Document:

Exhibit 4.56

CREDIT AGREEMENT

between

Bayerische Hypo- und Vereinsbank AG

and

Nordea Bank Sweden AB (publ)

as Lenders

and

Nordea Bank Sweden AB (publ)

as Agent and Security Beneficiary

and

Open Joint Stock Company “Vimpel-Communications”

as Borrower

TABLE OF CONTENTS

 

	 Clauses
 	  
 	  
 	 Page
 

	 1.     DEFINITIONS
 	 3
 
	  
 	  
 
	 2.     CONDITIONS PRECEDENT
 	 8
 
	  
 	  
 
	 3.     LOANS
 	 11
 
	  
 	  
 
	 4.     INTEREST
 	 12
 
	  
 	  
 
	 5.     REPAYMENT AND PREPAYMENT
 	 12
 
	  
 	  
 
	 6.     PAYMENTS
 	 13
 
	  
 	  
 
	 7.     FEES AND EXPENSES
 	 14
 
	  
 	  
 
	 8.     REPRESENTATIONS AND WARRANTIES
 	 16
 
	  
 	  
 
	 9.     COVENANTS
 	 18
 
	  
 	  
 
	 10.    INFORMATION
 	 20
 
	  
 	  
 
	 11.   EVENTS OF DEFAULT
 	 21
 
	  
 	  
 
	 12.   INDEMNITIES AND INCREASED COSTS
 	 24
 
	  
 	  
 
	 13.   RIGHTS, REMEDIES AND WAIVERS
 	 25
 
	  
 	  
 
	 14.   UNCONDITIONAL PAYMENTS
 	 25
 
	  
 	  
 
	 15.   MISCELLANEOUS
 	 25
 
	  
 	  
 
	 16.   THE AGENT, THE SECURITY BENEFICIARY AND THE LENDERS
 	 28
 
	  
 	  
 
	 17.   LIMITATION OF LIABILITY
 	 34
 
	  
 	  
 
	 18.   CURRENCY INDEMNITY
 	 35
 
	  
 	  
 
	 19.   ARBITRATION, APPLICABLE LAW AND JURISDICTION
 	 35
 
	  
 	  
 
	  
 	  
 
	  
 	  
 
	 Exhibits;
 	  
 
	  
 	  
 
	 Exhibit 1:     Form of Pledge of Equipment Agreement
 	  
 
	  
 	  
 
	 Exhibit 2:     Certified Copy of the Signed Bond Loan Agreement
 	  
 
	  
 	  
 
	 Exhibit 3:     Drawdown Notice
 	  
 
	  
 	  
 

This credit agreement (the “Credit Agreement”) is made on January 15, 2003 between

Nordea Bank Sweden AB (publ), a public company incorporated under the laws of Sweden and having its registered office at Hamngatan 10, SE-105 71 Stockholm, Sweden, and Bayerische Hypo- und Vereinsbank AG, a stock corporation incorporated under the laws of Germany and having its registered office at Am Tucherpark 16, 80538 Munich, Federal Republic of Germany (jointly referred as the “Lenders” and each a “Lender”), including its successors and permitted assigns; 

Nordea Bank Sweden AB (publ), a public company incorporated under the laws of Sweden and having its registered office at Hamngatan 10, SE-105 71 Stockholm, Sweden, as agent (the “Agent”) for the Lenders and security beneficiary (the “Security Beneficiary”)

and

Open Joint Stock Company “Vimpel-Communications”, a Russian open joint stock company having its legal address at 10, bldg. 14, 8 Marta str., Moscow 127083 Russian Federation (the “Borrower”).

BACKGROUND

Whereas the Supplier (as defined below) and the Borrower (as defined below) have entered into the Supply Contract (as defined below), pursuant to which the Supplier has delivered and will deliver telecommunication equipment to the Borrower as specified therein; and

Whereas the Lenders have agreed to make available a credit to the Borrower in the amount of USD 35,700,000 for the purpose of financing (in the form of reimbursements repayable in installments) of up to 85% the Contract Price (as defined below) for the delivery of the Equipment (as defined below) under the Supply Contract upon the terms and conditions set forth herein.

NOW, THEREFORE, IT IS AGREED as follows:

1.
DEFINITIONS

1.1
In this Credit Agreement:

“Acceptance Reimbursable Amount” with respect to a particular item or group of items of Equipment under the Supply Contract means 10% of the portion of the Contract Price attributable to such Equipment under the Supply Contract.

“Account” means the account number 40702840400001001001 of the Borrower, opened pursuant to clause 3.3 of this Credit Agreement with ING Bank (Eurasia) ZAO Moscow, Russia (SWIFT code: INGBRUMM).

“Affiliate” has, for the purposes of clause 9.2 (f) of this Credit Agreement, the meaning specified in the Bond Loan Agreement.

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“Bond Loan Agreement” means that certain Loan Agreement dated April 23, 2002 between the Borrower and J.P. Morgan AG.

“Business Day” means a day on which banks and foreign exchange markets are generally open for business in Stockholm, New York, London, Munich and Moscow.

“Change of Ownership” means the occurrence of any circumstance, other than an issuance of voting shares in which Telenor ASA and other entities owned, directly or indirectly, by Telenor ASA elects not to participate, by which Telenor ASA ceases to own, directly or indirectly, at least 25% of the voting shares of the Borrower. 

“Commitment” means, in relation to a Lender, the obligation of such Lender to make available a credit up to the aggregate principal amount of USD 17,850,000. 

“Contract Price” means the total purchase price in the amount of USD 42,000,000 to be paid to the Supplier for the Equipment under the Supply Contract.

“Debt” has the meaning given to the term “Indebtedness” in the Bond Loan Agreement.

“Default” means an Event of Default or any event or circumstance which with the giving of notice and/or the passage of time and/or the making of any determination of materiality or fulfilment of any other applicable condition (or any combination of the foregoing) may constitute an Event of Default.

“Delivery Reimbursable Amount” with respect to a particular item or group of items of Equipment under the Supply Contract means 75% of the portion of the Contract Price attributable to such Equipment under the Supply Contract.

“Drawdown Date” means the date of each Drawing.

“Drawdown Notice” means a notice from the Borrower to the Lender requesting a Drawing under this Credit Agreement in respect of Acceptance Reimbursable Amounts or Delivery Reimbursable Amounts, as the case may be, such notice to be substantially in the form of Exhibit 3 hereto. 

“Drawdown Period” means the period commencing on the date of this Credit Agreement and ending on whichever is the earliest of (i) February 20, 2004, (ii) the day on which the Loan is equal to the Total Commitments, and (iii) the termination of any Commitment in accordance with the terms and conditions of this Credit Agreement.

“Drawing” means a borrowing of the whole or a portion of the Total Commitments by the Borrower under this Credit Agreement. An individual drawing may not be for an amount less than the lesser of (i) USD500,000, and (ii) the then unfunded portion of the Total Commitments. The maximum amount of drawings made by the Borrower may not exceed twenty (20) drawings, provided that the Agent shall charge the Borrower an additional fee of USD1,500 for administration of each drawing in excess of twenty (20) drawings.

“EKN” means the Swedish Export Credits Guarantee Board, currently located at Kungsgatan 36, Stockholm, Sweden (postal address: Box 3064, S-103 61 Stockholm, Sweden).

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“EKN Guarantee” means each of the guarantees to be issued by EKN pursuant to the EKN Offer (collectively the “EKN Guarantees”).

“EKN Offer” means the EKN offer No. 2002-10340-1 dated December 20, 2002, a copy of which has been provided to the Borrower prior to the date of signing this Credit Agreement, as amended.

“EKN Premium” means the fees and premium estimated to be in the amount of USD 1,795,710 together with any interest thereon (as further described in clause 7.5 of this Credit Agreement), charged by EKN in relation to each of the EKN Guarantees.

“Equipment” means the equipment (including hardware and software) provided, or to be provided, by the Supplier to the Borrower in respect of the purchase orders under the Supply Contract. 

“Event of Default” means any of the events of default specified in clause 11.1 of this Credit Agreement.

“Interest Payment Date” means the last day of each Interest Period, as specified in clause 4.1 of this Credit Agreement.

“Interest Period” means, save as otherwise provided herein, a period of six (6) months, which for the first interest period for each Tranche begins on the first Drawdown Date and for each consecutive interest period begins on the last day of the immediately preceding interest period, provided, however, that the first interest period of each advance made after the first Drawing in a Tranche shall be adjusted so that the last day of the Interest Period for such advance coincides with the current interest period for the first Drawing under such Tranche.

If an interest period is ending on a day which is not a Business Day such interest period shall end on the next Business Day in that calendar month (if there is one) or on the preceding Business Day (if there is not).

If any interest period would overrun the first Repayment Date then such interest period shall be shortened in order to end on the first Repayment Date.

“KB Impuls” means OJSC “KB Impuls”, a Russian open joint stock company and wholly owned subsidiary of the Borrower.

“KB Licence” means licence No. 10005 awarded by the Ministry of Communications of the Russian Federation to KB Impuls and valid until 28 April 2008 and extensions or renewal thereof to operate a DCS-1800 and/or GSM 900 radiotelephone communication system for Moscow city and the Moscow region.

“LIBOR” means, in relation to the Loan or any part thereof:

(a)
the rate per annum of the offered quotation for deposits in USD for a period comparable to the relevant Interest Period which appears on Telerate Page 3750 or 3740, as applicable, at or about 11 a.m. (London time) on the second Business Day prior to commencement of each respective Interest Period; or

Page 5 of 5 

(b)
if no such offered quotation appears on Telerate Page 3750 or 3740, as applicable, at or about such time, the arithmetic mean (rounded upwards, if necessary, to four decimal places) of the offered quotations for deposits in USD for a period comparable to the relevant Interest Period which appears on the Reuters Screen LIBO page at or about 11.00 a.m. (London time) on the second Business Day prior to commencement of each respective Interest Period; or

(c)
if no such offered quotation appears on the Telerate Page 3750 or 3740 as applicable or one only or no such offered quotation appears on the relevant Page of the Reuters Screen at or about 11.00 a.m. (London time) on the second Business Day prior to commencement of each respective Interest Period (or if there is no relevant Page on the Reuters Screen), the arithmetic mean (rounded upwards, if necessary, to four decimal places) of the per annum rates, as supplied to the Agent at its request, quoted by the London offices of Barclays Bank plc, Morgan Guaranty Trust Company of New York and National Westminster Bank plc for the offering of deposits in the currency of the Loan (or part) in an amount comparable to the Loan (or part) and for a period equal to the relevant Interest Period.

For the purposes of this definition, “Telerate Page 3750” means the display designated as “Page 3750”, and “Telerate Page 3740” means the display designated as “Page 3740”, on the Telerate Service (or such other page as may replace Page 3750) or Page 3740, as the case may be, on that service or such other service as may be nominated by the British Bankers’ Association as the information vendor for the purpose of displaying British Bankers’ Association Interest Settlement Rates for deposits in USD.

“Licences” means the KB Licence and the Vimpelcom-Region Licence.

“Loan” means the total amount of principal from time to time outstanding hereunder.

“Majority Lenders” means:

(a)
if there are no Loans then outstanding, a Lender or Lenders whose Commitments aggregate more than 66 2/3% of the Total Commitments (or, if the Total Commitments have been reduced to zero, aggregated more than 66 2/3% of the Total Commitments immediately prior to the reduction); or

(b)
at any other time, a Lender or Lenders whose participations in the Loans then outstanding aggregate more than 66 2/3% of all the Loans then outstanding.

“Mean Delivery Date” means in respect of (i) Tranche No. 1 October 27, 2002 and (ii) Tranche No. 2 June 15, 2003 and (iii) Tranche No. 3 August 28, 2003, or such earlier date as may be determined by the Agent due to the EKN interpretation of the OECD Consensus Rules.

“Nordea Group” means Nordea Bank Finland Plc, Nordea Bank Danmark A/S and Nordea Bank Norge ASA.

“Party” means a party to this Credit Agreement.

Page 6 of 6 

“Related Person” has, for the purposes of clause 9.2 (f) of this Credit Agreement, the meaning specified in the Bond Loan Agreement.

“Repayment Date” means each of the dates provided for in clause 5.1 of this Credit Agreement for the repayment of the Loan, such dates to coincide with an Interest Payment Date. 

If a Repayment Date occurs on a day which is not a Business Day such Repayment Date shall occur on the next Business Day in that calendar month (if there is one) or on the preceding Business Day (if there is not). 

“SEC” means the Securities and Exchange Commission of the United States of America.

“Security Document(s)” means (a) the Equipment pledge agreement of even date herewith, entered into by the Security Provider, (b) the EKN Offer, (c) the EKN Guarantees and (d) any other document designated by the Borrower and the Lenders (or the Agent as the case may be) as a Security Document from time to time, in each case for the purpose of guaranteeing or securing the obligations and liabilities of the Borrower under this Credit Agreement.

“Security Interest” means any mortgage, pledge, lien, charge, assignment by way of security, hypothecation, security interest or title retention, or any other agreement or arrangement having the effect of conferring security.

“Security Provider(s)” means (a) the Borrower and (b) any other person who is providing security in respect of the Borrower’s obligations under this Credit Agreement from time to time.

“Specified Bond Default” means an “event of default” (as defined therein) under the Bond Loan Agreement, taking into account any cure period permitted thereunder, as a result of the breach of clause 14.6 (Liens), clause 14.7 (Incurrence of Indebtedness), clause 14.8 (Restricted Payments), or clause 14.9 (Asset Sales).

“Supplier” means Ericsson AB (formerly Ericsson Radio Systems AB) (in its capacity as supplier under the Supply Contract).

“Supply Contract” means the Supply Contract ECR/KK-02:016 dated May 29, 2002 between the Supplier and the Borrower in the amount of USD 42,000,000 with respect to the Equipment and in respect of purchase orders thereunder. 

“Total Commitments” means USD 35,700,000, being the aggregate principal amount of the Commitments of the Lenders.

“Tranche” means each or all of Tranche No. 1 and Tranche No. 2 and Tranche 3 as the context may require. 

“Tranche No. 1” means the Drawings, being part of the Loan, in respect of deliveries of Equipment made between June 25, 2002 and February 28, 2003.

“Tranche No. 2” means the Drawings, being part of the Loan, in respect of deliveries of Equipment made between March 1, 2003 and September 30, 2003.

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“Tranche No. 3” means the Drawings, being part of the Loan, in respect of deliveries of Equipment made between October 1, 2003 and December 30, 2003.

“USD” and “$” means the lawful currency of the United States of America.

“US GAAP” means generally accepted accounting principles in the United States of America.

“Vimpelcom-Region” means OJSC “Vimpelcom-Region”, a Russian open joint stock company.

“Vimpelcom-Region Licence” means licence No. 14710 awarded by the Ministry of Communications of the Russian Federation to Vimpelcom-Region and valid until 28 April 2008 and extensions or renewal thereof to operate a DCS-1800 and/or GSM 900 radiotelephone communication system for the Russian regions outside of Moscow.

2.
CONDITIONS PRECEDENT

2.1
The obligation of each of the Lenders under this Credit Agreement to make available their respective Commitment is subject to the condition that the Agent shall have received all of the following documents and evidence in form and substance satisfactory to the Lenders three (3) Business Days prior to the proposed first Drawdown Date: 

(a)
a notarised copy of the charter documents of the Borrower and each Security Provider, save for EKN;

(b1)
certified abstracts from the resolutions of the finance committee and the board of directors of the Borrower and each Security Provider, save for EKN, authorising it (or other evidence acceptable to the Agent as to the authority of the Borrower and each Security Provider, save for EKN) to enter into, execute and perform their respective obligations under this Credit Agreement and the relevant Security Document(s);

(b2)
a notarised copy of the certificate of registration of the Borrower and each Security Provider (save for EKN) issued by the relevant authorities; 

(b3)
a notarised copy of any certificates of registration of any amendments to the charter of the Borrower and each Security Provider (save for EKN);

(b4)
copies, certified by an authorised signatory, of the relevant entity of the resolutions or orders appointing the Chief Executive Officer and the Chief Accountant of the Borrower and each Security Provider (save for EKN); 

(b5)
copies, certified by an authorised signatory of the Borrower, of certificates from the relevant State Tax Authority issued to the Borrower and each Security Provider (save for EKN) confirming the tax registration number of such entities;

(c)
a certified copy of the Information on the Loan Agreement (in the form established by the Instruction No. 101-I of the Central Bank of the Russian Federation dated September 10, 2001) duly numbered, signed, stamped and dated by a responsible person in the Russian authorised bank servicing the loan;

Page 8 of 8 

(d)
certified copies of the Licences;

(e)
[intentionally omitted];

(f)
the Security Document(s) (save for the EKN Offer and the EKN Guarantees) duly entered into on behalf of each Security Provider that is a party thereto together with evidence that each Security Interest created by the Security Document(s) confers or, upon acquisition of title to the Equipment covered by such Security Interest and entry of such Security Interest in the pledge book of the Borrower in accordance with the relevant Security Document, will confer a first priority and fully perfected Security Interest in favour of the Lenders or the Agent, as the case may be;

(g)
the latest available audited US GAAP financial statements and report (containing a balance sheet and profit and loss account) of the Borrower and each Security Provider;

(h)
a copy, certified by an authorised signatory of the Borrower, of an extract from the Borrower’s pledge book recording the pledge of the Equipment received by the Borrower;

(i)
evidence that all fees and expenses, which are due and payable under clause 7 of this Credit Agreement, have been paid in full when due;

(j)
the EKN Offer;

(k)
a legal opinion from an independent counsel to the Agent in the Russian Federation as to the legality, validity and binding status, as well as enforceability of this Credit Agreement and the Security Document(s) under the laws of the Russian Federation and such other matters as the Agent or the Lenders may reasonably request; 

(l)
a legal opinion from an independent counsel to the Agent in Sweden as to the (i) legality, validity and binding status, as well as enforceability of this Credit Agreement under the laws of Sweden and (ii) the legality, validity and binding status of the EKN Offer as an offer and such other matters as the Agent or the Lenders may reasonably request;

(m)
evidence that Law Debenture Corporate Services, or another company acceptable to the Lenders, has agreed to act as the agent of the Borrower for the service of process, as provided for in clause 19.(5) of this Credit Agreement; 

(n)
a written confirmation executed by the General Director of the Borrower (or his duly authorised representative) stating that (i) there are/there are no interested parties (as defined in Article 81 of the Federal Law of the Russian Federation “On Joint Stock Companies”) in relation to the Borrower which are interested in the transactions contemplated in this Credit Agreement or any of the Security Documents, and (ii) that the conclusion of and the performance of the Borrower’s obligations under this Credit Agreement and Security Documents and any related documents would/would not constitute a major transaction for the Borrower (as defined in Article 78 of the Federal Law of the Russian Federation “On Joint Stock Companies”);

Page 9 of 9 

(o)
copies of permissions and licences (including without limitation any Central Bank of Russia permissions and licences) necessary for the Borrower to effect payments under this Credit Agreement to the Lenders; 

(p)
evidence satisfactory to the Agent that the Borrower has reimbursed the Agent for the amounts of the EKN Premium as will be due and payable in connection with the EKN Guarantee in respect of Tranche No. 1, as evidenced by an invoice from the Agent to the Borrower, such invoice to be based on the Borrower’s estimated aggregate amount of all Drawings to be made under Tranche No. 1 (to be notified by the Borrower to the Agent); and 

(q)
such other documents, certificates, opinions and other matters as the Agent may reasonably require and which might affect the ability of the Borrower to fulfil its obligations hereunder or which might affect the ability of any Security Provider (other than EKN) to fulfil its obligations under the Security Documents. 

