Result of EGM

Press-releaseKrasnodarJanuary 28, 2008

OJSC "Magnit" announces EGM results

Krasnodar, January 28, 2008: OJSC «Magnit» (the "Company"; RTS, MICEX and LSE: MGNT) announces the results of the extraordinary general shareholders' meeting.

Type of the general meeting (annual, extraordinary) - extraordinary general shareholders' meeting

Form of the general meeting - joint presence of shareholders to discuss the agenda items and make decisions on the voting issues with preliminary submission (delivery) of voting bulletins prior to the conduction of the general shareholders' meeting

Date and venue of the general meeting:

Date of the extraordinary general shareholders' meeting: January 20, 2009.

Venue: conference room, 3rd floor, 15/2 Solnechnaya st., Krasnodar, Russia.

Completed bulletins were sent to the postal address: 15/2 Solnechnaya st., Krasnodar, Russia, 350072

Quorum of the general meeting:

Number of votes of participants included in the list of persons entitled to participate in the general meeting and having no interest in the transactions made by the company:

Issue № 1: «Approval of a major related-party transaction» - 78 602 447 votes;

Issue № 2.1: «Approval of related-party transactions» -78 602 447 votes;

Issue № 2.2: «Approval of related-party transactions» - 78 602 447 votes;

Issue № 2.3 «Approval of related-party transactions» - 78 602 447 votes.

Number of votes of shareholders participated in the general meeting and entitled to vote on the agenda items with specification whether there was a quorum for each item:

Item № 1: «Approval of a major related-party transaction» - 62 634 827 votes, quorum is present,

Item № 2.1: «Approval of related-party transactions» - 62 634 827 votes, quorum is present,

Item № 2.2: «Approval of related-party transactions» - 62 634 827 votes, quorum is present,

Item № 2.3: «Approval of related-party transactions» - 62 634 827 votes, quorum is present.

Quorum is present to make the decisions on all the agenda items of the extraordinary general shareholders' meeting of OJSC «Magnit».

Voting issues and voting results.

Issue № 1: «Approval of a major related-party transaction».

Votes cast is as follows:

«for» - 59 245 899 votes which amounts to 75,37 % of the total votes of the shareholders participated in the general meeting and entitled to vote on this issue;

«against» - 3 622 votes which amounts to 0,005 % of the total votes of the shareholders participated in the general meeting and entitled to vote on this issue; 

«abstained» - 33 120 votes which amounts to 0,04 % of the total votes of the shareholders participated in the general meeting and entitled to vote on this issue;

Issue № 2.1: «Approval of related-party transactions».

Votes cast is as follows:

«for» - 59 245 849 votes which amounts to 75,37 % of the total votes of the shareholders participated in the general meeting and entitled to vote on this issue;

«against» - 3 672 votes which amounts to 0,005 % of the total votes of the shareholders participated in the general meeting and entitled to vote on this issue;

«abstained» - 33 120 votes which amounts to 0,04 % of the total votes of the shareholders participated in the general meeting and entitled to vote on this issue;

Issue № 2.2: «Approval of related-party transactions».

Votes cast is as follows:

«for» - 59 245 849 votes which amounts to 75,37 % of the total votes of the shareholders participated in the general meeting and entitled to vote on this issue;

«against» - 3 672 votes which amounts to 0,005 % of the total votes of the shareholders participated in the general meeting and entitled to vote on this issue;

«abstained» - 33 120 votes which amounts to 0,04 % of the total votes of the shareholders participated in the general meeting and entitled to vote on this issue;

Issue № 2.3: «Approval of related-party transactions».

Votes cast is as follows:

«for» - 59 027 645 votes which amounts to 75,1 % of the total votes of the shareholders participated in the general meeting and entitled to vote on this issue;

«against» - 3 672 votes which amounts to 0,005 % of the total votes of the shareholders participated in the general meeting and entitled to vote on this issue;

«abstained» - 33 120 votes which amounts to 0,04 % of the total votes of the shareholders participated in the general meeting and entitled to vote on this issue;

Decisions made by the general meeting.

Decision on the issue № 1:

«Approve the major party-related transaction. The major party-related transaction (hereinafter - the Transaction) executed by the Company under the facility agreement (hereinafter - "the Facility agreement") made between CJSC "Tander" acting as a borrower (hereinafter - "the Borrower"), the Company acting as Guarantor and Corporate Commercial Saving Bank of Russian Federation (OJSC) acting as the Lender.

