sc13dza

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, P/SM4N4/khmGaNSnY/MPsGa0inI3WT7a2zo3K5/vIX31hoJKbJ9dMgx+WX+PG4S7 hGjEuKNtlRLeasXXSxKC9A== 0000950134-07-003861.txt : 20070222 0000950134-07-003861.hdr.sgml : 20070222 20070222134235 ACCESSION NUMBER: 0000950134-07-003861 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 8 FILED AS OF DATE: 20070222 DATE AS OF CHANGE: 20070222 GROUP MEMBERS: VICTOR VEKSELBERG SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: MOSCOW CABLECOM CORP CENTRAL INDEX KEY: 0000006383 STANDARD INDUSTRIAL CLASSIFICATION: CABLE & OTHER PAY TELEVISION SERVICES [4841] IRS NUMBER: 060659863 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-19685 FILM NUMBER: 07641396 BUSINESS ADDRESS: STREET 1: 153 EAST 53RD STREET STREET 2: 58TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 2128268942 MAIL ADDRESS: STREET 1: 153 EAST 53RD STREET STREET 2: 58TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 FORMER COMPANY: FORMER CONFORMED NAME: ANDERSEN GROUP INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: ANDERSEN LABORATORIES INC DATE OF NAME CHANGE: 19790828 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: Renova Media Enterprises Ltd. CENTRAL INDEX KEY: 0001303199 IRS NUMBER: 000000000 STATE OF INCORPORATION: C5 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 2ND TERRACE WEST CENTREVILLE STREET 2: P.O. BOX N-7755 CITY: NASSAU STATE: C5 ZIP: 00000 BUSINESS PHONE: (242) 326-5528 MAIL ADDRESS: STREET 1: 2ND TERRACE WEST CENTREVILLE STREET 2: P.O. BOX N-7755 CITY: NASSAU STATE: C5 ZIP: 00000 FORMER COMPANY: FORMER CONFORMED NAME: Columbus Nova Investments VIII Ltd DATE OF NAME CHANGE: 20040915 SC 13D/A 1 f27637a9sc13dza.htm AMENDMENT TO SCHEDULE 13D sc13dza


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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D/A

Under the Securities Exchange Act of 1934
(Amendment No. 9 )*

Moscow CableCom Corp.

(Name of Issuer)

Common Stock, par value $0.01

(Title of Class of Securities)

61945R100

(CUSIP Number)



Henry Lesser, Esq. DLA Piper US LLP 2000 University Avenue East Palo Alto, California 94303 Telephone: (650) 833-2000		Marjorie Adams, Esq. DLA Piper US LLP 1251 Avenue of the Americas, 29th Floor New York, NY 10020-1104 Phone: (212) 335-4500

(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)

February 21, 2007

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).


CUSIP No.		61945R100

NAMES OF REPORTING PERSONS:

Renova Media Enterprises Ltd.

I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):

(a) o

(b) þ

SEC USE ONLY:

SOURCE OF FUNDS (SEE INSTRUCTIONS):

CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

CITIZENSHIP OR PLACE OF ORGANIZATION:

Bahamas

SOLE VOTING POWER:

NUMBER OF

None

SHARED VOTING POWER:

BENEFICIALLY

OWNED BY

22,884,017 (1)

EACH

SOLE DISPOSITIVE POWER:

REPORTING

PERSON

None

WITH

SHARED DISPOSITIVE POWER:

22,720,514 (2)

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

22,884,017 (1)

CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

80.5%(3)

TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

(1) Includes: (i) 3,375,084 shares of common stock, $0.01 par value (“Common Stock”), of Moscow CableCom Corp. (the “Company”) held directly by Renova Media Enterprises Ltd. (“Renova Media”), (ii) 1,687,542 shares of Common Stock that Renova Media is entitled to acquire upon exercise of warrants which are exercisable within 60 days, (iii) 4,500,000 shares of Common Stock issuable upon conversion of 4,500,000 shares of the Company’s Series B Convertible Preferred Stock, $0.01 par value (“Preferred Stock”), which are convertible within 60 days and are held directly by Renova Media, (iv) 8,283,000 shares of Common Stock issuable upon conversion of 8,283,000 shares of Preferred Stock which are convertible within 60 days, that Renova Media is entitled to acquire upon exercise of warrants which are exercisable within 60 days, (v) 4,220,879 shares of Common Stock held by Moskovskaya Telecommunikatsionnaya Corporatsiya (“COMCOR”) that Renova Media may be deemed to beneficially own by reason of a Shareholders Agreement between Renova Media and COMCOR, dated August 26, 2004, as amended (the “Shareholders Agreement”), and as a result of the acquisition by Renova Media of a controlling interest in COMCOR on June 7, 2006, with respect to which Renova Media disclaims beneficial ownership, and (vi) 817,512 shares of Common Stock that Renova Media may be deemed to beneficially own by reason of irrevocable proxy and power of attorney arrangements (the “Irrevocable Proxy Arrangements”) between Renova Media and certain stockholders of the Company, with respect to which Renova Media disclaims beneficial ownership.

(2) Includes all of the securities listed in note (1) above, except for 163,503 shares of Common Stock, which are subject to the Irrevocable Proxy Arrangements, with respect to which Renova Media does not have any dispositive power and disclaims beneficial ownership.

(3) Based upon a total of 28,442,907 shares of Common Stock, which figure is based on the number of shares of Common Stock outstanding on February 20, 2007, as disclosed by the Company to Renova Media (13,972,365) and assumes (i) exercise of 1,687,542 warrants beneficially owned by Renova Media, (ii) conversion of 4,500,000 shares of Preferred Stock beneficially owned by Renova Media, and (iii) exercise of warrants to acquire 8,283,000 shares of Preferred Stock, beneficially owned by Renova Media, and conversion of such Preferred Stock into 8,283,000 shares of Common Stock.


CUSIP No.		61945R100

NAMES OF REPORTING PERSONS:

Victor Vekselberg

I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):

(a) o

(b) þ

SEC USE ONLY:

SOURCE OF FUNDS (SEE INSTRUCTIONS):

Not Applicable

CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

CITIZENSHIP OR PLACE OF ORGANIZATION:

Russian Federation

SOLE VOTING POWER:

NUMBER OF

None

SHARED VOTING POWER:

BENEFICIALLY

OWNED BY

22,884,017 (4)

EACH

SOLE DISPOSITIVE POWER:

REPORTING

PERSON

None

WITH

SHARED DISPOSITIVE POWER:

22,720,514 (5)

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

22,884,017 (4)

CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

80.5%(6)

TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

(4) Includes: (i) 3,375,084 shares of Common Stock held directly by Renova Media, (ii) 1,687,542 shares of Common Stock that Renova Media is entitled to acquire upon exercise of warrants which are exercisable within 60 days, (iii) 4,500,000 shares of Common Stock issuable upon conversion of 4,500,000 shares of Preferred Stock, which are convertible within 60 days and are held directly by Renova Media, (iv) 8,283,000 shares of Common Stock issuable upon conversion of 8,283,000 shares of Preferred Stock which are convertible within 60 days, that Renova Media is entitled to acquire upon exercise of warrants which are exercisable within 60 days, (v) 4,220,879 shares of Common Stock held by COMCOR that Mr. Vekselberg may be deemed to beneficially own by reason of the Shareholders Agreement, and as a result of the acquisition by Renova Media of a controlling interest in COMCOR on June 7, 2006, with respect to which Mr. Vekselberg disclaims beneficial ownership, and (vi) 817,512 shares of Common Stock that Renova Media may be deemed to beneficially own by reason of the Irrevocable Proxy Arrangements, with respect to which Renova Media disclaims beneficial ownership.

(5) Includes all of the securities listed in note (1) above, except for 163,503 shares of Common Stock, which are subject to the Irrevocable Proxy Arrangements, with respect to which Renova Media does not have any dispositive power and with respect to which Mr. Vekselberg disclaims beneficial ownership.

(6) Based upon a total of 28,442,907 shares of Common Stock, which figure is based on the number of shares of Common Stock outstanding on February 20, 2007, as disclosed by the Company to Renova Media (13,972,365) and assumes (i) exercise of 1,687,542 warrants beneficially owned by Renova Media, (ii) conversion of 4,500,000 shares of Preferred Stock beneficially owned by Renova Media, and (iii) exercise of warrants to acquire 8,283,000 shares of Preferred Stock, beneficially owned by Renova Media, and conversion of such Preferred Stock into 8,283,000 shares of Common Stock.

CUSIP No. 61945R100

This Amendment No. 9 to Schedule 13D is filed in accordance with Rule 13d-2 of the Securities Exchange Act of 1934, as amended, jointly by Renova Media Enterprises Ltd., a Bahamas corporation formerly known as Columbus Nova Investments VIII Ltd. (“Renova Media”), and Victor Vekselberg (together with Renova Media, the “Reporting Persons”) and amends and supplements the below-indicated items from the Schedule 13D filed with the Securities and Exchange Commission by the Reporting Persons on September 23, 2004, and subsequently amended.

Item 3. Source and Amount of Funds or Other Consideration

Reference is made to the Agreement and Plan of Merger, dated February 21, 2007 (the “Merger Agreement”), by and among Renova Media, Galaxy Merger Sub Corporation, a newly formed wholly-owned subsidiary of Renova Media, and Moscow CableCom Corp. (the “Company”), a copy of which is attached hereto as Exhibit 30 and incorporated herein by reference, and which is referred to in Item 4 of this Amendment No. 9, which is incorporated herein by reference, setting forth the terms and conditions of a merger (the “Merger”). Based on the number of shares of Company common stock, $0.01 par value (“Common Stock”), outstanding and issuable upon conversion or exercise of other outstanding securities of the Company, in each case beneficially owned by persons other than the Reporting Persons, as set forth in the Merger Agreement, and based on the agreed cash price of $12.90 per share of Common Stock, the Reporting Persons estimate that an aggregate of approximately $184.5M will be used for (i) acquiring Company securities from persons other than the Reporting Persons in the Merger (for an aggregate purchase price of approximately $152M); (ii) exercising certain warrants to purchase shares of Series B preferred stock of the Company, $0.01 par value (“Series B Preferred Stock”), and subsequently converting those shares of Series B Preferred Stock (and other shares of Series B Preferred Stock currently held by Renova Media, if necessary) into shares of Common Stock, such that, as contemplated by the Merger Agreement, Renova Media will be assured of owning directly at least a majority of the voting power of the then-outstanding Company voting securities on the record date set by the Board of Directors of the Company, in accordance with the Merger Agreement, for the adoption of the Merger Agreement and the approval of the Merger by the Company’s stockholders, in order to assure that a majority of the voting power of the then-outstanding Company voting securities entitled to vote on such adoption is voted in favor thereof irrespective of the vote of any other stockholder entitled to vote; and (iii) estimated expenses related to the Merger. In the Merger, shares of the Company held directly by Moskovskaya Telecommunikatsionnaya Corporatsiya (“COMCOR”) (whether or not deemed beneficially owned by the Reporting Persons for purposes of Schedule 13D) would be acquired on the same terms as the shares held by all other stockholders of the Company other than Renova Media. COMCOR is not a party to the Merger Agreement and has no agreement with Moscow CableCom or Renova Media relating to the Merger.

The Reporting Persons believe that, as of the date hereof, Renova Media directly holds shares of Common Stock and Series B Preferred Stock representing approximately 40.0% of the voting power of the Company’s outstanding voting securities. This estimated percentage is based on information in the Merger Agreement. This estimated percentage differs from information set forth elsewhere in this Schedule 13D with respect to shares deemed beneficially owned by the Reporting Persons under the Schedule 13D rules regarding beneficial ownership in that this estimated percentage excludes: (i) shares of Common Stock held directly by COMCOR; (ii) shares of Company capital stock which Renova Media has the right to acquire under outstanding nonvoting securities of the Company held directly by Renova Media; and (iii) shares of Common Stock subject to irrevocable proxy and powers of attorney arrangements between Renova Media and certain stockholders of the Company.