2.2
The obligation of the Lenders to grant any Drawing hereunder for reimbursement of payments under the Supply Contract is subject to the further condition that, at each Drawdown Date:

(a)
the representations and warranties set out in clause 8.1 of this Credit Agreement are correct and will be correct immediately after such Drawing;

(b)
no Default shall have occurred or would occur as a result of such Drawing;

(c)
the amount of any Drawing is calculated in accordance with clause 3.2 of this Credit Agreement;

(d)
the total amount of such Drawing together with all Drawings previously made hereunder does not exceed the Total Commitments; 

(e)
the EKN Offer or the EKN Guarantee(s), whichever is relevant, remains in full force and effect;

(f)
the Agent has received a satisfactory written confirmation from the Supplier that (i) 90% of the portion of the Contract Price attributable to the Equipment identified in the relevant Drawdown Notice in respect of Delivery Reimbursable Amounts has been paid in clear funds to the Supplier, in the case of a Drawdown Notice in respect of Delivery Reimbursable Amounts, and/or (ii) 100% of the portion of the Contract Price attributable to the Equipment identified in the relevant Drawdown Notice in respect of Acceptance Reimbursable Amounts has been paid in clear funds to the Supplier, in the case of a Drawdown Notice in respect of Acceptance Reimbursable Amounts, such confirmation always to be accompanied by a list of the invoices in respect of which the confirmation of payment is made;

(g)
the Agent has received satisfactory evidence that the Borrower has paid all amounts due pursuant to clause 7 of this Credit Agreement; and

Page 10 of 10

(h)
the Agent has received satisfactory evidence that the Borrower has reimbursed the Agent for the amounts of the EKN Premium as will be due and payable in connection with the EKN Guarantee(s) in respect of the relevant Tranche, as evidenced by an invoice from the Agent to the Borrower, such invoice to be based on the Borrower’s estimated aggregate amount of all Drawings to be made under the relevant Tranche (to be notified by the Borrower to the Agent as soon as practicable prior to the beginning of the respective Tranche, provided that the Agent shall cooperate in good faith with the Borrower to ensure fulfilment of this clause 2.2(h) without any delay).

3.
LOANS

3.1
On the terms and conditions set out in this Credit Agreement the Lenders agree to make available to the Borrower advances up to an aggregate amount not exceeding the Total Commitments for the sole purpose of financing (by way of reimbursement of) up to 85% of the amounts from time to time paid by the Borrower under the Supply Contract (excluding for the avoidance of doubt any applicable Russian VAT, other taxes and duties).

3.2
Provided that the Borrower has complied with its obligations pursuant to clauses 2.1 and 2.2 of this Credit Agreement, and subject to the terms of this Credit Agreement, the Borrower may send a Drawdown Notice to the Agent, exactly specifying (and attaching copies of) the relevant invoice/s and their amount/s as well as to which Tranche the Drawing relates and whether it is in respect of Acceptance Reimbursable Amounts or Delivery Reimbursable Amounts, and requesting a Drawing under this Credit Agreement for an amount equal (subject to clause 3.4 of this Credit Agreement) to the relevant payments to the Supplier, being either 75% of the aggregate portion of the Contract Price stated in such invoices (excluding any VAT, taxes and duties applicable to such invoices) in the case of Delivery Reimbursable Amounts, or 10% of
the aggregate portion of the Contract Price stated in such invoices (excluding any VAT, taxes and duties applicable to such invoices) in the case of Acceptance Reimbursable amounts. 

3.3
Following receipt by the Agent of a Drawdown Notice duly completed in accordance with the form set forth in Exhibit 3 hereto (including the copies of relevant invoices) during the Drawdown Period, the Lenders shall, subject to the terms and conditions of this Credit Agreement, not later than three (3) Business Days after receipt of such Drawdown Notice pay the corresponding amount (less any VAT, taxes and duties applicable to such invoice) into the Account of the Borrower provided, however, that the Lenders shall not be obliged to advance any Drawings to the Borrower after February 20, 2004. For the avoidance of doubt, (i) a Drawdown Notice needs to be received by the Agent not later than 10.00 a.m. Stockholm time on a Business Day in order for such Drawdown Notice to be considered to be received on that Business Day and
(ii) as used in this clause 3.3, “duly completed” means in the form of Exhibit 3 hereto and with invoices which conform to the invoices and amounts covered by such Drawdown Notice. If the Agent determines in its reasonable discretion, that a Drawdown Notice is not duly completed, it shall promptly notify the Supplier and the Borrower and cooperate with them in good faith so that such Drawdown Notice may be duly completed.

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Following receipt by the Agent of a Drawdown Notice, the Agent shall send such Drawdown Notice (excluding the relevant invoices) to the Lenders without delay. Not later than 10.00 a.m. Stockholm time on the succeeding Business Day the Agent shall send a notice to the Lenders with the details of the advance to be made, provided that the Drawdown Notice (including the relevant invoices) is in form and substance satisfactory to the Agent. A Drawdown Notice received by the Agent on a day which is not a Business Day is deemed to have been received on the succeeding Business Day.

3.4
Each Lender will participate in each Drawing made pursuant to clauses 3.1-3.3 of this Credit Agreement in the proportion borne by its available Commitment to the available Total Commitments immediately prior to the making of that Drawing.

3.5
The obligations of each Lender hereunder are several and neither the Agent nor any Lender shall be responsible for any failure by any other Lender to meet its obligations hereunder nor shall such failure relieve the Borrower, the Agent or the remaining Lenders of their respective obligations hereunder.

4.
INTEREST

4.1
With respect to each Interest Period, the Borrower shall pay interest (as determined in accordance with clause 4.2) on the Loan on the last day of each such Interest Period. 

4.2
The rate of interest applicable to each Drawing from time to time for each Interest Period shall be the aggregate of (i) LIBOR for such Interest Period, and (ii) a margin of seventy hundredths of one (0.70) per cent per annum. 

4.3
[intentionally omitted].

4.4
In the event that the Agent does not receive on the due date any amount payable under this Credit Agreement (taking into account any grace period provided under clause 11.1(a) of this Credit Agreement, in which case the rate of interest specified in clause 4.2 of this Credit Agreement shall be applied), the Borrower shall on demand pay interest on such amount from and including the due date to the date such amount is received by the Agent at the rate of three (3) per cent per annum above the rate specified in clause 4.2 of this Credit Agreement. 

5.
REPAYMENT AND PREPAYMENT

5.1
The Borrower shall repay the Loan 

in respect of Tranche No. 1, in six (6) equal semi-annual consecutive instalments, commencing six (6) months after the Mean Delivery Date for Tranche No. 1, however, not later than April 27, 2003. 

In respect of Tranche No. 2, in six (6) equal semi-annual consecutive instalments, commencing six (6) months after the Mean Delivery Date for Tranche No. 2, however, not later than December 15, 2003.

In respect of Tranche No. 3, in six (6) equal semi-annual consecutive instalments, commencing six (6) months after the Mean Delivery Date for Tranche No. 3, however, not later than February 28, 2004.

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5.2
The Borrower may, by giving not less than five (5) Business Days’ prior written notice to the Agent, prepay the Loan in whole or in part, in an amount of not less than USD 1,000,000. Any such partial prepayment shall be applied against scheduled repayments of the Loan in the inverse order of maturity. For the avoidance of doubt, no amount prepaid hereunder may be reborrowed. The Borrower shall, upon presentment of documentation of such amounts, reimburse the Lender for all costs and expenses in relation to such prepayment, including, but not limited to, costs for broken funds, and any costs relating to the EKN Guarantee(s) for the amount prepaid which have not previously been reimbursed by the Borrower together with all sums payable under clause 12.3 in connection with such prepayment.

5.3
Following a Default (other than a Default under clause 11.1(a)) which is subject to a grace period, the Borrower may prepay the Loan in full (together with all other amounts outstanding under this Credit Agreement) within any originally applicable grace period forthwith upon notice to the Agent, notwithstanding the provisions in clause 5.2 of this Credit Agreement. The Borrower shall, upon presentment of documentation of such amounts, reimburse the Lenders for all costs and expenses related to such prepayment, including, but not limited to, costs for broken funds, and any costs relating to the EKN Guarantees for the amount prepaid which have not previously been reimbursed by the Borrower together with all sums payable under clause 12.3 in connection with such prepayment.

5.4
If the Borrower prepays all or any portion of the Loan in accordance with clause 5.2 and the Agent and the Lenders receive any refund of any fee paid in respect of the EKN Guarantees, such refund shall be applied to the obligations of the Borrower under this Credit Agreement in the order specified in clause 6.5 and, to the extent that any amount remains after payment in full of such obligations, paid to the account of the Borrower. The Agent and the Lenders shall cooperate in good faith with the Borrower to request any refund to which they or the Borrower may be entitled forthwith upon the prepayment of all or any portion of the Loan.

6.
PAYMENTS

6.1
The Agent shall not later than (a) ten (10) Business Days before (i) each Interest Payment Date on which interest is due hereunder and (ii) each Repayment Date, notify the Borrower in writing in the form of an original invoice on the Agent’s letterhead with the signature of the authorized officer, of the amount of the interest and instalment (if any) due on such day and the current interest rate and (b) five (5) Business Days before any other payment is due hereunder, notify the Borrower in writing of the amount and due date of such payment, provided, however, that the failure by the Agent to give such notice shall not affect the Borrower’s obligation to pay any amount hereunder on its due date. 

6.2
The Borrower shall make all payments to be made to the Agent for the account of the Lenders under this Credit Agreement in immediately available freely transferable and cleared funds to (swift code NDEASESS) account No. 001 1 796323 with JP Morgan Chase Bank, New York (swift code CHASUS33) stating reference “International Loan Administration, H 352” or, subject to compliance with applicable Russian currency control requirements, to any other bank account specified to the Borrower by the Agent, from time to time. The Borrower and the Agent shall cooperate in good faith in connection with complying with applicable Russian currency control requirements in the event that the Agent wishes to change the account or bank at which it receives payments hereunder.

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6.3
Whenever a payment is due on a day which is not a Business Day, such payment shall be made on the next Business Day, unless the next Business Day falls in another calendar month, in which case the payment shall instead be made on the preceding Business Day.

6.4
Amounts payable in respect of costs, expenses, losses, indemnities and taxes and the like are payable in the currency in which they are incurred. All other amounts payable hereunder shall be paid in USD.

6.5
If the Lenders receive a payment insufficient to discharge all the amounts then due and payable by the Borrower under this Credit Agreement, the Lenders should apply that payment towards the obligations of the Borrower under this Credit Agreement in the following order: 

First, in or towards payment of any unpaid fees, costs and expenses;

Second, in or towards payment of any accrued but unpaid interest;

Third, in or towards payment of any principal due but unpaid; and

Fourth, in or towards payment of any other sum due but unpaid.

6.6
All payments hereunder shall be made by the Borrower without any set-off or counterclaim whatsoever. 

6.7
All payments hereunder shall be made free and clear of any deductions or withholdings whatsoever required under Russian law. In the event that the Borrower is required by Russian law to make any deduction or withholding on account of tax or otherwise from any such payments, or there is an increase in the existing taxes or levies on such payments, the sum due from the Borrower shall be increased to the extent necessary to ensure that, after such deduction or withholding is made, the Lenders receive a net sum equal to the sum which the Lenders would have received had no deduction or withholding been made. The Borrower shall indemnify the Lenders in respect of any liability of the Lenders with respect to such taxes or withholdings upon demand supported by documentary evidence. The Lenders (or the Agent as the case may be)
and the Borrower shall assist each other on a best efforts basis with necessary documents relating to the applicability of the relevant double taxation treaty to the payments hereunder. 

6.8
The Agent shall maintain in accordance with its usual practice a bookkeeping account or accounts evidencing the amounts from time to time lent by, owing to and paid to it for the account of the Lenders pursuant to this Credit Agreement and such account or accounts are, in the absence of manifest error, prima facie evidence of such amounts.

6.9
Interest and applicable fees shall accrue from and including the first day of each applicable period to the last day of such applicable period and on the basis of the actual number of days elapsed in a (three hundred sixty) 360 day year.

7.
FEES AND EXPENSES

7.1
The Borrower shall within three (3) Business Days after the execution of this Credit Agreement pay to the Agent for account of the Lenders in accordance with their respective Commitments an arrangement fee of fifty hundredths of one (0.50) per cent calculated on the Total Commitments.

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7.2
The Borrower shall pay to the Agent for account of the Lenders in accordance with their respective Commitments a commitment fee of thirty-three hundredths of one (0.33) per cent per annum calculated on the daily undrawn Total Commitments during the period from (and including) the date hereof until the last day of the Drawdown Period. 

7.3
The Borrower shall further pay to the Agent for its own account a flat agency fee of USD 10,000 payable annually in advance on the date of execution and delivery of this Credit Agreement and on each anniversary thereof, with the fee for any period of less than a year between the due date for such fee and the final Repayment Date for Tranche 2 (or Tranche 3, if applicable), being prorated for the actual number of days in such period and with no refund of any already paid agency fee being payable by the Agent in the event of any prepayment of the Loan.

7.4
The commitment fee shall be paid in arrears on the last day of each Interest Period, provided that the final payment of the commitment fee shall be paid within ten (10) days from the last day of the Drawdown Period, or if earlier, within ten (10) days from the last Drawdown Date.

7.5
Upon the Agent’s written demand and presentation of a copy of an invoice from EKN for such amount, the Borrower shall within five (5) days from receipt of such demand pay to the Agent the amount of the EKN Premium specified in the applicable invoice(s) issued by EKN with respect to amounts not already reimbursed by the Borrower to the Agent in accordance with clause 2.1 (p) and 2.2 (h), provided that such amounts have not been caused due to the Agent’s gross negligence.

The Borrower and the Agent acknowledge that in case the aggregate amount of all Drawings made under a Tranche (i) exceeds the amount estimated by the Borrower, EKN will charge an additional EKN Premium in respect of the exceeding amount including interest thereon, such interest to be based on the so called OECD CIRR Base Rate or (ii) is less than the amount estimated by the Borrower, EKN will either (a) reimburse the Agent with a proportional part of the related EKN Premium (without interest) or (b) set-off the amount in question towards the EKN Premium charged in connection with the following Tranche (provided that there is one). 

7.6
Upon at least three (3) Business Days’ prior irrevocable written (including telecopy) notice to the Agent, the Borrower may permanently terminate all or any portion of the unfunded Total Commitments. If the Lenders receive any refund of any fee paid in respect of the EKN Guarantee(s) in connection with any such termination of all or any portion of the Total Commitments, such refund shall be applied to the obligations of the Borrower under this Credit Agreement in the order specified in clause 6.5 and, to the extent that any amount remains after payment in full of such obligations, paid to the account of the Borrower.

7.7
The Borrower shall, on demand, reimburse the Lenders for all reasonable and documented costs and expenses in relation to (i) the preparation, negotiation and execution of this Credit Agreement and the Security Documents and the granting of the Loan hereunder, (ii) the registration and perfection of all Security Interests created by the Security Documents, (iii) any amendment or waiver of this Credit Agreement or any Security Document requested by the Borrower, (iv) the enforcement or preservation of any rights of the Lender under this Credit Agreement or any of the Security Documents, and (v) all costs and expenses relating to the EKN Offer and the EKN Guarantee(s), in each case of (i) to (v), including, but not limited to, travel expenses and other out-of-pocket expenses, and external legal fees and all taxes thereon; it
being understood that the Borrower’s obligation in respect of the fees and expenses of counsel to the Lenders shall be as specified in the letter agreement dated November 20, 2002, between the Agent and the Borrower.