The Contract of guarantee shall be made under the following conditions:

- parties of the transaction: the Lender - Corporate Commercial Saving Bank of Russian Federation (OJSC), the Guarantor - OJSC "Magnit";

- beneficiary: CJSC "Tander" (hereinafter - the Borrower);

- subject of the transaction: provision of the guarantee (under one or several transactions) according to which the Guarantor shall be responsible before the Lender for the non performance of the Borrower's obligations assumed by the Borrower under Facility Agreements planned for the signing in future with the following conditions:

1. The Lender shall present to the Borrower the Loan (under revolving and non-revolving facilities) for refinancing of the working capital for three years with the total limit that shall not exceed 6 400 000 000 (six billion four hundred million) rubles, the Borrower shall cancel the credit under the terms and conditions of the Contract;

2. Interest rate for the credit use shall not exceed 25% (twenty five per cent) per year;

3. Conditions, terms of presenting and refinancing of the loan shall be determined by the Facility Agreements.

The aggregate amount of the non-recurrent indebtedness under revolving and non-revolving facilities under which the guarantee is provided shall not exceed 8 000 000 000 (eight billion) rubles».

This is to authorize S. Galitsky, the General Director of OJSC "Magnit" to sign additional agreements on the amendments of the conditions of the transactions in connection with the change of the Facility Agreements made between the Lender and the Borrower (including, but not limited by, the change of the interest rates, terms of the Loan)».

Decision on the issue № 2.1:

«To approve related party transactions, the contracts of guarantee provided for CJSC "Tander", namely contracts of guarantee made or planned for signing in future as several associated transactions with the following conditions:

1) the Contract of Guarantee made by the Company:

- parties of the transaction: the Lender - the Corporate commercial bank "Bank Societe Generalle Vostok" CJSC, the Guarantor - OJSC "Magnit";

- the beneficiary - CJSC "Tander" (hereinafter - the Borrower);

- subject of the transaction: provision of the guarantee according to which the Guarantor shall be fully jointly liable for the non performance of the Borrower's obligations under the revolving facility agreement № 080318/0249018, made between the Lender and the Borrower on March 18, 2008 with reference to the additional agreement №1 made between the Lender and the Borrower on November 12, 2008 under the following conditions:

- subject of the contract: the Lender provides the Borrower funds in the form of separate Facilities in amount and under conditions provided by the Contract, Facility Agreement, and Notices of accordance of the interest rate under the contract and the Borrower shall repay the Lender all the provided facilities, pay the interest rate and fulfill other obligations under the Contract. The maximum amount of the non-recurrent indebtedness under each Facility in rubles, US dollars or euro (The limit of the facility) shall not exceed during any day of the Credit period since the date of the signing of the Contract (inclusive) 1 000 000 000 (one billion) rubles or the equivalent of the amount above mentioned in US dollars or euro at the rate of the Bank of Russia;

- the interest rate for the credit use, inclusive the Margin of the Lender, shall not exceed 35% (thirty five per cent) per year;

- the facility is provided for the period till October 30, 2009 (inclusive);

- in case of delay in repayment under the Separate facility and/or the Interest rate and the amounts due to be paid under the Contract, the Borrower pay to the Lender the penalty for the all period of the delay at the rate:

- for the Separate Facilities in US dollars and euro 0,05% (point zero three per cent) of the amount unpaid on time for each day of the delay;

- for the Separate Facilities in rubles - the double refinancing rate of Bank of Russia actual for the relevant period for each day of delay.

The limit of the transaction: The Guarantor is absolutely, irrevocably and jointly responsible before the Lender for default in the Borrower's obligations under the Facility Agreement to the same extent as the Borrower, inclusive the amount of the main debt under the Separate Facility, incurred interests and penalties, compensation of all expenses, inclusive but not limited by, the expenses of the Lender connected with the foreclosure for the securing obligations of the Borrower under the facility agreement and the compensation of the Lender's expenses, inclusive loss of benefit raised from default in obligations or improper performance of obligations by the Borrower under the Facility Agreement.