The Reporting Persons anticipate obtaining the funds necessary to complete the Merger from proceeds of borrowings from Renova Media’s two shareholders under the Amended and Restated Credit Facility Agreement dated November 3, 2006 among Renova Media, Renova Industries Ltd. and CMCR Management Limited, as the same has been amended by the Deed of Amendment to such agreement, dated February 13, 2007, which deed of

CUSIP No. 61945R100

amendment is attached hereto as Exhibit 31 and incorporated herein by reference. Such agreement, as amended, covers the approximately $56M in existing borrowings by Renova Media unrelated to the Merger, and the approximately $184.5M estimated to be needed for the Merger, as described above. The consummation of the Merger is not conditioned upon the Reporting Persons obtaining any financing.

Though the Merger Agreement has been executed, there is no assurance that all of the conditions to the closing of the Merger will be satisfied and that the Merger will be consummated.

Item 4. Purpose of Transaction

On February 21, 2007, Renova Media and the Company entered into the Merger Agreement, a copy of which is attached hereto as Exhibit 30 and incorporated herein by reference, containing the terms and conditions of the Merger in which Renova Media would acquire all of the equity interests of the Company not then beneficially owned by the Reporting Persons (subject to the next sentence of this Item 4) at a cash price of $12.90 per share of Common Stock and a price per share of Series A Preferred Stock based on the conversion right of such shares of Series A Preferred Stock (which, according to the Merger Agreement, is 3.055 shares of Common Stock for each share of Series A Preferred Stock). Under the Merger Agreement, shares of the Company held directly by COMCOR (whether or not deemed beneficially owned by the Reporting Persons for purposes of Schedule 13D) would be acquired on the same terms as the shares held by all other stockholders of the Company other than Renova Media. The Merger would be subject to the terms and conditions set forth in the Merger Agreement. The consummation of the Merger is not conditioned upon the Reporting Persons obtaining any financing.

On February 21, 2007, concurrently with the execution of the Merger Agreement, RME Finance Ltd, a company formed under the laws of the Republic of Cyprus and a wholly-owned subsidiary of Renova Media (“Bridge Finance Lender”), the Company and ZAO ComCor-TV, a closed joint stock company organized under the laws of the Russian Federation and a wholly-owned subsidiary of the Company (“Company Sub”), entered into a Bridge Facility Agreement (the “Bridge Facility Agreement”), a copy of which is attached hereto as Exhibit 32 and incorporated herein by reference, pursuant to which Bridge Finance Lender has agreed, subject to the terms and conditions set forth therein, to make available to Company Sub unsecured subordinated debt financing during the pendency of the Merger (and, in certain circumstances, up to three months following a termination of the Merger Agreement). Bridge Finance Lender will receive all funds necessary to provide loans to Company Sub under the Bridge Facility Agreement from Renova Media pursuant to an inter-company loan arrangement.

The payment and performance of Company Sub’s obligations under the Bridge Facility Agreement have been unconditionally guarantied by the Company pursuant to the Continuing Unconditional Guaranty executed by the Company in favor of Bridge Finance Lender (the “Guaranty”), a copy of which is attached hereto as Exhibit 33 and incorporated herein by reference. The parties to the Bridge Facility Agreement have agreed that the loans made to Company Sub pursuant to such agreement and the Guaranty shall be unsecured obligations of Company Sub and the Company, respectively, and subordinate to the secured obligations of Company Sub and the Company (as guarantor) under the Facility Agreement, dated as of August 26, 2004 by and among Bridge Finance Lender, the Company, Company Sub, certain other subsidiaries of the Company and the agent and security agent thereunder (as amended, the “$28,500,000 Facility Agreement”) by executing and delivering (i) the Amendment Agreement No. 5 to $28,500,000 Facility Agreement dated 26 August 2004, which amendment is dated February 21, 2007, and (ii) the Subordination Agreement dated February 21, 2007 (the “Subordination Agreement”) between Bridge Finance Lender, as agent and security agent under the $28,500,000 Facility Agreement and Bridge Finance Lender, as subordinated creditor, copies of which are attached hereto as Exhibit 34 and Exhibit 35, respectively, and incorporated herein by reference.

CUSIP No. 61945R100

The first advance of $5,000,000 from Bridge Finance Lender to Company Sub is scheduled to occur shortly. Subsequent monthly loans of $5,000,000 will be subject to Company Sub meeting certain conditions. The maximum principal amount that may be loaned to the Company under the Bridge Facility Agreement is $45,000,000. The obligation of Bridge Finance Lender to make loans to the Company under the Bridge Facility Agreement would terminate in the event that the Merger Agreement were terminated under certain circumstances specified in the Bridge Facility Agreement.

On February 21, 2007, Renova Media and the Company issued a joint press release announcing the Merger Agreement and the Bridge Facility Agreement. A copy of such press release is attached hereto as Exhibit 36 and is incorporated herein by reference.

Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.

The information set forth in Items 3 and 4 of this Schedule 13D are incorporated herein by reference in response to Item 6.

Item 7. Material to be filed as Exhibits

Item 7 is hereby amended and supplemented to include the following exhibits, filed herewith:


Exhibit 30		Agreement and Plan of Merger, dated February 21, 2007, among Renova Media, Galaxy Merger Sub Corporation and the Company

Exhibit 31		Deed of Amendment, dated February 13, 2007, among Renova Industries Ltd., CMCR Management Limited, and Renova Media in respect of the Amended and Restated Up To US$216,000,000 Credit Facility Agreement of November 3, 2006

Exhibit 32		Bridge Facility Agreement, dated February 21, 2007, among RME Finance Ltd, the Company and ZAO Com-Cor TV

Exhibit 33		Continuing Unconditional Guaranty, dated February 21, 2007, executed by the Company in favor of RME Finance Ltd

Exhibit 34		Amendment Agreement No. 5 to $28,500,000 Facility Agreement dated 26 August 2004, which amendment is dated February 21, 2007, among RME Finance Ltd, the Company, ZAO Com-Cor TV and the subsidiary guarantors named therein

Exhibit 35		Subordination Agreement, dated February 21, 2007, between RME Finance Ltd, as agent and security agent, and RME Finance Ltd, as subordinated creditor

Exhibit 36		Press release of Renova Media and the Company, dated February 21, 2007

CUSIP No. 61945R100

SIGNATURE

After reasonable inquiry and to the best of our knowledge and belief, we certify that the information in this statement is true, complete and correct.

Dated: February 22, 2007


RENOVA MEDIA ENTERPRISES LTD.
By:	/s/ Evgenia Loewe
	Name:	Evgenia Loewe
	Title:	Attorney-in-Fact

VICTOR VEKSELBERG
By:	/s/ Evgenia Loewe
	Name:	Evgenia Loewe
	Title:	Attorney-in-Fact

EX-99.30 2 f27637a9exv99w30.htm EXHIBIT 30 exv99w30

Exhibit 30

AGREEMENT AND PLAN OF MERGER
by and among

RENOVA MEDIA ENTERPRISES LTD.,

GALAXY MERGER SUB CORPORATION,
a subsidiary of Renova Media Enterprises Ltd., and

MOSCOW CABLECOM CORP.

Dated as of February 21, 2007

TABLE OF CONTENTS


			Page
ARTICLE I		THE MERGER; CLOSING; EFFECTIVE TIME		2
	1.1	The Merger		2
	1.2	Closing		2
	1.3	Effective Time		2

ARTICLE II		CERTIFICATE OF INCORPORATION AND BY-LAWS OF THE SURVIVING CORPORATION		2
	2.1	The Certificate of Incorporation		2
	2.2	The By-Laws		2

ARTICLE III		OFFICERS AND DIRECTORS OF THE SURVIVING CORPORATION		3
	3.1	Directors		3
	3.2	Officers		3

ARTICLE IV		EFFECT OF THE MERGER ON CAPITAL STOCK; EXCHANGE OF CERTIFICATES		3
	4.1	Effect on Capital Stock		3
	4.2	Surrender of Certificates for Payment		4
	4.3	Dissenters’ Rights		6
	4.4	Treatment of Company Options, Warrants, Restricted Shares and Convertible Debentures		7
	4.5	Further Action		8

ARTICLE V		REPRESENTATIONS AND WARRANTIES OF THE COMPANY		8
	5.1	Subsidiaries, Organization, Good Standing and Qualification		9
	5.2	Capitalization of the Company and its Subsidiaries		9
	5.3	Corporate Authority; Approval and Fairness		10
	5.4	Consents and Approvals; No Violations		11
	5.5	Compliance with Laws; Licenses		11
	5.6	No Default		12
	5.7	Company Reports; Financial Statements		12
	5.8	No Undisclosed Material Liabilities		14
	5.9	Litigation		14
	5.10	Material Contracts		14
	5.11	Absence of Certain Changes or Events		14

TABLE OF CONTENTS
(continued)


			Page
	5.12	Employee Matters		15
	5.13	Intellectual Property		16
	5.14	Taxes		16
	5.15	Takeover Statutes; Charter Provisions		17
	5.16	Opinion of Financial Advisor		17
	5.17	Brokers		17
	5.18	Information Supplied		18

ARTICLE VI		REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB		18
	6.1	Organization, Good Standing and Qualification		18
	6.2	Authority Relative to This Agreement		18
	6.3	Consents and Approvals		19
	6.4	Merger Sub		19
	6.5	Financing		19
	6.6	Information Supplied		19
	6.7	HSR Act		19
	6.8	No Current Intention to Sell Company		20
	6.9	Brokers		20

ARTICLE VII		COVENANTS		20
	7.1	Interim Operations		20
	7.2	Acquisition Proposals		23
	7.3	Information Statement; Stockholder Consent Solicitation; Recommendation; Record Date		24
	7.4	Warrant Exercise and Conversion of Series B Stock; Delivery of Consent		26
	7.5	Commercially Reasonable Efforts; Cooperation		27
	7.6	Other Access and Investigation		28
	7.7	Consents		29
	7.8	Public Announcements		29
	7.9	Employee Benefits		29
	7.10	Indemnification; Directors’ and Officers’ Insurance		29
	7.11	Funds for Cash Out Payments		31

TABLE OF CONTENTS
(continued)


			Page
	7.12	Takeover Statutes		31
	7.13	Director Resignations		31
	7.14	Obligation to Notify		31
	7.15	Debentures		31
	7.16	Other Exercisable/Convertible Securities		32

ARTICLE VIII		CONDITIONS		32
	8.1	Conditions to the Obligations of the Company, Parent and Merger Sub to Effect the Merger		32
	8.2	Conditions to Obligations of Parent and Merger Sub		32
	8.3	Conditions to Obligation of the Company		33

ARTICLE IX		TERMINATION		34
	9.1	Termination by Mutual Consent		34
	9.2	Termination by Either Parent or the Company		34
	9.3	Termination by the Company		34
	9.4	Termination by Parent		36
	9.5	Effect of Termination and Abandonment		37

ARTICLE X		MISCELLANEOUS AND GENERAL		37
	10.1	Non-Survival of Representations and Warranties		37
	10.2	Modification or Amendment		37
	10.3	Waiver of Conditions		37
	10.4	Definitions		37
	10.5	Counterparts		37
	10.6	Governing Law and Venue; Waiver of Jury Trial		37
	10.7	Notices		38
	10.8	Entire Agreement		40
	10.9	Enforcement; No Third Party Beneficiaries		40
	10.10	Severability		41
	10.11	Interpretation; Absence of Presumption		41
	10.12	Fees and Expenses		41
	10.13	Assignment		42

iii

TABLE OF CONTENTS


		Page
ANNEX AND EXHIBITS


Annex I		Glossary of Defined Terms I-1

Exhibit A		Certificate of Incorporation A-1

Exhibit B		Form of Written Consent of Stockholder B-1

AGREEMENT AND PLAN OF MERGER

AGREEMENT AND PLAN OF MERGER (this “Agreement”), dated as of February 21, 2007, by and among Renova Media Enterprises Ltd., a Bahamian corporation (“Parent”), Galaxy Merger Sub Corporation, a Delaware corporation and a subsidiary of Parent (“Merger Sub”), and Moscow CableCom Corp., a Delaware corporation (the “Company”).