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8.
REPRESENTATIONS AND WARRANTIES

8.1
The Borrower represents and warrants to the Lenders at the date of this Credit Agreement that:

(a)
it is duly organised and validly existing under the laws of the Russian Federation as an open joint stock company, with full power, authority and legal right to carry on its business as presently conducted, to own its property and to execute, and to perform all of its obligations under, this Credit Agreement and each Security Document to which it is a party, and all actions required to authorise such execution and performance have been duly taken;

(b)
the execution and performance of this Credit Agreement and each Security Document to which it is a party, have not and will not violate any applicable law or regulation or contravene any provision of its constitutional documents or any agreement to which it is a party; its operations have not and will not violate any applicable law or regulation or any agreement to which it is a party, which violation could have a material adverse effect on its business or financial condition or its ability to perform its obligations under this Credit Agreement and each Security Document to which it is a party;

(c)
all governmental or other licences, consents and authorisations necessary or desirable for (i) the execution and performance of this Credit Agreement and each Security Document to which it is a party, and (ii) for proper exercise of the Licenses and development and operation of the type of communication system the Licenses relate to, and for the import and operation of the Equipment, have been obtained and are in full force and effect;

(d)
this Credit Agreement and each Security Document, constitute legally valid and binding obligations of the Borrower and/or the Security Provider other than EKN, respectively, enforceable in accordance with their respective terms, subject to insolvency laws applicable to creditors generally;

(e)
it is not in breach of or in default under any agreement to which it is a party or by which it or any of its assets or property is bound, which breach or default might have a material adverse effect on its business or financial condition, or its ability to perform its obligations under this Credit Agreement and each Security Document to which it is a party;

(f)
no litigation, arbitration or administrative proceedings are current or pending or, to its best knowledge, threatened, which might, if adversely determined, have a material adverse effect on its business or financial condition, or its ability to perform its obligations under this Credit Agreement and each Security Document to which it is a party;

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(g)
neither the Borrower nor any Security Provider other than EKN has taken, nor, to the knowledge of the Borrower, has any other person started any legal proceedings for the bankruptcy or winding-up of the Borrower or any Security Provider other than EKN or for the appointment of a receiver, administrator or similar officer of the Borrower or any Security Provider other than EKN;

(g1)
no Default has occurred and is subsisting;

(h)
the latest annual audited Russian financial statements of the Borrower have been prepared in accordance with the laws of the Russian Federation, the latest audited financial statements of the Borrower and its subsidiaries filed by the Borrower with the SEC have been prepared in accordance with US GAAP, and the latest unaudited financial statements of the Borrower and its subsidiaries filed by the Borrower with the SEC have been prepared in accordance with US GAAP (subject to customary year end adjustments) and, since the date of the most recent financial statements filed with the SEC there has been no material adverse change in the condition (financial or otherwise) or affecting the business, prospects, financial position or results of operations of the Borrower or the Borrower and its subsidiaries taken as a whole; 

(i)
the Borrower has made available to the Lenders the Borrower’s annual report for the fiscal year ended December 31, 2001 filed on Form 20-F with the SEC, together with subsequent filings by the Borrower with the SEC (copies of each of which have been made available to the Agent) and has provided other written or formally presented information about the Borrower and its subsidiaries; none of such information contained, at the time it was prepared, any material misstatement of fact, or omitted at such time to state any material fact necessary to make the statements therein, in the light of the circumstances in which they were given, not misleading; provided, that to the extent that any such information was based upon or constitutes a forecast or projection, the Borrower represents only that it acted in good faith and
utilized what it believed to be reasonable assumptions at the time that such information was prepared and due care in the preparation of such information; 

(j)
[intentionally omitted]; 

(k)
the Security Interest created under the Security Documents constitutes a perfected Security Interest in favour of the Agent for the benefit of the Lenders securing the Borrower’s obligations to the Lenders under this Credit Agreement and such Security Interest is in full force and effect and enforceable in accordance with its terms and constitutes a first priority Security Interest subject only to mandatory provisions of law which create super priority for certain classes of creditors;

(l)
no event or series of events have occurred (including, but not limited to, the revocation or non-renewal of any licence, consent or authorisation) which might have a material adverse effect on the business or financial condition of the Borrower or any Security Provider, or on their ability to fully perform their obligations under this Credit Agreement or the Security Documents;

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(m)
it has not entered into any agreement in respect of Debt under which the maturity of such Debt may be accelerated prior to its stated maturity date as the result of a default (howsoever described, other than as a result of the breach of a covenant to pay principal or interest or a Specified Bond Default) under any other agreement in respect of Debt of the Borrower with an aggregate principal amount in excess of $10 million (or, to the extent non-U.S. dollar denominated, the U.S. dollar equivalent of such amount as of the date of such default); and 

(n)
to the best of the Borrower’s knowledge and without any duty of inquiry by the Borrower of any third person, none of the following events has occurred or is occurring with regard to the Borrower or any Security Provider (save for EKN): (a) implementation of the measures for the prevention of bankruptcy of the Borrower or any Security Provider (save for EKN), including, but not limited to, implementation of pre-judicial recovery (dosudebnaya sanatsiya); (b) they seeking, consenting or acquiescing in the introduction of proceedings for their liquidation or bankruptcy or the appointment of a liquidation commission (likvidatsionnaya komissiya) or a similar officer of them; (c) the presentation or filing of a petition in
respect of it in any court, arbitrazh court or before any agency alleging or for its bankruptcy, insolvency, dissolution, liquidation (or any analogous proceeding); (d) the institution of the supervision (nablyudeniye), financial recovery (finansovoe ozdorovleniye), external management (vneshneye upravleniye), bankruptcy management (konkursnoye upravleniye) over them and/or the appointment of a temporary manager (vremenniy upravlayushiy), administrative manager (administrativniy upravlayushiy), external manager (vneshniy upravlayushiy), bankruptcy manager
(konkursniy upravlayushiy) or similar officer of them; (e) the convening or announcement of an intention to convene a meeting of their creditors for the purposes of considering an amicable settlement; (f) any extra-judicial liquidation or analogous act in respect of them by any governmental, regulatory or supervisory body in or of the Russian Federation (in each case, as the above terms are defined in the Federal Law of the Russian Federation No. 127-FZ “On Insolvency (Bankruptcy)” of October 26, 2002); (g) or any other similar proceeding is commenced against the Pledgor causing any other similar condition or event contemplated by sub-clauses (a) - (f) hereof.

9.
COVENANTS

9.1
Affirmative Covenants

As long as any of the Borrower’s obligations are outstanding under this Credit Agreement the Borrower will:

(a)
maintain its corporate existence as an open joint stock company registered in Russia and preserve and keep in full force and effect its rights (charter and statutory), licences and franchises necessary for it to carry on its business and operations, except to the extent that the failure to preserve and keep in full force and effect any such right, licence or franchise could not reasonably be expected to have a material adverse effect on its business or financial condition or its ability to perform its obligations under this Credit Agreement and each Security Document to which it is a party;

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(b)
comply (and take all corporate action within its power to procure that Vimpelcom-Region complies) in all material respects with all applicable laws, regulations, regulatory authorisations and licences (including the Vimpelcom-Region Licence) necessary for the operation of the Equipment;

(c)
file all relevant tax returns and pay all taxes promptly upon the same becoming due except to the extent that the taxes are being contested in good faith and by appropriate means and adequate reserves have been set aside;

(d)
maintain proper and accurate books and records in accordance with the laws of the Russian Federation and maintain accounts on a consolidated basis in accordance with US GAAP consistently applied; 

(e)
purchase and maintain (or take all corporate action within its power to procure that Vimpelcom-Region purchases and maintains) adequate insurance covering loss, damage or destruction of the Equipment in an amount equal to or in excess of the Loan, and all other risks normally covered by an insurance of equipment of the same kind;

(f)
[intentionally omitted];

(g)
[intentionally omitted];

(h)
at its own expense, keep (or take all corporate action within its power to procure that Vimpelcom-Region at its own expense keeps) the Equipment in good working order and condition, ordinary wear and tear permitted, and not do or permit to be done anything which may expose any part of the Equipment to detention or destruction, and procure that the Lenders shall have the right, at any time and on reasonable notice, to inspect the Equipment, or instruct a third party to carry out inspection on its behalf;

(i)
procure that its obligations under this Credit Agreement do and will rank at least pari passu with all its present and future unsecured, unsubordinated obligations, except for obligations, which are mandatorily preferred by law;

(j)
immediately upon becoming aware of any such necessity, apply for and procure the obtaining of any new or amended permissions and licences (including without limitation any Central Bank of Russia permissions and licences) needed by the Borrower to effect payments under this Credit Agreement to the Agent for the benefit of itself and the Lenders (bearing in mind the representation and warranty given by the Borrower in clause 8.1.(c)) ; 

(k)
forthwith notify the Agent if it enters into any agreement in respect of Debt which would render the Borrower unable to give the representation and warranty set forth in clause 8.1(m) of this Credit Agreement as of the date of such agreement; and 

(l)
notify the Agent promptly upon becoming aware of any Change of Ownership.

9.2
Negative Covenants

As long as any of the Borrower’s obligations are outstanding under this Credit Agreement the Borrower will not, without the prior written consent of the Agent:

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(a)
conduct any other business apart from the operation of telecommunications services, and businesses ancillary thereto, including providing services and leasing equipment to subsidiaries in the business of providing telecommunications services (for the avoidance of doubt, the Borrower may, without the prior written consent of the Agent, engage in any business constituting a “Permitted Business” under and as defined in the Bond Loan Agreement);

(b)
create, incur, or suffer to exist any Security Interest in the Equipment (other than in favour of the Lenders);

(c)
incur any Debt except as permitted by clause 14.7 of the Bond Loan Agreement;

(d)
declare or pay any dividend or make any distribution except as permitted by clause 14.8 of the Bond Loan Agreement;

(e)
sell, transfer, or otherwise dispose of any assets except as permitted by clause 14.9 (a) and (d) of the Bond Loan Agreement;

(f)
enter into any transaction with any Related Person or Affiliate except as permitted by clause 14.10 of the Bond Loan Agreement;

(g)
enter into or become subject to any reorganisation, whether by way of merger (sliyaniye obshestva), company accession (prisoedinyeniye obshestva), company division (razdelyeniye obshestva), company separation (vydelyeniye obshestva), company transformation (preobrazovaniye obshestva), company liquidation (likvidatsiya obshestva) or any other company reorganisation (reorganizatsiya obshestva) (as these terms are construed by applicable Russian law) or otherwise other than a merger with KB Impuls,
or Vimpelcom-Region and other wholly-owned subsidiaries in which the Borrower is the surviving entity; or

(h)
amend its constitutional documents in a way, which would have a material adverse effect on the ability of the Borrower to perform its obligations under this Credit Agreement or any of the Security Documents to which it is a party.

10.
INFORMATION

10.1
At the request of the Agent, the Borrower undertakes and agrees to promptly furnish to the Agent:

(a)
all information in the Borrower’s (or Vimpelcom-Region’s) possession regarding the Equipment, its use, location and condition;

(b)
budget and projections for the Borrower’s operations; 

(c)
such information concerning the business, assets and financial conditions of the Borrower or any Security Provider, which may reasonably be requested by the Agent.

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10.2
The Borrower shall submit to the Agent (a) its and each Security Provider’s (save for EKN’s) annual audited financial statements (in the case of the Borrower prepared in conformity with US GAAP consistently applied) as soon as such statement becomes available, and in any event not later than one hundred eighty (180) days after the end of each fiscal year, and (b) its and each Security Provider’s (save for EKN’s) quarterly unaudited financial statements for the first three quarters of each financial year within (ninety) 90 days after the end of the respective quarter.

10.3
The Borrower shall forthwith notify the Agent of the occurrence of a Default and of any other event which might have a material adverse effect on the Borrower’s ability to perform any of its obligations under this Credit Agreement or any of the Security Documents to which it is a party or the ability of any Security Provider (other than EKN) to perform any of its obligations under the Security Documents to which the Security Provider is a party, and provide the Agent with full details of any steps which the Borrower (or the relevant Security Provider) is taking, or is considering taking, in order to remedy or mitigate the effect of the Default or otherwise in connection with such events.

11.
EVENTS OF DEFAULT

11.1
The following events shall constitute Events of Default: 

(a)
the Borrower shall fail to pay any amount due under this Credit Agreement except where the failure to pay is either:

(i)
due to technical problems in the transmission of funds and payment is made within three (3) Business Days of the due date, or

(ii)
a shortfall in the amount of interest paid by the Borrower and such shortfall is caused by the failure of the Agent to notify the Borrower of the amount of interest payable in accordance with clause 6.1 of this Credit Agreement and payment of such shortfall is made within five (5) Business Days of notification by the Agent that a shortfall exists which notification shall specify the amount of the shortfall;

(b)
the Borrower, or any Security Provider, shall fail to perform or observe any obligation, covenant or undertaking to be performed or observed by it hereunder or any Security Document to which it is a party (other than the obligation to pay any amount due and other than any failure to perform or observe any obligation, covenant or undertaking regarding any consent, licence, or authorisation necessary for the operation of the Borrower’s or any Security Provider’s business, any such failure being addressed in clause 11.1(k) below) and such failure shall continue unremedied for a period of thirty (30) Business Days from the earlier of the date on which (i) the Borrower or such Security Provider should have become aware of such failure to comply and (ii) the Agent gives a notice to the Borrower requiring the same
to be remedied;

(c)
any representation or warranty made or repeated, or deemed made or repeated, by the Borrower, or any Security Provider, in this Credit Agreement or any Security Document to which it is a party or in any document or statement delivered in connection with this Credit Agreement or any Security Document to which it is a party shall prove to be incorrect, misleading or breached in any respect reasonably deemed material by the Agent and the Lenders and, in the case of any such representation and warranty relating to the Licences, any other telecommunication licence, or any licence, consent, or authorisation of the Central Bank of Russia, the incorrectness, misleading nature, or breach shall continue for ninety (90) days following notice from the Agent to the Borrower that the Agent considers such incorrectness, misleading
nature, or breach to be material;

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(d)
this Credit Agreement or any Security Document shall for any reason become invalid, unlawful, unenforceable or terminated in accordance with their respective terms, or it is or becomes unlawful for the Lenders in any applicable jurisdiction to give effect to any of its obligations as contemplated by this Credit Agreement and the same shall continue unremedied for a period of ten (10) Business Days after the earlier of the date on which (i) the Borrower or any Security Provider should have become aware of such unlawfulness and (ii) notice thereof is given by the Agent to the Borrower;

(e1)
a decree, judgement, or order by a court of competent jurisdiction shall have been entered adjudging the Borrower as bankrupt or insolvent, or approving as properly filed a petition seeking reorganisation of the Borrower under any bankruptcy or similar law, and such decree or order shall have continued undischarged and unstayed for a period of sixty (60) days; or a decree or order of a court of competent jurisdiction over the appointment of a receiver, liquidator, trustee, or assignee in bankruptcy or insolvency of the Borrower or any substantial part of the Borrower’s assets or property, or for the winding up or liquidation of the affairs of the Borrower, shall have been entered, and such decree, judgment or order shall have remained in force undischarged and unstayed for a period of sixty (60) days; 

(e2)
the Borrower, or any Security Provider (other than EKN), shall have instituted proceedings to be adjudicated a voluntary bankrupt, or shall have consented to the filing of a bankruptcy proceeding against it, or shall have filed a petition or answer or consent seeking reorganisation under any bankruptcy or similar law or similar statute, or shall have consented to the filing of any such petition, or shall have consented to the appointment of a custodian, receiver, liquidator, trustee or assignee in bankruptcy or insolvency of it or any substantial part of its assets or property, or shall make a general assignment for the benefit of creditors, or shall have admitted in writing its inability to pay its debts generally as they become due, or shall have, within the meaning of any applicable Russian bankruptcy law, become
insolvent, fail generally to pay its debts as they become due, or shall have taken any corporate action in furtherance of or to facilitate, conditionally or otherwise, any of the foregoing;

(f1)
default on any Debt of the Borrower with an aggregate principal amount in excess of $10 million (or, to the extent non-U.S. dollar denominated, the U.S. dollar equivalent of such amount as of the date of such default) (i) resulting from the failure to pay principal or interest (in the case of interest default or a default in the payment of principal other than at its stated maturity, after the expiration of the originally applicable grace period) in an aggregate amount in excess of $5 million (or, to the extent non-U.S. dollar denominated, the U.S. dollar equivalent of such amount as of the date of such default) when due; or (ii) as a result of which the maturity of such Debt has been accelerated prior to its stated maturity date;

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(f2)
default (howsoever described, other than as a result of the breach of a covenant to pay principal or interest or a Specified Bond Default) under any agreement in respect of Debt of the Borrower with an aggregate principal amount in excess of $10 million (or, to the extent non-U.S. dollar denominated, the U.S. dollar equivalent of such amount as of the date of such default) as a result of which the maturity of any other Debt may be accelerated prior to its stated maturity date;

(g)
any final judgement or order (not covered by insurance) for the payment of money in excess of $5 million (or, to the extent non-U.S. dollar denominated, the U.S. dollar equivalent of such amount) in the aggregate for all such final judgements or orders against the Borrower (treating any deductibles, self-insurance or retention as not so covered) shall be rendered against the Borrower and shall not be paid or discharged, and there shall be any period of sixty (60) consecutive calendar days following entry of the final judgement or order that causes the aggregate amount for all such final judgements or orders outstanding and not paid or discharged against the Borrower to exceed $5 million (or, to the extent non-U.S. dollar denominated, the U.S. dollar equivalent of such amount) during which a stay of enforcement of such
final judgement or order, by reason of a pending appeal or otherwise, shall not be in effect;

(h)
the Borrower or any Security Provider (other than EKN) shall discontinue all or a substantial part of its business operations (other than as a result of a merger or other reorganization permitted by this Credit Agreement where the surviving entity continues substantially all of the non-surviving entity’s business operations);

(i)
the Equipment, the Borrower, any Security Provider (other than EKN), the shares or the assets or business of the Borrower or any Security Provider (other than EKN), or any substantial part thereof shall become nationalised or expropriated;

(j)
the Equipment shall become subject to a Security Interest of any kind which is not created under the Security Documents or otherwise permitted under this Credit Agreement, or the Security Interests created by any Security Document shall reasonably deemed by the Agent to be in jeopardy or challenged in any way and the same shall continue unremedied for a period of ten (10) Business Days after the earlier of the date on which (i) the Borrower or any Security Provider should have become aware of such Security Interest, event or challenge and (ii) notice thereof is given by the Agent to the Borrower; 

(k)
any consent, licence, or authorisation necessary for the operation of the Borrower’s or any Security Provider’s business is withdrawn or terminated and the same shall continue unremedied for a period of ten (10) Business Days (ninety (90) days in the case of the withdrawal or termination of any of the Licences or any telecommunication licence or licence, consent, or authorisation of the Central Bank of Russia) after the earlier of the date on which (i) the Borrower or any Security Provider should have become aware of such withdrawal or termination and (ii) notice thereof is given by the Agent to the Borrower; and

(l)
the expiration of sixty (60) days following a Change of Ownership.

