
  Partial
  Additional Contract Value

  	
  means the part of the value of the deliveries made
  or services rendered as defined in Article H of the Preamble

  
	
   

  	
   

  
	
  Reference Banks

  	
  means the London offices of HSBC Bank plc and ING
  Bank N.V. and Commerzbank Aktiengesellschaft

  
	
   

  	
   

  
	
  Repayment
  Date(s)

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

  
	
   

  	
   

  
	
  Passport Bank

  	
  means OOO HSBC Bank (RR) 9, Dmitrovsky pereulok,
  Moscow 103031, Russian Federation or such other bank as approved by the
  Facility Agent

  
	
   

  	
   

  
	
   Special Payment Procedure

  	
  means the special payment procedure provided for
  under a certain disbursement facility agreement to be entered into by and
  between the Borrower, the Facility Agent and the Passport Bank.

  
	
   

  	
   

  
	
  Subsidiary

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

  
	
   

  	
   

  
	
  Supplemental
  Insurance Agreement

  	
  means the supplemental agreement as per Clause 11.1

  
	
   

  	
   

  
	
  Total Assets

  	
  means the book value of the consolidated total
  assets of the Borrower as determined by reference to the Borrower’s most
  recent annual consolidated balance sheet delivered in accordance with Clause
  14 a)

  
	
   

  	
   

  
	
  Total Contract
  Value

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

  
	
   

  	
   

  
	
  Total Additional
  Contract Value

  	
  means the aggregate price agreed upon in the
  Additional Export Contract for deliveries to be made and services to be
  rendered thereunder as defined in Article F of the Preamble

  
	
   

  	
   

  
	
  Tranche 1

  	
  means the part of Credit A as defined in Clause
  2.2.a) hereof

  
	
   

  	
   

  
	
  Tranche 2

  	
  means the part of Credit A as defined in Clause
  2.2.b) hereof

  
	
   

  	
   

  
	
  Tranche 3

  	
  means the part of Credit B as defined in Clause
  2.2.c) hereof

  
	
   

  	
   

  
	
  Tranche 4

  	
  means the part of Credit B as defined in Clause
  2.2.d) hereof

  
	
   

  	
   

  
	
  Tranches

  	
  means, collectively, Tranche 1 and Tranche 2 and, if
  applicable Tranche 3 and Tranche 4 as defined in Clause 2.2

  
	
   

  	
   

  
	
  UMC

  	
  Means Closed Joint Stock Company “Ukrainian Mobile
  Communications”, 15 Leiptsyzka Street, Kyiv, Ukraine

  
	
   

  	
   

  

 7
 

 

 

	
  UMC Litigation

  	
  means any of the claims, proceedings (present of
  future) and causes of action involving the Borrower, and/or any Affiliate thereof
  (including UMC) relating to or arising out of the sale of UMC to the
  Borrower, or the acquisition, reorganization or ownership of UMC by the
  Borrower.

  
	
   

  	
   

  
	
  USD

  	
  means the lawful currency of the United States of
  America

  

 

2.                             Amount and Purpose of
the Credits

 

	
  2.1

  	
  The Lenders grant to
  the Borrower a credit in an aggregate amount of up to:

  
	
   

  	
   

  
	
   

  	
  USD
  125,725,500

  (in
  words: United States Dollars one hundred and twenty five million seven
  hundred and twenty five thousand five hundred)

  (“Credit
  A”)

   

  
	
   

  	
  With reference to the
  Additional Export Contract, and subject to the agreement of Hermes, the
  Lenders may elect in their absolute and free discretion to grant to the
  Borrower upon its written request a further credit in an aggregate amount of
  up to:

  
	
   

  	
   

  
	
   

  	
  USD
  28,321,000

  (in
  words: United States Dollars twenty eight million three hundred and twenty
  one thousand)

  (“Credit
  B”)

   

  It is hereby agreed and
  understood by the Borrower and the Lenders that the Lenders, by entering into
  this Credit Agreement, do not assume any commitment to grant Credit B but
  that the granting of such Credit B is at their sole discretion and will only
  materialise upon the Lenders written approval. 

   

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

   

  
	
  2.2

  	
  Credits shall consist
  of:

  
	
   

  	
   

  

 8
 

 

 

	
  

  	
  a)                       Tranche 1
  in an amount of USD 115,417,872 (in words: United States Dollars one hundred
  and fifteen million four hundred and seventeen thousand and eight hundred
  seventy two) which shall be available for the financing of the Partial
  Contract Value either (i) still due and payable to the Exporter
  resulting from deliveries made/services rendered under the Export Contract,
  or (ii) payable to the Borrower resulting from deliveries made /
  services rendered under the Export Contract for which payment has been made,
  directly by the Borrower to the Exporter; and 

   

  b)                      Tranche 2
  in an amount of USD 10,307,628 (in words: United States Dollars ten million
  three hundred and seven thousand six hundred and twenty eight) which shall be
  available for the financing of up to 100% of the Insurance Premium for cover
  of the Lenders’ payment claims under the Insurance Agreement as per Clause
  11.1 paid or payable by the Lenders through the Facility Agent to Hermes; and
  if so applicable 

   

  c)                       Tranche 3
  in an amount of up to USD 26,006,148 (in words: United States Dollars twenty
  six million six thousand one hundred and forty eight) which shall be
  available for the financing of the Partial Additional Contract Value either
  (i) still due and payable to the Exporter resulting from deliveries
  made/services rendered under the Additional Export Contract, or
  (ii) payable to the Borrower resulting from deliveries made / services
  rendered under the Additional Export Contract for which payment has been made
  directly by the Borrower to the Exporter; and 

   

  d)                      Tranche 4
  in an amount of up to USD 2,314,852 (in words: United States Dollars two
  million three hundred and fourteen thousand eight hundred and fifty two)
  which shall be available for the financing of up to 100% of the Additional
  Insurance Premium for cover of the Lenders’ payment claims under the
  Supplemental Insurance Agreement as per Clause 11.1 paid or payable by the
  Lenders through the Facility Agent to Hermes;

  
	
   

  	
   

  
	
   

  	
  unless otherwise
  stipulated hereinafter, any reference in this Credit Agreement to the Credit
  shall include the Tranches applicable to that Credit, and to Credits or to
  credit amounts or to any other similar term shall include the Tranches.

  
	
   

  	
   

  

 9
 

 

 

	
  2.3

  	
  The amounts borrowed
  under this Credit Agreement are exclusively available (i) provided that
  payment of the Partial Contract Value for deliveries made/services rendered
  has been effected by the Borrower to the Exporter prior to fulfilment of all
  conditions precedent to disbursements / reimbursements under Clause 4 of this
  Credit Agreement or waiver thereof by the Lenders by means of payment from
  sources other than this Credit Agreement, for reimbursement thereof to the
  Borrower; (ii) with effect from the date of fulfilment of all conditions
  precedent to disbursements / reimbursements under this Credit Agreement or
  waiver thereof by the Lenders, for reimbursement to the Borrower in the
  amount of the Partial Contract Value resulting from deliveries made/services
  rendered under the Export Contract for which payment has been made directly
  by the Borrower to the Exporter; (iii) with effect from the date of
  fulfilment of all conditions precedent to disbursements / reimbursements
  under this Credit Agreement or waiver thereof by the Lenders, for the payment
  of sums due to the Exporter in the amount of the Partial Contract Value
  resulting from deliveries made/services rendered under the Export Contract;
  (iv) for reimbursement to the Borrower of up to 100% of the Insurance
  Premium paid by the Borrower to the Lenders through the Facility Agent;
  (v) in respect of the additional financing of Credit B if so required by
  the Borrower, and subject to the agreement of Hermes and the Lenders, for
  reimbursement to the Borrower in the amount of the Partial Additional
  Contract Value resulting from further deliveries made/services rendered under
  the Additional Export Contract for which payment has been made directly by
  the Borrower to the Exporter; (vi) in respect of the optional financing
  of Credit B if so required by the Borrower, and subject to the agreement of
  Hermes and the Lenders, for the payment of sums due to the Exporter in the
  amount of the Partial Additional Contract Value resulting from deliveries
  made/services rendered under the Additional Export Contract; and
  (vii) in respect of the additional financing of Credit B if so required
  by the Borrower, and subject to the agreement of Hermes and the Lenders, for
  reimbursement to the Borrower of up to 100% of the Additional Insurance
  Premium paid by the Borrower to the Lenders through the Facility Agent.

  
	
   

  	
   

  

 10
 

 

 

	
  2.4

  	
  Upon and subject to the
  terms and conditions of this Credit Agreement each of the Lenders shall participate
  in each disbursement or reimbursement of the Credits in the proportion of its
  maximum liability mentioned in this Clause 2.4 as percentage of the maximum
  credit amounts mentioned in Clause 2.1 hereof. 

  
	
   

  	
   

  	
   

  
	
   

  	
  HSBC Bank plc

  	
  Credit A

  
	
   

  	
  8 Canada Square

  	
  35%, max. USD 44,003,925

  
	
   

  	
  London E14 5HQ

  	
  (in words: United States Dollars forty four million
  three thousand nine hundred and twenty five)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Credit B (optional financing)

  
	
   

  	
   

  	
  35%, up to max. USD 9,912,350 (in words: United
  States Dollars nine million nine hundred and twelve thousand three hundred
  and fifty)

  
	
   

  	
   

  	
   

  
	
   

  	
  ING Bank Deutschland AG

  	
  Credit A

  
	
   

  	
  Hahnstrasse 49

  	
  35%, max. USD 44,003,925

  
	
   

  	
  60606 Frankfurt am Main

  	
  (in words: United States Dollars forty four million
  three thousand nine hundred and twenty five) 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Credit B (optional financing)

  35%, up to max. USD 9,912,350 

  (in words: United States Dollars nine million nine hundred and twelve
  thousand three hundred and fifty)

  
	
   

  	
   

  	
   

  
	
   

  	
  Commerzbank Aktiengesellschaft

  	
  Credit A

  
	
   

  	
  Munich branch

  	
  30%, max. USD 37,717,650

  
	
   

  	
  Postbox, D-80791, Munich

  	
  (in words: United States Dollars thirty seven
  million seven hundred and seventeen thousand six hundred and fifty)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Credit B (optional financing)

  
	
   

  	
   

  	
  30%, up to max. USD 8,496,300

  
	
   

  	
   

  	
  (in words: United States Dollars eight million four
  hundred and ninety six thousand three hundred)

  
	
   

  	
   

  
	
  2.5

  	
  The Credit shall be
  made available under exclusion of any joint liability. Therefore, each of the
  Lenders shall only be responsible for the fulfilment of its own obligations
  and shall not be liable for the fulfilment of the obligations of the other
  Lenders under this Credit Agreement. The failure of any of the Lenders to
  provide funds according to its obligation under this Credit Agreement shall
  neither release the other Lenders nor the Borrower from any of their
  respective obligations towards each other hereunder.

  
	
   

  	
   

  
	
  3.

  	
  Disbursements /
  Reimbursements

  
	
   

  	
   

  
	
  3.1

  	
  Tranche 1 (and if
  applicable, Tranche 3) shall be disbursed in credit portions directly to the
  Borrower or, as the case may be, the Exporter to such account and to such
  financial institution as specified by the Borrower or, as the case may be,
  the Exporter to the Facility Agent. 