RECITALS

WHEREAS, the definitions of certain capitalized terms used in this Agreement are set forth in Annex I;

WHEREAS, as of the date hereof, Parent owns 3,375,084 shares of Common Stock, warrants to purchase 1,687,542 shares of Common Stock, 4,500,000 shares of Series B Stock and warrants to purchase 8,283,000 shares of Series B Stock;

WHEREAS, a special committee (the “Special Committee”) of the board of directors of the Company (the “Company Board”) has unanimously recommended to the Company Board that the Company Board approve this Agreement and the acquisition of all of the equity interests of the Company which Parent does not beneficially own on the date hereof, on the terms and subject to the conditions set forth in this Agreement;

WHEREAS, the Company Board has, by the unanimous vote of those directors adopting the applicable resolutions, duly approved and declared advisable this Agreement and the merger of Merger Sub with and into the Company (the “Merger”) upon the terms and conditions set forth in this Agreement;

WHEREAS, the boards of directors of each of Parent and Merger Sub have approved this Agreement;

WHEREAS, Parent, as the sole shareholder in Merger Sub, will adopt this Agreement following the execution of this Agreement;

WHEREAS, concurrently with the execution of this Agreement, RME Finance Ltd, a company formed under the laws of the Republic of Cyprus (“Bridge Finance Lender”), the Company and Company Sub, have entered into the Bridge Facility Agreement dated as of the date hereof (the “Bridge Facility Agreement”), pursuant to which Bridge Finance Lender has agreed, subject to the terms and conditions set forth therein, to make available to Company Sub certain Loans (as defined in the Bridge Facility Agreement), the payment and performance of which has been unconditionally guarantied by the Company; and

WHEREAS, the Company, Parent and Merger Sub desire to make those representations, warranties, covenants and agreements specified herein in connection with this Agreement.

NOW, THEREFORE, in consideration of the premises and the representations, warranties, covenants and agreements contained herein, and intending to be legally bound hereby, Parent, Merger Sub and the Company agree as follows:

ARTICLE I

THE MERGER; CLOSING; EFFECTIVE TIME

1.1 The Merger. Upon the terms and subject to the conditions set forth in this Agreement, at the Effective Time (as defined below), Merger Sub shall be merged with and into the Company and the separate corporate existence of Merger Sub shall thereupon cease. The Company shall be the surviving corporation in the Merger (sometimes hereinafter referred to as the “Surviving Corporation”), and the separate corporate existence of the Company with all its rights, privileges, immunities, powers and franchises shall continue unaffected by the Merger, except as set forth in Article II of this Agreement. The Merger shall have the effects specified in the DGCL.

1.2 Closing. Unless otherwise mutually agreed in writing between Parent and the Company, the closing for the Merger (the “Closing”) shall take place at the offices of DLA Piper US LLP, 1251 Avenue of the Americas, 29th Floor, New York, New York 10020-1041, at 9:00 A.M. local time on the first Business Day (the “Closing Date”) following the day on which the last to be satisfied or waived of the conditions set forth in Article VIII (other than those conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of those conditions) shall be satisfied or, subject to applicable Law, waived in accordance with this Agreement.

1.3 Effective Time. Immediately following the Closing, Parent and the Company shall cause a Certificate of Merger (the “Certificate of Merger”) to be executed, acknowledged and filed with the Secretary of State of the State of Delaware as provided by the applicable provisions of the DGCL. The Merger shall become effective at the time when the Certificate of Merger has been duly filed with the Secretary of State of the State of Delaware or at such later time as may be agreed by the parties in writing and specified in the Certificate of Merger (the “Effective Time”).

ARTICLE II

CERTIFICATE OF INCORPORATION AND BY-LAWS
OF THE SURVIVING CORPORATION

2.1 The Certificate of Incorporation. The certificate of incorporation of the Company shall be amended to read in its entirety as set forth in Exhibit A and shall be the certificate of incorporation of the Surviving Corporation (the “Charter”), until thereafter amended as provided therein or by applicable Law.

2.2 The By-Laws. The By-Laws of the Company shall be amended and restated to conform to the By-Laws of Merger Sub as in effect immediately prior to the Effective Time and shall be the By-Laws of the Surviving Corporation (the “By-Laws”), until thereafter amended as provided therein or in accordance with the Charter and applicable Law.

ARTICLE III

OFFICERS AND DIRECTORS OF THE SURVIVING CORPORATION

3.1 Directors. The directors of Merger Sub immediately prior to the Effective Time shall, from and after the Effective Time, be the directors of the Surviving Corporation until their successors have been duly elected or appointed and qualified or until their earlier death, resignation or removal in accordance with the Charter and the By-Laws.

3.2 Officers. The officers of the Company at the Effective Time shall, from and after the Effective Time, be the officers of the Surviving Corporation until their successors have been duly elected or appointed and qualified or until their earlier death, resignation or removal in accordance with the Charter and the By-Laws.

ARTICLE IV

EFFECT OF THE MERGER ON CAPITAL STOCK; EXCHANGE OF CERTIFICATES

4.1 Effect on Capital Stock. At the Effective Time, as a result of the Merger and without any action on the part of Parent, Merger Sub, the Company or any holder of any capital stock of Parent, Merger Sub or the Company:

(a) Merger Consideration.

(i) Each share of Common Stock issued and outstanding immediately prior to the Effective Time (other than (A) shares of Common Stock owned by Parent, (B) shares of Common Stock owned by the Company or any direct or indirect wholly-owned Subsidiary of the Company, or (C) shares of Common Stock (the “Dissenting Common Shares”) that are owned by stockholders holding Common Stock who are entitled to demand and properly demand an appraisal of their shares of Common Stock (the “Dissenting Common Stockholders”) pursuant to Section 262 of the DGCL (each of (A), (B) and (C) of this sentence, an “Excluded Common Share” and collectively, “Excluded Common Shares”)) shall be converted into the right to receive an amount in cash equal to $12.90 (the “Common Stock Merger Consideration”).

(ii) Each share of Series A Convertible Preferred Stock of the Company, par value $0.01 per share (“Series A Stock”), issued and outstanding immediately prior to the Effective Time (other than (A) shares of Series A Stock owned by Parent, (B) shares of Series A Stock owned by the Company or any direct or indirect wholly-owned Subsidiary of the Company, or (C) shares of Series A Stock (the “Dissenting Series A Shares”) that are owned by stockholders holding Series A Stock who are entitled to demand and properly demand appraisal of their shares of Series A Stock (the “Dissenting Series A Stockholders”) pursuant to Section 262 of the DGCL (each of (A), (B) and (C) of this sentence, an “Excluded Series A Share” and collectively, “Excluded Series A Shares”)) shall be converted into the right to receive an amount in cash equal to the product of (x) the Common Stock Merger Consideration and (y) the number of shares of Common Stock into which one share of Series A Stock is convertible in accordance with its terms at the Effective Time (together with any declared and unpaid dividends on a share of Series A Stock for which a record date has occurred prior to the Closing Date, in

accordance with the terms of the Series A Stock) (the “Series A Merger Consideration”) (it being understood that the aggregate amount payable to any individual holder of record of Series A Stock shall be rounded to the nearest cent).

(iii) At the Effective Time, all shares of Common Stock and Series A Stock shall no longer be outstanding and all shares of Common Stock and Series A Stock shall be cancelled and retired and shall cease to exist, and each certificate (a “Certificate”) formerly representing any such shares of Common Stock or Series A Stock (other than Excluded Common Shares or Excluded Series A Shares) shall thereafter represent only the right to the Common Stock Merger Consideration or Series A Merger Consideration, as applicable, and any Dissenting Common Shares or Dissenting Series A Shares shall thereafter represent only the right to receive the applicable payments set forth in Section 4.3. At the Effective Time, all shares of Series B Stock, which are all held by Parent as of the date hereof, shall cease to be outstanding, shall be cancelled and retired without payment of any consideration therefor and shall cease to exist.

(b) Cancellation of Parent-Owned Shares and Treasury Shares. Each share of Company capital stock issued and outstanding immediately prior to the Effective Time and owned by Parent, the Company, or any direct or indirect wholly-owned Subsidiary of the Company shall, by virtue of the Merger and without any action on the part of the holder thereof, cease to be outstanding, shall be cancelled and retired without payment of any consideration therefor and shall cease to exist.

(c) Merger Sub Shares. At the Effective Time, each share of common stock, par value $0.01 per share, of Merger Sub issued and outstanding immediately prior to the Effective Time shall be converted into a number of shares of common stock, par value $0.01 per share, of the Surviving Corporation equal to the result of dividing (i) the difference between (x) the sum of the shares of Company Common Stock that are, immediately prior to the Effective Time, outstanding, issuable upon conversion of convertible securities, issuable upon exercise of exercisable securities, and/or issuable upon conversion of securities issuable upon exercise of exercisable securities, which sum shall be set forth on a certificate executed by a duly authorized executive of the Company and delivered to Parent at the Closing, and (y) the number of shares subject to Company Options that, immediately prior to the Effective Time, are not terminable upon the Surviving Corporation’s delivery of an Option Cash Out Payment, as defined and described in Section 4.4(a), by (ii) 1,000 (the number of shares of Merger Sub Common Stock that will be outstanding immediately prior to the Effective Time).

4.2 Surrender of Certificates for Payment.

(a) Paying Agent. At or immediately prior to the Effective Time, Parent shall deposit, or shall cause to be deposited, with a paying agent appointed by Parent and approved in advance by the Company (such approval not to be unreasonably withheld or delayed) (the “Paying Agent”), for the benefit of the holders of shares of Common Stock and Series A Stock (other than Parent or the Company), cash sufficient to pay the aggregate Common Stock Merger Consideration and aggregate Series A Merger Consideration in exchange for shares of Common Stock and Series A Stock, respectively, outstanding immediately prior to the Effective Time (other than Excluded Common Shares and Excluded Series A Shares), deliverable upon due surrender of the Certificates pursuant to the provisions of this Article IV (such cash being

hereinafter referred to as the “Payment Fund”). The Payment Fund shall not be used for any other purposes. The Paying Agent shall invest the cash included in the Payment Fund in obligations guaranteed by the full faith and credit of the United States of America or such other instruments as constitute customary investments for payment funds of this nature. All interest earned on such funds shall be paid to Parent.

(b) Payment Procedures. Parent and the Surviving Corporation shall cause the Paying Agent to mail, as soon as reasonably practicable after the Effective Time, to each holder of record of shares of Common Stock and Series A Stock (i) a letter of transmittal (which shall be in a form prepared by Parent and approved by the Company, such approval not to be unreasonably withheld, prior to the Effective Time), (A) specifying that delivery shall be effected, and risk of loss and title to Certificates shall pass, only upon delivery of Certificates to the Paying Agent, and (B) containing an irrevocable waiver of any appraisal rights under Section 262 of the DGCL in connection with the Merger; and (ii) instructions for use in effecting the surrender of the Certificates in exchange for the Common Stock Merger Consideration and Series A Merger Consideration (together with any declared and unpaid dividends on such securities, respectively, for which a record date has occurred prior to the Closing Date, in accordance with the terms of their respective securities). Upon the surrender of a Certificate to the Paying Agent in accordance with the terms of such letter of transmittal, duly executed, the holder of such Certificate shall be entitled to receive in exchange therefor a check in the amount (after giving effect to any required tax withholdings) of (x) the number of shares of Common Stock or Series A Preferred Stock, as applicable, represented by such Certificate multiplied by (y) the Common Stock Merger Consideration or Series A Merger Consideration, as applicable (together with any declared and unpaid dividends on such securities, respectively, for which a record date has occurred prior to the Closing Date, in accordance with the terms of their respective securities), and the Certificate so surrendered shall forthwith be cancelled. No interest shall be paid or accrued on any amount payable upon due surrender of the Certificates. In the event of a transfer of ownership of shares of Common Stock or Series A Stock that is not registered in the transfer records of the Company, a check for any cash to be paid upon due surrender of the Certificate may be paid to such a transferee if the Certificate formerly representing such shares of Common Stock or Series A Stock is presented to the Paying Agent, accompanied by all documents required to evidence and effect such transfer and to evidence that any applicable stock transfer taxes have been paid or are not applicable.

(c) Transfers. From and after the Effective Time, the share transfer books of the Company shall be closed and there shall be no further registration of transfers on the share transfer books of the Surviving Corporation of the shares of Common Stock or Series A Stock which were outstanding immediately prior to the Effective Time (except for any transfers made in accordance with customary settlement procedures to reflect trades effected prior to the Effective Time). If, after the Effective Time, Certificates representing shares of Common Stock or Series A Stock are presented to the Surviving Corporation or Parent for transfer, they shall be cancelled and exchanged for a check in the proper amount pursuant to this Article IV.