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11.2
Upon the occurrence of any Event of Default and at any time thereafter so long as the same shall be continuing, the Agent may (and, if so instructed by the Majority Lenders, shall), declare this Credit Agreement to be in default and the Agent may (and, if so instructed by the Majority Lenders, shall), in addition to any other remedies provided herein or by applicable law, elect to:

(a)
forthwith cancel, in whole or in part, any portion of the Total Commitments;

(b)
declare that the Loan and all interest and all other sums payable under this Credit Agreement have become immediately due and payable or have become due and payable on demand, whereupon the same shall, immediately or in accordance with the terms of such notice, become so due and payable;

(c)
enforce all or any of its rights and remedies under this Credit Agreement and any of the Security Document(s).

12.
INDEMNITIES AND INCREASED COSTS

12.1
The Borrower shall pay and forthwith on demand indemnify the Lenders (i) against any liability they incur in respect of any Russian stamp, registration and similar taxes, and (ii) any other taxes, duties and other Russian charges levied or imposed against it, each of which is or becomes payable in connection with or relating to the entry into, performance or enforcement of this Credit Agreement or any of the Security Documents, except for taxes on the Lenders’ overall net income in Sweden and/or in Germany.

12.2
If there is a change in any law or regulation applicable to any bank or financial institution (the “Bank”) or its holding company, or in its interpretation or application, or if the Bank or its holding company complies with any direction or request of any competent authority, all in its capacity as Lender under this Credit Agreement, then

(a)
the Bank will certify to the Borrower the amount of any increased cost, reduction of return, expense or liability which is referable to the Credit Agreement and which results from any such change or compliance; and

(b)
the Borrower will pay that amount to the Bank on the Bank’s demand.

12.3
The Borrower shall forthwith on demand indemnify the Lenders against any loss or expense that they sustain or incur as a consequence of the making of any payment of the Loan on a date other than an Interest Payment Date unless the Borrower has delivered to the Agent a written notice no later than thirty (30) days prior to prepayment.

12.4
The Borrower shall forthwith on demand indemnify the Lenders against any loss or liability, which the Lenders incur as a consequence of:

(a)
the occurrence of any Default;

(b)
the operation of clause 11.2 of this Credit Agreement; or

(c)
any payment of principal or interest being received from any source other than from the Borrower.

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The Borrower’s liability in each case includes but is not limited to any loss of margin or other loss or expense on account of funds borrowed, contracted for or utilised to fund (i) any amount payable under this Credit Agreement, (ii) any amount repaid or prepaid under the Loan or any part thereof. 

12.5
If any payment in connection with this Credit Agreement is made or recovered in a currency other than that in which it is required to be paid then, if the payment to the Lenders falls short of the amount unpaid under this Credit Agreement, the Borrower will indemnify the Lenders against the amount of the shortfall on the Agent’s demand.

12.6
The indemnities contained in this clause 12 shall not extend to any loss to the extent that such loss is caused by the wilful misconduct or gross negligence of the Agent or any Lender.

12.7
The indemnities contained in this clause 12 shall continue in full force and effect notwithstanding the termination of this Credit Agreement.

13.
RIGHTS, REMEDIES AND WAIVERS

13.1
No failure by the Agent or the Lenders to exercise, nor any delay by the Agent or by the Lenders in exercising, any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy prevent any further or other exercise thereof or the exercise of any other right or remedy. The rights and remedies provided herein are cumulative and not exclusive of any rights or remedies provided by law.

14.
UNCONDITIONAL PAYMENTS

14.1
The Borrower expressly acknowledges that this Credit Agreement constitutes an obligation on the Borrower’s part that is independent and completely separate from the Supply Contract and the liability of the Borrower to repay the Loan and to pay any other amount under this Credit Agreement on the due dates therefore, shall not be conditional upon:

(i)
performance by the Supplier or any other party of the terms of the Supply Contract or any related contract, and shall not be affected by any claim which the Borrower may have against the Supplier; or

(ii)
the legality, validity or enforceability of the Supply Contract (including, but not limited to, the absence of any consents or authorisations required in connection with the Supply Contract).

15.
MISCELLANEOUS

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

Page 25 of 25

A Lender may at any time assign all or any part of its rights and/or obligations under this Credit Agreement and the relevant Security Documents to (i) EKN, without the prior consent of the Borrower or (ii) to any other internationally recognized financial institution outside of Russia, with the prior written consent of the Borrower, such consent not to be unreasonably withheld or delayed. Notice of such assignment shall be given in writing to the Borrower thirty (30) days prior to such assignment. The out of pocket expenses of the assignor Lender, if any, for such assignment, shall be for the account of such Lender except if such assignment is made after an Event of Default has occurred and is subsisting, in which case such expenses shall be paid or reimbursed by the Borrower. Notwithstanding the foregoing, before any such assignment by a Lender of its obligations hereunder, the Lender shall deliver to
the Borrower such agreements and other evidence as the Borrower reasonably requests to the effect that the relevant assignee has irrevocably assumed such obligations. For the avoidance of doubt, (i) a financial institution shall not be considered to be “outside of Russia” if its ultimate parent entity or the largest banking institution in the group of which it is part has significant operations in the Russian Federation and (ii) in no event may a Lender assign all or any part of its rights and/or obligations under this Credit Agreement and the relevant Security Documents to an entity other than EKN or a financial institution outside Russia.

Upon an assignment made in accordance with this clause 15, the Borrower shall on demand by the Agent execute such documents and do all such acts as the Agent may reasonably request to give effect to the assignment.

All references in this Credit Agreement to the Lenders shall after an assignment has been made apply also to the assignee, and the assignee shall be represented by the Agent as agent as if originally a party to this Credit Agreement as a Lender.

15.2
All information, notices, communications, opinions and the like required to be given by the Borrower or to be delivered to the Agent hereunder, if not in the English language, shall be accompanied by a certified English translation. The English version of all such information, notices, communications, opinions and other documents shall as between the parties prevail in the event of any conflict with the non-English versions thereof.

15.3
All notices and other communications under this Credit Agreement shall be in writing and either delivered by hand or sent by telefax or internationally recognised courier, in each case to the address or telefax number of the intended recipient as set out below or as subsequently notified to the other party in accordance herewith. Any such notice or other communications delivered shall be deemed to have been made or delivered when received (in the case of any communication made by telefax) or (in the case of any communication made by internationally recognised courier) when left at that address or (as the case may be) ten (10) days after such internationally recognised courier has acknowledged receipt of such communication properly addressed. A notice or other communications received or deemed received on a non-working
day in the place of receipt or after office hours shall be deemed to have been delivered on the following working day in the place of receipt.

Page 26 of 26

 

	 Agent
 (on behalf of the Lenders):
 	  
 	 
 Nordea Bank Sweden AB (publ)
 International Loan Administration, H 352
 Attn. Helene Sparrfeldt/Gunder Forsman
 Hamngatan 10
 SE-105 71 Stockholm, Sweden
 Telephone: +46 8 614 70 00
 Telefax: +46 8 20 98 94
 
	  
 	  
 	  
 
	 Borrower:
 	  
 	 OJSC “Vimpel-Communications”
 10, bldg. 14, 8 Marta str.,
 Moscow 127083
 Russian Federation
 Telephone: +7 095 212 05 12
 Telefax: +7 095 755 46 16
 
	  
 	  
 	  
 
	  
 	  
 	 For the attention of: Financial Director/Head of Treasury
 

15.4
This Credit Agreement supersedes all other agreements prior to the date hereof, oral or written, with respect to the subject matter hereof, and contains the entire agreement between the Lenders, the Agent and the Borrower with respect to the transactions contemplated hereunder.

15.5
The Borrower shall, from time to time, do and perform such other and further acts and execute and deliver any and all other further instruments as may be required by law or reasonably requested by the Agent or the Lenders to establish, maintain and protect the rights and remedies of the Lenders and to carry out and effect the intent and purpose of this Credit Agreement.

15.6
The terms and conditions of this Credit Agreement and the Security Documents are confidential and shall neither in whole or in part be disclosed to any person nor published without the prior written consent of the Parties hereto, provided that this clause 15.6 shall not prevent (i) disclosures by either the Borrower or the Lenders as required by the rules of any securities exchange or otherwise by law or ministerial or judicial or parliamentary authority (as such law or authority is applicable to the Borrower or the Lenders) or to the legal or audit or taxation or other professional advisers of the Borrower or the Lenders (provided that such advisers are bound by confidentiality obligations), (ii) the Lenders from disclosing this Credit Agreement and the Security Documents, or its terms or any information proved under
such agreements to any entity that is a permitted assignee under clause 15.1 of this Credit Agreement and that undertakes to be bound by this clause 15.6 as if a Party, or (iii) the Borrower from disclosing to its other creditors, the existence of any Default or Event of Default or the express terms of clause 11.1(f2) of this Credit Agreement.

15.7
[intentionally omitted].

15.8
Any certification or determination by the Agent of a rate or amount under this Credit Agreement is, in the absence of manifest error, prima facie evidence of the matters to which it relates.

15.9
The Lenders upon providing a five (5) days prior written notice to the Borrower, may set off any matured obligation owed by the Borrower under this Credit Agreement (to the extent beneficially owned by the Lenders) against any matured obligation owed by the Lenders to the Borrower, regardless of the place of payment, booking branch or currency of either obligation. If the obligations are in different currencies, the Lenders may convert either obligation at a market rate of exchange in its usual course of business for the purpose of the set-off. If either obligation is unliquidated or unascertained, the Lenders may set off an amount estimated by it in good faith to be the amount of that obligation.

Page 27 of 27

15.10
In the event that the making or maintaining the facility by the Lenders has become impossible and / or unlawful by reason of any change after the date of this Credit Agreement in any applicable law or governmental regulation or order or in any requirement of any monetary authority, whether or not having the force of law, or in the interpretation of any of the same, with respect to this Credit Agreement, then the Agent shall notify the Borrower thereof immediately and the Borrower shall, within thirty (30) Business Days after receipt of such notice repay all Drawings and pay accrued interest thereon provided, however, that prior to any such prepayment the Borrower and the Lenders shall negotiate in good faith on the basis of a lawful and practicable proposal to be submitted by the Agent with a view to arriving at a
mutually acceptable alternative arrangement and, if such agreement is agreed upon within the period of thirty (30) Business Days, the Borrower shall not be obliged to make any prepayment pursuant to the provisions of this clause 15. The obligations of the Lenders to maintain the facility shall unless otherwise agreed terminate immediately.

Should the Lenders become subject to (i) any form of taxation (other than tax on the overall net income, profit or gain of the Lender, imposed in jurisdiction in which such Lender’s principal income or lending office is located) with respect to the Credit Agreement or if new or (ii) amended rules regarding the liabilities of the Lenders with respect to capital or reserve requirements of any kind against any assets of, deposits with, or for the account of, or loan by the Lenders and should such rules affect the obligations under the Credit Agreement; or should the Lenders otherwise become subject to some conditions imposed by any authority in Russia with respect to this Credit Agreement, which will increase such Lender’s total cost with respect to the Credit Agreement, the Borrower shall at the request of the Lender pay to the Lender an amount which will compensate the Lender for its increased
costs or reduced rate of return.

In the event the Borrower is required to make payment to the Lenders under this clause 15, the Borrower shall have the option to prepay any outstanding amounts in full, by giving the Agent not less than five (5) Business Days irrevocable prior notice of its intention to do so.

15.11
On the first Drawdown Date, each of the Lenders has delivered to the Borrower duly certified copies of certificates issued by the relevant tax authorities of each Lender’s jurisdiction and other documents and/or information as may be reasonably requested by the Borrower pursuant to applicable Russian tax laws.

16.
THE AGENT, THE SECURITY BENEFICIARY AND THE LENDERS

16.1
Appointment of the Agent

(a)
Each of the Lenders hereby appoints the Agent to act as its agent under and in connection with this Credit Agreement and the Security Documents.

(b)
Each of the Lenders authorises the Agent to exercise the rights, powers, authorities and discretions specifically given to the Agent under or in connection with this Credit Agreement and the Security Documents together with any other incidental rights, powers, authorities and discretions. 

Page 28 of 28

16.2
Duties of the Agent

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

(b)
Except where this Credit Agreement and the Security Documents specifically provides otherwise, the Agent is not obliged to review or check the adequacy, accuracy or completeness of any document it forwards to another Party. 

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

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

(e)
The Agent’s duties under this Credit Agreement and any other related document are solely mechanical and administrative in nature.

16.3
No Fiduciary Duties

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

(b)
The Agent shall be bound to account to any Lender for any sum or the profit element of any sum received by it for its own account.

16.4
[intentionally omitted]

16.5
Business with the Group

The Agent may accept deposits from, lend money to and generally engage in any kind of banking or other business with any of the Security Providers.

16.6
Rights and Discretions of the Agent

(a)
The Agent may rely on:

(i)
any representation, notice or document received from any Party to this Credit Agreement believed by the Agent to be genuine, correct and appropriately authorised; and

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

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

Page 29 of 29

(i)
no Default has occurred (unless it has actual knowledge of a Default arising under clause 11.1 (a) (Non-payment)) of this Credit Agreement;

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

(iii)
any notice or request made by the Borrower is made on behalf of and with the consent and knowledge of all the Security Providers.

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

(d)
The Agent may act in relation to this Credit Agreement and any related document through its personnel and agents.

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

(f)
Notwithstanding any other provision of this Credit Agreement or any related document to the contrary, the Agent is not obliged to do or omit to do anything if it would or might in its reasonable opinion constitute a breach of any law or regulation or a breach of a fiduciary duty or duty of confidentiality provided, however, that the Agent shall promptly notify other Parties in writing.

16.7
Majority Lenders’ Instructions

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

(b)
Unless a contrary indication appears in this Credit Agreement and any related document, any instructions given by the Majority Lenders will be binding on all the Lenders. 

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

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

(e)
The Agent is not authorised to act on behalf of a Lender (without first obtaining that Lender’s consent) in any legal or arbitration proceedings relating to this Credit Agreement and any related document.

16.8
Responsibility for Documentation

Page 30 of 30

The Agent is not:

(a)
responsible for the adequacy, accuracy and/or completeness of any information (whether oral or written) supplied by the Agent, a Security Provider or any other person given in or in connection with this Credit Agreement and any related document; or

(b)
responsible for the legality, validity, effectiveness, adequacy or enforceability of this Credit Agreement and any related document or any other agreement, arrangement or document entered into, made or executed in anticipation of or in connection with this Credit Agreement and any related document.

16.9
Exclusion of Liability

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

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

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

16.10
Lenders’ Indemnity to the Agent

Each Lender shall (in proportion to its share of the Total Commitments or, if the Total Commitments are then zero, to its share of the Total Commitments immediately prior to their reduction to zero) indemnify the Agent, within three (3) Business Days of demand, against any cost, loss or liability incurred by the Agent (otherwise than by reason of the Agent’s gross negligence or wilful misconduct) in acting as Agent under this Credit Agreement and any related document (unless the Agent has been reimbursed by a Security Provider pursuant to this Credit Agreement and any related document).

16.11
Resignation of the Agent

(a)
The Agent may resign and appoint any member within the Nordea Group as successor by giving notice to the Lenders and the Borrower.

(b)
Alternatively the Agent may resign by giving notice to the Lenders and the Borrower, in which case the Majority Lenders (after consultation with the Borrower) may appoint as successor Agent any entity to which a Lender could, in accordance with clause 15.1 of this Credit Agreement, assign its interest. 

Page 31 of 31

(c)
If the Majority Lenders have not appointed a successor Agent in accordance with paragraph (b) above within (thirty) 30 days after notice of resignation was given, the Agent (after consultation with the Borrower) may appoint as successor Agent any entity to which a Lender could, in accordance with clause 15.1 of this Credit Agreement, assign its interest. 

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

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

(f)
Upon the appointment of a successor, the retiring Agent shall be discharged from any further obligation in respect of this Credit Agreement and any related document but shall remain entitled to the benefit of this clause 16. Its successor and each of the other Parties shall have the same rights and obligations amongst themselves as they would have had if such successor had been an original Party.