2) Contract of guarantee planned for the signing by the Company in future:

- parties of the transaction: the Lender - the Corporate commercial bank "Bank Societe Generalle Vostok" CJSC, the Guarantor - OJSC "Magnit";

- the beneficiary - CJSC "Tander" (hereinafter - the Borrower);

- subject of the transaction: provision of the guarantee according to which the Guarantor shall be fully jointly liable for the non performance of the Borrower's obligations under the revolving facility agreement № 081101/0249018, made between the Lender and the Borrower on November 01, 2008 under the following conditions:

- subject of the contract: The Lender provides the Borrower funds in the form of separate Facilities in amount and under conditions provided by the Contract, facility Agreement, and Notices of accordance of the interest rate under the contract and the Borrower shall repay the Lender all the provided facilities, pay the interest rate and fulfill other obligations under the Contract. The maximum amount of the non-recurrent indebtedness under each Facility in rubles, US dollars or euro (The limit of the facility) shall not exceed during any day of the Credit period since the date of the signing of the Contract (inclusive) 1 000 000 000 (one billion) rubles or the equivalent of the amount above mentioned in US dollars or euro at the rate of the Bank of Russia;

- the interest rate for the credit use, inclusive the Margin of the Lender, shall not exceed 35% (thirty five per cent) per year;

- the facility is provided for the period till October 30, 2009 (inclusive);

- in case of delay in repayment under the Separate facility and/or the Interest rate and the amounts due to be paid under the Contract, the Borrower pay to the Lender the penalty for the all period of the delay at the rate:

- for the Separate Facilities in US dollars and euro 0,05% (point zero three per cent) of the amount unpaid on time for each day of the delay;

- for the Separate Facilities in rubles - the double refinancing rate of the Bank of Russia actual for the relevant period for each day of delay.

The limit of the transaction: the Guarantor is absolutely, irrevocably and jointly responsible to the Lender for the default in the Borrower's obligations under the Facility Agreement to the same extent as the Borrower, inclusive the amount of the main debt under the Separate Facility, incurred interests and penalties, compensation of all expenses, inclusive but not limited by, the expenses of the Lender connected with the foreclosure for the securing obligations of the Borrower under the facility agreement and the compensation of the Lender's expenses, inclusive loss of benefit raised from the default in obligations or improper performance of obligations by the Borrower under the Facility Agreement.

3) Contract of guarantee planned for signing by the Company in future:

- parties of the transaction: the Lender - the Corporate commercial bank "Bank Societe Generalle Vostok" CJSC, the Guarantor - OJSC "Magnit";

- the beneficiary - CJSC "Tander" (hereinafter - the Borrower);

- subject of the transaction: provision of the guarantee according to which the Guarantor shall be fully jointly liable for the non performance of the Borrower's obligations under the Additional agreement №2 as of November 07, 2008 (hereinafter the Agreement) to the bank account contract № 0249018/RUB dated October 25, 2008 with the following conditions:

- subject of the contract: according to the conditions of the Agreement the Lender is entitled to, but is not obliged at any time of the validity of the Agreement effect the financing the account of the CJSC "Tander" within the limit of the Facility determined in the Agreement at the amount of 100 000 000 (One hundred million) rubles;

- the financing is effected by the filling by the Lender of the payment documents on the transfer of the funds from the Borrower's account in case of undersaving or the lack of funds. For the credit use the Borrower shall pay the Lender the interest at the rate determined in the Agreement. The Borrower shall pay the Lender's services for the presenting of the facility, repay the credit with the interests incurred and pay the penalty (if such will be charged) according to the terms of the Agreement;

- the interest rate for the credit use, inclusive the Margin of the Lender, shall not exceed 35% (thirty five per cent) per year;

- the facility is provided for the period till November 06, 2009 (inclusive);

- In case of delay in repayment of any amount of the Loan under the Agreement in Russian rubles payable to the Bank, the latter is entitle to charge the penalty to the amount unpaid on time at the rate of the double refinancing rate of the Central Bank of Russian Federation for each day of delay. 

The limit of the transaction: The Guarantor is absolutely, irrevocably and jointly responsible before the Lender for the default in the Borrower's obligations under the Facility Agreement to the same extent as the Borrower, inclusive the amount of the main debt under the Separate Facility, incurred interests and penalties, compensation of all expenses, inclusive but not limited by, the expenses of the Lender connected with the foreclosure for the securing obligations of the Borrower under the facility agreement and the compensation of the Lender's expenses, inclusive loss of benefit raised from the default in obligations or improper performance of obligations by the Borrower under the Facility Agreement.

4) Contract of guarantee, planned for signing in future:

- parties of the transaction: the Lender - the Corporate commercial bank "Bank Societe Generalle Vostok" CJSC, the Guarantor - OJSC "Magnit";

- the beneficiary - CJSC "Tander" (hereinafter - the Borrower);

- subject of the transaction: provision of the guarantee according to which the Guarantor shall be fully liable before the Lender for non performance of the Borrower's obligations under the revolving and non-revolving facility agreements planned for signing in future under the following conditions:

- subject of the contract: the Lender shall present to the Borrower the revolving or non-revolving facility for the refinancing of the working funds for the period of one year inclusive with the limit of 1 000 000 000 (one billion) rubles or the equivalent of the amount in other currencies, and the Borrower shall repay the facility according to the terms and conditions of the Contract;

- the interest rate for the credit use, inclusive the Margin of the Lender, shall not exceed 35% (thirty five per cent) per year;

- the conditions, presenting and repayment of the facility shall be determined by the agreements.