  

 11
 

 

 

	
  

  	
  The Borrower hereby
  irrevocably agrees that - under Clause 3.2.b) below - only the Exporter shall
  have the exclusive right to request payments under Tranche 1 (and if
  applicable, Tranche 3) and that such direct payments to the Exporter will
  constitute disbursements of Tranche 1 (and if applicable, Tranche 3) to the
  Borrower under this Credit Agreement.

  
	
   

  	
   

  
	
  3.2

  	
  a)                       In the
  event that prior to or after fulfilment of the conditions precedent to
  disbursements / reimbursements under the Credit Agreement or the waiver
  thereof by the Facility Agent acting on behalf of the Lenders, payments are
  made by the Borrower to the Exporter in the amount or amounts of the
  respective Partial Contract Value (or Partial Additional Contract Value) out
  of funds other than out of this Credit Agreement in and towards satisfaction
  and fulfilment of sums due to the Exporter resulting from the Export
  Contract, then reimbursements under Tranche 1 (and if applicable, Tranche 3)
  will be made by the Lenders through the Facility Agent against presentation
  by the Borrower to the Facility Agent of a certificate as per Annex 1a or 1d
  hereto in an amount or amounts equal to the aggregate principal amount or
  amounts of such payments in the maximum amount of the respective Partial
  Contract Value (or Partial Additional Contract Value) to the Borrower to such
  account as specified by the Borrower to the Facility Agent. 

  

  The Borrower and the Lenders acknowledge and agree to the Exporter’s intent
  to provide the Facility Agent, upon any delivery having been made/service
  having been rendered under the Export Contract for which the Borrower shall
  make direct payment to the Exporter out of other funds than of this Credit
  Agreement before being reimbursed in accordance with this Clause 3.2.a), with
  copies of the respective delivery documents or invoice, as the case may be.
  It is the common understanding of the parties hereto that the dispatch of
  such copies to the Facility Agent shall be for information purposes only;
  therefore shall neither the failure of the Exporter to send such copies
  prevent the Lenders in any way from making reimbursements, nor shall the
  delivery of such copies oblige the Lenders to make reimbursements under this
  Clause 3.2.a), in particular not in case of any of the conditions precedent
  for disbursement / reimbursement not being fulfilled. 

   

  b)                      With
  effect from the date of fulfilment of all conditions precedent to
  disbursements / reimbursements under this Credit Agreement or the waiver
  thereof by the Facility Agent acting on behalf of the Lenders, Tranche 1 (and
  if applicable, Tranche 3) shall be disburseddirectly to the Exporter on a pro
  rata basis against deliveries made/services rendered in an amount equal to
  85% of the value of such deliveries/services only upon presentation by the
  Exporter to the Facility Agent of a certificate as per Annex 1b hereof and of
  the following documents: 

   

             In case of equipment deliveries 

   

                  -   a copy of the commercial invoice issued by
  the Exporter; 

                  -   a copy of the international waybill
  relating to such equipment. 

   

             In case of licenses 

   

                  -   a copy of the commercial invoice issued by
  the Exporter; 

                  -   a copy of the acceptance certificate,
  signed by the Borrower and the Exporter. 

   

  The Facility Agent
  shall accept and make disbursements against the aforementioned documents as
  they are being presented to it without any obligation of examination thereof;
  in particular the Facility Agent shall not be obliged to verify whether or
  not any documents delivered to it under this Clause 3.2.b) are in compliance
  with the Uniform Customs and Practices for Documentary Credits, 1993 Revision,
  ICC Publication No. 500.

   

  

 12
 

 

 

	
  3.3

  	
  Disbursements /
  reimbursements under Tranche 1 (and if applicable, Tranche 3) as per Clause
  3.2 shall be made in minimum amounts of USD 1,000,000.00 provided, however,
  that, in the event that 85% of the value of any documents presented to the
  Facility Agent during a calendar month for disbursements under Tranche 1 (and
  if applicable, Tranche 3) or the amount mentioned in a reimbursement
  certificate as per Annex 1a or 1d, as the case may be, is less than the
  aforementioned minimum amount, disbursements or reimbursements under Tranche
  1 (and if applicable, Tranche 3) will be made at the end of the relevant
  calendar month in one amount equal to 85% of the aggregate value of all
  documents or equal to the aggregate value of all certificates, as the case
  may be, received by the Lenders during that month in relation to which
  disbursement or reimbursement under Tranche 1 (and if applicable, Tranche 3)
  has not previously been made.

  
	
   

  	
   

  
	
  3.4

  	
  Disbursement under
  Tranche 2 (and if applicable, Tranche 4) for the financing of up to 100% of
  the Insurance Premium (or as the case may be, the Additional Insurance
  Premium) shall in either event, whether the Insurance Premium has become due
  and payable prior to or after the fulfilment of all conditions precedent to
  disbursements / reimbursements under this Credit Agreement or the waiver
  thereof by the Facility Agent, acting on behalf of the Lenders, and provided
  that the Borrower has paid the total amount of the Insurance Premium (or the
  Additional Insurance Premium) to the Facility Agent as per Clause 11.2
  hereof, be made without any request or action by the Borrower upon fulfilment
  of the conditions precedent to disbursements / reimbursements or waiver
  thereof by the Lenders through the Facility Agent to the Borrower to such
  account as will be specified by the Borrower to the Facility Agent.

  
	
   

  	
   

  
	
  3.5

  	
  Each disbursement or
  reimbursement of the Credits or any portion thereof under this Credit
  Agreement shall be made at the latest on the 5th Banking Day after all conditions precedent
  applicable to such disbursement or reimbursement pursuant to Clause 4 hereof
  have been fulfilled or waived, as the case may be, and provided that the
  Lenders through the Facility Agent have not exercised any of their rights
  under Clause 12 hereof.

  
	
   

  	
   

  
	
  3.6

  	
  Unless otherwise
  instructed by Hermes, the Lenders may (but are not obliged to do so) refuse
  to disburse the Credits or any portion thereof after the due date of the
  first repayment instalment laid down in Clause 8 hereof. The Credits will
  then be reduced by the corresponding amount.

  
	
   

  	
   

  
	
  3.7

  	
  The Borrower may - in
  case of disbursements according to Clause 3.2.b) - only waive disbursement of
  the Credits, in full or in part, with the prior written consent of the
  Lenders and the Exporter.

  
	
   

  	
   

  
	
  4.

  	
  Conditions Precedent to
  Disbursements / Reimbursements

  
	
   

  	
   

  
	
  4.1

  	
  In relation to Credit A

   

  The first disbursement
  or reimbursement under Credit A of this Credit Agreement shall be conditional
  upon the Facility Agent having received the following documents free of
  expense in form and substance satisfactory to the Lenders:

  
	
   

  	
   

  

 13
 

 

 

	
  

  	
  a)        a legal opinion to be
  issued by Freshfields Bruckhaus Deringer, Moscow, Russian Federation; 

   

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

   

  c)        a specimen signatures
  list as per Annex 4 hereof with the specimen signatures of such persons
  authorised by the Borrower to act on its behalf in connection with this
  Credit Agreement and such other documents which, pursuant to mandatory
  provisions under German, Dutch or English law, are required by the Lenders
  and/or the Facility Agent to open and to maintain a credit account on behalf
  of the Borrower such documents to be specified by the Lenders and/ or the
  Facility Agent without any undue delay in writing; 

   

  d)       a copy of the executed
  Export Contract; 

   

  e)        an undertaking by the
  Exporter in favour of the Lenders with regard to certain risks and
  obligations not covered by the Insurance Agreement as per Clause 11.1 hereof;
  

   

  f)        a certificate as per
  Annex 1a, 1b, 1c, 1d or 1e , as the case may be; 

   

  g)       confirmation issued by
  the Passport Bank certifying its appointment by the Borrower asPassport Bank;
  

   

  h)       evidence that the down
  payment referred to in Article D of the Preamble has been made to
  theExporter by the Borrower; and 

   

  i)         such
  other certificates and documentation and other evidence reasonably requested
  by the Lenders in order for them to carry out and be satisfied with the
  results of all necessary “know your customer” or similar requirements,
  including those reasonably required to ensure compliance with money
  laundering procedures in their relevant jurisdictions.

  
	
   

  	
   

  
	
   

  	
  In relation to Credit B
  (if applicable) 

   

  The first disbursement
  or reimbursement under Credit B of this Credit Agreement shall be conditional
  upon the Facility Agent having received the following documents free of
  expense in form and substance satisfactory to the Lenders: 

   

  a)        a written confirmation
  issued by Freshfields Bruckhaus Deringer, Moscow, as Lenders’ counsel
  confirming that the original legal opinion rendered under Clause 4.1.a) above
  is applicable mutatis mutandis to this Credit Agreement as increased by
  Credit B, such confirmation stating inter alia that all necessary permits,
  authorisations and registrations in the Russian Federation have been
  obtained; 

   

  b)       a copy of the executed
  Additional Export Contract; 

   

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

   

  d)       an undertaking by the
  Exporter in favour of the Lenders with regard to certain risks and
  obligations not covered by the Supplemental Insurance Agreement as per Clause
  11.1 hereof.

  
	
   

  	
   

  
	
  4.2

  	
  Furthermore, the first
  disbursement or reimbursement under Credit A or, if applicable Credit B, is
  conditional upon receipt by the Lenders of the following payments: 

  

 14
 

 

 

	
  

  	
  a)        payment of the fee as
  per Clause 6.2 hereof in the case of Credit A and, payment of additional fees
  pursuant to Clause 6.4 hereof in the case of Credit B; and

   

  b)       payment of 100% of the
  Insurance Premium and, as the case may be, 100% of the Additional Insurance
  Premium.

  
	
   

  	
   

  
	
  4.3

  	
  Moreover, the first
  disbursement under this Credit Agreement by way of direct disbursement to the
  Exporter as per Clause 3.2. is subject to such disbursement procedure being
  in full and strict compliance with the Russian laws (in particular but not
  limited to the Law on Currency Regulation and Currency Control dated 10
  December 2003); such compliance to be evidenced to the Lenders in form
  and substance satisfactory to the Lenders.

  
	
   

  	
   

  
	
  4.4

  	
  Each reimbursement
  under Tranche 1 or Tranche 3 as per Clause 3.2. a) hereof is furthermore
  subject to evidence satisfactory to the Lenders that payments were made by
  the Borrower for deliveries made/services rendered under the Export Contract
  or the Additional Export Contract, as the case may be, and have been received
  by the Exporter in amounts corresponding to those mentioned in the relevant
  reimbursement certificate in form and substance as per Annex 1a or 1d, as the
  case may be, hereto.

  
	
   

  	
   

  
	
  4.5

  	
  Each disbursement or
  reimbursement under this Credit Agreement is subject to the condition that
  the Insurance Agreement and, as the case may be, the Supplemental Insurance
  Agreement, as per Clause 11.1 is in full force and effect and covers the
  Lenders’ claims under this Credit Agreement.

  
	
   

  	
   

  
	
  4.6

  	
  The Lenders through the
  Facility Agent shall together be entitled to waive any one or more of the
  aforementioned conditions precedent to disbursements / reimbursements as the
  Lenders at their sole discretion deem fit, whereupon — unless otherwise
  notified in writing by the Facility Agent to the Borrower - any such condition
  precedent shall be deemed to constitute a condition subsequent which the
  Borrower undertakes to satisfy within such period of time which the Facility
  Agent may reasonably determine.

  
	
   

  	
   

  
	
  4.7

  	
  The Facility Agent will
  notify the Borrower and the Exporter without delay in writing of the
  fulfilment of the conditions precedent to first disbursement or reimbursement
  and, if applicable, conditions subsequent.

  
	
   

  	
   

  
	
  5.