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

16.12
Confidentiality

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

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

16.13
Relationship with the Lenders

The Agent may treat each Lender as a Lender, entitled to payments under this Credit Agreement unless it has received not less than five (5) Business Days prior notice from that Lender to the contrary in accordance with the terms of this Credit Agreement.

16.14
Credit Appraisal by the Lenders

Without affecting the responsibility of any Security Provider for information supplied by it or on its behalf in connection with this Credit Agreement and any related document, each Lender confirms to the Agent that it has been, and will continue to be, solely responsible for making its own independent appraisal and investigation of all risks arising under or in connection with this Credit Agreement and any related document including but not limited to:

(a)
the financial condition, status and nature of each of the Security Providers;

Page 32 of 32

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

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

(d)
the adequacy, accuracy and/or completeness of any information provided by the Agent, any Party or by any other person under or in connection with this Credit Agreement and any related document, the transactions contemplated by this Credit Agreement and any related document or any other agreement, arrangement or document entered into, made or executed in anticipation of, under or in connection with this Credit Agreement and any related document.

16.15
Deduction from Amounts Payable by the Agent

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

16.16
Parallel Debt 

(a)
Always subject to terms of this clause 16 of this Credit Agreement, the Borrower hereby irrevocably and unconditionally undertakes to pay to the Security Beneficiary amounts equal to any amounts owing by the Borrower to the Banks under this Credit Agreement as and when the same fall due for payment hereunder, so that the Security Beneficiary shall be the obligee of such covenant to pay and shall be entitled to claim performance thereof in its own name subject to the terms of the Security Documents and not as the Agent acting on behalf of the Lenders.

(b)
The Borrower and the Security Beneficiary acknowledge that for this purpose such monetary obligations of the Borrower are substitute obligations which the Borrower has to the Lenders under this Credit Agreement, provided that this shall not result in the Borrower incurring an aggregate monetary obligation to the Security Beneficiary which is greater than the then outstanding monetary obligation to the Lenders under this Credit Agreement.

Page 33 of 33

(c)
To this end and without prejudice to the foregoing, it is agreed that (i) the amounts due and payable by the Borrower under this clause 16.16 (the “Parallel Debt”) shall be decreased to the extent that the Borrower or other Security Provider has paid, redeemed or prepaid any amounts to the Lenders or any of them in respect of the Borrower’s liabilities hereunder and vice versa and (ii) the Parallel Debt shall not at any time exceed the aggregate of the corresponding obligations which the Borrower then owes to the Lenders under this Credit Agreement.

(d)
Nothing in this clause 16.16 shall in any way negate, affect or increase the obligations which the Borrower has to the Lenders under this Credit Agreement in respect of the Borrower’s liabilities hereunder. 

(e)
For the purpose of this clause 16.16 the Security Beneficiary acts in its own name and on behalf of itself and not as Agent or representative of any other party hereto and any security granted to the Security Beneficiary to secure the Parallel Debt is granted to the Security Beneficiary in its capacity as creditor of the Parallel Debt and solely for the purpose referred to above.

(f)
The Security Beneficiary shall promptly transfer to the Agent any amounts received by it pursuant to this clause 16.16 for application by the Agent in accordance with the order prescribed in clause 6 (Payments). The Security Beneficiary will be obliged to make such transfer only to the extent that it has actually received the amounts to be transferred. 

(g)
The Security Beneficiary undertakes to act upon the instructions of the Agent, and in the absence of any such instructions, the Security Beneficiary may act in relation to such security in such manner as it reasonably believes will, and shall use its best endeavours to enforce its rights under the Security Documents so as to, ensure the maximum amount possible is received by it pursuant to this clause 16.16 and available for application in accordance with sub-clause 16.16(f) of this clause 16.16.

17.
LIMITATION OF LIABILITY

The Lenders and the Agent shall not be held responsible for any loss or damage from a legal enactment (Swedish or foreign), the intervention of a public authority (Swedish or foreign), an act of war, a strike, a blockade, a boycott or a lockout or any other similar circumstance. The reservation in respect of strikes, blockades, and lockouts applies even if the Lenders or the Agent themselves are subjected to such measures or take such measures.

Any loss or damage that may occur in other circumstances shall not be indemnified by the Lenders or the Agent provided that the Lenders and the Agent have observed general standard of care. No Party shall have any responsibility for indirect losses or damages of any kind of another Party. For the avoidance of doubt, except as otherwise expressly provided by this Credit Agreement, each Party shall be liable for damages caused by its failure to perform its obligations under this Credit Agreement.

Where a circumstance as referred to in the first paragraph prevents the Lenders from making a payment or taking other measures, the making of such payments and the taking of such measures may be postponed until the obstacle no longer exists.

Page 34 of 34

Where a circumstance as referred to in the first paragraph should prevent the Lenders from receiving payments, the Lenders shall, as long as the obstacle exists, be entitled to interest only on the terms prevailing on the date of maturity for the payment.

18
CURRENCY INDEMNITY

If, for the purpose of obtaining an award or judgement in any court it becomes necessary to convert into any other currency (the “Judgement Currency”) an amount due in a currency under this Credit Agreement then the conversion shall be made at the discretion of the Agent, at the rate of exchange prevailing on the date on which the award or judgement is given (the “Conversion Date”).

If there is a change in the rate of exchange prevailing between the Conversion Date and the date of actual payment of the amount due, the Borrower will pay such additional amounts (if any), but in any event not a lesser amount, as may be necessary to ensure that the amount paid in the Judgement Currency when converted at the rate of exchange prevailing on the date of payment will produce the amount then due in the currency specified under this Credit Agreement on the Conversion Date.

Any amount due from the Borrower under this clause 18 shall be due for payment as a separate debt and shall not be affected by an award or judgement being obtained for any other sums due under or in respect of this Credit Agreement.

The term “rate of exchange” in this clause 18 means the spot rate which the Agent in accordance with its normal practise is able on the relevant date to purchase the currency under this Credit Agreement with the Judgement Currency and includes any premiums and costs of exchange ordinarily payable in connection with such purchase.

19.
ARBITRATION, APPLICABLE LAW AND JURISDICTION

19.1
Arbitration

Any dispute, controversy or claim (a “Dispute”) arising out of or in connection with this Credit Agreement (including a dispute regarding the existence, validity or termination of this Credit Agreement or the consequences of its nullity) shall be referred to and finally settled by arbitration in accordance with the Rules of the Arbitration Institute of the Stockholm Chamber of Commerce (the “Rules”).

19.2
Procedure for Arbitration

The arbitral tribunal shall consist of three (3) arbitrators appointed in accordance with the Rules. The seat of arbitration shall be Stockholm and the language to be used in the arbitral proceedings shall be English.

19.3
Waiver of Immunity

Page 35 of 35

To the extent permitted under applicable law, the Borrower waives generally all immunity it or its assets or revenues may otherwise have in any jurisdiction, including immunity in respect of:

(i)
the giving of any relief by way of injunction or order for specific performance or for the recovery of assets or revenues; and

(ii)
the issue of any process against its assets or revenues for the enforcement of a judgement or, in an action in rem, for the arrest, detention or sale of any of its assets and revenues.

19.4
This Credit Agreement shall in all respects be governed by and construed in accordance with the laws of Sweden.

19.5
Without prejudice to any other mode of service, the Borrower:

(i)
hereby irrevocably appoints Law Debenture Corporate Services Limited at Princes House, 95 Gresham Street, London EC2V 7LY as its agent for service of process in relation to any proceedings before the Arbitration Institute of the Stockholm Chamber of Commerce in connection with this Credit Agreement and the Security Documents;

(ii)
agrees that failure by a process agent to notify it of the process will not invalidate the proceedings concerned;

(iii)
consents to the service of process relating to any such proceedings by delivery of a copy of the process to its address for the time being applying under clause 15.3 of this Credit Agreement;

(vi)
agrees that if the appointment of any person mentioned in paragraph (i) above ceases to be effective, it shall immediately appoint a further person in London or Sweden, to accept service of process on its behalf in London or Sweden and, failing such appointment within fifteen (15) days, the Lender is entitled to appoint a person by notice to the Borrower; and

(v)
agrees that nothing contained herein shall affect the right to serve process in any other manner permitted by law.

Page 36 of 36

IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to be duly executed in four counterparts on the day and year first above written.

 

	  
 	 As Lender
 Nordea Bank Sweden AB (publ)
 	  
 	 As Borrower
 OJSC “Vimpel-Communications”
 
	  
 	 By: 
 	 
 
 
 	  
 	 By: 
 	 
 
 
 
	  
 	  
 	 
 	  
 	  
 	 
 
	  
 	 Name: 
 	  
 	  
 	 Name:
 	 Jo Lunder
 
	  
 	 Title: 
 	  
 	  
 	 Title:
 	 General Director
 

 

	  
 	  
 	  
 	  
 
	  
 	 By: 
 	 
 
 
 	  
 	 By: 
 	 
 
 
 
	  
 	  
 	 
 	  
 	  
 	 
 
	  
 	 Name: 
 	  
 	  
 	 Name:
 	 Dmitry Steshchenko
 
	  
 	 Title: 
 	  
 	  
 	 Title:
 	 Chief Accountant
 

 

	  
 	 As Lender
 Bayerische Hypo- und Vereinsbank AG
 	  
 	 As Agent and Security Beneficiary
 Nordea Bank Sweden AB (publ)
 
	  
 	 By: 
 	 
 
 
 	  
 	 By: 
 	 
 
 
 
	  
 	  
 	 
 	  
 	  
 	 
 
	  
 	 Name: 
 	  
 	  
 	 Name:
 	  
 
	  
 	 Title: 
 	  
 	  
 	 Title:
 	  
 

 

	  
 	  
 	  
 	  
 
	  
 	 By: 
 	 
 
 
 	  
 	 By: 
 	 
 
 
 
	  
 	  
 	 
 	  
 	  
 	 
 
	  
 	 Name: 
 	  
 	  
 	 Name:
 	  
 
	  
 	 Title: 
 	  
 	  
 	 Title:
 	  
 

 

Page 37 of 37

Exhibit 1

FORM OF PLEDGE OF EQUIPMENT AGREEMENT

[attached]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit 2

CERTIFIED COPY OF THE SIGNED BOND LOAN AGREEMENT

[attached]

Page 38 of 38

Exhibit 3

DRAWDOWN NOTICE

From:
OJSC Vimpel-Communications

To:
Nordea Bank Sweden AB (publ)

Dated:
[date]

Dear Sirs,

1.
We refer to the agreement (the “Credit Agreement”) dated January 15, 2003 and made between OJSC Vimpel-Communications as borrower, Nordea Bank Sweden AB (publ) and Bayerische Hypo- und Vereinsbank AG as lenders and Nordea Bank Sweden AB (publ) as agent and security beneficiary. Terms defined in the Credit Agreement shall have the same meaning in this notice.

2.
This notice is irrevocable.

3.
We hereby give you notice that, pursuant to the Credit Agreement and on [date of proposed Drawing], we wish to borrow a Drawing in the amount of USD [amount in figures] under Tranche No. [number of relevant Tranche] upon the terms and subject to the conditions contained therein.

4.
We confirm that, at the date hereof, (i) no event or circumstance has occurred and is continuing which constitutes an Event of Default and (ii) the representations and warranties contained in clause 8 of the Credit Agreement are true in all material respects. 

5.
The proceeds of this drawdown should be credited to the bank account No. 40702840400001001001 opened with ING Bank (Eurasia) ZAO Moscow, Russia (SWIFT code: INGBRUMM).

6.
We enclose the relevant invoice(s).

 

	  
 	  
 	  
 	  
 	 Yours faithfully
 
	  
 	 
 
 
 	  
 	  
 	 
 
 
 
	  
 	  
 	  
 	  
 	 
 
	  
 	  
 	  
 	  
 	 Authorised Signatory
 for and on behalf of
 OJSC Vimpel-Communications
 

 

Page 39 of 39Exhibit 4.87

SHARE PURCHASE AGREEMENT

THIS SHARE PURCHASE AGREEMENT (this “Agreement”) dated December 15, 2002 between Telenor Mobile Communications AS, a company organized under the laws of Norway (the “Seller”), and Open Joint Stock Company “VimpelCom-Region”, an open joint stock company organized under the laws of the Russian Federation (the “Purchaser” and, together with the Seller, collectively, the “Parties” and, individually, each, a “Party”).

W I T N E S S E T H :

WHEREAS, the Seller is the owner of 35,035 registered shares of common stock, in uncertificated form, having a par value of one thousand (1,000) Russian rubles each (state share issuance registration numbers 21-1-01390 and 1-02-55001-R, dates of registration May 6, 1997 and July 30, 1997, respectively) (the “Shares”), of Closed Joint Stock Company “StavTeleSot”, a closed joint stock company organized under the laws of the Russian Federation, located at 10/12 Prospekt Oktyabrskoy Revolutsii, Stavropol, 355000, Russian Federation (the “Company”), and the Shares represent 49% of the issued and registered shares of common stock of the Company; and

WHEREAS, the Purchaser wishes to acquire from the Seller, and the Seller wishes to sell to the Purchaser, all of the Shares;

NOW, THEREFORE, the Parties agree as follows:

1.
SALE AND PURCHASE OF SHARES

1.1
Upon the terms and subject to the conditions set forth herein, the Seller agrees to sell the Shares to the Purchaser, and the Purchaser agrees to purchase the Shares from the Seller and pay for them (the “Transaction”).

The consummation of the Transaction (the “Closing”) shall be held at 10:00 a.m. (Moscow time) at the offices of the Company, located at 10/12 Prospekt Oktyabrskoy Revolutsii, Stavropol 355000, Russian Federation, on the first Business Day (as hereinafter defined) to occur on which each of the conditions precedent specified in Section 4 hereof have been fulfilled or waived (or on such other date as the Parties may agree in writing) (the “Closing Date”) simultaneously with the Closing under (and as defined in) the Share Purchase Agreement dated the date hereof between OAO “Stavtelecom” (“Stavtelecom”) and the Purchaser (the “Stavtelecom Share
Purchase Agreement”) (unless the Purchaser shall waive the condition precedent set forth in Section 4.2(c) that the Closing under (and as defined in) the Stavtelecom Share Purchase Agreement shall be simultaneous with the Closing hereunder). The Purchaser shall notify the Seller of (a) the proposed date of the Closing at least five (5) Business Days prior to such proposed Closing Date and (b) upon written notice from the Seller that all conditions specified in Section 4.2 hereof have been satisfied, the actual date of the Closing at least two (2) Business Days prior to such date. The Parties are committed to taking all necessary action so that the Closing will occur no later than March 31, 2003. At the Closing, each and all of the actions specified in Section 4 hereof shall take place, all of which shall be considered to be taking place simultaneously and none of which shall be considered to have taken place unless and until all of such actions shall have
taken place. As used herein, “Business Day” shall mean a day other than a Saturday, a Sunday or any day on which banks located in New York, New York, U.S.A., Oslo, Norway, London, England or Moscow, Russia are authorized or obliged to close.

1.2
Deliveries. At the Closing: (a) the Seller shall deliver to the Purchaser a true and correct extract from the share register of the Company, evidencing that the Shares are duly registered in the name of the Purchaser, free and clear of any Liens (as defined below) (other than the Company’s and other shareholders’ rights arising under the Company’s charter and the Foundation Agreement (as hereinafter defined) and Russian law in respect of future transfers of the Shares), (b) the Purchaser shall deliver to the Seller the Purchase Price in accordance with Section 2.3 hereof, and (c) the Seller and the Purchaser shall execute and deliver the Act of Delivery and Acceptance, substantially in the form of Exhibit A hereto.

2.
CONSIDERATION

2.1
Purchase Price. The total consideration for the Shares shall be the Russian ruble equivalent of twenty million nine hundred thousand US dollars (US$20,900,000.00) (the “Purchase Price”), calculated in accordance with the Exchange Rate (as defined below) on the date of payment, payable in full at Closing. As used herein, “Exchange Rate” shall mean the Russian ruble / US dollar official rate, as established by the Central Bank of Russia for the date of payment and published in Rossiiskaya Gazeta or posted on the Central Bank of Russia’s website (www.cbr.ru) on the date of payment, or, if the payment is made on
a day that follows a Sunday or a public holiday, as published in the last issue of Rossiiskaya Gazeta before the date of payment or posted on the Central Bank of Russia’s website (www.cbr.ru). The Purchase Price shall be inclusive of all taxes and other duties, if any, which the Seller shall be solely responsible for and shall be obligated to pay in connection with the Transaction. 

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2.2
Conversion Costs. The Purchaser shall reimburse the Seller for any and all costs incurred by the Seller in connection with the conversion of the Russian ruble-denominated proceeds of the Purchase Price from Russian rubles into US dollars (including, without limitation, the fees, if any, charged by the Seller’s Bank (as hereinafter defined) for such conversion and an amount equal to the difference between the US dollar proceeds of such conversion (at the conversion rate actually applied by the Seller’s Bank) and the US dollar proceeds which would have been received by the Seller had the Exchange Rate been used for such conversion) (collectively, the “Conversion Costs”); provided, however, that the Purchaser shall
reimburse the Seller for such Conversion Costs only if the Seller uses its best efforts to (a) cause such conversion to be effected as soon as possible and in any case not later than one (1) Business Day following the receipt of such payment in the Seller’s Russian Bank Account and (b) cause such conversion of Russian rubles into US dollars to be effected at the most favorable rate commercially available to the Seller from the Seller’s Bank. The Seller shall notify the Purchaser of the amount of such Conversion Costs (and provide reasonable documentary evidence thereof) within ten (10) Business Days after the receipt of the Purchase Price, and the Purchaser shall reimburse the Seller for the amount specified in such notice by wire transfer to the Seller’s Russian Bank Account (as hereinafter defined) within three (3) Business Days of receipt of such notice.