(d) Termination of Payment Fund. Any portion of the Payment Fund (including the proceeds of any investments thereof) that remains unclaimed by the stockholders of the Company for 180 days after the Effective Time shall be delivered to the Surviving Corporation. Any holders of shares of Common Stock or Series A Stock (other than Excluded

Common Shares or Excluded Series A Shares) who have not theretofore complied with this Article IV shall thereafter look only to the Surviving Corporation for payment of (after giving effect to any required tax withholdings) the Common Stock Merger Consideration and Series A Merger Consideration, as applicable, upon due surrender of their Certificates, without any interest thereon. Notwithstanding the foregoing, none of Parent, Merger Sub, the Surviving Corporation, the Company, the Paying Agent or any other Person shall be liable to any former holder of shares of Common Stock or Series A Stock for any amount delivered to a public official pursuant to applicable abandoned property, escheat or similar Laws. Any portion of the Payment Fund remaining unclaimed as of a date which is immediately prior to such time as such amounts would otherwise escheat to or become property of any government entity shall, to the extent permitted by applicable Law, become the property of Parent free and clear of any claims or interest of any person previously entitled thereto.

(e) Lost, Stolen or Destroyed Certificates. In the event any Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the Person claiming such Certificate to be lost, stolen or destroyed and if required by Parent the posting by such Person of a bond in customary amount with customary terms against any claim that may be made against it with respect to such Certificate, the Paying Agent shall issue a check in the amount (after giving effect to any required tax withholdings) of the number of shares of Common Stock or Series A Stock represented by such lost, stolen or destroyed Certificate multiplied by the Common Stock Merger Consideration or Series A Merger Consideration, as applicable, in exchange for such lost, stolen or destroyed Certificate. Any affidavit of loss presented pursuant to this Article IV, to be deemed effective, must be in form and substance reasonably satisfactory to the Surviving Corporation.

4.3 Dissenters’ Rights. Any Dissenting Common Stockholder or Dissenting Series A Stockholder shall not be entitled to receive the Common Stock Merger Consideration or Series A Merger Consideration, as applicable, with respect to the shares of Common Stock or Series A Stock owned by such Person unless and until such Person shall have failed to perfect or shall have effectively withdrawn or lost such holder’s right to dissent from the Merger under the DGCL. Each Dissenting Common Stockholder and each Dissenting Series A Stockholder, as the case may be, shall be entitled to receive only the payment provided by Section 262 of the DGCL with respect to the shares of Common Stock and/or Series A Stock owned by such Dissenting Common Stockholder or Dissenting Series A Stockholder, as the case may be, and as to which dissenters’ rights have been properly perfected. The Company shall give Parent (i) prompt notice of any written demands for appraisal, attempted withdrawals of such demands, and any other instruments served pursuant to applicable Law received by the Company relating to stockholders’ rights of appraisal, and (ii) the opportunity to direct all negotiations and proceedings with respect to demands for appraisal under the DGCL. The Company shall not, except with the prior written consent of Parent, voluntarily make any payment with respect to any demands for appraisals of Dissenting Common Shares or Dissenting Series A Shares, offer to settle or settle any such demands or approve any withdrawal of any such demands.

4.4 Treatment of Company Options, Warrants, Restricted Shares and Convertible Debentures.

(a) Upon and after the Effective Time, with respect to any outstanding stock option to purchase shares of Common Stock (each, a “Company Option”) the holder thereof shall be entitled to receive an amount of cash (without interest) equal to the product of (x) the total number of shares of Common Stock subject to the Company Option (with all shares subject to the option deemed fully vested and exercisable) multiplied by (y) the excess, if any, of the amount of the Common Stock Merger Consideration over the exercise price per share of Common Stock under such Company Option (with the aggregate amount of such payment rounded to the nearest cent), less applicable Taxes, if any, required to be withheld with respect to such payment (the “Option Cash Out Payment”) and, upon the holder’s receipt of such Option Cash Out Payment, the holder’s Company Option shall be terminated; provided, however, that to the extent an option holder’s acknowledgment or consent or an amendment to the Company Option agreement is required to permit the Company to terminate the Company Option, the holder of a Company Option shall only be entitled to the Option Cash Out Payment upon such holder’s execution and delivery of a form of acknowledgment and consent, or amendment to Company agreement, which has been prepared by Parent and approved by the Company, which approval shall not be unreasonably withheld. With respect to any Company Option that is not otherwise terminable upon the delivery of the Option Cash Out Payment, the Company Option shall remain outstanding, provided that the shares subject to the Company Option shall be shares of the Surviving Corporation. From and after the date hereof, the Company shall use commercially reasonable efforts to distribute to the holders of Company Options the forms of acknowledgment and consent described in this Section 4.4(a) and such other information currently in the Company’s possession relating to such Company Options to facilitate Option Cash Out Payments upon and after the Effective Time.

(b) Upon and after the Effective Time, each warrant to purchase shares of Common Stock which is not held by Parent and is then outstanding (each, a “Company Common Warrant”) shall, in accordance with the terms of such Company Common Warrant, represent the right to receive, upon the exercise thereof, an amount in cash (without interest) equal to the product of (x) the total number of shares of Common Stock subject to such Company Common Warrant multiplied by (y) the Common Stock Merger Consideration. In lieu of exercising a Company Common Warrant (upon and after the Effective Time but prior to the expiration of such Company Common Warrant), if the holder so requests, the Surviving Corporation shall permit the holder thereof to receive an amount of cash (without interest) equal to the product of (x) the total number of shares of Common Stock subject to such Company Common Warrant multiplied by (y) the excess, if any, of the amount of the Common Stock Merger Consideration over the exercise price per share of Common Stock under such Company Common Warrant (with the aggregate amount of such payment rounded to the nearest cent), less applicable Taxes, if any, required to be withheld with respect to such payment (the “Warrant Cash Out Payment”). Except as described herein, the terms and conditions of each Company Common Warrant, including terms and conditions regarding the expiration of such Company Common Warrant, shall remain in effect after the Effective Time.

(c) Upon the Effective Time, each warrant to purchase shares of Common Stock or Series B Stock, which warrant is then held by Parent and then outstanding, shall,

notwithstanding any terms to the contrary therein, be terminated and cancelled without payment of any consideration therefor and shall cease to exist.

(d) Immediately prior to the Effective Time, each share of Common Stock subject to forfeiture or reacquisition by the Company (“Company Restricted Stock”) shall fully vest and no longer be subject to forfeiture or reacquisition by the Company. The Company shall take all actions necessary to effect such vesting. A holder of Company Restricted Stock will accordingly have the right to receive the Common Stock Merger Consideration for each outstanding share of Company Restricted Stock without any restrictions applicable to unvested shares of Company Restricted Stock.

(e) Upon and after the Effective Time, each of the Company’s 10 1/2% Convertible Subordinated Debentures due 2007 that is then outstanding (each a “Debenture”) shall, in accordance with the terms of each Debenture, become convertible into the right to receive, upon the conversion thereof, an amount in cash (without interest) equal to the Common Stock Merger Consideration multiplied by each whole share of Common Stock issuable upon conversion of such Debenture immediately prior to the Effective Time. Except as described herein, the terms and conditions of each Debenture shall remain in effect after the Effective Time.

(f) Prior to the Effective Time, the Company shall use all commercially reasonable efforts to cause the transactions contemplated by this Section 4.4 and any other dispositions of equity securities of the Company (including derivative securities) in connection with this Agreement by each individual who is subject to the reporting requirements of Section 16(a) of the Exchange Act with respect to the Company to be exempt under Rule 16b-3 under the Exchange Act.

4.5 Further Action. If, at any time after the Effective Time, any further action is determined by Parent to be necessary or desirable to carry out the purposes of this Agreement or to vest the Surviving Corporation with full right, title and possession of and to all rights and property of Merger Sub and the Company, the officers and directors of the Surviving Corporation and Parent shall be fully authorized (in the name of Merger Sub, in the name of the Company and otherwise) to take such action.

ARTICLE V

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

Except as set forth in (i) the Company Reports (as defined below) filed prior to the date hereof or (ii) the applicable section of the disclosure schedule delivered by the Company to Parent on the date hereof (the “Company Disclosure Schedule”) (it being understood that any matter disclosed in any section or subsection of the Company Disclosure Schedule with respect to the corresponding section or subsection of this Agreement shall be deemed to be disclosed under any other section or subsection of this Agreement, as long as the relevance of such disclosure to such other section or subsection of the Agreement is reasonably apparent), the Company hereby represents and warrants to Parent and Merger Sub as follows:

5.1 Subsidiaries, Organization, Good Standing and Qualification. Each of the Company and its Subsidiaries is a corporation or other legal entity duly organized, validly existing and in good standing (where applicable) under the Laws of the jurisdiction of its incorporation or organization and has all requisite corporate or other business entity power and authority to own, lease and operate its properties and assets and to carry on its businesses as now being conducted and is qualified to do business and is in good standing (where applicable) as a foreign corporation or other business entity in each jurisdiction where the ownership, leasing or operation of its properties or assets or conduct of its business requires such qualification, except where the failure to be so qualified or in good standing or to have such power or authority, would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

5.2 Capitalization of the Company and its Subsidiaries.

(a) The authorized stock of the Company consists of 25,800,000 shares of Preferred Stock, of which 25,000,000 are designated Series B Stock and 800,000 are designated Series A Stock, and 40,000,000 shares of Common Stock. As of February 20, 2007, 13,972,365 shares of Common Stock were issued and outstanding, 149,962 shares of Series A Stock were issued and outstanding and 4,500,000 shares of Series B Stock were outstanding. All such shares of Common Stock, Series A Stock and Series B Stock outstanding as of such date have been duly authorized, validly issued, and are fully paid, nonassessable and free of preemptive rights or other similar rights. The Company has no commitments to issue or deliver any shares of Common Stock, except that, as of February 20, 2007, a total of 1,090,265 shares of Common Stock were reserved for issuance pursuant to outstanding Company Options, 702,680 shares of Common Stock were reserved for issuance pursuant to outstanding Company Common Warrants, 8,283,000 shares of Series B Stock were reserved for issuance pursuant to outstanding warrants to purchase Series B Stock, 22,077 shares of Common Stock were required for issuance upon conversion and in accordance with the terms of outstanding Debentures, 458,134 shares of Common Stock were reserved for issuance upon conversion of outstanding shares of Series A Preferred Stock and 12,783,000 shares of Common Stock were reserved for issuance upon conversion of shares of Series B Stock (both outstanding and issuable upon exercise of warrants to purchase Series B Stock). All outstanding Company Options are governed by the terms and conditions of the Company’s 2003 Stock Plan and the standard form of stock option agreement used for such plans, respectively. All outstanding Company Common Warrants are governed by the terms and conditions of a warrant agreement, the form of which is included as an exhibit to a Company Report. Except as set forth in this paragraph, there are no authorized or outstanding debt or equity securities of the Company, and the Company has no obligations to authorize or issue additional debt or equity securities of the Company.

(b) As of the date hereof, the number of shares of Common Stock into which each outstanding share of Series A Stock is convertible is 3.055; the number of shares of Common Stock into which each outstanding share of Series B Stock is convertible is 1.0; and the voting power of each outstanding share of Series B Stock in any matter presented to the holders of the Company’s capital stock voting as a single class is 0.81833 per share (compared to 1.0 per share for each outstanding share of Common Stock).

(c) Each of the outstanding shares of capital stock or other securities of each of the Company’s Subsidiaries is duly authorized, validly issued, fully paid and nonassessable, and owned by the Company or by a direct or indirect wholly-owned Subsidiary of the Company, free and clear of any Lien. Section 5.1 of the Company Disclosure Schedule sets forth a correct and complete list of all such capital stock or other securities. Except as set forth above, there are no shares of capital stock of the Company or any of its Subsidiaries authorized, reserved, issued or outstanding and there are no preemptive or other outstanding rights, subscriptions, options, warrants, stock appreciation rights, redemption rights, repurchase rights, convertible, exercisable, or exchangeable securities of the Company or any of its Subsidiaries or other agreements, arrangements or commitments of any character to which the Company or any of its Subsidiaries is a party relating to the issued or unissued share capital or other ownership interest of the Company or any of its Subsidiaries or any other securities or obligations of the Company or any of its Subsidiaries convertible or exchangeable into or exercisable for, or giving any Person a right to subscribe for or acquire, any securities of the Company or its Subsidiaries, and no securities evidencing such rights are authorized, issued or outstanding. Except as set forth above, the Company does not have outstanding any bonds, debentures, notes or other obligations the holders of which have the right to vote (or convertible or exchangeable into or exercisable for securities having the right to vote) with the stockholders of the Company on any matter.