  	
  Interest Periods,
  Interest, Increased Costs

  
	
   

  	
   

  
	
  5.1

  	
  For the purpose of
  periodical calculation of interest and its payment by the Borrower as
  determined hereinafter, each interest period (the “Interest Period”) shall be
  of a duration of 6 months, provided that: 

   

  a)        the first Interest
  Period in respect of the first disbursement or reimbursement shall commence
  on the date of that disbursement or reimbursement and end 6 months after the
  date of that disbursement or reimbursement subject to 5.1 d and 5.1 e below; 

   

  b)       the first Interest
  Period in respect of any subsequent disbursement or reimbursement shall commence
  on the date of that disbursement or reimbursement and end upon expiry of the
  then current Interest Period relating to the respective Credit A or Credit B,
  as the case may be; 

   

  c)        each subsequent
  Interest Period shall commence on the expiry of the preceding Interest
  Period; 

   

  d)       any Interest Period
  which would otherwise extend beyond the due date of any repayment 

   

  

 15
 

 

 

	
  

  	
             instalment pursuant
  to Clause 8.1 of this Credit Agreement (any such repayment date hereinafter
  referred to as a “Repayment Date” or “Additional Repayment Date”, if
  applicable) shall be shortened to the extent necessary to end upon such
  Repayment Date or Additional Repayment Date, as the case may be; 

   

  e)        any Interest Period
  which would otherwise end on a day which is not a Banking Day shall end on
  the next Banking Day unless the result of such extension would be to carry
  such Interest Period over into another calendar month, in which event such
  Interest Period shall end on the preceding Banking Day.

  
	
   

  	
   

  
	
  5.2

  	
  a)        Subject to Clause 5.2
  d) below, for as long as any principal amounts repayable under this Credit
  Agreement remain outstanding, the Borrower shall pay to the Lenders through
  the Facility Agent for each Interest Period on each credit amount outstanding
  interest at a rate per annum to be the aggregate of (i) a margin of
  0.30% p.a. (in words zero point three per cent per annum) (the “Margin”) and
  (ii) the London Interbank Offered Rate (“LIBOR”) relating to such
  Interest Period (rounded upwards - if necessary - to a full month). 

   

             LIBOR shall mean, in
  relation to such Interest Period, the rate per annum determined by the
  Facility Agent to be equal to the arithmetic mean (rounded upwards, if
  necessary, to five decimal places) of the London interbank offered rates for
  deposits of USD for a period equal to such period 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 on such date the
  offered rates for the relevant period of fewer banks than two leading banks
  are so displayed, as quoted to the Facility Agent by each of the Reference
  Banks at the request of the Facility Agent and calculated on the above
  mentioned basis. Interest (Margin plus LIBOR), as specified under this Clause
  5.2(a) is due from the Borrower exclusively against delivery to the
  Borrower of the related invoices (originals) and the original (apostilled and
  with notarised translation into Russian) residency certificate for the
  Lenders and/or the Facility Agent, depending on the Borrower’s request. Each
  Lender and the Facility Agent hereby undertake prior to issuance of the
  relevant invoices to the Borrower for the purposes of this Clause
  5.2(a) to agree with the Borrower in written correspondence on whether
  the Russian VAT shall apply to a receipt by, or payment to the
  Lender(s) and/or the Facility Agent due from the Borrower under this
  Clause 5.2(a), as may be required under the Russian law. 

   

  b)       The Facility Agent
  shall promptly advise the Borrower in writing by letter or means of
  telecommunication of the rate of interest determined from time to time as per
  Clause 5.2.a) hereof and of the amount of interest to be paid at the end of
  the respective Interest Period, provided that to the extent the interest rate
  determined by the Facility Agent, as specified in Clause 5.2.b), is
  reasonable, proven and objective, no failure by the Facility Agent to so
  advise the Borrower shall relieve the Borrower from its payment obligations
  hereunder 

   

  c)        The rate of interest
  as stipulated in Clause 5.2.a) shall always apply without any further
  request, communication or whatsoever as far and as long as no rate of
  interest is applicable in accordance with Clause 5.2.d) hereof. 

   

  d)       For all amounts
  outstanding under this Credit Agreement the Lenders shall, upon the
  Borrower’s request and subject to the Lenders’ internal approvals, offer a
  fixed interest rate (the Lenders using their best efforts to ensure that such
  rate is commercially reasonable) for the whole remaining amount and lifetime
  of the Credits provided that: 

   

  (i)        the last disbursement
  or reimbursement under the Credit Agreement has been effected, in the case of
  either Credit A or Credit B, 

  
	
   

  	
   

  
	
   

  	
  (ii)       the exact Repayment
  Dates for the repayment instalments of the Credits stand firm in the case of
  either Credit A or Credit B, 

  

 16
 

 

 

	
  

  	
   

  (iii)      the Borrower’s
  request in the form of Annex 1 f hereto has been received by the Facility
  Agent at the latest 15 Banking Days prior to the next
  Repayment Date and,

   

  (iv)     corresponding funds in
  like amounts and for a duration equivalent to the term of the Credits under
  this Agreement are available to the Lenders.

   

  Such fixed
  interest rate takes binding effect for the period starting with the next
  Repayment Date and ending on the last Repayment Date for the Credits, in the
  case of either Credit A or Credit B, as may be the case, provided that the
  Facility Agent has received the Borrower’s agreement to the fixed rate
  offered by the Lenders through the Facility Agent within the validity period
  of such offer. 

   

  e)        Interest on any credit
  amounts outstanding shall accrue from day to day and be calculated on a per
  annum basis from the date of each disbursement or reimbursement until the
  date on which the respective repayment instalment is unconditionally credited
  on the account specified in or to be indicated by the Facility Agent in
  accordance with Clause 9.1 hereof. Interest on any credit amounts outstanding
  shall be paid by the Borrower in arrears on each Interest Payment Date (each
  “Interest Payment Date” being, (i) in the case of an interest rate
  applicable as per Clause 5.2 a), the last day of any and each Interest
  Period; and (ii) in case of a fixed interest rate applicable as per
  Clause 5.2 d) hereof each Repayment Date).

  
	
   

  	
   

  
	
  5.3

  	
  Subject to Clause 5.5
  (Exceptions), if by reason of any change occurring after the date of this
  Credit Agreement in any law, regulation, treaty or official directive
  (whether or not having the force of law) or the interpretation or application
  thereof (including but not limited to any reserve, deposit or similar
  requirements) and for compliance by the Lenders and/or the Facility Agent
  with any legally binding requirement of any central bank or other
  governmental or monetary authority arising after the date of this Credit Agreement
  any of the Lenders incur any Increased Costs (as defined hereinafter), then,
  in any such case, the Borrower shall pay to the Facility Agent for account of
  the Lenders within thirty days of a demand by the Facility Agent such amounts
  of the Increased Costs as the Lenders through the Facility Agent shall
  specify to be necessary to compensate the Lenders for such increase or such
  reduction. 

   

  In this Agreement
  “Increased Costs” means: 

   

  (i)        a
  reduction in the rate of return from the Credits or on a Lender’s overall
  capital; 

  (ii)       an
  additional or increased cost; or 

  (iii)      a
  reduction of any amount due and payable under the Credits, 

   

  which is incurred or
  suffered by a Lender to the extent that it is attributable to that Lender
  having entered into this Credit Agreement or funding or performing its
  obligations under it.

  
	
   

  	
   

  
	
  5.4.

  	
  A Lender intending to
  make a claim pursuant to Clause 5.3 (Increased Costs) shall notify the
  Facility Agent of the event giving rise to the claim, following which the
  Facility Agent shall promptly notify the Borrower. Each Lender shall, as soon
  as practicable after a demand by the Facility Agent, provide a certificate
  confirming the amount of its Increased Costs and the circumstances giving
  rise to the claim.

  
	
   

  	
   

  
	
  5.5

  	
  Clause 5.3 (Increased
  Costs) does not apply to the extent any Increased Cost is: 

   

  (i)     compensated for under
  another Clause or would have been but for an exception to that Clause; 

   

  (ii)    a tax, levy, duty,
  charge or fee of whatever nature on the overall net income of a Lender or
  attributable to any deduction or withholding for or on account of any tax, 

   

  

 17
 

 

 

	
  

  	
           Levy, duty, charge or
  fee of whatever nature required by law to be made by the Borrower (provided
  that nothing in this sub-clause 5.5 (ii) reduces the Borrower’s
  Liability to make any payment on account of any tax, levy, duty, charge or
  fee required pursuant to Clause 10); or 

   

  (iii)   attributable to a Lender
  being grossly negligent or wilfully failing to comply with any law or
  regulation or official administration order or court decision.

  
	
   

  	
   

  
	
  6.

  	
  Fees

  
	
   

  	
   

  
	
  6.1

  	
  From the date of this
  Credit Agreement until disbursement of Credit A in full, the Borrower shall
  pay to the Lenders through the Facility Agent a commitment fee at a rate of
  0.10% p.a. (in words: zero point one per cent per annum) calculated on a
  daily basis on such portion of the maximum amount of Credit A not yet
  disbursed at any time. The commitment fee is payable pro rata in arrears
  (i) prior to the first disbursement or reimbursement on June 30 and
  December 30 of each year; and (ii) with effect from the first
  disbursement or reimbursement on each Interest Payment Date.

  
	
   

  	
   

  
	
  6.2

  	
  The Borrower will pay
  to the Lenders (in their capacity as mandated lead arrangers) through the
  Facility Agent an arrangement fee of 0.20% flat (in words: zero point two per
  cent flat) calculated on the maximum amount of Credit A mentioned in Clause
  2.1 hereof.

   

  The arrangement fee is
  due prior to the first disbursement or reimbursement under the Credit
  Agreement, at the latest however, within 30 days after the date of this
  Credit Agreement.

  
	
   

  	
   

  
	
  6.3

  	
  From the date of this
  Credit Agreement until all monies owing by the Borrower are fully repaid to
  the Lenders, the Borrower shall pay to the Facility Agent an agency fee of
  USD 10,000 per annum on the date of signature of this Credit Agreement and
  annually thereafter on the anniversary date of this Credit Agreement.

  
	
   

  	
   

  
	
  6.4

  	
  Clauses 6.1 and 6.2
  shall apply mutatis mutandis in case of Credit B being made available by the
  Lenders to the Borrower whereas calculation of the additional commitment fee
  shall start on the date on which the Lenders will have approved the granting
  of Credit B to the Borrower in writing; the additional arrangement fee shall
  be paid within 30 days after the date of such approval, at the latest,
  however, prior to disbursement or reimbursement under Credit B.

  
	
   

  	
   

  
	
   

  	
   

  
	
  7.

  	
  Calculation of Periods

  
	
   

  	
   

  
	
   

  	
  For the purpose of
  calculating interest, commitment fee and other payment obligations based on
  periods of time, a year will be calculated on the basis of the actual number
  of days elapsed and a year of 360 days.

  
	
   

  	
   

  
	
  8.