2.3
Payment of Purchase Price. Subject to the terms and conditions hereof and in consideration of the sale and transfer of the Shares to the Purchaser by the Seller, on the Closing Date, the Purchaser shall pay to the Seller, by wire transfer, in immediately available funds, to the Seller’s Russian Bank Account (as defined below), the Purchase Price. As used herein, “Seller’s Russian Bank Account” shall mean the Russian ruble-denominated bank account of Telenor East Invest AS, the agent for the Seller, held at ZAO Citibank (the “Seller’s Bank”), or such other bank account as may be designated in writing by the Seller pursuant to Section 4.2(i). Upon
confirmation of receipt of the Purchase Price in the Seller’s Russian Bank Account, the Seller shall deliver to the Purchaser a true and correct extract from the share register of the Company, evidencing the due registration of the Shares in the name of the Purchaser, free and clear of any Liens (other than the Company’s and other shareholders’ rights arising under the Company’s charter and the Foundation Agreement and Russian law in respect of future transfers of the Shares).

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3.
REPRESENTATIONS AND WARRANTIES

3.1
Representations and Warranties of Seller. The Seller represents and warrants to the Purchaser that, on and as of the date of this Agreement and on and as of the Closing Date:

(a)
The Seller is duly organized and validly existing as a company organized under the laws of Norway and has all requisite corporate and other power and authority to carry on its business as now being and heretofore conducted and to own, use, lease, operate and dispose of the assets and properties which it currently owns, uses, leases and operates.

(b)
The Seller has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder, and to consummate the Transaction, including, without limitation, to sell the Shares to the Purchaser. The execution and delivery of this Agreement by the Seller and the performance by the Seller of its obligations hereunder have been duly and validly authorized, and no other corporate action on the part of the Seller, its board of directors or its shareholders is necessary therefor.

(c)
This Agreement has been duly and validly executed and delivered by the Seller and constitutes the legal, valid and binding obligation of the Seller, enforceable against the Seller in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights and remedies generally and by general equitable principles (whether applied by a court of law or equity).

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(d)
The execution, delivery and performance by the Seller of this Agreement and the consummation by the Seller of the Transaction will not:

(i)
conflict with or result in a violation or breach of any of the terms or conditions of the Seller’s charter (vedtekter);

(ii)
subject to obtaining the consents, approvals and actions, making the filings and giving the notices specified in Schedule 3.1(d)(ii) hereto, conflict with or result in a violation or breach of any term or provision of any law or any writ, judgment, decree, injunction or similar order of any governmental or regulatory authority (an “Order”) applicable to the Seller or any of its assets and properties; or

(iii)
subject to obtaining the third party consents specified in Schedule 3.1(d)(ii) hereto, conflict with or constitute a breach of or result in a default under any agreement, letter of intent, lease, evidence of Indebtedness (as hereinafter defined), mortgage, pledge agreement or other contract or understanding (whether written or oral) (collectively, “Contracts”) or any license, permit, certificate, authorization, approval, registration or consent granted by any governmental or regulatory authority (collectively, “Licenses”) to which the Seller is a party or by which any of its assets and properties (including, without limitation, any Shares) is bound. As used herein “Indebtedness” shall mean, with respect to any Person, all obligations of such Person (A) for borrowed money, (B) evidenced by notes, bonds, debentures or similar instruments, (C) for the deferred purchase price of goods or services (other than trade payable or accruals incurred in the ordinary course of business), (D) under capital leases or (E) in the nature of a guarantee of any obligation described in clauses (A) through (D) above.

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(e)
Except as specified in Schedule 3.1(d)(ii) hereto, no consent, approval or action of, filing with or notice to any governmental or regulatory authority of the Russian Federation or Norway on the part of the Seller is required in connection with the Seller’s execution, delivery or performance of this Agreement or the consummation by the Seller of the Transaction.

(f)
There are no actions, suits, administrative proceedings or arbitration proceedings (collectively, “Actions or Proceedings”) pending or, to the knowledge of the Seller, threatened against, the Seller or any of its assets and properties which could reasonably be expected to result in the issuance of an Order which (i) questions the validity of this Agreement or any action taken or to be taken pursuant hereto or (ii) restrains, enjoins or otherwise prohibits or makes illegal the consummation of any of the transactions contemplated by this Agreement.

(g)
The Seller beneficially owns the Shares, free and clear of any mortgage, pledge, assessment, security interest, lease, lien, adverse claim, purchase right, preemptive right, right of first refusal, levy, tax, charge or other encumbrance of any kind, or any similar rights, commitment, claim or demand, or any conditional sale Contract, title retention Contract or other Contract to give effect to any of the foregoing (collectively, “Liens”) (other than the Company’s and other shareholders’ rights arising under the Company’s charter and the Foundation Agreement and Russian law in respect of future transfers of the Shares). On the Closing Date, the Seller will have full right, power and authority to sell, assign, transfer and deliver the
Shares to the Purchaser. Upon registration of the Shares in the name of the Purchaser in the register of the Company’s shareholders, against payment therefor in accordance with the terms of this Agreement, good and valid title to the Shares, free and clear of all Liens (other than the Company’s and other shareholders’ rights arising under the Company’s charter and the Foundation Agreement and Russian law in respect of future transfers of the Shares), will be transferred to the Purchaser.  The Shares have been duly authorized and validly issued, are fully paid and non-assessable, are not subject to any preemptive or similar rights with respect to the Company or any other shareholder (other than as provided in the Company’s charter and the Foundation Agreement and Russian law), and were properly registered with the appropriate authorities competent for registration of the issue of such shares. The Shares are uncertificated. The Shares constitute no less than 49%
of the outstanding share capital of the Company.

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(h)
Except as provided in the Company’s charter, the Foundation Agreement and Russian law, there are no outstanding options, warrants or other rights granted or issued by the Company and entitling any Person to purchase or otherwise acquire from the Company any shares of common stock or any other securities of the Company.

(i)
Except as specified in Schedule 3.1(i) hereto, all negotiations relating to this Agreement and the transactions contemplated hereby have been carried out by the Seller directly with the Purchaser without the intervention of any Person (as hereinafter defined) on behalf of the Seller in such manner as to give rise to any valid claim by any Person against the Purchaser for any finder’s fee, brokerage commission or similar payment. As used herein, “Person” shall mean any natural person, corporation, partnership, limited liability company, proprietorship, other business organization, trust, union, association or governmental or regulatory authority, whether incorporated or unincorporated.

(j)
Except as disclosed in Schedule 3.1(j) and Schedule 3.2(I) hereto, (i) there is no Indebtedness or other liability of the Company the value of which exceeds US$1,000,000 in the aggregate or (ii) any material Liens on any of the assets and properties of the Company.

(k)
All information given by, or on behalf of, the Seller to the Purchaser regarding the Shares is true, complete, accurate and not misleading, no such information contains any untrue statement of material fact or omits to state a material fact necessary in order to make the statements herein or therein, in light of the circumstances under which they were made, not misleading, and all material information to which the Seller has access or of which the Seller has knowledge concerning the Shares has been disclosed to the Purchaser.

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3.2
Representations and Warranties of Seller regarding Company. Subject to the information contained in the documents provided in the data room established by the Seller for the benefit of the Purchaser (a list of which documents is attached hereto as Schedule 3.2(I)), the Seller represents and warrants to the Purchaser that, on and as of the date of execution of this Agreement and on and as of the Closing Date, except as set forth on the Schedules hereto, to the Knowledge of the Seller (as hereinafter defined):

(a)
The Company and each of its Subsidiaries (as hereinafter defined) is a closed joint stock company and has been duly organized, is validly existing as a legal entity properly organized, registered and existing under the laws of the Russian Federation, with corporate power and authority to carry on its business as it is currently being conducted and to own, lease and operate its assets and properties.  

(b)
Except as described in Schedule 3.2(b) hereto, neither the Company nor any of its Subsidiaries is in default under any provision of any Contract to which it is a party or by which it is bound, which involves an obligation of the Company to make payments in any year to any Person exceeding US$50,000 in the aggregate or which default would have a Material Adverse Effect (as hereinafter defined) on the Company and no event has occurred which, but for the passage of time or the giving of notice, would constitute such a default. As used herein, “Material Adverse Effect” shall mean, with respect to any Person (as hereinafter defined), a material adverse effect on or with respect to the business, assets, financial condition or results of operations of such
Person and its Subsidiaries (as hereinafter defined) taken as a whole. As used herein, “Subsidiary” shall mean, with respect to any Person, (i) any corporation in which such Person owns or controls, directly or indirectly, more than fifty percent (50%) of the securities having ordinary voting power for the election of directors or other governing body of such corporation and/or (ii) any partnership, association, joint venture or other entity in which such Person owns or controls, directly or indirectly, more than fifty percent (50%) of the equity interests of such partnership, association, joint venture or other entity.

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(c)
Neither the Company nor any of its Subsidiaries is on notice with respect to any intended or possible suspension, termination, withdrawal or cancellation of any of its Telecommunications Licenses (as hereinafter defined).  Except as disclosed in Schedule 3.2(c) hereto, the Company and each of its Subsidiaries has fulfilled and performed all of its material obligations with respect to its Telecommunications Licenses, and no event has occurred which allows, or after notice or lapse of time would allow, suspension, revocation or termination thereof or would result in any other material impairment of the rights of the Company or any of its Subsidiaries, as applicable, in respect of any such Telecommunications Licenses. No such Telecommunications License contains any restriction that has or could have
a Material Adverse Effect on the Company. As used herein, “Telecommunications Licenses” shall mean, collectively, the Licenses described in Schedule 3.2(c) hereto. 

(d)
There are no Actions or Proceedings pending or threatened against the Company or any of its Subsidiaries which, if determined adversely to the Company or any of its Subsidiaries, could reasonably be expected to result in, individually or in the aggregate, any judgments or awards against the Company in excess of US$50,000 or could reasonably be expected to have a Material Adverse Effect on the Company.

(e)
As of the date of this Agreement, the entire charter capital of the Company consists of 71,500 shares of common stock. All such shares have been duly authorized and validly issued, are fully paid and non-assessable, are not subject to any pre-emptive or similar rights with respect to the Company or any other shareholder (other than as provided in the Company’s charter and the Foundation Agreement and Russian law), and were properly registered with the appropriate authorities competent for registration of the issue of such shares. All of the shares of the Company are uncertificated.

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(f)
Subject to obtaining the third party consents referred to in Schedule 3.1(d)(ii) hereto, neither the execution of this Agreement nor the consummation of the Transaction will (i) violate any material law, regulation, rule, judgment, Order or other restriction of any governmental or regulatory authority to which the Company is subject or by which any of the assets and properties of the Company is bound, (ii) conflict with or constitute a breach of any terms or provisions of the Company’s charter, (iii) conflict with or constitute a breach of or default under any material Contract or License to which the Company or any of its Subsidiaries is a party or by which any of the assets and properties of the Company is bound, (iv) require the mandatory prepayment of any Indebtedness of the Company or any of its
Subsidiaries prior to the maturity stated therein, or (v) result in the early termination of any Contract or License to which the Company or any of its Subsidiaries is a party or the imposition of any Lien on any of the assets and properties of the Company or any of its Subsidiaries. 

(g)
The Company has good and marketable title to, or a valid leasehold interest in, each base station used by it in its business which has a value equal to or in excess of US$20,000.

(h)
All material assets of the Company are in good operating condition and in no need of special maintenance or repair.

(i)
Except as disclosed in Schedule 3.2(i) hereto, the Company does not hold any shares or other equity interests in any other Person. With respect to each entity listed in Schedule 3.2(i) which is a Subsidiary of the Company, the shares of such Subsidiary owned by the Company constitute no less than the percentage indicated in Schedule 3.2(i) of the outstanding share capital of such Subsidiary, and such shares owned by the Company have been duly authorized and validly issued, are fully paid and non-assessable, are not subject to any pre-emptive or similar rights with respect to the Company or any other shareholder (other than as provided in such Subsidiary’s charter and foundation agreement and Russian law), and were properly registered with the appropriate authorities competent for registration of the
issue of such shares; and such shares are uncertificated. 

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(j)
The most recent financial statements of the Company were prepared and audited in accordance with Russian accounting standards, consistent with past practice. Such financial statements present the financial position of the Company as of September 30, 2002 in accordance with Russian accounting standards. The accounts receivable of the Company reflected in such financial statements and the accounts receivable arising subsequent to the date of such financial statements arose from bona fide sales transactions in the ordinary course of business and are payable on ordinary trade terms, are legal, valid and binding obligations of the respective debtors generally enforceable in accordance with their terms, are collectible in the ordinary course of business consistent with past practice in the aggregate recorded
amounts thereof, net of any applicable reserve reflected in such financial statements, and are not the subject of any actions or proceedings brought by or on behalf of the Company or any of its Subsidiaries (except actions or proceedings against subscribers brought by the Company or any of its Subsidiaries in the ordinary course of business).

(k)
The Company owns or has the right to use the intellectual property employed by it in connection with its business as it is currently being conducted. 

(l)
Since September 30, 2002, there has not been any material adverse change in the condition (financial or otherwise) or prospects of the Company, and, except for the transactions contemplated by this Agreement and the Stavtelecom Share Purchase Agreement and the transactions disclosed in Schedule 3.2(l) hereto, there has been no transaction entered into by the Company which is material to the Company other than in the ordinary course of business.

(m)
All information given by, or on behalf of, the Company and the Seller to the Purchaser is true, complete, accurate and not misleading, no such information contains any untrue statement of material fact or omits to state a material fact necessary in order to make the statements herein or therein, in light of the circumstances under which they were made, not misleading, and all material information concerning the Company’s share capital and the Company’s business has been disclosed to the Purchaser.

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(n)
Neither the Company, nor any of its Subsidiaries, nor any director, officer, agent, employee or other Person acting on behalf of the Company or any of its Subsidiaries has, in the course of its actions for, or on behalf of, the Company (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity, (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds, (iii) violated (or is in violation of) any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended, or (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic government official or employee.

(o)
The Company has duly filed with the appropriate taxing authorities (or has received an extension for filing with respect to) all material tax documents required to be filed by it, and each such tax document was, when filed, accurate and complete in all material respects, and the Company has duly paid, on time, or has made adequate reserves for, or has contested in good faith, all material taxes required to be paid or remitted by it or levied against it and no material tax deficiency is currently asserted against the Company. 

(p)
 Not more than fifty percent (50%) of the assets of the Company consists of real estate situated on the territory of the Russian Federation. Accordingly, under current law, the income received by the Seller from the sale of the Shares hereunder will not be income of a foreign organization from sources in the Russian Federation and will not be subject to any tax being withheld at the source of payment of income for the purposes of Section 309 of the Tax Code of the Russian Federation, or, on or prior to the date of Closing, the Seller will have obtained from the Norwegian tax authorities and provided to the Purchaser confirmation that the Seller is a tax resident of Norway.

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(q)
Except for any violation or alleged violation of, or default or alleged default under, any law or Order applicable to the Company or any of its assets and properties which has been settled or otherwise resolved, neither the Company nor any of its Subsidiaries is or has received a written notice that it is or has been in violation or in default under any law or Order applicable to it or its assets and properties, in each case, which could have a Material Adverse Effect on the Company. 

As used herein, “Knowledge of the Seller” shall mean the actual knowledge of the individuals named on Schedule 3.2(II) hereto

3.3
Representations and Warranties of Purchaser. The Purchaser represents and warrants to the Seller that, on and as of the date of this Agreement and on and as of the Closing Date:

(a)
The Purchaser is duly organized and validly existing as an open joint stock company under the laws of the Russian Federation and has all requisite corporate and other power and authority to carry on its business as now being and heretofore conducted and to own, use, lease, operate and dispose of the assets and properties which it currently owns, uses, leases and operates.

(b)
Except as set forth in Schedule 3.3(d)(ii) hereto, the Purchaser has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder. The execution and delivery of this Agreement by the Purchaser, and the performance by the Purchaser of its obligations hereunder have been duly and validly authorized and no other corporate action on the part of the Purchaser, its board of directors or its shareholders is necessary therefore.

(c)
This Agreement has been duly and validly executed and delivered by the Purchaser and constitutes the legal, valid and binding obligation of the Purchaser, enforceable against the Purchaser in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights and remedies generally and by general equitable principles (whether applied by a court of law or equity).

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(d)
The execution, delivery and performance by the Purchaser of this Agreement and the consummation by the Purchaser of the Transaction will not:

(i)
conflict with or result in a violation or breach of any of the terms or conditions of the Purchaser’s charter;

(ii)
subject to obtaining the consents, approvals and actions, making the filings and giving the notices specified in Schedule 3.3(d)(ii) hereto, conflict with or result in a violation or breach of any term or provision of any law or Order applicable to the Purchaser or any of its assets and properties;

(iii)
subject to obtaining the consents specified in Schedule 3.3(d)(ii) hereto, conflict with, constitute a breach of or result in a default under any Contract or License to which the Purchaser is a party or by which any of its assets and properties is bound; or

(iv)
conflict with any of the Company’s internal policies and/or procedures, including, without limitation, any policy with respect to insider trading.

(e)
Except as specified in Schedule 3.3(d)(ii) hereto, no consent, approval or action of, filing with or notice to any governmental or regulatory authority of the Russian Federation on the part of the Purchaser is required in connection with the Purchaser’s execution, delivery or performance of this Agreement or the consummation by the Purchaser of the Transaction.