(d) There are no voting trusts or other agreements or understandings to which the Company or any of its Subsidiaries is a party with respect to the voting of any of the capital stock of the Company. None of the Company or any of its Subsidiaries is obligated under any registration rights or similar agreements to register any shares of capital stock of the Company or any of its Subsidiaries on behalf of any Person.

5.3 Corporate Authority; Approval and Fairness.

(a) The Company has all requisite corporate power and authority and has taken all corporate action necessary in order to execute, deliver and perform its obligations under this Agreement and, subject only to adoption of this Agreement by its stockholders by the Company Requisite Vote, to consummate the Merger. The Company Requisite Vote is the only vote of the holders of any class or series of capital stock of the Company necessary to adopt, approve or authorize this Agreement and the Merger. Under the Charter, Bylaws and applicable Law, the Company’s stockholders may provide the Company Requisite Vote by written consent in lieu of a stockholder meeting. The form of written consent attached hereto as Exhibit B is a form sufficient for delivery of a valid stockholder approval of the Merger by written consent under the Charter, Bylaws and applicable Law. If Parent holds of record shares of Company capital stock representing a majority of the outstanding voting power of the then outstanding shares of Common Stock and Series B Stock, voting together as a single class, at the time Parent executes a written consent in the form attached hereto as Exhibit B, such written consent will constitute the Company Requisite Vote. This Agreement has been duly and validly executed and delivered by the Company and, assuming due authorization, execution and delivery hereof by Parent and Merger Sub, constitutes a valid and binding agreement of the Company enforceable against the Company in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of general applicability relating to affecting creditors’ rights and to general equity principles.

(b) (i) The Special Committee has been duly authorized and constituted, (ii) the Special Committee, at a meeting thereof duly called and held on February 21, 2007, unanimously (A) determined that this Agreement and the Merger are fair to and in the best interests of the Company and its stockholders (other than the Interested Stockholders), (B) recommended that the Company Board approve and declare advisable this Agreement and the Merger and (C) resolved to recommend that the Company Board submit this Agreement for adoption by the stockholders of the Company and recommend that such stockholders adopt this Agreement and approve the Merger and (iii) the Company Board, at a meeting thereof duly called and held on February 21, 2007, by the unanimous vote of those directors adopting the applicable resolutions, (A) determined that this Agreement and the Merger are fair to and in the best interests of the Company and its stockholders (other than the Interested Stockholders), (B) approved and declared advisable this Agreement and the Merger and (C) resolved to submit this Agreement for adoption by the stockholders of the Company and recommend that such stockholders adopt this Agreement and approve the Merger.

5.4 Consents and Approvals; No Violations.

(a) No filing with or notice to, and no permit, authorization, registration, consent or approval of, any Governmental Entity is required on the part of the Company or any of its Subsidiaries for the execution, delivery and performance by the Company of this Agreement or the consummation by the Company of the transactions contemplated hereby, except (i) any post-execution filings required under the Exchange Act, (ii) the filing of the Certificate of Merger pursuant to the DGCL, (iii) FAS Clearance and (iv) such filings, notices, permits, authorizations, registrations, consents or approvals, the failure of which to make, give or obtain would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

(b) Neither the execution, delivery and performance of this Agreement by the Company nor the consummation by the Company of the transactions contemplated hereby will (A) conflict with or result in any breach, violation or infringement of any provision of the respective certificate of incorporation or By-Laws (or similar governing documents) or any resolutions of the respective boards of directors of the Company or of any its Subsidiaries, (B) result in a breach, violation or infringement of, or constitute (with or without due notice or lapse of time or both) a default (or give rise to the creation of any Lien or any right of termination, amendment, cancellation or acceleration) under, any of the terms, conditions or provisions of any Material Contract, or (C) violate or infringe any Law applicable to the Company or any of its Subsidiaries or any of their respective properties or assets, except in the case of (B) or (C) for breaches, violations, infringements, defaults or changes which would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

5.5 Compliance with Laws; Licenses. The Company and its Subsidiaries operate their respective businesses in compliance with any Laws applicable to such businesses except for such noncompliance that would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect. To the Knowledge of the Company, no investigation or review by any Governmental Entity with respect to the Company or any of its Subsidiaries is pending or threatened, nor has any Governmental Entity provided written notice of an intention to conduct the same, except for such investigations or reviews that would not, individually or in

the aggregate, reasonably be expected to have a Company Material Adverse Effect. The Company and each of its Subsidiaries has all governmental permits, licenses, franchises, variances, exemptions, orders issued or granted by a Governmental Entity and all other authorizations, consents and approvals issued or granted by a Governmental Entity necessary to conduct its business as presently conducted, except those the absence of which would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect. All the payments required in connection with the maintenance of such permits, licenses, franchises, variances, exemptions, orders, authorizations, consents and approvals are current, except where the failure to make such payments would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

5.6 No Default. Neither the Company nor any of its Subsidiaries is in default or violation (and no event has occurred which with notice or the lapse of time or both would constitute a default or violation) of any term, condition or provision of (a) its certificate of incorporation or By-Laws (or similar governing documents) or (b) any Material Contract, except in the case of clause (b) of this sentence for violations, breaches or defaults that would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect.

5.7 Company Reports; Financial Statements.

(a) Each of the Company and its Subsidiaries has filed and furnished all forms, statements, reports and documents required to be filed or furnished by it with the SEC pursuant to applicable securities statutes, regulations, policies and rules since January 1, 2005. The Company Reports were prepared in all material respects in accordance with the applicable requirements of the Securities Act and the Exchange Act and complied in all material respects with the then applicable accounting standards. As of their respective dates (and, if amended or supplemented after giving effect to such amendment or supplement) the Company Reports did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements made therein, in light of the circumstances in which they were made, not misleading. There is no comment letter or request for information from the SEC with respect to any Company Report that the Company has received that, to the Knowledge of the Company, remains outstanding.

(b) Each of the consolidated balance sheets included in or incorporated by reference into the Company Reports (including the related notes and schedules) filed on or prior to the date of this Agreement fairly presents in all material respects, and if filed after the date of this Agreement, will fairly present in all material respects, the consolidated financial position of the Company and its Subsidiaries, as of its date, and each of the consolidated statements of operations, cash flows and of changes in stockholders’ equity included in or incorporated by reference into the Company Reports (including any related notes and schedules) fairly presents in all material respects, and if filed on or after the date of this Agreement, will fairly present in all material respects, the results of operations, retained earnings and changes in financial position, as the case may be, of the Company and its Subsidiaries for the periods set forth therein (subject, in the case of unaudited statements, to the omission of notes required by GAAP and to normal year-end audit adjustments), in each case in accordance with GAAP consistently applied during the periods involved, except as may be noted therein. The Company maintains a system

of internal controls over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) sufficient to provide reasonable assurances regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. The Company (A) maintains disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) to ensure that material information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and is accumulated and communicated to the Company’s management as appropriate to allow timely decisions regarding required disclosure, and (B) has disclosed, based on its most recent evaluation of such disclosure controls and procedures prior to the date hereof, to the Company’s auditors and the audit committee of the Company Board (1) any significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting that are reasonably likely to adversely affect in any material respect the Company’s ability to record, process, summarize and report financial information and (2) any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal controls over financial reporting.

(c) Since December 31, 2005, (i) to the Knowledge of the Company, neither the Company nor any of its Subsidiaries nor any director, officer, employee, auditor, accountant or representative of the Company or any of its Subsidiaries has received in writing, nor does the Company have any Knowledge of, any material complaint, allegation, assertion or claim, regarding the accounting or auditing practices, procedures, methodologies or methods of the Company or any of its Subsidiaries or their respective internal accounting controls, including any material complaint, allegation, assertion or claim that the Company or any of its Subsidiaries has engaged in questionable accounting or auditing practices, and (ii) to the Knowledge of the Company, no attorney representing the Company or any of its Subsidiaries, whether or not employed by the Company or any of its Subsidiaries, has reported to the Company Board or any committee thereof or to the General Counsel or Chief Executive Officer of the Company evidence of a material violation of securities Laws, breach of fiduciary duty or similar violation by the Company or any of its officers, directors, employees or agents.

(d) The audited balance sheet and audited profit and loss accounts for Company Sub as at December 31, 2005 and unaudited balance sheet and unaudited profit and loss accounts for Company Sub as at December 31, 2006 have been prepared in accordance with Russian accounting standards and fairly and accurately present the material assets and liabilities (whether actual or contingent), in each case in accordance with Russian accounting standards, of the Company Sub’s business.

(e) Neither the Company nor any of its Subsidiaries has entered into or proposed to enter into loans or other extensions of credit to officers or directors or other arrangements that are covered by Section 402 of the Sarbanes-Oxley Act (including those to which an exemption may apply) or entered into or proposed to enter into any arrangement or transaction with any person, which arrangement or transaction would be required to be disclosed under Item 404 of Regulation S-K.

5.8 No Undisclosed Material Liabilities. There are no liabilities or obligations of the Company or any of its Subsidiaries of any kind whatsoever, whether accrued, contingent, fixed, matured or otherwise that the Company would be required by GAAP to set forth on a consolidated balance sheet of the Company and its Subsidiaries or in the notes thereto, except (a) liabilities reflected or reserved against or disclosed in the Company Reports filed by the Company prior to the date hereof, (b) liabilities or obligations incurred in the ordinary course of business consistent with past practices since December 31, 2005, or (c) liabilities and obligations incurred under contracts to which the Company or any of its Subsidiaries is a party or by which any of them or any of their respective properties or assets may be bound, other than liabilities or obligations arising from a breach or default under any such contract.

5.9 Litigation. There is no Action pending to which the Company or any of its Subsidiaries, is a party or, to the Knowledge of the Company, threatened in writing to the Company against the Company or any of its Subsidiaries, except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect. Neither the Company nor any of its Subsidiaries is subject to any outstanding order, writ, injunction or decree, except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect. To the Knowledge of the Company, there is no Action pending to which any current or former officer or director of the Company or any of its Subsidiaries, in his or her capacity as such, is a party or threatened in writing against any current or former officer or director of the Company or any of its Subsidiaries, in his or her capacity as such.

5.10 Material Contracts.

(a) All of the Material Contracts of the Company and its Subsidiaries are in full force and effect, except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect. Without limiting the foregoing sentence, each of the Material Contracts into which Company Sub has entered that, at the time entered into, constituted a “major transaction” and/or an “interested party transaction” under the Russian Joint Stock Company Law, was approved as such prior to the entry into such Material Contract in compliance with the approval procedures set forth in the Russian Joint Stock Company Law.

(b) Except as set forth on Schedule 5.10(b) of the Company Disclosure Schedule: (i) there are no Material Contracts and (ii) there are no Contracts that purport to limit the ability of the Company or any Subsidiary to conduct their respective businesses in any geographic area or to sell any goods to, or provide any services to, any party.

5.11 Absence of Certain Changes or Events. Since December 31, 2005, each of the Company and its Subsidiaries has conducted its business only in the ordinary course of such business, and there has not been any change, development, event, effect, occurrence or non-occurrence affecting the business, assets, liabilities, property, financial condition or results of operations of any of the Company and its Subsidiaries that individually or in the aggregate, has had or would reasonably be expected to have a Company Material Adverse Effect.

5.12 Employee Matters.

(a) All Benefit Plans have been maintained and administered in all material respects in accordance with their terms and applicable Law, and there are no pending or, to the Knowledge of the Company, threatened claims, audits, investigations, inquiries or proceedings against the Benefit Plans, any related trusts, any Benefit Plan sponsor or plan administrator, or any fiduciary of the Benefit Plans with respect to the operation of such plans (other than routine benefit claims). With respect to each Benefit Plan, the Company and each Company Subsidiary have prepared in good faith and timely filed all requisite governmental reports (which were, to the Knowledge of the Company, true and correct as of the date filed).