  	
  Repayment and
  Prepayment

  
	
   

  	
   

  
	
  8.1

  	
  Credit A

   

  The credit amounts
  disbursed under Credit A are to be repaid in 17 equal and consecutive
  semi-annual repayment instalments; the first of which will be due on the
  earlier of (i) the date falling 6 months after the date of the
  mean-weighted acceptance of equipment and software to be evidenced
  concurrently to the Borrower and the Lenders (by delivery as specified in
  Clause 16.1 hereunder) by a certificate in accordance with Annex 3a hereof;
  and (ii) 30 September 2006. Credit amounts disbursed after the
  first Repayment Date under Credit A shall be repaid in equal amounts on the
  remaining Repayment Dates; the repayment instalments which then have not yet
  become due will be increased accordingly and the Facility Agent shall
  promptly, upon its drawing up thereof however, at the latest 20 Business Days
  prior to the next Repayment Date, deliver an updated repayment schedule to
  the Borrower showing the amounts of repayment instalments due on each
  subsequent Repayment Date, provided that no failure by the Facility Agent to
  so advise the 

  

 18
 

 

 

	
  

  	
  Borrower shall relieve
  the Borrower from its payment obligations under this Credit Agreement. 

   

   

  Credit B

   

  If applicable, the
  credit amounts disbursed under Credit B will be repaid in 17 equal and
  consecutive semi-annual repayment instalments; the first of which will,
  depending on the respective Hermes approval, either be due on the earlier of
  (i) the date falling 6 months after the date of the mean-weighted
  acceptance of equipment and software relating to the deliveries made/services
  rendered under the Additional Export Contract, to be evidenced by a
  certificate in accordance with Annex 3b hereof, or (ii) a certain latest
  date still to be agreed upon prior to the first disbursement under Credit B,
  subject to Hermes approval, in each such case as advised to the Borrower by
  the Facility Agent. Credit amounts disbursed after the first Additional
  Repayment Date under Credit B shall be repaid in equal amounts on the
  remaining Additional Repayment Dates; the repayment instalments which then
  have not yet become due will be increased accordingly and the Facility Agent
  shall promptly, upon its drawing up thereof, however, at the latest 20
  Business Days prior to the next Repayment Date, deliver an updated repayment
  schedule to the Borrower showing the amounts of repayment due on each
  subsequent Additional Repayment Date, provided that no failure by the
  Facility Agent to so advise the Borrower shall relieve the Borrower from its
  payment obligations under this Credit Agreement.

  
	
   

  	
   

  
	
  8.2

  	
  Where the interest rate
  defined in Clause 5.2 a) applies, the Borrower shall be entitled upon 30
  days’ prior notice to the Facility Agent to prepay on any Interest Payment
  Date, in full or in part, any credit amounts outstanding together with
  interest accrued thereon and any other amounts then due under the Credit
  Agreement. Any such notice of the Borrower shall be irrevocable and binding
  and obliges the Borrower to repay the credit amounts in accordance with its
  notice of prepayment. 

   

  In case of partial
  prepayments, any partial amount repaid may be applied by the Facility Agent
  in the inverse order of their maturities. 

   

  Any amount prepaid in
  accordance with this Clause 8.2 may not be reborrowed.

  
	
   

  	
   

  
	
  8.3

  	
  Where the interest rate
  in Clause 5.2 d) applies, prepayment of any amounts not yet due according to
  this Credit Agreement is not permitted.

  
	
   

  	
   

  
	
  8.4

  	
  Prior to the first
  Repayment Date the Facility Agent shall furnish the Borrower with a repayment
  schedule which sets out the Repayment Dates and the amount of repayment
  instalments to be paid on each such Repayment Date or Additional Repayment
  Date, if applicable, provided that no failure by the Facility Agent to so
  advise the Borrower shall relieve the Borrower from its obligations
  hereunder. In case of the granting of Credit B and if a repayment schedule in
  relation to Credit A has already been delivered at such time, the Lenders
  shall furnish the Borrower with a revised repayment schedule or an additional
  repayment schedule, as the case may be. All other stipulations of the preceding
  sentence shall apply mutatis mutandis to such revised or additional schedule.

  
	
   

  	
   

  
	
  9.

  	
  Payments

  
	
   

  	
   

  
	
  9.1

  	
  All payments to be made
  by the Borrower to the Lenders through the Facility Agent under this Credit
  Agreement shall be made in USD without any deduction not later than
  10.00 a.m. London time on the respective due date at the Facility
  Agent’s free disposal to the account of the Facility Agent held with HSBC
  Bank USA, New York, SWIFT MRMDUS33 account number 000-023868, in favour
  of HSBC Bank plc London, SWIFT MIDLGB22, account number 36677449 in the name
  of Project and Export Finance, quoting reference 53M/FC1072 or such other
  account with such other financial institution as notified by the Facility
  Agent to the Borrower.

  
	
   

  	
   

  
	
  9.2

  	
  The Borrower shall not be
  entitled to exercise any right of retention or to set off any counterclaims
  against claims arising from this Credit Agreement against any Lender unless
  such counterclaims exist against the Lender that the Borrower exercises the
  right of retention or set off against, and such counterclaims have been
  accepted by that Lender in writing or have otherwise been adopted or 

  
	
   

  	
   

  

 19
 

 

 

	
  

  	
  consistently relied
  upon.

  
	
   

  	
   

  
	
  9.3

  	
  If the Facility Agent
  receives a payment insufficient to discharge all the amounts then due and
  payable by the Borrower under this Credit Agreement, the Facility Agent on
  behalf of the Lenders shall, notwithstanding any converse instruction given
  by the Borrower, apply incoming payments in the following order: 

   

  (i)                      firstly,
  in or towards any costs and expenses due and payable hereunder; 

  (ii)                   secondly, in
  or towards payment of any fees due and payable hereunder; 

  (iii)                thirdly, in or
  towards payment of any default interest and/ or indemnification then due and
  payable as provided for in Clauses 9.4 and 9.5; 

  (iv)               fourthly, in or
  towards payment of any contractual interest due and payable hereunder; 

  (v)                  fifthly, in or
  towards repayment of any principal amount due and payable hereunder; 

  (vi)               sixthly, in or
  towards payment of any other amount (including any indemnification other than
  such as under Clause 9.5) due and payable hereunder.

  
	
   

  	
   

  
	
  9.4

  	
  The Lenders through the
  Facility Agent shall be entitled to demand on repayment instalments overdue
  default interest at a rate which is the sum of 2% p.a. (in words: two per
  cent per annum) and the rate which would have been payable if such overdue
  amount had, during the period of non payment, constituted a Credit for
  successive periods of any duration as the Lenders (acting reasonably) through
  the Facility Agent may determine from time to time.

  
	
   

  	
   

  
	
  9.5

  	
  The Lenders through the
  Facility Agent shall be entitled to demand on amounts overdue other than
  repayment instalments, a lump sum indemnification which is the sum of 2% p.a.
  (in words: two per cent per annum) and the rate which would have been payable
  if such overdue amount had, during the period of non payment, constituted a
  Credit for successive periods of any duration as the Lenders (acting
  reasonably) through the Facility Agent may determine from time to time.

  
	
   

  	
   

  
	
  9.6

  	
  All payments owed by
  the Borrower as per Clauses 9.4 and 9.5 shall be made immediately upon the
  Facility Agent’s first demand except when under the applicable Russian
  currency regulations the Borrower is required to reserve a particular amount
  of payment at a special account prior to proceeding with a transfer of such
  amounts to the benefit of the Facility Agent. In the latter case the delay in
  payment shall not exceed the particular reservation period specified in the
  Russian currency regulations applicable to the Borrower.

  
	
   

  	
   

  
	
  9.7

  	
  If a due date on which
  a payment of the Borrower must have been received at the free disposal of the
  Facility Agent is not a Banking Day, the next succeeding Banking Day shall be
  the due date, unless such Banking Day falls into a new calendar month in
  which event the due date shall be the preceding Banking Day. The obligations
  of the Borrower to pay interest and fees shall accrue accordingly.

  
	
   

  	
   

  
	
  10.

  	
  Taxes, Levies, Duties
  and Other Costs

  
	
   

  	
   

  
	
  10.1

  	
  Definitions

  
	
   

  	
   

  

a)                                      In
this Credit Agreement

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

“Qualifying Lender” means a Lender, which is situated
for tax purposes in (i) the Russian Federation, (ii) in a Tax Treaty
Jurisdiction or (iii) in the United Kingdom or the Federal Republic of
Germany.

 20
 

 

 

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

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

“Tax Deduction” means a deduction or withholding for
or on account of Tax from a payment under this Credit Agreement.

“Tax Payment” means an increased payment made by the
Borrower to a Lender under Clause 10.2 or a payment under
Clause 10.3.

“Tax Treaty Jurisdiction” means a jurisdiction, which
has in force a double tax treaty with the Russian Federation (or with the Union
of Soviet Socialist Republics to which the Russian Federation has succeeded),
which provides for full exemption from Russian withholding tax on interest
derived from a source within the Russian Federation payable to a resident of
such jurisdiction.

b)                                     Unless
a contrary indication appears, in this Clause 10 a reference to “determines”
or “determined” means a determination made in the absolute discretion of the
person making the determination.

	
  10.2

  	
  Tax Gross up

  
	
   

  	
   

  
	
   

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

   

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

   

  c)              Subject
  to paragraph d) below, if a Tax Deduction is required by law to be made by
  the Borrower, the amount of the payment due from the Borrower to the Lenders
  shall be increased to an amount which (after making any Tax Deduction) leaves
  an amount equal to the payment which would have been due if no Tax Deduction
  had been required.

   

  d)             The
  Borrower is not required to make an increased payment to a Lender under
  paragraph c) above if, on the date on which the payment falls due, the
  Borrower could have made such a payment to that Lender without a Tax Deduction
  if that Lender was a Qualifying Lender, but on that date that Lender is not,
  or has ceased to be, a Qualifying Lender (other than as a result of any
  change after the date it became a Lender under the Credit Agreement in (or in
  the interpretation, administration, or application of) any law or treaty, or
  any published practice or concession of any relevant taxing authority).

   

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

   

  f)              The
  Borrower shall pay to the relevant taxation or other authorities within the
  period for payment permitted by applicable law the full amount of the
  deduction or withholding (including but without prejudice to the generality
  of the foregoing, the full amount of any deduction or withholding from any
  additional amount paid pursuant to this sub-clause).

   

  g)             Promptly
  upon making either a Tax Deduction or any payment required in connection with
  that Tax Deduction, the Borrower shall deliver to the Facility Agent for a
  Lender entitled to 

  
	
   

  	
   

  

 21
 

 

 

the payment an original
receipt (or certified copy thereof) demonstrating that the Tax Deduction has
been made or (as applicable) any appropriate payment paid to the relevant
taxing authority.

 

10.3                   Tax Indemnity

 

a)                              The
Borrower shall promptly pay to a Protected Party through the Facility Agent an
amount equal to the loss, liability or cost which that Protected Party
determines has been suffered for or on account of Tax by that Protected Party
in respect of this Credit Agreement.

 

b)                             Paragraph
(a) above shall not apply:

 

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

 

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

 

(B)                        under the
law of the jurisdiction in which that Lender’s facility office is located in
respect of amounts received or receivable in that jurisdiction,

 

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

 

(ii)                          to the
extent a loss, liability or cost:

 

(C)      is compensated for by an
increased payment under Clause 10.2; or

 

(D)     would have been compensated
for by an increased payment under Clause 10.2 but was not so compensated solely
because one of the exclusions in paragraph d) of Clause 10.2 applied.

 

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

 

d)                             A
Protected Party shall, on receiving a payment from the Borrower under this
Clause 10.3, notify the Facility Agent.

 

10.4                   Tax Credit

 

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

 

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

 

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

 

the Lender shall (within
three Business Days of demand by the Borrower) pay through the Facility Agent
an amount to the Borrower which that Lender determines will leave the Lender
(after that payment) in the same after-tax position as it would have been in
had the Tax Payment not been made by the Borrower.