(f)
There are no Actions or Proceedings pending or, to the knowledge of the Purchaser, threatened against, the Purchaser or any of its assets and properties which could reasonably be expected to result in the issuance of an Order which (i) questions the validity of this Agreement or any action taken or to be taken pursuant hereto, or (ii) restrains, enjoins or otherwise prohibits or makes illegal the consummation of any of the transactions contemplated by this Agreement.

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(g)
All negotiations relating to this Agreement and the transactions contemplated hereby have been carried out by the Purchaser directly with the Seller without the intervention of any Person on behalf of the Purchaser in such manner as to give rise to any valid claim by any Person against the Seller for any finder’s fee, brokerage commission or similar payment.

(h)
There is no breach of any representation or warranty made by the Seller in this Agreement of which the Purchaser has actual knowledge.

4.
CONDITIONS PRECEDENT

4.1
Conditions Precedent to Seller’s Obligations. The Seller shall not be obligated to transfer the Shares to the Purchaser unless and until the following conditions have been satisfied (or waived in writing by the Seller):

(a)
The Purchaser’s representations and warranties contained in this Agreement shall be true and correct on and as of the Closing Date

(b)
The Purchaser shall have fully performed and complied with its obligations under Section 5.2 (to the extent not waived in writing by the Seller).

(c)
There shall not be in effect on the Closing Date any Order or law restraining, enjoining or otherwise prohibiting or making illegal the consummation of any of the transactions contemplated by this Agreement and there shall not be pending on the Closing Date any Action or Proceeding or any other action in, before or by any governmental or regulatory authority which could reasonably be expected to result in the issuance of any such Order or the enactment, promulgation or deemed applicability to the Purchaser or the Seller or the transactions contemplated by this Agreement of any such law.

(d)
All consents, approvals and actions of, filings with and notices to any governmental or regulatory authority specified in Schedule 3.3(d)(ii) hereto which are required to have been obtained, made or given (as applicable) by the Purchaser pursuant to applicable law and are necessary for the performance of the obligations of the Purchaser under this Agreement (i) shall have been duly obtained, made or given, (ii) shall not be subject to the satisfaction of any condition that has not been satisfied or waived (unless any such condition relates to reporting or other requirements which by the terms of such consents, approvals, actions, filings or notices can only be effected on or after the Closing) and (iii) shall be in full force and effect, and all terminations or expirations of waiting periods imposed by any
governmental or regulatory authority shall have occurred.

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(e)
All necessary third party consents (or in lieu thereof waivers) and agreements specified in Schedule 3.3(d)(ii) hereto (i) shall have been obtained by the Purchaser, (ii) shall not be subject to the satisfaction of any condition that has not been satisfied or waived (unless any such condition relates to reporting or other requirements which by the terms of such consents can only be effected on or after the Closing) and (iii) shall be in full force and effect.

(f)
The Purchaser shall have delivered to the Seller a certificate of the Secretary of the Board of Directors of VimpelCom as to the incumbency of, and such other documents as are necessary to evidence the signatory authority of, the Person or Persons executing this Agreement, and all other documents delivered hereunder on behalf of the Purchaser, attached to which are true and correct copies of the Purchaser’s charter and resolutions of the Purchaser’s shareholders, authorizing the Purchaser’s execution, delivery and performance of this Agreement and the acquisition of the Shares in accordance with the terms hereof.

(g)
The Purchaser shall have delivered by hand, by courier or by fax to the Seller the documents listed in Schedule 4.1(h) hereto.

(h)
The Company and the Seller shall have executed (A) a settlement agreement and promissory note (the “Settlement Agreement and Promissory Note”) in respect of the payment of the Russian ruble equivalent of one million four hundred seventy-one thousand five hundred fifteen US dollars and thirty-five cents (US$1,471,515.35) owed by the Company to the Seller (the “Company Debt”) under the Security Agreement dated November 4, 1997 (the “Security Agreement”) between the Company and the Seller and the Management Consultancy Agreement dated January 4, 1998 (the “Management Consultancy Agreement”) between the Company and the Seller, with at least US$500,000 of the outstanding principal amount thereof being due and payable on June 30, 2003, US$500,000 being due and payable on December 31, 2003 and the remaining balance thereof being due and payable on June 30, 2004, in each case, to the Seller’s Russian Bank Account,  (B) Amendment No. 1 to the Security Agreement  in the form attached as Exhibit A to the Settlement Agreement and Promissory Note and (C) Amendment No. 1 to the Management Consultancy Agreement in the form attached as Exhibit B to the Settlement Agreement and Promissory Note. 

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(i)
VimpelCom and the Seller shall have entered into a binding guarantee agreement  (the “Guarantee”) satisfactory in form and substance to the Seller under which VimpelCom shall have agreed to (i) ensure that (A) the Seller is released from all of its obligations under the  Guarantee dated November 4, 1997 between the Seller and Citibank, N.A. in respect of the Company’s obligations under the Credit Agreement dated November 4, 1997 among the Company, ZAO Citibank and the Seller (the “Citibank Credit Agreement”) and (B) if the Seller, ZAO Citibank and the Company have not entered into Amendment No. 1 to the Citibank Credit Agreement providing, among other things, that the Seller shall cease to
be a party to the Citibank Credit Agreement, the Seller is released from all of its obligations, if any, under the Citibank Credit Agreement, in each case, no later than February 14, 2003; provided, that the Parties agree that VimpelCom shall have no obligation to provide refinancing in respect of such obligations or provide a guarantee in respect of such obligations, and (ii) guarantee repayment by the Company to the Seller of the Company Debt under (and in accordance with the terms of) the Settlement Agreement and Promissory Note.

(j)
(i) ZAO Citibank shall have delivered to the Company and the Seller a waiver in form and substance satisfactory to the Seller confirming that ZAO Citibank has waived any event of default under the Citibank Credit Agreement which, in the absence of such waiver, would arise as a result of the consummation of the Transaction, or (ii) the Seller, ZAO Citibank and the Company shall have entered into Amendment No. 1 to the Citibank Credit Agreement providing, among other things, that the consummation of the Transaction will not result in a default under the Citibank Credit Agreement or require payment of the outstanding principal amount of the loans thereunder prior to their scheduled maturity.

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4.2
Conditions Precedent to Purchaser’s Obligations. The Purchaser shall not be obligated to purchase the Shares from the Seller unless and until each of the following conditions has been satisfied (or waived in writing by the Purchaser):

(a)
The Seller’s representations and warranties contained in this Agreement shall be true and correct on and as of the Closing Date.

(b)
The Seller shall have fully performed and complied with its obligations under Section 5.1 (to the extent not waived in writing by the Purchaser).

(c)
All conditions precedent required to have been fulfilled by Stavtelecom under (and as defined in) the Stavtelecom Share Purchase Agreement shall have been fulfilled (or waived in writing by the Purchaser), and the closing under the Stavtelecom Share Purchase Agreement shall be consummated on the Closing Date simultaneously with the Closing.

(d)
There shall not be in effect on the Closing Date any Order or law restraining, enjoining or otherwise prohibiting or making illegal the consummation of any of the transactions contemplated by this Agreement and there shall not be pending on the Closing Date any Action or Proceeding or any other action in, before or by any governmental or regulatory authority which could reasonably be expected to result in the issuance of any such Order or the enactment, promulgation or deemed applicability to the Purchaser or the Seller or the transactions contemplated by this Agreement of any such law.

(e)
All consents, approvals and actions of, filings with and notices to any governmental or regulatory authority specified in Schedule 3.1(d)(ii) and Schedule 3.3(d)(ii) hereto which are required to have been obtained, made or given (as applicable) by the Seller or the Purchaser, as applicable, pursuant to applicable law and are necessary for the performance of the obligations of the Seller or the Purchaser, as applicable, under this Agreement (i) shall have been duly obtained, made or given, (ii) shall not be subject to the satisfaction of any condition that has not been satisfied or waived (unless any such condition relates to reporting or other requirements which by the terms of such consents, approvals, actions, filings or notices can only be effected on or after the Closing) and (iii) shall be in full
force and effect, and all terminations or expirations of waiting periods imposed by any governmental or regulatory authority shall have occurred.

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(f)
All necessary third party consents (or in lieu thereof, waivers) and agreements specified in Schedule 3.1(d)(ii) and Schedule 3.3(d)(ii) hereto (i) shall have been obtained by the Seller or the Purchaser, as applicable, (ii) shall not be subject to the satisfaction of any condition that has not been satisfied or waived (unless any such condition relates to reporting or other requirements which by the terms of such consents can only be effected on or after the Closing) and (iii) shall be in full force and effect.

(g)
The Seller shall have delivered to the Purchaser a certificate of a director of the Seller as to the incumbency of, and such other documents as are necessary to evidence the signatory authority of, the Person or Persons executing this Agreement, the share transfer order for the transfer of the Shares to the Purchaser (the “Transfer Order”) and all other documents required to be delivered hereunder on behalf of the Seller, attached to which are true and correct, duly apostilled and notarized copies of the Seller’s constitutive documents and resolutions of the Seller’s board of directors, and, if required by applicable law, the Seller’s shareholders, authorizing the Seller’s execution, delivery and performance of this Agreement and
the sale of the Shares in accordance with the terms hereof.

(h)
The Seller shall have delivered to the Purchaser (a) the documents listed in Schedule 4.2(h) hereto and (b) an extract from the register of the Company’s shareholders dated the Closing Date, showing the Seller as the owner of the Shares, free and clear of all Liens (other than the Company’s and other shareholders’ rights arising under the Company’s charter and the Foundation Agreement and Russian law in respect of future transfers of the Shares).

(i)
If the Seller wishes the Purchase Price to be paid to a bank account other than the account specified in Section 7.8, the Seller shall have delivered (or caused to be delivered) to the Purchaser at least three (3) Business Days prior to the date on which such payment is scheduled to be made the Seller’s instruction for the wire transfer of the Purchase Price.

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(j)
The Purchaser shall have obtained a fairness opinion from United Financial Group, addressed to VimpelCom’s board of directors, as to the fairness, from a financial point of view, to VimpelCom and its minority shareholders, of the transactions with the Seller contemplated hereby.

(k)
(i) ZAO Citibank shall have delivered to the Company and the Seller a waiver confirming that ZAO Citibank has waived any event of default under the Citibank Credit Agreement which, in the absence of such waiver, would arise as a result of the consummation of the Transaction, or (ii) the Seller, ZAO Citibank and the Company shall have entered into Amendment No. 1 to the Citibank Credit Agreement providing, among other things, that the consummation of the Transaction will not result in a default under the Citibank Credit Agreement or require payment of the outstanding principal amount of the loans thereunder prior to their scheduled maturity.

(l)
The shareholders of the Company shall have entered into an amendment to the Company’s Foundation Agreement dated November 20, 1996 (the “Foundation Agreement”), which has the effect of deleting Section 10 thereof, or the shareholders of the Company shall have irrevocably waived their respective rights under Section 10 of the Foundation Agreement.

5.
COVENANTS

5.1
Covenants of Seller. The Seller covenants and agrees with the Purchaser that, at all times from and after the date hereof until the Closing, the Seller will comply with all covenants and provisions of this Section 5.1.

(a)
The Seller will not take, nor will it permit any of its affiliates (or authorize or permit any investment banker, financial advisor, attorney, accountant or other Person (as hereinafter defined) retained by or acting for or on its behalf or on behalf of any such affiliate) to take, directly or indirectly, any action to initiate, assist, solicit, negotiate, encourage or accept any offer or inquiry from any Person (or any Person known by the Seller to be acting on behalf of another Person) to engage in, reach any agreement or understanding (whether or not such agreement or understanding is absolute, revocable, contingent or conditional) for the transfer, assignment, pledge, acquisition or other disposition of any of the Shares. If the Seller (or any Person acting for or on its behalf) receives from any Person
any offer, inquiry or informational request relating to any transaction of the type referred to in this Section 5.1(a), the Seller will promptly advise the Purchaser in writing of such offer, inquiry or request and, if such offer, inquiry or request is in writing, deliver a copy thereof to the Purchaser. 

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(b)
The Seller shall take all steps necessary and proceed diligently and in good faith to satisfy each condition precedent contained in Section 4.2 which is required to be fulfilled by it, and shall immediately notify the Purchaser when the Seller believes such conditions precedent have been fulfilled or when the Seller is unable to satisfy any such condition precedent. 

(c)
The Seller shall not take any action, directly or indirectly, to increase the charter capital of the Company (unless so required by the applicable legislation of the Russian Federation).

(d)
The Seller, in its capacity as a shareholder of the Company, shall vote its shares of the Company at meetings of the shareholders of the Company (or in written consents in lieu of meetings), and, subject to compliance with directors’ fiduciary duties and Russian law, shall cause the three (3) members of the board of directors of the Company nominated by the Seller to vote at meetings of the board of directors of the Company (or in written consents in lieu of meetings), in such a way so as:

(i)
not to permit (A) any change in the Company’s corporate structure, organization or existence or (B) the termination, withdrawal or cancellation of any approvals, Licenses, permits or authorizations necessary for the Company to carry on its business as now conducted and consistent with past practice;

(ii)
not to permit any steps that may result in material changes in the assets or liabilities of the Company;

(iii)
not to cause or permit the Company to pledge any assets, enter into any commitments or assume any Indebtedness or create any Liens with respect to all or substantially all assets of the Company;

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(iv)
to ensure that the activities of the Company are conducted in the ordinary course of business consistent with past practice; 

(v)
 not to permit the Company to take any step that may result in the termination of this Agreement, or the failure of the Closing to occur;

(vi)
not to permit the Company to grant or promise any increase in the compensation or remuneration (including bonuses) payable or to become payable to any officer, director, employee, agent, independent contractor or consultant of the Company (other than increases made in the ordinary course of business), or any acceleration in the rate at which any such compensation accrues;

(vii)
not to permit the Company to make any investment in any fixed asset or otherwise enter into any other transaction other than in the ordinary course of business, in each case, having a value in excess of one hundred thousand US dollars (US$100,000)  (or the Russian ruble equivalent thereof calculated on the basis of the Exchange Rate), whether in a single transaction or a series of related transactions; and

(viii)
to cause the Company to permit representatives of the Purchaser to have full access at all reasonable times, and in such a manner so as not to interfere with the normal business and operations of the Company, to all premises, properties, personnel, books, records, contracts, documentation and information required for the Purchaser’s due diligence investigation of the Company.

5.2
Covenant of Purchaser. The Purchaser covenants and agrees with the Seller that, at all times from and after the date hereof until the Closing, the Purchaser shall take all steps necessary and proceed diligently and in good faith to satisfy each condition precedent contained in Section 4.1 which is required to be fulfilled by it, and shall immediately notify the Seller when the Purchaser believes such conditions have been fulfilled or when the Purchaser is unable to satisfy any such condition precedent.

6.
PUBLIC STATEMENTS AND CONFIDENTIALITY

6.1
No Public Statements. No announcement or press release concerning the Transaction or any matter ancillary thereto shall be made by either Party either before or after the Closing Date, without the prior written consent of the other Party, provided that nothing herein shall prevent either Party from making any announcement, notice or filing required by law or the rules of any stock exchange or securities regulatory authority to which such Party is subject; provided further that VimpelCom and Telenor ASA may issue press releases regarding the Transaction immediately upon the Closing and file copies of the same with the United States Securities and Exchange Commission, The New York Stock Exchange, Nasdaq and the Oslo Stock Exchange, as applicable.

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6.2
Non-disclosure of Present Arrangement. The Parties shall treat as confidential for the period of three (3) years from the date hereof the terms of this Agreement and shall not, directly or indirectly, disclose, or permit the disclosure, of such terms, conditions or other aspects thereof, without prior written consent of the other Party (which consent shall not be unreasonably withheld or delayed), except to the legal, financial or business consultants or auditors of the relevant Party or to the Party’s affiliates, or to third parties from whom a Party is required to obtain a consent or approval specified herein, provided that nothing herein shall prevent either Party from making any announcement, notice or filing required by law or the rules of any stock exchange or
securities regulatory authority to which such Party is subject. 

7.
MISCELLANEOUS

7.1
Indemnification.

(a)
Subject to Section 7.1(c) hereof, each Party (the “Indemnifying Party”) agrees to indemnify, defend and hold harmless the other Party (and its principals, officers, directors, employees, affiliates and assigns) (the “Indemnified Party”) from and against any and all losses, liabilities, damages, deficiencies, costs or expenses, including attorneys’ fees, disbursements or other charges (collectively, “Losses”), based upon, arising out of, or otherwise in respect of any inaccuracy in or any breach of any representation, warranty, covenant or undertaking of the Indemnifying Party contained in this Agreement (but excluding any claims for
lost profits). Each Party’s indemnity hereunder shall be in addition to any liability to which the Indemnifying Party may otherwise be subject, provided that any recovery by the Indemnified Party from the Indemnifying Party in respect of a claim under this Section 7.1 shall be without duplication of any other recovery for such claim by the Indemnified Party from the Indemnifying Party.  In the event that any claim is asserted against the Indemnified Party, or the Indemnified Party is made a party defendant in any Action or Proceeding, and such claim, Action or Proceeding involves a matter which is the subject of a claim for indemnification under this Section 7.1, then the Indemnified Party shall (i) promptly give written notice pursuant to Section 7.7 hereof  to the Indemnifying Party, of such claim, Action or Proceeding, and (ii) not make any admission of liability, agreement or compromise with any Person in relation to such claim without prior written notice to the Indemnifying
Party; and the Indemnifying Party shall have the right to join in the defense of said claim, Action or Proceeding at the Indemnifying Party’s own cost and expense and, if the Indemnifying Party agrees in writing to be bound by and to promptly pay the full amount of any final judgment from which no further appeal may be taken to the extent such judgment involves an indemnifiable claim under this Section 7.1 and subject to the limitations in Section 7.1(c), and if the Indemnified Party is reasonably assured of the Indemnifying Party’s ability to satisfy such agreement, then, at the option of the Indemnifying Party, the Indemnifying Party may take over the defense of such claim, Action or Proceeding, except that, in such case, the Indemnified Party shall have the right to join in the defense of said claim, Action or Proceeding at its own cost and expense, and the Indemnifying Party shall not make any admission of liability, agreement or compromise with respect to such claim
without the prior written consent of the Indemnified Party.