(b) Without limiting anything in this Section 5.12, in the case of Company Sub, except for pension payments required to be paid to the state under the Laws of the Russian Federation, Company Sub does not maintain or contribute to, has no obligation to contribute to, and has no liability under any pension, severance, termination or similar Benefit Plan, or a pension plan sponsored by any ERISA Affiliate of the Company, providing benefits to any current or former employee, consultant, or director of Company Sub. Company Sub has timely made full payment of all pension payments required to be paid to the state under the Laws of the Russian Federation.

(c) Each Benefit Plan that is intended to qualify under Section 401 of the Internal Revenue Code of 1986, as amended (the “Code”), and each trust maintained pursuant thereto, has received a favorable determination or opinion letter from the Internal Revenue Service, and, to the Knowledge of the Company, nothing has occurred with respect to the operation of any such Benefit Plan that could cause the loss of such qualification.

(d) Neither the execution and delivery of this Agreement nor the consummation of the transactions contemplated hereby (either alone of in conjunction with another event, such as a termination of employment) will (i) result in any payment becoming due to any current or former director or current or former employee of the Company or any of its Subsidiaries under any Benefit Plan or otherwise, (ii) increase any benefits otherwise payable under any Company Benefit Plan, (iii) result in any acceleration of the time of payment or vesting of any such benefits, or (iv) result in an “excess parachute payment” under Section 280G of the Code.

(e) Without limiting the representations and warranties contained in Section 5.5, except as would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect, the Company and its Subsidiaries are in compliance with all applicable Laws relating to employment and employment practices, wages, hours and terms and conditions of employment.

(f) Without limiting the foregoing or any of the other representations and warranties of the Company in this Agreement, Company Sub has made all payments (of any kind) to its employees in accordance with the terms and conditions of applicable employment contracts and paid or withheld all applicable Taxes applicable to such payments (including without limitation social taxes and income taxes).

5.13 Intellectual Property.

(a) Except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect, the Company and its Subsidiaries are the lawful owners of or have valid licenses to use or otherwise exploit all Intellectual Property used in the conduct of the business of the Company and its Subsidiaries as currently conducted, and with respect to Intellectual Property owned by the Company or its Subsidiaries, such Intellectual Property is owned free and clear of all Liens. Other than with respect to Intellectual Property licensed by the Company or a Subsidiary from another Person, none of the Company or any of its Subsidiaries jointly owns, licenses or claims any right, title or interest with any other Person (including the Company or any other Subsidiary) of any Intellectual Property. No current or former officer, manager, director, stockholder, member, employee, consultant or independent contractor of any of the Company or any of its Subsidiaries has any right, title or interest in, to or under any Intellectual Property material to the Company and its Subsidiaries and in which the Company or any of its Subsidiaries has (or purports to have) any right, title or interest that has not been exclusively assigned or transferred to the Company or a Company Subsidiary. To the Knowledge of the Company, all registrations which are owned by the Company or any Company Subsidiary for Intellectual Property are valid and in force (with all related filing fees having been duly paid).

(b) To the Knowledge of the Company, the conduct of the business of the Company and its Subsidiaries as presently conducted thereby does not infringe upon the Intellectual Property of any third party. There are no claims pending or, to the Knowledge of the Company, threatened, and neither the Company nor any of its Subsidiaries has received any written notice of a material third-party claim, in each case alleging that the conduct of the business of the Company and its Subsidiaries infringes upon the Intellectual Property of any third party or challenging the ownership, use, validity or enforceability of any Intellectual Property.

(c) To the Knowledge of the Company, except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect, no third party is infringing or otherwise violating any Intellectual Property owned by the Company or any of its Subsidiaries, and no such claims have been brought against any third party by the Company or any of its Subsidiaries.

5.14 Taxes. Except as would not, individually or in the aggregate, reasonably be expected to have a Company Material Adverse Effect: (i) the Company and each of its Subsidiaries have prepared in good faith and duly and timely filed (taking into account any extension of time within which to file) all Tax Returns required to be filed by any of them and all such filed Tax Returns are complete and accurate in all respects; (ii) the Company and each of its Subsidiaries have paid all Taxes, or have withheld and remitted to the appropriate taxing authority all Taxes due and payable or, where payment is not yet due or where such Taxes are being challenged in good faith, have established in accordance with GAAP an adequate accrual for all Taxes through the end of the last period covered by the financial statements contained in the Company Reports filed on or prior to the date of this Agreement; (iii) the Company and each of its Subsidiaries have not waived any statute of limitations with respect to Taxes which has not since expired or agreed to any extension of time with respect to a Tax assessment or deficiency which has not since expired; (iv) neither the Company nor any of its Subsidiaries (A) is or has

ever been a member of an affiliated group (other than a group the common parent of which is the Company or consisting solely of some or all of the Company’s Subsidiaries) filing a consolidated tax return or (B) has any liability for Taxes of any person (other than the Company and its Subsidiaries) arising from the application of Treasury Regulation Section 1.1502-6 or any analogous provision of state, local or foreign law, or as a transferee or successor, by contract, or otherwise; (v) none of the Company or any of its Subsidiaries is a party to, is bound by or has any obligation under any Tax sharing or Tax indemnity agreement or similar contract or arrangement; (vi) neither the Company nor any of its Subsidiaries has engaged in any “listed transaction” under Section 6011 of the Code and the regulations thereunder; (vii) all of the payments by the Company and its Subsidiaries to agents, consultants and other third parties have been in payment of bona fide fees and commissions and not as a payment described in Section 162(c) of the Code or any similar provision under foreign law; (viii) no claim has ever been made in writing by any authority in a jurisdiction where the Company does not file a Tax Return that the Company is or may be subject to taxation by that jurisdiction; and (ix) as of the date of this Agreement, there are not pending or, to the Knowledge of the Company, threatened in writing, any audits, examinations, investigations or other proceedings in respect of Taxes or Tax matters with respect to the Company or any of its Subsidiaries.

5.15 Takeover Statutes; Charter Provisions. The Company Board, upon recommendation by the Special Committee, has approved the Merger and this Agreement. No additional approval is required to render inapplicable to the Merger and this Agreement the limitations on business combinations contained in Section 203 of the DGCL to the extent applicable or, to the Knowledge of the Company, any other restrictive provision of any “fair price,” “moratorium,” “control share acquisition,” “interested stockholder” or other similar anti-takeover statute or regulation (“Takeover Statute”) or restrictive provision of any applicable anti-takeover provision in the Company’s certificate of incorporation or By-Laws. No other state takeover statute or similar statute or regulation or other comparable takeover provision of the Company’s certificate of incorporation or By-Laws applies to the Merger, this Agreement or any of the transactions contemplated by this Agreement.

5.16 Opinion of Financial Advisor. Lazard Frères & Co. llc (the “Financial Advisor”) has delivered its opinion to the Special Committee to the effect that, as of the date of such opinion, and subject to the assumptions, qualifications and limitations set forth therein, the Common Stock Merger Consideration to be received by the holders of shares of Common Stock (other than as set forth in such opinion) was fair, from a financial point of view, to such holders. A true and complete copy of the written opinion will be provided to Parent as soon as practicable after the date hereof solely for information purposes.

5.17 Brokers. No broker, finder or investment banker (other than the Financial Advisor, all of whose fees expenses and other payments are obligations solely of the Company) is entitled to any brokerage, finders’ or other fee or commission from the Company or any of its Subsidiaries in connection with the transactions contemplated hereby based upon arrangements made by or on behalf of the Company. Section 5.17 of the Company Disclosure Schedule sets forth all fees payable by the Special Committee, the Company or any of its Subsidiaries to the Financial Advisor in connection with the negotiation, approval and execution of this Agreement, the performance of the Company’s obligations hereunder, and the consummation of the

transactions contemplated hereby, and all arrangements for reimbursement by the Special Committee, the Company or any of its Subsidiaries of the expenses of the Financial Advisor.

5.18 Information Supplied. None of the information supplied or to be supplied by the Company or any of its Subsidiaries for inclusion or incorporation by reference in (i) the Schedule 13E-3, or (ii) the Company Information Statement will, at the time such document is filed with the SEC or any other regulatory authority, at any time it is amended or supplemented or at the time it is first published, sent or given to the Company’s stockholders, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading. The Schedule 13E-3, the Company Information Statement and any other SEC filing in connection with the Merger will comply (with respect to the Company and its Subsidiaries) in all material respects, as to form, with the applicable requirements of the Exchange Act and the rules and regulations thereunder. No representation or warranty is made by the Company with respect to statements made or incorporated by reference in the Schedule 13E-3 or the Company Information Statement based on information supplied by Parent in writing specifically for inclusion or incorporation by reference therein.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB

Parent and Merger Sub hereby represent and warrant to the Company as follows:

6.1 Organization, Good Standing and Qualification. Each of Parent and Merger Sub is a corporation or other legal entity duly organized, validly existing and in good standing under the Laws of the jurisdiction of its incorporation or organization and has all requisite corporate or other business entity power and authority to own, lease and operate its properties and assets and to carry on its businesses as now being conducted and is qualified to do business and is in good standing as a foreign corporation or other business entity in each jurisdiction where the ownership, leasing or operation of its properties or assets or conduct of its business requires such qualification, except where the failure to be so qualified or in good standing or to have such power or authority, would not, individually or in the aggregate, reasonably be expected to have a Parent Material Adverse Effect. Parent has heretofore delivered or made available to the Company accurate and complete copies of the certificate of incorporation and bylaws (or similar governing documents), as currently in effect, of Parent and Merger Sub.

6.2 Authority Relative to This Agreement. Each of Parent and Merger Sub has all necessary corporate power and authority, and has taken all action necessary, to execute, deliver and perform its obligations under this Agreement and to consummate the transactions contemplated hereby in accordance with the terms hereof except for the adoption of this Agreement by Parent in its capacity as sole stockholder of Merger Sub, which adoption shall be effected by written consent promptly following the execution of this Agreement. This Agreement has been duly and validly executed and delivered by Parent and Merger Sub and, assuming due authorization, execution and delivery hereof by the Company, constitutes a valid and binding agreement of Parent and Merger Sub, enforceable against Parent and Merger Sub in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization,

moratorium and similar laws of general applicability relating to affecting creditors’ rights and to general equity principles.

6.3 Consents and Approvals. No filing with or notice to, and no permit, authorization, registration, consent or approval of, any Governmental Entity is required on the part of Parent or Merger Sub or any of their Subsidiaries for the execution, delivery and performance by Parent and Merger Sub of this Agreement or the consummation by Parent or Merger Sub of the transactions contemplated hereby, other than (i) any post-execution filings required under the Exchange Act, (ii) the filing of the Certificate of Merger pursuant to the DGCL, (iii) clearance required from the Federal Antimonopoly Service of the Russian Federation under the Laws of the Russian Federation, or (iv) such filings, notices, permits, authorizations, registrations, consents or approvals, the failure of which to make, give or obtain would not, individually or in the aggregate, reasonably be expected to have a Parent Material Adverse Effect.

6.4 Merger Sub. All of the issued and outstanding capital stock of Merger Sub is, and at the Effective Time will be, owned by Parent or a direct or indirect wholly-owned Subsidiary of Parent. Merger Sub has not conducted any business prior to the date hereof and has no, and prior to the Effective Time will have no, assets, liabilities or obligations of any nature other than those incident to its formation and pursuant to this Agreement and the Merger and the other transactions contemplated by this Agreement.

6.5 Financing. Parent will have, as of the date on which it exercises its warrant to purchase shares of Series B Stock as described in Section 7.4(a) below, available cash or other liquid assets to exercise such warrant. Additionally, Parent will have, as of the Closing Date, available cash or other liquid assets to (a) pay the aggregate Merger Consideration in full, and (b) fulfill its covenant to ensure the Surviving Corporation can make all Option Cash Out Payments and Warrant Cash Out Payments, as described in Section 7.11.