 

                                        However,
if the relevant Lender should be obliged by any law, regulation or court or any
other official decision to repay any Tax Credit obtained by such Lender and
paid to the Borrower pursuant to the preceding paragraph, or if any such Tax
Credit should otherwise be officially revoked, the Borrower shall promptly upon
demand of such Lender and against reasonable 

 22
 

 

 

                                        evidence
of such repayment obligation or revocation, as the case may be, refund the
respective Lender through the Facility Agent of such amount.

 

10.5                   Without
prejudice to the Borrower’s obligations/the Lenders’ rights according to Clause
10.2 and 10.3, in the event of withholding taxes being imposed in the Russian
Federation on payments due under this Credit Agreement that are eligible for
exemption and provided that the Borrower and/or the Lenders can claim such
exemption with the result that they are released from any obligation to pay
such taxes, the Borrower hereby undertakes to apply with the competent
authorities in the Russian Federation to be exempted and released from such
taxes and to provide the Facility Agent with a tax exemption certificate or any
other evidence of such tax exemption, all in form and substance as reasonably
may be required by the Lenders through the Facility Agent. In turn, in order to
enjoy the benefits of an applicable convention on avoidance of double taxation
each Lender undertakes to submit to the Borrower a certificate of its residence
in the form and in the manner required by Russian Law, provided that any
expenses incurred by a Lender in doing so shall be borne by the Borrower. The
form of the certificate as well as its main items shall be advised by the
Borrower to the Facility Agent reasonably in advance.

 

10.6                   Without
prejudice to the Lenders’ rights under this Credit Agreement, in particular
under this Clause 10, the Borrower shall pay to, or reimburse the Lenders
through the Facility Agent upon demand for (i) any stamp duties,
registration fees and similar taxes and charges in connection with this Credit
Agreement and (ii) all legal fees (including VAT) and out-of-pocket
expenses incurred by the Lenders and/or the Facility Agent in connection with
the negotiation, preparation, documentation and execution of this Credit
Agreement provided that in relation to Credit A only all such fees and expenses
shall not exceed USD 15,000.00 (plus VAT and disbursements, plus costs for
required translation of any of the finance documents related to this Credit
Agreement into the Russian language) and (iii) any costs, including
lawyer’s fees and taxes arising thereon, in connection with the preservation
and enforcement of the Lenders’ rights under this Credit Agreement.

                                        

10.7                   Each Lender and
the Facility Agent hereby undertake prior to issuance of any invoices to the
Borrower to discuss the invoicing procedure with the Borrower in written
correspondence and further undertake to provide the Borrower upon its request
as soon reasonably practicable with the original invoices and an original
(updated) residency certificate (apostilled and together with a translation
into Russian).

 

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

 

11.1                   The Hermes
Agent on behalf of the Lenders has applied for insurance cover of 95% of the
Lenders’ claims arising from this Credit Agreement by the Federal Republic of
Germany, represented by Hermes by means of an insurance agreement (the
“Insurance Agreement”). Credit A will be made available on the basis of such
Insurance Agreement and the terms and conditions governing it. In the event
that additional insurance cover is provided by Hermes for the purposes of
financing being made available for Credit B hereunder, then Credit B will be
made available on the basis of such supplemental insurance (“Supplemental
Insurance Agreement”) and the terms and conditions governing it.

The Lenders are entitled to give information on the Credit Agreement and the
transactions contemplated thereby to the competent authorities of the Federal
Republic of Germany and the European Union and to allow such authorities
perusal of all records that may be connected with this Credit Agreement and to
furnish them with copies thereof.

 

 

11.2                   The Borrower
undertakes to reimburse and indemnify the Lenders through the Facility Agent in
full for and against the aggregate amount of premiums and charges (the
“Insurance Premium”) payable by the Lenders through the Facility Agent to
Hermes under the Insurance Agreement for insurance cover of their payment
claims arising from Credit A of this Credit Agreement.

 

                                        The
Insurance Premium shall be paid by the Borrower immediately upon written demand
by the Facility Agent in accordance with Annex 1c or Annex 1e, as the case may
be, provided that the

 23
 

 

 

                                        insurance
premium is payable (and is either already due or will become due shortly) by
the Lenders to Hermes under the Insurance Agreement.

 

 

11.3                   In the event
that additional financing in the form of Credit B is made available to the
Borrower, the Borrower undertakes to reimburse and indemnify the Lenders
through the Facility Agent in full for and against the additional amount of
premiums and charges (the “Additional Insurance Premium”) payable by the Lenders
through the Facility Agent to Hermes under the Supplemental Insurance Agreement
for additional insurance cover of their payment claims arising from Credit B of
this Credit Agreement. The second paragraph of Clause 11.2 shall apply mutatis
mutandis hereto.

 

 

11.4                   Prior to the
first Repayment Date under this Credit Agreement or - in case of disbursements
or reimbursements after such date - upon disbursement in full of the Credits,
the Facility Agent will procure the recalculation by Hermes of the amount of
Insurance Premium (or as applicable, the amount of Additional Insurance
Premium) payable to Hermes and will provide the Borrower with reasonable
evidence of the correctness of such recalculation if the Insurance Premium (or
as applicable, the Additional Insurance Premium) payable for cover with respect
to this Credit Agreement does not equal the aggregate amounts which the
Borrower has paid to the Facility Agent as per Clause 11.2 or, as the case may
be, Clause 11.3 hereof towards reimbursement of such Insurance Premium (or as
applicable the Additional Insurance Premium).

 

                                        If the aggregate amount reimbursed by the
Borrower is more than the respective Insurance Premium (or if applicable, the
Additional Insurance Premium), on the Interest Payment Date following the date
on which the Lenders have received the excess amount from Hermes the Lenders
through the Facility Agent will refund the excess amount to the Borrower.
Payment of the excess amount to the Borrower as per the preceding sentence
shall be made by the Lenders through the Facility Agent by application of the
amounts thus to be refunded to the Borrower towards partial prepayment of the
Credit disbursed and then still outstanding under this Credit Agreement. In
order to achieve the purpose laid down in this paragraph on the due date
thereof the excess amount to be paid to the Borrower shall - at the option of
the Lenders either equally and proportionally or in the inverse order of
maturities - be set off by the Lenders against repayment installments then
still outstanding under this Credit Agreement without any prior notice by the
Lenders to the Borrower with regard thereto. The Lenders through the Facility
Agent will inform the Borrower without delay of any such set-off.

 

                                        If the aggregate amount paid by the Borrower
towards reimbursement against the respective Insurance Premium (or if
applicable, the Additional Insurance Premium) was less than the Insurance
Premium (or if applicable, the Additional Insurance Premium) payable by the
Lenders, the Borrower undertakes upon request of the Facility Agent within 30
calendar days to pay to the Facility Agent the balance in favor of the Lenders.

                                        

12.                         Suspension
of Disbursement, Payments Immediately Due (Events of Default)

                                        

12.1                   The Lenders
acting through the Facility Agent shall be entitled to suspend each and/or any
future disbursement of the Credits in whole or in part, and/or to terminate
this Credit Agreement, and/or to demand immediate repayment of all credit
amounts outstanding, as well as the payment of all interest and fees accrued
thereon, any charges and other claims incidental thereto, if:

 

a)                              the
Borrower fails to fulfil any payment obligation whether in respect of
principal, interest or any other amount under this Credit Agreement when due
and payable unless

 

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

(ii) payment
is made within three Banking Days of the due date;

 

or

 

b)                             the
Borrower breaches or fails to fulfil any other obligation under this Credit
Agreement and in case of any such breach or failure capable of being remedied,
such failure or breach is not 

 24
 

 

 

                                        remedied
within 10 Banking Days after the Facility Agent has notified the Borrower in
writing of such failure or breach;

 

                                        or

 

c)                              any
representation, warranty or statement in this Credit Agreement or any other
document provided by the Borrower under the terms of this Credit Agreement  is or proves to be or to have been incorrect
or untrue in any material respect at any time during the term of this Credit
Agreement and in case that such incorrectness is capable of being remedied -
whereas the determination of such capability shall be upon the sole but
reasonable discretion of the Lenders - such incorrectness is not cured within
15 Banking Days after the Facility Agent has notified the Borrower in writing
of such incorrectness;

 

                                        or

 

d)                             the
Borrower shall fail to pay when due or within any applicable period of grace
any indebtedness owed to any of the Lenders or to any other creditor, provided,
however, that in relation to any such indebtedness owed by the Borrower to any
creditor other than any of the Lenders (including any of their Affiliates) such
failure by the Borrower shall not constitute an event of default under this
sub-clause if (i) the overdue amounts in relation to the Borrower in
aggregate do not exceed USD 10,000,000.00 or the equivalent thereof in any
other currency, or (ii) in the event of any such failure by the Borrower
exceeding the aforementioned amount any such default is remedied (including by
waiver or amendment) within 15 calendar days after the due date of the
respective payment obligation or after lapse of any applicable period of grace
unless the respective creditor accelerates the relevant indebtedness before;

 

                                        or

 

e)                              at
any time it shall become unlawful for the Borrower (provided that such event,
if capable of being cured in the reasonable opinion of the Lenders, is not
cured within 30 Business Days from the date it became unlawful) to perform any
or all of its obligations under this Credit Agreement (including, without
limitation, any governmental or other consent, licence or authorisation
required to make this Credit Agreement legal, valid, binding and enforceable,
or required at any time to enable the Borrower to perform its obligations under
this Credit Agreement, ceasing to be in full force and effect);

 

                                        or

 

f)                                any
material provision of this Credit Agreement is or becomes invalid or
unenforceable;

 

                                        or

 

g)                             the
Borrower shall enter into voluntary suspension of payments, bankruptcy, liquidation
or dissolution, or shall become insolvent, or a receiver or liquidator shall be
appointed on all or any material part of the undertaking or assets of the
Borrower or proceedings are commenced by or against the Borrower under any law
or regulation providing for any reorganisation, arrangement, readjustment of
debts, dissolution or liquidation or any act shall be done or event shall occur
which under the laws of the relevant jurisdiction has a substantially similar
effect to any of the foregoing act or event, provided that an event of default
will not occur under this sub-clause g) in respect of any petition or
application being initiated or commenced by any person other than the Borrower
if the petition or application is - in the sole discretion of the Lenders -
frivolous or vexatious and is withdrawn or rejected within 30 calendar days
from the date of such application and before a court order for the commencement
of any such procedure has been made;

 

                                        or

 

h)                             the Borrower
admits its inability to meet its payment obligations to any of the Lenders or
to 

 25
 

 

 

                                        any other
creditor or to convert the funds necessary to effect such payments into the
currency payable under agreements with parties domiciled outside of its country
or to transfer such payments, or the Borrower admits - towards any of the
Lenders - its unwillingness with regard to any of the aforementioned actions;

 

                                        or

 

i)                                 any
material adverse change shall occur in the financial condition or operations,
assets, prospects, business or the legal status of the Borrower such that it is
reasonably likely that the Borrower may not, or will be unable to perform or
observe its obligations under this Credit Agreement,

 

provided, however, that
in case of the occurrence of any of the events as stipulated in sub-clauses a),
b), c) and d) of this Clause 12.1, for so long as such events are continuing
the Lenders through the Facility Agent shall be entitled to suspend
disbursements / reimbursements under this Credit Agreement prior to the expiry
of the grace period for remedy of the relevant events of default.