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(b)
In addition to the obligations of the Purchaser under Section 2.2 and Section 7.1 hereof, the Purchaser agrees to indemnify, defend and hold harmless the Seller from and against any and all Losses incurred by the Seller as a result of the Seller’s inability to purchase US dollars with, or otherwise effect the conversion into US dollars of, all or any portion of the Russian ruble proceeds of the Purchase Price within five (5) Business Days from the date of payment of such Russian ruble proceeds into the Seller’s Russian Bank Account; provided (i) the Seller’s inability to convert such Russian ruble proceeds of the Purchase Price is not due to (A) the Seller’s failure to instruct the Seller’s Bank to undertake such conversion or (B) the Seller’s Bank’s failure to effect such
conversion in accordance with such instructions; (ii) the Seller shall take reasonable actions to mitigate any such Losses as and when such actions are permitted by applicable law; and (iii) the Seller makes a claim for any such Loss within twelve (12) months from the date of payment of the Russian ruble proceeds which the Seller has been unable to convert into US dollars.

(c)
Notwithstanding any other provision of this Agreement to the contrary:

(i)
subject to the limitations specified in sub-clauses (ii) - (viii) (inclusive) of this Section 7.1(c), the aggregate liability of each Party for indemnification under Section 7.1(a) hereof shall not exceed the lesser of (A) an amount equal to the total of such Party’s Losses indemnified against hereunder and (B)  the Purchase Price; 

(ii)
the aggregate liability of the Seller for indemnification for any inaccuracy in or any breach of any of the Seller’s representations and warranties contained in Section 3.1(h) or Section 3.1(j) hereof shall not exceed an amount equal to forty-nine percent (49%) of the lesser of (A) the total of the Purchaser’s Losses arising from such inaccuracy or breach and indemnified against hereunder and (B) US$4,000,000; provided that (1) if, as of the date any claim is made hereunder by the Purchaser in respect of any such inaccuracy or breach, the aggregate amount of all claims made by the Purchaser under this Section 7.1 in respect of Section 3.1(h) and/or Section 3.1(j) (including the proposed claim) does not exceed US$500,000, the Seller shall have no liability hereunder and (2) if as of the date any
claim is made hereunder by the Purchaser in respect of any such inaccuracy or breach, the aggregate amount of all claims made by the Purchaser under this Section 7.1 in respect of Section 3.2 (including the proposed claim) exceeds US$500,000, subject to the limitations specified in this Section 7.1(c)(ii) above, the Seller shall be liable for the entire amount of such claims;

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(iii)
a Party shall have no liability in respect of any claim unless such claim is made in good faith and unless written particulars of such claim (giving such details of the specific matter in respect of which such claim is made as are then in the possession the claimant Party) shall have been given to such Party pursuant to Section 7.7 hereof within the twelve (12)-month survival period specified in Section 7.1(d);

(iv)
if a claim is made against the Company which may give rise to a claim by the Purchaser in respect of Section 3.1(h) or Section 3.1(j) hereof and the obligation of the Company which gives rise to such claim was not approved by the board of directors of the Company or the shareholders of the Company or, if approved only by the General Director or another officer of the Company, was, in the opinion of Independent Counsel (as hereinafter defined) obtained pursuant to Section 7.1(c)(vi) hereof, outside the scope of his or her authority under the charter of the Company, the protocols of the board of directors of the Company and/or the protocols of the general meeting of shareholders of the Company, then the Purchaser shall cause the Company to litigate or arbitrate the validity of such obligation until a final,
non-appealable judgment or award of a court or arbitral tribunal having jurisdiction over the matter shall have been rendered, and if such court or arbitral tribunal determines in such judgment or award that such obligation is a valid obligation of the Company and specifies the amount of such obligation which is valid, then such amount shall constitute the Purchaser’s Loss for purposes of Section 7.1(c)(ii) hereof. As used herein, “Independent Counsel” shall mean legal counsel of recognized international standing, with an office in Russia, who has not regularly represented the Purchaser, the Seller, the Company or any of their respective Subsidiaries or affiliates;

(v)
if a claim is made against the Company which may give rise to a claim by the Purchaser in respect of Section 3.1(h) or Section 3.1(j) hereof and the obligation of the Company which gives rise to such claim was approved by the board of directors of the Company and/or the shareholders of the Company or, if approved only by the General Director or another officer of the Company, was, in the opinion of Independent Counsel obtained pursuant to Section 7.1(c)(vi) hereof, within scope of his or her authority under the charter of the Company, the protocols of the board of directors of the Company and/or the protocols of the general meeting of shareholders of the Company, then the Purchaser shall not be obliged to cause the Company to litigate or arbitrate the validity of such obligation and the amount of such
obligation shall constitute the Purchaser’s Loss for purposes of Section 7.1(c)(ii) hereof;

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(vi)
if a claim is made against the Company which may give rise to a claim by the Purchaser in respect of Section 3.1(h) or Section 3.1(j) hereof and the obligation of the Company which gives rise to such claim was approved only by the General Director or another officer of the Company, any claim made by the Purchaser in respect of Section 3.1(h) or Section 3.1(j) shall be accompanied by a written opinion of Independent Counsel addressed to the Purchaser and the Seller concerning the issue of whether the General Director or such other officer of the Company by approving such obligation exceeded the scope of his or her authority under the charter of the Company, the protocols of the board of directors of the Company and/or the protocols of the general meeting of shareholders of the Company;

(vii)
no Party shall have any liability in respect of any claim under this Section 7.1 if: 

(A)
such  claim shall arise by reason of a liability of a Party which is contingent only, in which case, the Indemnifying Party shall have no obligation to make any payment in respect of such claim until such time as the contingent liability ceases to be contingent and becomes actual; and

(B)
to the extent that such claim relates to any Loss for which the claimant Party actually recovers under the terms of any insurance policy in effect at the Closing Date; and

(viii)
no Party shall be entitled to be paid more than once in respect of any claim arising out of the same subject matter.

(d)
Each Party has the right to rely fully upon the representations, warranties, covenants and agreements of the other Party contained in this Agreement; provided that, for the avoidance of doubt, the information contained in the data room and listed on Schedule 3.2(I) hereto, shall not be deemed to be part of the Knowledge of the Seller (as previously defined) unless actually known by the individuals named on Schedule 3.2(II) hereto. All representations and warranties of the Parties contained in Section 3 shall survive the Closing Date and remain in effect for a period of twelve (12) months following the Closing Date. In addition to the foregoing, the obligations of the Parties under this Section 7.1 shall survive the Closing and the termination of this Agreement.

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7.2
Term and Early Termination. This Agreement shall take effect on the date hereof and shall terminate in the earlier of: (i) full performance of the Parties’ obligations hereunder, (ii) the mutual written consent of the Parties and (iii) April 1, 2003 if the Closing has not occurred prior to such date. If this Agreement is validly terminated pursuant to Section 7.2(i) or (ii), this Agreement will forthwith become null and void, and there will be no liability or obligation on the part of the Seller or the Purchaser (or any of their respective officers, directors, employees, agents or other representatives or affiliates), except that Section 7.1, Section 7.6 and Section 8 hereof will continue to be in effect and shall apply following any such termination.
Notwithstanding any other provision in this Agreement to the contrary, upon termination of this Agreement pursuant to Section 7.2(iii), the Seller will remain liable to the Purchaser for any breach of this Agreement by the Seller existing at the time of such termination, and the Purchaser will remain liable to the Seller for any breach of this Agreement by the Purchaser existing at the time of such termination, and the Seller or the Purchaser, as the case may be, may seek such remedies, including damages and legal fees, against the other Party with respect to any such breach as are provided in this Agreement or as are otherwise available at law.

7.3
Amendments. No amendment or modification to this Agreement shall be effective unless made in writing and signed by both Parties.

7.4
Waiver. Any term or condition of this Agreement may be waived at any time by the Party that is entitled to the benefit thereof, but no such waiver shall be effective unless set forth in a written instrument duly executed by or on behalf of the Party waiving such term or condition. The failure of a Party to insist upon strict adherence to any term of this Agreement on any occasion shall not be considered a waiver of any right hereunder, nor shall it deprive that Party of the right thereafter to insist upon the strict adherence to the respective term or any other terms of this Agreement.

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7.5
Parties in Interest. This Agreement shall be binding upon, and inure to the benefit of, the Parties and may not be assigned by the Seller or the Purchaser to any third party, without the prior written consent of the other Party.

7.6
Expenses. Except as otherwise expressly provided in this Agreement, whether or not the transactions contemplated hereby are consummated, each of the Parties will pay its own costs and expenses, including, without limitation, legal fees, incurred in connection with the negotiation, execution and closing of this Agreement and the transactions contemplated hereby.

7.7
Notices. All notices, requests, demands and other communications shall be in writing and delivered by hand, by courier, by post or facsimile and shall be addressed as follows:

If to the Purchaser, to:

OAO “VimpelCom-Region”
10 Ulitsa 8-Marta
Building 14
Moscow 127083
Russian Federation

Attn:   Alexei M. Mischenko
Fax:   +7 095 910 5993

With a copy to:

Akin  Gump Strauss Hauer & Feld LLP
7 Ul. Gasheka
Moscow
Russian Federation

Attn:  Melissa J. Schwartz
Fax:  +7095-974-2412

If to the Seller, to:

Telenor Mobile Communications AS
Snarøyveien 30
N-1331 Fornebu
Norway

Attn:  Sigmund Ekhougen
Fax: +47 97 21 27 58

With a copy to:

Coudert Brothers LLP
60 Cannon Street,
London, EC4N 6JP
England
Attn:  Peter S. O’Driscoll

Fax:  +44 207 248 3001

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or to such other address or to such other Person as any Party shall have last designated by notice to the other Party. All such notices, requests and other communications, including any request for arbitration will:  (a) if delivered personally to the address as provided in this Section 7.7, be deemed given and effective upon delivery, (b) if delivered by facsimile transmission to the facsimile number as provided in this Section 7.7, be deemed given and effective upon receipt, and (c) if delivered by courier in the manner described above to the address as provided in this Section 7.7, be deemed given and effective upon confirmed receipt (in each case, regardless of whether such notice, request or other communication is received by any other Person to whom a copy of such notice is to be delivered pursuant to this Section 7.7).

7.8
Seller’s Account. Unless otherwise notified by the Seller to the Purchaser in writing, the Seller’s Russian Bank Account shall be:

ZAO Citibank
8-10 Gasheka
125047 Moscow
Russian Federation
”Russian text was illegible”  044525202
Acc. 30101810300000000202
Account  No.:  40814810800500804025
INN:                7738149054

7.9
Languages and Counterparts. This Agreement has been executed in two counterparts, each in both the Russian and English languages, one for each Party. In the event of any discrepancies or differences between the texts, the English version shall prevail.

7.10
Entire Agreement. This Agreement supersedes all prior discussions and agreements between the Parties with respect to the subject matter hereof, and contains the sole and entire agreement between the Parties with respect to the subject matter hereof.

8.
GOVERNING LAW AND DISPUTE RESOLUTION

8.1
Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, United States of America, without giving effect to any conflicts of laws principles thereof which would result in the application of the laws of another jurisdiction.

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8.2
Dispute Resolution. (a)     Any and all disputes and controversies arising under, relating to or in connection with this Agreement shall be settled by arbitration by a panel of three (3) arbitrators under the United Nations Commission on International Trade Law (UNCITRAL) Arbitration Rules then in force (the “UNCITRAL Rules”) in accordance with the following terms and conditions:

(i)
In the event of any conflict between the UNCITRAL Rules and the provisions of this Agreement, the provisions of this Agreement shall prevail.

(ii)
The place of the arbitration shall be Geneva, Switzerland.

(iii)
Where there is only one claimant party and one respondent party, each shall appoint one arbitrator in accordance with the UNCITRAL Rules, and the two arbitrators so appointed shall appoint the third (and presiding) arbitrator in accordance with the UNCITRAL Rules within thirty (30) days from the appointment of the second arbitrator. In the event of an inability to agree on a third arbitrator, the appointing authority shall be the International Court of Arbitration of the International Chamber of Commerce, acting in accordance with such rules as it may adopt for this purpose. Where there is more than one claimant party, or more than one respondent party, all claimants and/or all respondents shall attempt to agree on their respective appointment(s). In the event that all claimants and all respondents
cannot agree upon their respective appointment(s) within thirty (30) Business Days of the date of the notice of arbitration, all appointments shall be made by the International Court of Arbitration of the International Chamber of Commerce.

(iv)
The English language shall be used as the written and spoken language for the arbitration and all matters connected to the arbitration.

(v)
The arbitrators shall have the power to grant any remedy or relief that they deem just and equitable and that is in accordance with the terms of this Agreement, including specific performance, and including, but not limited to, injunctive relief, whether interim or final, and any such relief and any interim, provisional or conservatory measure ordered by the arbitrators may be specifically enforced by any court of competent jurisdiction. Each Party retains the right to seek interim, provisional or conservatory measures from judicial authorities and any such request shall not be deemed incompatible with the agreement to arbitrate or a waiver of the right to arbitrate.

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(vi)
The award of the arbitrators shall be final and binding on the Parties.

(vii)
The award of the arbitrators may be enforced by any court of competent jurisdiction and may be executed against the person and assets of the losing party in any competent jurisdiction.

(b)
Except for arbitration proceedings pursuant to Section 8.2(a), no action, lawsuit or other proceeding (other than the enforcement of an arbitration decision, an action to compel arbitration or an application for interim, provisional or conservatory measures in connection with the arbitration) shall be brought by or between the Parties in connection with any matter arising out of or in connection with this Agreement.

(c)
Each Party irrevocably appoints CT Corporation System, located on the date hereof at 111 Eighth Avenue, 13th Floor, New York, New York 10011, USA, as its true and lawful agent and attorney to accept and acknowledge service of any and all process against it in any judicial action, suit or proceeding permitted by Section 8.2(b), with the same effect as if such Party were a resident of the State of New York and had been lawfully served with such process in such jurisdiction, and waives all claims of error by reason of such service, provided that the Party effecting such service shall also deliver a copy thereof on the date of such service to the other Party by facsimile as specified in Section 7.7. Each Party will enter into such agreements with such agent as may be necessary to constitute and
continue the appointment of such agent hereunder. In the event that any such agent and attorney resigns or otherwise becomes incapable of acting, the affected Party will appoint a successor agent and attorney in New York reasonably satisfactory to the other Party, with like powers. Each Party hereby irrevocably submits to the non-exclusive jurisdiction of the United States District Court for the Southern District of New York and of any New York state court sitting in New York City, in connection with any such action, suit or proceeding, and agrees that any such action, suit or proceeding may be brought in such court, provided, however, that such consent to jurisdiction is solely for the purpose referred to in this Section 8.2 and shall not be deemed to be a general submission to the jurisdiction of said courts of or in the State of New York other than for such purpose. Each Party hereby irrevocably waives, to the fullest extent permitted by law, any objection that it may now or
hereafter have to the laying of the venue of any such action, suit or proceeding brought in such a court and any claim that any such action, suit or proceeding brought in such a court has been brought in an inconvenient forum. Nothing herein shall affect the right of a Party to serve process in any other manner permitted by law or to commence legal proceedings or otherwise proceed against the other Party in any other jurisdiction in a manner not inconsistent with Section 8.2(b).

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(d)
Each of the Purchaser and the Seller hereby represents and acknowledges that it is acting solely in its commercial capacity in executing and delivering this Agreement and in performing its obligations hereunder, and each of the Purchaser and the Seller hereby irrevocably waives with respect to all disputes, claims, controversies and all other matters of any nature whatsoever that may arise under or in connection with this Agreement and any other document or instrument contemplated hereby, all immunity it may otherwise have as a sovereign, quasi-sovereign or state-owned entity (or similar entity) from any and all proceedings (whether legal, equitable, arbitral, administrative or otherwise), attachment of assets, and enforceability of judicial or arbitral awards.

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year first above written.

	 The Seller
 	  
 	  
 	  
 
	 TELENOR MOBILE COMMUNICATIONS AS
 	  
 	  
 	  
 
	 
 By: 
 	 /signed/
 	  
 	  
 	  
 
	  
 	 
 	  
 	  
 	  
 
	  
 	 Name:   Arve Johansen
 	  
 	  
 	  
 
	  
 	 Title:     Chairman
 	  
 	  
 	  
 
	  
 	               /seal/
 	  
 	  
 	  
 

	 The Purchaser
 	  
 	  
 	  
 
	 OPEN JOINT STOCK COMPANY
 “VIMPELCOM-REGION”
 	  
 	  
 	  
 
	 
 By: 
 	 /signed/
 	  
 	  
 	  
 
	  
 	 
 	  
 	  
 	  
 
	  
 	 Name:   A.Mishchenko
 	  
 	  
 	  
 
	  
 	 Title:     General Director
 	  
 	  
 	  
 
	  
 	               /seal/
 	  
 	  
 	  
 

 

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Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00053-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00053-of-00352.parquet"}]]