6.6 Information Supplied. None of the information supplied or to be supplied by Parent or Merger Sub for inclusion or incorporation by reference in (i) the Schedule 13E-3, or (ii) the Company Information Statement will, at the time such document is filed with the SEC or any other regulatory authority, at any time it is amended or supplemented or at the time it is first published, sent or given to the Company’s stockholders, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading. The Schedule 13E-3, the Company Information Statement and any other SEC filing in connection with the Merger will comply (with respect to Parent and Merger Sub) in all material respects, as to form, with the applicable requirements of the Exchange Act and the rules and regulations thereunder. No representation or warranty is made by Parent or Merger Sub with respect to statements made or incorporated by reference in the Schedule 13E-3 or the Company Information Statement based on information supplied by the Company in writing specifically for inclusion or incorporation by reference therein.

6.7 HSR Act. For the purposes of the Hart-Scott-Rodino Antitrust Improvement act of 1976, as amended, and the rules and regulations promulgated thereunder (collectively, the “HSR Act”), and assuming the accuracy of the Company’s representations in Section 5.2: (i)

Parent beneficially owns, directly and through its Controlling interest in Moskovskaya Telecommunikatsionnaya Corporatsiya, a majority of the outstanding voting securities of the Company, and (ii) the Merger and the transactions contemplated by this Agreement are not subject to the premerger notification and waiting period requirements of the HSR Act.

6.8 No Current Intention to Sell Company. As of the date of this Agreement, and to the Parent’s knowledge, neither the Parent nor any Person Controlling Parent has the current intention to (i) sell, transfer or otherwise dispose of the shares of the capital stock of the Company (or, following the Effective Time, of the Surviving Corporation); (ii) following the Effective Time, sell, lease, assign, transfer or otherwise dispose of all or a substantial portion of the Surviving Corporation’s assets; or (iii) following the Effective Time, cause the Surviving Corporation to consolidate with or merge into another Person or permit one or more other Persons to consolidate with or merge into the Surviving Corporation, in each case except pursuant to this Agreement or pursuant to a transaction exclusively with one or more of Parent’s affiliates.

6.9 Brokers. No broker, finder or investment banker is entitled to any brokerage, finders’ or other fee or commission from the Company or any of its Subsidiaries in connection with the transactions contemplated hereby based upon arrangements made by or on behalf of Parent or Merger Sub.

ARTICLE VII

COVENANTS

7.1 Interim Operations.

(a) Except as set forth in the corresponding section of the Company Disclosure Schedule or otherwise as expressly provided herein, subject to applicable Law, the Company covenants and agrees as to itself and its Subsidiaries that, from the date of this Agreement until the Effective Time, the business of the Company and its Subsidiaries shall be conducted only in the ordinary course and, to the extent consistent therewith, the Company and its Subsidiaries shall use their respective commercially reasonable efforts to preserve their business organizations intact and maintain their existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, key employees and business associates and keep available the services of the present key employees of the Company and its Subsidiaries.

(b) Without limiting the generality of Section 7.1(a) and in furtherance thereof, except as set forth in the corresponding section of the Company Disclosure Schedule or as otherwise expressly provided herein, from the date of this Agreement until the Effective Time, the Company shall not and shall not permit its Subsidiaries to (unless Parent shall otherwise approve in writing, in its sole discretion):

(i) adopt or propose any change in its certificate of incorporation or By-Laws (or similar governing documents);

(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person, except for any such transactions among wholly-owned Subsidiaries of the Company;

(iii) acquire assets outside of the ordinary course of business from any Persons with a purchase price in excess of $100,000 in the aggregate except pursuant to Contracts in effect as of the date of this Agreement;

(iv) other than (A) as required by the terms of Contracts in effect as of the date of this Agreement, (B) upon the exercise of outstanding Company Options or Company Common Warrants or warrants to purchase Series B Stock, (C) pursuant to the terms of the Debentures (to the extent required by such terms) or (D) upon conversion of outstanding shares of Series A Stock and Series B Stock, in each case, in accordance with their terms, issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock of the Company or any Company Subsidiary (other than the issuance of shares by a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary), or securities convertible or exchangeable or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;

(v) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for (i) dividends or other distributions by any direct or indirect wholly-owned Subsidiary of the Company to the Company or to any other direct or indirect wholly-owned Subsidiary of the Company, (ii) periodic dividends and other periodic distributions by non-wholly-owned Subsidiaries of the Company in the ordinary course of business, and (iii) declaration and payment of scheduled dividends with respect to the Series A Stock);

(vi) reclassify, combine, split, subdivide or redeem, purchase or otherwise acquire, directly or indirectly, any of its capital stock or securities convertible or exchangeable into or exercisable for any shares of its capital stock;

(vii) incur any third-party indebtedness for borrowed money or guarantee indebtedness or any other obligation of another Person other than in the ordinary course of business consistent with past practice and in compliance with the Company’s existing Contracts;

(viii) enter into any Contract that would have been a Material Contract had it been entered into prior to the execution of this Agreement, other than any such Contract (A) entered into in the ordinary course of business or (B) providing for any capital expenditure to the extent permitted by Section 7.1(c)(ii);

(ix) other than in the ordinary course of business, amend or modify in any material respect, or terminate or waive any material right or benefit under, any Material Contract;

(x) make any changes with respect to accounting policies or practices, except as required by changes in GAAP or by Law;

(xi) settle any litigation or other proceedings before or threatened to be brought before a Governmental Entity or arbitral proceeding for an amount payable by or on behalf of the Company or any Subsidiary in excess of $100,000 in the aggregate for all such litigation or proceedings (exclusive of any amounts to be received by the Company in reimbursement of such settlement amount, whether under any insurance policy or indemnity, other than such amounts that are contested) or which would be reasonably likely to have any material adverse impact on the operations of the Company or any of its Subsidiaries or on any current or future litigation or other proceeding of the Company or any of its Subsidiaries;

(xii) sell, lease, license or otherwise dispose of any assets of the Company or its Subsidiaries except for sales of (A) products or services provided in the ordinary course of business or (B) other assets in aggregate amount not in excess of $100,000 in the aggregate, and other than pursuant to Contracts in effect as of the date of this Agreement;

(xiii) engage in the conduct of any new line of business; or

(xiv) agree, resolve or commit to do any of the foregoing.

(c) Without limiting the generality of Section 7.1(a) and in furtherance thereof, except as set forth in the corresponding section of the Company Disclosure Schedule or as otherwise expressly provided herein, from the date of this Agreement until the Effective Time, the Company shall not and shall not permit its Subsidiaries to (unless Parent shall otherwise approve in writing, which approval shall not be unreasonably withheld or delayed and which shall be subject to the procedures set forth on Schedule 7.1(c) of the Company Disclosure Schedule):

(i) other than pursuant to Contracts in effect as of the date of this Agreement, make any loan, advance or capital contribution to or investment in any Person (other than a wholly-owned Subsidiary of the Company) outside the ordinary course of business;

(ii) make or authorize any capital expenditure in excess of $100,000 in the aggregate;

(iii) except as required by Law, make any material Tax election or take any material position on any material Tax Return filed on or after the date of this Agreement or adopt any material method therefor that is inconsistent with elections made, positions taken or methods used in preparing or filing similar Tax Returns in prior periods;

(iv) other than pursuant to Contracts in effect as of the date of this Agreement or as otherwise required by Law, (A) enter into any new employment or compensatory agreements with, or increase the compensation and employee benefits of, any employee, consultant, or director of the Company or any of its Subsidiaries (including entering into any bonus, severance, change of control, termination, reduction-in-force or consulting agreement or other employee benefits arrangement or agreement pursuant to which such person has the right to any form of compensation from the Company or any of its Subsidiaries), (B) hire

any employee to fill a position at the level of (i) executive officer or (ii) vice president or above who reports directly to an executive officer, or (C) adopt or amend in any respect, or accelerate vesting or payment under, any Benefit Plan in the case of clauses (A) and (C) above other than in the ordinary course of business consistent with past practice; or

(v) agree, resolve or commit to do any of the foregoing.

7.2 Acquisition Proposals.

(a) The Company agrees that it shall not, it shall cause each its Subsidiaries and their respective officers and directors not to, and it shall use its reasonable best efforts to cause its and its Subsidiaries’ respective employees, agents and representatives (including any investment banker, attorney, consultant or accountant retained by it (collectively, “Representatives”)) not to, directly or indirectly, initiate, solicit or knowingly encourage or facilitate any inquiries or the making of any proposal or offer with respect to: (i) a merger, reorganization, share exchange, consolidation or similar transaction involving the Company or any of its Subsidiaries; (ii) any purchase of more than 15% of the voting power of the then outstanding equity securities of the Company or any of its Subsidiaries, or of the right to obtain more than 15% of the voting power of the then outstanding equity securities of the Company, or of more than 15% of the assets of the Company and its Subsidiaries (taken as a whole, based on consolidated book value of the assets as recorded on the Company’s most recent balance sheet); (iii) the adoption by the Company of a plan of liquidation or recapitalization; or (iv) any combination of the foregoing (any such proposal or offer being hereinafter referred to as an “Acquisition Proposal”). The Company further agrees that it shall not, it shall cause each of its Subsidiaries and their respective officers and directors not to, and it shall use its reasonable best efforts to cause its and its Subsidiaries’ Representatives not to, directly or indirectly, engage in any negotiations concerning, or provide any information or data to, or have any discussions with, any Person relating to an Acquisition Proposal, or otherwise knowingly encourage or facilitate any effort or attempt to make or implement an Acquisition Proposal; provided, however, that nothing contained in this Agreement shall prevent the Company or the Special Committee or the Company Board from (x) complying with its disclosure obligations under Sections 14d-9 and 14e-2 of the Exchange Act with regard to an Acquisition Proposal; provided that if such disclosure has the effect of withdrawing, modifying or qualifying the Recommendation in a manner adverse to Parent or the approval or recommendation of this Agreement by the Special Committee or the Company Board, Parent shall have the right to terminate this Agreement to the extent set forth in Section 9.4 of this Agreement; and (y) at any time prior to, but not after, the condition set forth in Section 8.1(a) has been satisfied, (A) providing information in response to a request therefor by a Person who has made an unsolicited bona fide written Acquisition Proposal that is or would reasonably be expected to lead to a Superior Proposal (as defined below) (a “Section 7.2(a)(y)(A) Acquisition Proposal”) if (x) the Company receives from the Person so requesting such information an executed confidentiality agreement on customary terms no less favorable to the Company than the confidentiality agreement dated December 13, 2006 between Parent and the Company (the “Confidentiality Agreement”) and (y) the Company furnishes to Parent, concurrently with furnishing it to such Person, the same information to the extent it has not been previously furnished to Parent, or (B) engaging in any negotiations or discussions with any Person who has made an unsolicited bona fide written Section 7.2(a)(y)(A) Acquisition Proposal if the Company receives from such Person an executed confidentiality

agreement as described in (A) above, in each case if and only to the extent that in each such case referred to in clause (A) or (B) above, the Company shall have complied with all terms of this Section 7.2 and the Company Board or the Special Committee, as applicable, determines in good faith, after consulting with outside legal counsel, that the failure to take such actions is reasonably likely to constitute a violation of its respective fiduciary duties to the Company’s stockholders (other than the Interested Stockholders) under applicable Law (including the Company Board’s and Special Committee’s duties of good faith and candor to the Company’s stockholders). For purposes of this Agreement, “Superior Proposal” means an Acquisition Proposal involving the direct or indirect acquisition of (i) all of the shares of the outstanding capital stock of the Company (provided however that such Acquisition Proposal is not required to be conditioned upon the acquisition of any shares of capital stock held by the Interested Stockholders), (ii) in excess of 50% of the voting power of the shares of Common Stock outstanding and issuable upon exercise and/or conversion of outstanding securities exercisable and/or convertible into shares of Common Stock, or (iii) all or substantially all of the assets of the Company, in each case which the Company Board or the Special Committee, as applicable, determines in good faith (after consideration of all relevant factors and consultation with its financial advisor and outside legal counsel) would, if consummated, result in a transaction more favorable to the Company’s stockholders from a financial point of view (other than the Interested Stockholders) than the transaction contemplated by this Agreement after taking into account any changes hereto agreed to by Parent.