                                        

12.2                   Insofar as any
statements made by the Facility Agent according to Clause 12.1 are sent by
airmail (with a copy by fax), these statements shall be deemed to have been
received not later than on the 10th Banking Day after their dispatch. If such
statements are made by means of telecommunication, the day following their
dispatch shall be deemed as the date of receipt.

                                        

13.                         Representations
and Warranties

 

The
Borrower hereby represents and warrants to the Lenders that

a)                            the
Borrower is a corporation duly incorporated under the laws of the Russian
Federation, validly existing and in good standing;

b)                           the
Borrower has the power to own its assets and carry on its business as it is
being conducted;

c)                            the
Borrower is not entitled to claim immunity from suit, execution, attachment or
other legal process in any proceedings taken in the Russian Federation in
relation to this Credit Agreement;

d)                           the
Borrower has full power and legal right to execute, deliver and to perform this
Credit Agreement;

e)                            the
execution, delivery and performance of this Credit Agreement will not violate
any provisions of, and have duly and validly been authorised under, the laws,
regulations, orders and decrees of the Russian Federation or any other
competent Russian authority and all consents, licences, approvals,
authorisations and instrumentalities of, and registrations and/or declarations
with any authority within the Russian Federation required in connection with
the valid execution, delivery, performance or enforceability of this Credit
Agreement (including without limitation the obtaining and transfer in USD of
all amounts due under this Credit Agreement) have been obtained and made and
are in full force and effect;

f)                              each
action necessary under the statutes of the Borrower or under any other
agreement or instrument binding on the Borrower to authorise the execution,
delivery and/or performance of this Credit Agreement has been duly taken and
the execution, delivery and performance of this Credit Agreement will not
conflict with, or constitute a breach of the statutes of the Borrower or any
such agreement or instrument binding upon the Borrower;

g)                           the
Borrower is not in default under any agreement or instrument constituting
present or future payment obligations as debtor, surety or guarantor;

 26
 

 

 

h)                           other
than the UMC Litigation no litigation, administration or insolvency proceedings
are pending or, to the knowledge of the Borrower are threatened, which
adversely determined, would reasonably be expected to have a material adverse
effect on the assets or financial condition of the Borrower or on its right or
ability to perform its obligations hereunder or would affect the legality,
validity or enforceability of this Credit Agreement; and

i)                               all
its payment obligations in connection with this Credit Agreement rank at least
pari passu in point of preference and security with all other unsecured and
unsubordinated existing and future indebtedness owed to any creditor other than
the Lenders, except for any preference being due to mandatory law.

14.        Financial Statements, Information and
Undertakings (Covenants)

Until
such date as all obligations incurred under this Credit Agreement have been
fulfilled in full, the Borrower shall:

a)                            furnish
the Facility Agent within 6 months from the end of its financial year with
audited annual financial statements (including profit and loss accounts and
explanatory notes) prepared in accordance with US GAAP (US Generally Accepted
Accounting Principles, Standards and Practices) and provide the Facility Agent
with such additional financial information as the Facility Agent may from time
to time reasonably request. In the event that completion and adoption of the
financial statements should be delayed, the Borrower shall furnish the Facility
Agent with provisional profit and loss accounts and balance sheet figures
within 6 months after the end of its financial year;

b)                           inform
the Facility Agent without delay of the occurrence of any of the events
mentioned in Clause 12 hereof and in the event any of the Representations and
Warranties mentioned in Clause 13 hereof ceases to be true or correct in any
material respect;

c)                            only
with the prior written consent of the Lenders agree upon any modification
and/or amendment to the Export Contract or, as the case may be, the Additional
Export Contract, which represents a material change to the Export Contract or
Additional Export Contract, including but not limited to changes in the
price/currency, terms of payment, country of origin, delivery and/or
installation periods etc.;

d)                           obtain
and keep in full force all authorisations, licenses, approvals and permits
(governmental or otherwise) which are required for the validity and
enforceability of this Credit Agreement;

e)                            comply
with all applicable laws, rules, regulations and orders including all
environmental laws and all applicable restrictions imposed by all governmental
authorities (including but not limited to the central bank of the Russian
Federation) and do all such acts and things which are required thereunder, if
failure so to comply will or in the reasonable opinion of the Lenders may,
materially impair the ability of the Borrower to perform its obligations,
whether in respect of any payment of principal, interest, fees, costs or
expenses or otherwise, under this Credit Agreement in strict compliance with
its terms;

f)                              procure
that no substantial change is made to the general nature or scope of its
business from that carried out on the date of this Credit Agreement and
forthwith inform the Facility Agent of any circumstances which might result in
such change provided that the Borrower may amalgamate, merge, demerge or
consolidate with any Affiliate as part of any corporate restructuring unless
any such action would result in a material adverse change which falls within
the scope of application of Clause 12.1.i) hereof;

 27
 

 

 

g)                           immediately
upon the Borrower’s knowledge or awareness thereof inform the Facility Agent of
any forthcoming amalgamation, demerger, merger, consolidation or corporate
reconstruction of the Borrower;

h)                           ensure
that neither in a single transaction nor in a series of transactions, whether
related or not, all or any substantial part of its assets are sold,
transferred, granted or leased or otherwise disposed of unless such sale,
transfer, grant, lease or disposal is:

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

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

(iii)                               made by the Borrower to any
Affiliate of the Borrower unless any such transaction would result in a
material adverse change which falls within the scope of application of Clause
12.1.i) hereof;

(iv)                              for
cash or cash equivalents;

(v)                                 where
the book value of such asset (when aggregated with the book value of each other
asset disposed of under this sub-clause (v)) (in each case as calculated in
accordance with US GAAP) does not exceed 25% of the Borrower’s Total Assets in
any financial year of the Borrower and provided that at all times the disposal
of such assets will be made for full consideration and will not lead to any
material adverse change which would fall within the scope of Clause 12.1 i). At
the request of the Facility Agent (any such request to be made no more than
once per calendar quarter, unless an Event of Default is continuing), the
Borrower shall provide a certificate to the Agent setting out in reasonable
detail the book value of any assets disposed of under this sub-clause (v) (calculated
in accordance with US GAAP); or

(vi)                              involving
the transfer of any or all of the Borrower’s shares in UMC pursuant to the UMC
Litigation to a person that is not the Borrower or any of its Subsidiaries.

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

i)                               do
all such things as are necessary to maintain its corporate existence and ensure
that it has the right and is duly qualified to conduct its business;

j)                               not
create or agree to create any mortgage, charge, pledge, lien or other security
interest on the whole or any part of its assets to secure any indebtedness owed
to any creditor other than the Lenders (for the avoidance of doubt, any
suretyship or guarantee shall not be deemed a security for the purposes of this
paragraph), unless the Credits shall at the same time be secured equally and
rateably therewith to the Lenders’ satisfaction other than any Permitted Lien
(as defined hereinafter)

“Permitted Lien” means:

(i)          any
lien on any property or assets of any person existing at the time such person
is merged or consolidated with or into the Borrower and not created in
contemplation of such event;

(ii)       any
lien existing on any property or assets prior to the acquisition thereof by the
Borrower and not created in contemplation of such acquisition;

 28
 

 

 

(iii)           any lien on any property or assets securing
indebtedness of the Borrower incurred or assumed for the purpose of financing
all or part of the cost of acquiring or constructing or refurbishing any
property or assets, provided that the aggregate principal amount of all
indebtedness secured by liens under this sub-Clause (iii) shall not exceed
the lower of (x) the purchase price of such property or assets and (y) the
fair market value of such property or assets at the time of acquisition, or
construction or refurbishment;

(iv)  any netting or
set-off arrangement entered into in the ordinary course of the Borrower’s
banking arrangements for the purpose of netting debit and credit balances;

(v)         any lien arising by operation of law either (a) in
the ordinary course of business; or (b) in respect of taxes, assessments,
government charges or claims, including without limitation those in favour of
Russian governmental fiscal authorities;

(vi)          any lien on the property or assets of the
Borrower securing inter-company indebtedness;

(vii)       any extension, renewal or replacement of any
lien described in sub-Clauses (i) to (vi) above, provided that (a) such
extension, renewal or replacement shall be no more restrictive in any material
respect than the original lien, (b) the amount of indebtedness secured by
such lien is not increased and (c) if the property, income or assets
securing the indebtedness subject to such lien are changed in connection with
such refinancing, extension or replacement, the fair market value of the
property, income or assets is not increased;

(viii)    any other lien, pledge, mortgage or other type
of encumbrance, provided that immediately after giving effect to such lien,
pledge, mortgage or other type of encumbrance the Borrower’s secured
indebtedness in the aggregate do not exceed 10% of the book value of the
aggregate amount of the Borrower’s total assets, determined by reference to its
most recent quarterly or, as the case may be, audited  annual unconsolidated balance sheet;

(ix)        easements, rights-of-way,
and any other similar charges and legally binding restrictions or encumbrances
incurred in the ordinary course of business and not interfering in any material
respect with the business of the Borrower or the Business of any Subsidiary of
the Borrower, including any encumbrance with respect to an equity interest of
any joint venture agreement;

k)                            ensure
that its payment obligations under this Credit Agreement rank at least pari
passu with all its other present and future unsecured payment obligations.

15.                       Assignability

15.1 The Borrower may not
assign all or any of its rights and claims under this Credit Agreement.

15.2  Unless (i) the assignment is to an Affiliate
of a Lender or to another Lender or (ii) an Event of Default has occurred,
any assignment occurring after the date of this Credit Agreement by any Lender
shall require the consent of the Borrower, provided that (x) such consent
shall not be unreasonably withheld or delayed; and (y) unless the Borrower
has notified the Facility Agent to the contrary within 5 Banking Days of
receiving notice of the intended assignment, the Borrower will be deemed to
have given consent to that assignment.

 29
 

 

 

15.3 Any Lender may also
disclose to any person to whom it assigns or intends to assign its rights and
obligations hereunder such information about the Borrower and the Credit
Agreement, as such Lender shall consider necessary.

16.                       Statements
and Notices

 

	
  16.1

  	
  Any notices or other communications in connection
  with this Credit Agreement are to be made by letter or by written means of
  telecommunication, and to be sent to the following addresses:

  

 

	
  Borrower:

  	
  OJSC
  Mobile TeleSystems 

  
	
   

  	
  4
  Marksistskaya Street

  
	
   

  	
  Moscow
  109147

  
	
   

  	
  Russian
  Federation

  
	
   

  	
   

  
	
   

  	
  Telefax:

  +
  7 095 223-2183

  Attention
  of Mr. Nikolay V. Tsekhomsky

  Vice
  President — Chief Financial Officer

  +
  7 095 223-2168

  Attention
  of Ms. Marina V. Zabolotneva

  Head
  of the Treasury Department

  
	
   

  	
   

  
	
  Facility
  Agent:

  	
  HSBC
  Bank plc

  
	
  (for
  and on behalf of

  	
  Level
  17, Project and Export Finance

  
	
  the
  Lenders)

  	
  8
  Canada Square

  
	
   

  	
  London
  E14 5HQ

  
	
   

  	
  United
  Kingdom

  
	
   

  	
   

  
	
   

  	
  Telefax:+44
  207 992 4428 (Attention of: Mr Alan Marshall)

  

 

	
  16.2

  	
  The Borrower shall provide the Facility Agent with
  specimen signatures in form and substance as per Annex 4 of those persons who
  are authorised to act on its behalf.

  
	
   

  	
   

  
	
  16.3

  	
  Any alteration in the above-mentioned companies’
  names, addresses and power of representation shall be binding upon the other
  contracting party only upon receipt by such other party of written
  notification or documents evidencing such alteration.