- in case of delay in repayment under the Separate facility and/or the Interest rate and the amounts due to be paid under the Contract, the Borrower pay to the Lender the penalty for the all period of the delay at the rate:

The limit of the transaction: The Guarantor is absolutely, irrevocably and jointly responsible to the Lender for the default in the Borrower's obligations under the Facility Agreement to the same extent as the Borrower, inclusive the amount of the main debt under the Separate Facility, incurred interests and penalties, compensation of all expenses, inclusive but not limited by, the expenses of the Lender connected with the foreclosure for the securing obligations of the Borrower under the facility agreement and the compensation of the Lender's expenses, inclusive loss of benefit raised from the default in obligations or improper performance of obligations by the Borrower under the Facility Agreement».

This is to authorize S. Galitsky, the General Director of OJSC "Magnit" to sign additional agreements on the amendments of the conditions of the transactions in connection with the change of the Facility Agreements made between the Lender and the Borrower (including, but not limited by, the change of the interest rates, terms of the Loan) under which the Guarantee is presented».

Decision on the issue № 2.2:

«Approve party related transaction, namely the contract of guarantee planned for signing by the Company in future with the following conditions:

- parties of the transaction: the Lender - VTB bank (open joint-stock company), the Guarantor - OJSC "Magnit";

- the beneficiary: CJSC "Tander" (hereinafter - the Borrower);

- subject of the transaction: provision of the guarantee according to which the Guarantor shall be fully responsible before the Lender for default in the Borrower's obligations under the Facility Agreement that is planned for signing in future under the following conditions:

- subject of the contract: the Lender shall provide the Borrower the Facility for refinancing of the working funds for the period of 3 years with the total limit not exceeding 500 000 000 (five hundred million) rubles, and the Borrower shall repay to the Lender the facility under the terms and conditions determined by the Contract;

- the interest rate for the credit use shall not exceed 25% (twenty five per cent) per year;

- conditions, presenting and repayment of the facility shall be determined by the agreements».

This is to authorize S. Galitsky, the General Director of OJSC "Magnit" to sign additional agreements on the amendments of the conditions of the transactions in connection with the change of the Facility Agreements made between the Lender and the Borrower (including, but not limited by, the change of the interest rates, terms of the Loan)».

Decision on the issue № 2.3:

«Approve party related transaction, the contract of guarantee provided for CJSC "Tander", namely the contract of guarantee planned for signing by the Company in future with the following conditions:

- parties of the transaction: the Lender - VTB bank (open joint-stock company), the Guarantor - OJSC "Magnit";

- the beneficiary: CJSC "Tander" (hereinafter - the Borrower);

- subject of the transaction: provision of the guarantee according to which the Guarantor shall be fully responsible before the Lender for default in the Borrower's obligations under the Facility Agreement that is planned for signing in future with the following conditions:

- subject of the contract: the Lender shall present to the Borrower the Loan for refinancing of the working funds for the period of 3 years with the total limit not exceeding 1 250 000 000 (one billion two hundred fifty thousand) rubles, and the Borrower shall repay to the Lender the facility under the terms and conditions determined by the Contract;

- the interest rate for the credit use shall not exceed 25% (twenty five per cent) per year;

- conditions, provision and repayment of the loan shall be determined by the agreements».

This is to authorize S. Galitsky, the General Director of OJSC "Magnit" to sign additional agreements on the amendments of the conditions of the transactions in connection with the change of the Facility Agreements made between the Lender and the Borrower (including, but not limited by, the change of the interest rates, terms of the Loan)».

Date of execution of the minutes of the general meeting - January 27, 2009

Oleg Goncharov

Director, Investor Relations

e-mail: [email protected] 

tel. in Krasnodar +7 (861) 277-45-54, 210-98-10 ext. 5100

Mob.: +7 (903) 411-40 -35

Direct line for investors only: +7 (861) 277-45-62

Dina Chistyak

Manager, Investor Relations

e-mail: [email protected]

tel. in Krasnodar +7 (861) 277-45-54, 210-98-10 ext. 5101

Mob.: +7-961-511-02-02

Direct line for investors only: +7 (861) 277-45-62