  
	
   

  	
   

  
	
  16.4

  	
  All correspondence between the parties hereto shall
  be conducted and carried out in the English language. Should the wording of
  any document be in a language other than English such document shall be
  accompanied by a translation certified to be true and accurate that is either
  authorised by the person who produced it or by a sworn translator.

  
	
   

  	
   

  
	
  17.

  	
  Miscellaneous

  
	
   

  	
   

  
	
  17.1

  	
  This Credit Agreement is independent from the Export
  Contract and, as the case may be, the Additional Export Contract. Neither the
  Borrower nor the Lenders are allowed to raise and hereby each waives any
  defences or objections emanating from the Export Contract and, if appropriate
  the Additional Export Contract, and from its legal relationship with the
  Exporter. In particular, the Borrower’s obligation to repay the Credits as
  well as all other payment obligations under this Credit Agreement as well as
  the Lenders’ obligations to disburse the financing hereunder are independent
  from the legality, validity and enforceability of the Export Contract and, as
  the case may be, the Additional Export Contract or from any non-performance,
  bad performance and/or default by the Exporter under the Export Contract and,
  as the case may be, the Additional Export Contract.

  
	
   

  	
   

  
	
  17.2

  	
  In satisfaction of the Lenders’ respective
  obligations under the Money Laundering Act, to record 

  

 30
 

 

 

	
  

  	
  the economical beneficiary of borrowing hereunder,
  the Borrower hereby confirms that the borrowing of the Credits is made on its
  own behalf and for its own account.

  
	
   

  	
   

  
	
  18.

  	
  Currency Indemnity

  
	
   

  	
   

  
	
   

  	
  In the event that for the purpose of obtaining
  judgement in any court of any country or enforcement of any judgement by the
  Lenders it becomes necessary to convert an amount of the currency due
  hereunder (the “Agreed Currency”), into an amount of another currency (the
  “Judgement Currency”), then the amount due hereunder, expressed in the
  Judgement Currency, shall be determined on the basis of the rate of exchange
  at which the Facility Agent for account of the Lenders is able to purchase
  the relevant amount of the Judgement Currency on the Banking Day immediately
  before the day on which the judgement is given or on such earlier date as may
  be required by the procedural law of the court in which the judgement is
  sought (the “Agreed Conversion Date”).

   

  In the event of a change in such rate of exchange
  between the Agreed Conversion Date and the date of actual payment, the
  Borrower shall pay such additional amounts of the Judgement Currency (or the
  Lenders through the Facility Agent shall remit to the Borrower amounts of
  such currency) as may be appropriate to ensure that the amounts of the
  Judgement Currency paid by the Borrower, when converted at the rate of
  exchange as defined above prevailing at the date of actual payment, shall
  produce in total the amount of the Agreed Currency due hereunder together
  with any premium or costs of exchange payable in connection with the purchase
  or conversion into the Agreed Currency.

   

  Any such additional amounts due shall be due as a
  separate debt and shall not be affected by a judgement being obtained for any
  other sums due under or in respect of this Credit Agreement.

  
	
   

  	
   

  
	
  19.

  	
  Applicable Law, Place of Performance and
  Jurisdiction

  
	
   

  	
   

  
	
  19.1

  	
  This Credit Agreement, as well as all the rights and
  obligations arising therefrom, shall be governed by and construed in
  accordance with the laws of the Federal Republic of Germany.

  
	
   

  	
   

  
	
  19.2

  	
  Save as otherwise stipulated herein, place of
  performance is Frankfurt am Main, Federal Republic of Germany.

  
	
   

  	
   

  
	
  19.3

  	
  Any legal action or proceeding with regard to this
  Credit Agreement shall be brought in the District Court (Landgericht) at
  Frankfurt am Main, Federal Republic of Germany, the Lenders reserving to
  themselves the right to bring any such legal action or proceeding in any
  other court of law having or accepting jurisdiction as the Lenders may elect.
  Without prejudice to and notwithstanding the above, the parties agree that
  subject to the option in favour of the Lenders, any dispute, controversy or
  claim arising out of this Credit Agreement or related to its fulfilment, breach,
  termination, or invalidity shall be settled by three arbitrators under the
  arbitration rules of the UNCITRAL (United Nations Commission on
  International Trade Law) Model Law on International Commercial Arbitration.
  The arbitrators shall be appointed in accordance with those rules and be
  qualified to practise as a judge in the Federal Republic of Germany. Place of
  arbitration shall be at Frankfurt am Main, Federal Republic of Germany. The
  parties herewith irrevocably express their consent to have the hearing
  conducted in the English language.

  
	
   

  	
   

  
	
  19.4

  	
  For any service which may become necessary in
  connection with proceedings before the courts at Frankfurt/Main, Federal
  Republic of Germany, the Borrower hereby undertakes to irrevocably designate,
  appoint and empower, such appointment to be in form and substance as per
  Annex 5 to this Credit Agreement, Smeets, Haas, Wolff, Partnerschaft von
  Rechtsanwälten, Eschersheimer Landstraße 121, D-60322 Frankfurt am
  Main, Federal Republic of Germany, as its agent for service of process (the
  “Agent for Service of Process”) authorised to receive, for and on behalf of
  itself, service of process. 

  

 31
 

 

 

	
  

  	
  In the event that the legal capacity of the Agent
  for Service of Process to act as provided in this Clause 19.4 should cease
  for any reason whatsoever, the Borrower hereby undertakes in consultation
  with the Facility Agent to forthwith (but in no event later than 10 Banking
  Days) designate, appoint and empower another person who is acceptable to the
  Lenders to act as the Borrower’s Agent for Service of Process. Failing this,
  the Facility Agent may appoint another Agent for the Service of Process for
  this purpose.

  
	
   

  	
   

  
	
  20.

  	
  General Provisions

  
	
   

  	
   

  
	
  20.1

  	
  This Credit Agreement shall not be capable of being
  waived, modified or varied otherwise than by an express waiver, modification
  or variation in writing. Any delay or failure on the part of the Lenders
  and/or the Facility Agent in exercising any of their rights under this Credit
  Agreement shall not be regarded as a waiver of these rights or as
  acquiescence in any conduct contravening the terms of this Credit Agreement.
  Exercise of single rights only, or merely partial exercise of any rights
  shall not preclude the claiming in the future of any rights not yet or only
  partially exercised.

  
	
   

  	
   

  
	
  20.2

  	
  In the event of any provisions laid down in this
  Credit Agreement being or becoming wholly or partially ineffective in law,
  the other provisions of this Credit Agreement shall remain in force. Any
  insufficiency thus created shall be filled by a corresponding provision
  consistent with the spirit and purpose of this Credit Agreement.

  
	
   

  	
   

  
	
  20.3

  	
  This Agreement shall be executed in the English
  language.

  

 

 32
 

 

 

	
   

  	
  OJSC Mobile TeleSystems 

  
	
   

  	
   

  
	
   

  	
   

  
	
  Moscow, _________________________

  	
  _____________________     ____________________

  
	
  (place, date)                   STAMP

  	
  (legally binding
  signature(s))

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HSBC Bank plc. as the
  Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
  London, __________________________

  	
  ________________________________

  
	
  (place, date)

  	
  (legally binding
  signature(s))

  
	
   

  	
   

   

  HSBC Bank plc. as the
  Facility Agent

   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ING Bank Deutschland AG

  
	
   

  	
   

  
	
   

  	
   

  
	
  Frankfurt am Main, ____________

  	
  ________________________________

  
	
  (place, date)

  	
  (legally binding
  signature(s))

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Commerzbank
  Aktiengesellschaft

  
	
   

  	
   

  
	
   

  	
   

  
	
  Frankfurt am Main, ____________

  	
  ________________________________

  
	
  (place, date)

  	
  (legally binding
  signature(s))

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BHF-BANK Aktiengesellschaft as the Hermes Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
  Frankfurt am Main, _____________

  	
  ________________________________

  
	
  (place, date)

  	
  (legally binding
  signature(s))

  
	
   

  	
   

  

 

 33
 

 

 

Annex 1a

HSBC Bank plc

Level 17, Project and
Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

For the attention of: Mr Alan Marshall

Certificate for
Reimbursement

Credit Agreement dated October 18th, 2005 in the amount of USD
125,725,500 [as increased by USD 28,321,000*](the “Credit Agreement”)

We hereby confirm to you
that we have paid to the Exporter an amount of USD _____________ representing
the last 85% of the total value of deliveries made/services rendered* by the
Exporter under the Export Contract / Additional Export Contract* during the
period from ______________(date) to ___________(date).

According to Clause
3.2.a) of the Credit Agreement, the amount of USD__________ is thus to be paid
to us to our account no. _________ with ____________

We confirm that the
Representations and Warranties mentioned under Clause 13 of the Credit
Agreement are true and correct in all material respect as of the date hereof.

_________________________________

(place)(date)

OJSC Mobile TeleSystems

___________________________________

(legally binding signature(s) of the Borrower)

We,
the undersigned, herewith confirm having made/rendered* the above captioned
deliveries/services* and having received the above-mentioned amount(s). We also
confirm having received the 15% down payment associated with the above
captioned deliveries/services*.

_______________________________

(place)(date)

Siemens
Aktiengesellschaft

___________________________________

(legally binding signature(s) of the Exporter)

 

* Please delete as appropriate

 34
 

 

 

Annex 1b

HSBC Bank plc

Level 17, Project and
Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

For the attention of: Mr Alan Marshall

Certificate for
Disbursement

Credit Agreement dated October 18th, 2005 in the amount of USD
125,725,500 [as increased by USD 28,321,000*](the “Credit Agreement”)

We hereby confirm to you
that during the period from ______________(date) to ___________(date) we have
made deliveries/rendered services* of _____________ under the Export Contract /
Additional Export Contract* in the total value of USD ____________ and we have
presented to you documents in conformity with Clause 3.2.b) of the Credit
Agreement.

At present, the amount
due to us under the Export Contract / Additional Export Contract* on the basis
of the aforementioned deliveries/services amounts to 85% of the
deliveries/services.

We
confirm having received the 15% down payment associated with the aforementioned
deliveries/services*.

According to Clause 3.2.b)
of the Credit Agreement, the amount of USD _________ is thus to be paid to us.
Please effect payment to us to our account no. _______ with ____________ .

______________           ________________

(place)                                (date)

Siemens
Aktiengesellschaft

___________________________________

(legally binding signature(s) of the Exporter)

* Please delete as appropriate

 35
 

 

 

Annex 1c

To

OJSC Mobile TeleSystems

4 Marksistskaya Street

Moscow 109147

Russian Federation

__________________

Certificate for
Disbursement

for the Insurance Premium

Credit Agreement dated October 18th, 2005 in the amount of USD
125,725,500 [as increased by USD 28,321,000*](the “Credit Agreement”)

Dear Sirs,

As per the attached copy
of the invoice of Hermes dated ___________ the Insurance Premium / Additional
Insurance Premium* in the amount of USD __________ was/will become due and
payable to Hermes on _______________ .According to Clause 11.2 / 11.3* of the
Credit Agreement, the amount of USD _____________ is payable to us/ In order to
achieve fulfilment of the condition precedent as per Article 4.2.b) and
your obligations as per Article 11.2 / 11.3* please pay to us the
Insurance Premium / Additional Insurance Premium* calculated by the Facility
Agent to amount to USD__________ which will become due and payable to Hermes
shortly*.

Please remit the
aforementioned amount to SWIFT MRMDUS33, account number 000-023868 held
with HSBC Bank USA, New York, in favour of HSBC Bank plc, London, SWIFT
MIDLGB22 account number 36677449 in the name of Project and Export Finance quoting
ref 53M/FC1072. Reimbursement to you will be made pursuant to Clause 3.4 of the
Credit Agreement.

London, _____________                                                                   __________________________
                                                                                                                 HSBC
Bank plc

* Please
delete as appropriate

 

 36
 

 

 

Annex 1d

HSBC Bank plc

Level 17, Project and
Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

For the attention of: Mr Alan Marshall

Certificate for
Reimbursement

in case of application of the Special Payment Procedure

Credit Agreement dated October 18th, 2005 in the amount of USD
125,725,500 [as increased by USD 28,321,000*](the “Credit Agreement”)

We hereby confirm to you
that the Exporter made deliveries/rendered services* under the Export Contract
/ Additional Export Contract* during the period from ______________(date) to ___________(date)
in the total amount of USD _________ and that we have instructed the Passport
Bank to effect payment of USD ___________ to the Exporter representing the last
85% of the total value of such deliveries made/services rendered*.

According to Clause
3.2.a) of the Credit Agreement, the amount of USD__________ is thus to be paid
to us to our account no. _________ with the Passport Bank.

We confirm that the
Representations and Warranties mentioned under Clause 13 of the Credit
Agreement are true and correct in all material respect as of the date hereof.

_________________________________

(place)(date)

OJSC Mobile TeleSystems

___________________________________

(legally binding signature(s) of the Borrower)

 

 

*
Please delete as appropriate

 37
 

 

 

Annex 1e

To

OJSC Mobile TeleSystems

4 Marksistskaya Street

Moscow 109147

Russian Federation

__________________

Certificate for
Disbursement for the Insurance Premium

in case of application of the Special Payment Procedure

Credit Agreement dated October 18th, 2005 in the amount of USD
125,725,500 [as increased by USD 28,321,000*](the “Credit Agreement”)

Dear Sirs,

As per the attached copy
of the invoice of Hermes dated ___________ the Insurance Premium in the amount
of USD __________ was/will become due and payable to Hermes on _______________
..

According to Clause 11.2
of the Credit Agreement, the amount of USD _____________ is payable to us/In
order to achieve fulfilment of the condition precedent as per Article 4.2.b)
and your obligations as per Article 11.2 please pay to us, through the
Passport Bank, the Insurance Premium calculated by the Facility Agent to amount
to USD __________ which will become due and payable to Hermes shortly*.

Please instruct the
Passport Bank to remit the aforementioned amount to us in accordance with the
terms and conditions of the certain disbursement agreement entered into between
you, us and the Passport Bank, and which provides for the Special Payment
Procedure. Reimbursement to you will be made pursuant to Clause 3.4 of the
Credit Agreement.

London, _____________                                                                   __________________________
                                                                                                                 HSBC
Bank plc

* Please delete as appropriate

 38
 

 

 

Annex 1f

HSBC Bank plc

Level 17, Project and
Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

For the attention of: Mr Alan Marshall

Request for a fixed
interest rate

Credit Agreement dated October 18th, 2005 in the amount of USD
125,725,500 [as increased by USD 28,321,000*](the “Credit Agreement”)

We refer to Clause 5.2 (d) of
the Credit Agreement. We hereby request the Lenders to offer us a fixed interest
rate for all amounts outstanding under the Credit Agreement and for the
remaining amount and lifetime of the Credits.

We confirm that the
Representations and Warranties mentioned under Clause 13 of the Credit
Agreement are true and correct in all material respect as of the date hereof.

_________________________________

(place)(date)

OJSC Mobile TeleSystems

___________________________________

(legally binding signature(s) of the Borrower)

 39
 

 

 

Annex 2

HSBC Bank plc

Level 17, Project and
Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

For the attention of: Mr Alan Marshall

Confirmation of
Coming into Force of the Export Contract* / Additional Export Contract*

Credit Agreement dated October 18th, 2005 in the amount of USD
125,725,500 [as increased by USD 28,321,000*](the “Credit Agreement”)

We hereby confirm
to you that the Export Contract between OJSC Mobile TeleSystems in the Russian
Federation and Siemens Aktiengesellschaft dated 17 December 2004 for USD
166,381,200 has
come into force on ________________ . * / We hereby confirm to you that the
Additional Export Contract between OJSC Mobile TeleSystems in the Russian
Federation and Siemens Aktiengesellschaft dated [_____________] for USD [_____________]
has come into force on ________________ . *

_____________              _____________                                       _______________               ______________

(place)                                (date)                                                           (place)                                      (date)

Siemens Aktiengesellschaft                                                                OJSC
Mobile TeleSystems

                                            `                                                                    in
the Russian Federation

__________________________________                                  _________________________________

(legally binding signature(s) of the Exporter)                                   (legally binding signature(s) of
the 
                                                                                                                 Borrower)

*
Please delete as appropriate

 40
 

 

 

Annex 3a

HSBC Bank plc

Level 17, Project and
Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

For the attention of: Mr Alan Marshall

Confirmation of
Mean-weighted Acceptance of Equipment and Software

in relation to the Export Contract

Credit Agreement dated October 18th, 2005 in the amount of USD
125,725,500 [as increased by USD 28,321,000*](the “Credit Agreement”)

We hereby confirm to you that in respect of the Export
Contract as mentioned in the Preamble of the above-mentioned Credit Agreement
the mean-weighted acceptance of equipment and software and for operation in
relation to the several operation units (starting point) took place on ______________
..

_____________              _____________

(place)                                (date)

 

_________________

__________________________________

(legally binding signature(s) of the Exporter)

*
Please delete as appropriate

 41
 

 

 

Annex 3b

HSBC Bank plc

Level 17, Project and
Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

For the attention of: Mr Alan Marshall

Confirmation of
Mean-weighted Acceptance of Equipment and Software

in relation to the Additional Export Contract

Credit Agreement dated October 18th, 2005 in the amount of USD
125,725,500 [as increased by USD 28,321,000*](the “Credit Agreement”)

We hereby confirm to you that in respect of the
Additional Export Contract as mentioned in the Preamble of the above-mentioned
Credit Agreement the mean-weighted acceptance of equipment and software in
relation to the additional operation units (starting point) took place on ______________
..

_____________              _____________

(place)                                (date)

 

_________________

__________________________________

(legally binding signature(s) of the Exporter)

 

*
Please delete as appropriate

 42
 

 

 

Annex 4

HSBC Bank plc

Level 17, Project and
Export Finance

8 Canada Square

London E14 5HQ

United Kingdom

For the attention of: Mr Alan Marshall

Specimen Signature List

Credit Agreement dated October 18th, 2005 in the amount of USD
125,725,500 [as increased by USD 28,321,000*](the “Credit Agreement”)

Dear Sirs,

Pursuant to the provisions of the above Credit Agreement we are
required to provide you with certified specimen signatures of those persons
authorised to act on our behalf in connection with the said Credit Agreement.

Accordingly, we herewith confirm to you that the persons listed
hereafter are authorised to act on our behalf in connection with the said
Credit Agreement.

 43
 

 

 

A. Persons (if any) authorised to sign singly:

	
  Person

  	
   

  	
  First Name

  	
   

  	
  Surname

  	
   

  	
  Position

  	
   

  	
  Date of Birth

  	
   

  	
  Place of Birth

  	
   

  	
  Nationality

  	
   

  
	
  1

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
  Person

  	
   

  	
  Address

  	
   

  	
  Sort and Number

  of Identity Card

  	
   

  	
  Identity Card

  Issuing Authority

  	
   

  	
  Specimen Signature

  	
   

  
	
  1

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

B. Persons authorised to sign jointly with any person from Group A or
B:

 

	
  Person

  	
   

  	
  First Name

  	
   

  	
  Surname

  	
   

  	
  Position

  	
   

  	
  Date of Birth

  	
   

  	
  Place of Birth

  	
   

  	
  Nationality

  	
   

  
	
  1

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
  Person

  	
   

  	
  Address

  	
   

  	
  Sort and Number

  of Identity Card

  	
   

  	
  Identity Card

  Issuing Authority

  	
   

  	
  Specimen Signature

  	
   

  
	
  1

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

I, ____________________________(please specify title), hereby certify
that the specimen signatures listed above are the authentic signatures of
persons authorised to act on the Borrower’s behalf in connection with the
Credit Agreement in the amount of USD ___________

______________           ________________                                ____________________________

(place)                                (date)                                                           (legally
binding signature of
                                                                                                                 ______________________)

 44
 

 

 

I/We, ___________________________(OOO HSBC Bank (RR), Moscow), hereby
certify the authenticity of the above signature of _________________ .

________________       _________________                              ___________________(OOO
HSBC Bank (RR), Moscow)

(place)                                (date)

                                                                                                _____________________________
                                                                                                                 (legally
binding signature(s), with name(s) and
position(s))

 

*
Please delete as appropriate

 45
 

 

 

Annex 5

[on the letterhead of the Borrower]

Smeets, Haas, Wolff

Partnerschaft von Rechtsanwälten

Eschersheimer Landstraße 121

D-60322 Frankfurt am Main

Federal Republic of Germany

Credit Agreement dated October 18th, 2005 in the amount of USD
125,725,500 (the “Credit Agreement”)

Dear Sirs,

On October 18th, 2005 OJSC Mobile TeleSystems
, 4 Marksistskaya Street, Moscow 109147 Russian Federation entered into a
Credit Agreement with HSBC Bank plc, 8 Canada Square, London E14 5HQ, United
Kingdom and ING Bank Deutschland AG, Hahnstrasse 49, 60606 Frankfurt am
Main,Germany, Commerzbank Aktiengesellschaft, Munich branch, Postbox, D-80791,
Munich, Germany, BHF-BANK Aktiengesellschaft, Bockenheimer Landstraße 10,
Frankfurt am Main, Federal Republic of Germany. The provisions of the Credit
Agreement provide for that we shall appoint an agent of process for the purpose
of accepting service of process in the Federal Republic of Germany. We hereby
appoint you as our authorised agent of process for that purpose, limited solely
to service of process in connection with actions, which might arise under the
Credit Agreement. We hereby irrevocably authorise you to accept all services of
process in connection with those actions in our name and to receive all
correspondence, documents and declarations related thereto until October 1st, 2015 (“Termination Date”).
You have agreed to a compensation of € 5,000.00 (Euro five thousand) plus VAT,
if any, for the period until the Termination Date.

Upon receipt of any process served on you or of any correspondence,
document and declaration related thereto, you are hereby instructed to notify
us at the above mentioned address unless we notify you in writing of another
address. If it is deemed necessary by you to do so in the best of our interest,
you are hereby authorised to notify us in your discretion by telex, telefax or
telephone of the contents of the process served on you and of correspondence,
documents or declarations received by you. Once each such notice has made, you
have fulfilled your obligations under this agreement.

Your liability as our authorised agent of process will be restricted to
cases of wilful misconduct and gross negligence. The relationship between you
and our company is governed by the laws of the Federal Republic of Germany.
Your liability as our authorised agent of process is limited to € 1,000,000.00
(Euro one million) except for cases of wilful misconduct and gross negligence.
Sec. 254 German Civil Code applies.

Exclusive place of jurisdiction shall be Frankfurt am Main, Federal
Republic of Germany.

Yours sincerely,

____________________________________

(legally binding signature(s) of the Borrower)

Accepted:

Smeets, Haas, Wolff

_________________________

(legally binding signature(s)

 

 46

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