(b) The Company agrees that it shall immediately cease and cause to be terminated any existing activities, discussions or negotiations with any Person conducted heretofore with respect to any Acquisition Proposal. The Company agrees that it shall take the necessary steps to promptly inform the Company’s and its Subsidiaries’ officers and directors (other than any directors designated by Parent) and their respective Representatives of the obligations undertaken in this Section 7.2. The Company shall notify Parent of the Company’s receipt of: (i) any Acquisition Proposal (including the terms of such Acquisition Proposal and the identity of the Person making such Acquisition Proposal), (ii) any request for information relating to the Company (including non-public information) or for access to the properties, books or records of the Company by any Person that has made an Acquisition Proposal, or (iii) an amendment to a previously disclosed Acquisition Proposal (including the terms of such amendment), in each case promptly (but in any event no later than two (2) Business Days) after such receipt. The Company will keep Parent apprised of the status and details of each Acquisition Proposal on a current basis. The Company agrees promptly to request the return or destruction of all information and materials provided prior to the date of this Agreement by it, its affiliates (other than Parent) or their respective Representatives with respect to the consideration or making of any Acquisition Proposal.

7.3 Information Statement; Stockholder Consent Solicitation; Recommendation; Record Date.

(a) The Company shall (i) as promptly as practicable following the date of this Agreement, prepare and file with the SEC (after Parent and Merger Sub have had a reasonable opportunity to review and comment on) an information statement (together with any amendments thereto, the “Company Information Statement”) in preliminary form relating to the Merger and the other transactions contemplated hereby, (ii) notify Parent promptly of the receipt

of any comments from the SEC or its staff and of any request by the SEC or its staff for amendments or supplements to the Company Information Statement or for additional information and shall supply Parent with copies of all correspondence between the Company or any of its Representatives, on the one hand, and the SEC or its staff, on the other hand, with respect to the Company Information Statement, (iii) use its commercially reasonable efforts to have cleared by the SEC, and shall thereafter mail to its stockholders as promptly as reasonably practicable, the Company Information Statement, and (iv) otherwise use commercially reasonable efforts to comply with all requirements of Law applicable to the Merger and the requirement of the DGCL that the Company’s stockholders be notified of action taken by written consent of the holders of a majority of the voting power of the then outstanding voting securities of the Company. Parent and Merger Sub shall cooperate with the Company in connection with the preparation and filing of the Company Information Statement, including furnishing the Company upon request with any and all information regarding Parent, Merger Sub or their respective affiliates, the plans of such Persons for the Surviving Corporation after the Effective Time, and all other matters and information as may be required to be set forth in the Company Information Statement under the Exchange Act or the rules and regulations promulgated thereunder, including without limitation Rule 13e-3. The Company shall provide Parent and Merger Sub a reasonable opportunity to review and comment upon the Company Information Statement, or any amendments or supplements thereto, or any SEC comments received with respect thereto, prior to filing the same with the SEC.

(b) In connection with the filing of the Company Information Statement, the Company, Parent and Merger Sub shall cooperate to (i) concurrently with the preparation and filing of the Company Information Statement, jointly prepare and file with the SEC the Schedule 13E-3 (together with any amendments thereto, the “Schedule 13E-3”) relating to the Merger and the other transactions contemplated hereby and furnish to each other all information concerning such party as may be reasonably requested in connection with the preparation of the Schedule 13E-3, (ii) respond as promptly as reasonably practicable to any comments received from the SEC with respect to such filings and shall consult with each other prior to providing such response, (iii) as promptly as reasonably practicable after consulting with each other, prepare and file any amendments or supplements necessary to be filed in response to any SEC comments or as required by Law, (iv) have cleared by the SEC the Schedule 13E-3 and (v) as promptly as reasonably practicable, to the extent required by applicable Law, prepare, file and distribute to the Company stockholders any supplement or amendment to the Schedule 13E-3 if any event shall occur which requires such action.

(c) Neither the Company Board nor the Special Committee shall modify, qualify or withdraw its recommendation of or relating to the Merger or adoption of this Agreement by the holders of shares of voting capital stock of the Company (such recommendation being the “Recommendation”), the Recommendation shall be included in the Company Information Statement and the Schedule 13E-3, and the Company Board shall take all lawful action to solicit the adoption of this Agreement by the holders of shares of voting capital stock of the Company. Notwithstanding the foregoing, the Company Board or the Special Committee may withdraw or modify the Recommendation and the Company shall not be required to include the Recommendation in the Company Information Statement or the Schedule 13E-3, or, if already so included, shall be permitted to amend or modify the same, in each case to the extent that the Company Board or the Special Committee determines in good faith, after

consulting with outside legal counsel, that its failure to take such action is reasonably likely to constitute a violation of its respective fiduciary duties to the Company’s stockholders (other than the Interested Stockholders) under applicable Law (including the Company Board’s and the Special Committee’s duties of good faith and candor to the Company’s stockholders); provided, however, that prior to such withdrawal or modification, Parent shall have had written notice of the Company Board’s or the Special Committee’s, as applicable, intention to take the action referred to in this sentence at least two (2) Business Days prior to the taking of such action by the Company Board or the Special Committee, as applicable. Notwithstanding any withdrawal or modification of the Recommendation, the Company shall submit the Agreement and the transactions contemplated hereby to the holders of shares of voting capital stock of the Company for adoption and comply with Section 7.3(d) and Section 7.3(e), below.

(d) The Company shall establish in accordance with the DGCL one or more dates (each a “Record Date”) for the delivery of written consents or casting of votes at a special meeting of the Company’s stockholders on such date as Parent shall determine after the date hereof after consultation with the Company, it being the agreement of the parties to this Agreement that the Record Date established for the purpose of Section 7.4(c) shall be a date determined with the intention that the Written Consent shall be delivered by Parent (assuming compliance by the Company with its obligations under Sections 7.4(a) and (b)) as soon as reasonably practicable following the 20th SEC Business Day from the date on which the definitive Company Information Statement is first mailed to the Company’s stockholders and filed as an amendment to the Schedule 13e-3.

(e) Whether or not Parent has requested a Record Date under Section 7.3(d), if requested by Parent, the Company shall convene, as promptly as practicable after receipt of such request by Parent, a special meeting of the Company’s stockholders for the purpose of voting on the Merger on a date requested by Parent, provided that such date is prior to the Termination Date and permits the Company to comply with its Charter, Bylaws and all applicable Law with respect to notice of and conduct of such a meeting.

7.4 Warrant Exercise and Conversion of Series B Stock; Delivery of Consent.

(a) On or prior to the Record Date established for the purposes of this Section 7.4, Parent shall execute and deliver (i) a written election to exercise that portion of its warrant to purchase Series B Stock that, based solely on the certificate provided by the Company pursuant to Section 7.4(b), below, will ensure that, after such exercise and the conversion of the Series B Stock then held of record by Parent into shares of Common Stock, Parent shall, together with the shares of Common Stock it already holds of record, directly hold of record at least a majority of the voting power of the then outstanding shares of voting capital stock of the Company, (ii) the warrant certificate representing the warrant to be so exercised, (iii) payment of the exercise price under the warrant in immediately available funds for the purchase of such shares of Series B Stock issuable upon such warrant exercise, and (iv) a written request to convert all of the shares of Series B Stock issuable upon such warrant exercise, above, effective immediately following the issuance of such shares of Series B Stock. Notwithstanding any terms or conditions in the warrants to purchase Series B Stock so exercised, the Company shall promptly (and no later than the Business Day prior to the Record Date) following the Company’s receipt of the items listed above facilitate the issuance of the Series B Stock upon the warrant exercise described in Section

7.4(a)(i), (ii) and (iii) above, and facilitate the issuance by the Company’s Common Stock transfer agent to Parent of the Common Stock issuable upon the conversion of shares of Series B Stock as described in Section 7.4(a)(iv) and accordingly ensure that Parent can vote such shares of the Company’s Common Stock on the Record Date.

(b) Parent may request at any time after the date hereof that the Company deliver a certification executed by an officer of the Company certifying, as of a date specified in such request, as to (i) the number of each class or series of then issued and outstanding shares of capital stock of the Company and the voting power of such shares, (ii) the number of each class or series of shares of capital stock of the Company then owned of record by Parent and the voting power of such shares, (iii) all then outstanding securities exercisable and/or convertible into shares of voting Common Stock; (iv) whether, as of the time of the delivery of the certificate, the issuance of shares of common stock following the exercise of any exercisable securities or the conversion of any convertible securities is pending. The Company shall deliver such certificate no later than 5:00 p.m. Eastern time on the second Business Day after the later of (x) the date of Parent’s request or (y) the date specified in Parent’s request. Furthermore, if, at any time after the date of this Agreement, the Company issues to any Person other than Parent any shares of Common Stock upon the conversion of any convertible securities or upon exercise of any exercisable securities, the Company shall promptly notify Parent of such issuance, in writing.

(c) Parent shall execute and deliver to the Company as soon as practicable, and in any event not later than the three Business Days, after a Record Date established under Section 7.3(d) for the delivery of written consents, and the Company shall accept from Parent, a written consent of the Company’s stockholders to the adoption of this Agreement and the Merger in the form attached hereto as Exhibit B (the “Written Consent”) for the purpose of obtaining the Company Requisite Vote in reliance on the certificate delivered by the Company pursuant to Section 7.4(a).

(d) Following the delivery of the Written Consent, the Company shall comply with Section 228(e) of the DGCL.

7.5 Commercially Reasonable Efforts; Cooperation.

(a) Upon the terms and subject to the conditions of this Agreement, each of Parent, Merger Sub and the Company agrees to use its commercially reasonable efforts to take, or cause to be taken, all actions, and to do, or cause to be done, all things necessary, proper or advisable on its part under this Agreement and any applicable Laws to consummate and make effective the Merger and the other transactions contemplated hereby as promptly as practicable including, but not limited to, (i) the preparation and filing of all forms, registrations, notifications and notices required to be filed to consummate the transactions contemplated hereby (including making or causing to be made the filings required under any applicable Laws in foreign jurisdictions governing antitrust or merger control matters as promptly as practicable and in any event, within ten Business Days after the date of this Agreement) and the taking of such actions as are necessary to obtain any requisite approvals, consents, orders, exemptions or waivers by any third party or Governmental Entity, (ii) cooperating with the other in connection with the preparation and filing of any such forms, registrations and notices (including, with respect to the

party hereto making a filing, providing copies of all such documents to the non-filing party and its advisors prior to filing and, if requested, to accept all reasonable additions, deletions or changes suggested in connection therewith) and in connection with obtaining any requisite approvals, consents, orders, exemptions or waivers by any third party or Governmental Entity, (iii) the satisfaction of the conditions to the consummation of the Merger set forth in Article VIII, and (iv) the execution of any additional instruments, including the Certificate of Merger, necessary to consummate the transactions contemplated hereby. Subject to the terms and conditions of this Agreement and the applicable provisions of the DGCL, each party hereto agrees to use commercially reasonable efforts to cause the Effective Time to occur as soon as practicable after the date hereof. Notwithstanding anything in this Agreement to the contrary, no party to this Agreement shall be required to divest itself or any of its Subsidiaries of any assets, including any shares of any Subsidiary in order to comply with the obligations of such party under this Agreement.

(b) The Company and Parent each shall, upon request by the other, furnish the other with all information concerning itself, its Subsidiaries, directors, officers and stockholders and such other matters as may be reasonably necessary or advisable in connection with any statement, filing, notice or application made by or on behalf of Parent, the Company or any of their respective Subsidiaries to any third party and/or any Governmental Entity in connection with the Merger and the transactions contemplated by this Agreement.

(c) Without limiting the generality of the foregoing, each of the Company and Parent shall provide promptly to any Governmental Antitrust Entity or provide promptly to any other Person so that such Person may provide to a Governmental Antitrust Entity, information and documents requested by any Governmental Antitrust Entity or necessary, proper or advisable to permit consummation of the Merger and the transactions contemplated by this Agreement.

7.6 Other Access and Investigation. Subject to applicable antitrust Laws relating to the sharing of information, and to the provisions of the Confidentiality Agreement, upon reasonable notice, the Company shall, and shall cause its Subsidiaries to, afford Parent, and its officers, employees, counsel, accountants and other authorized Representatives, reasonable access, during normal business hours throughout the period prior to the Effective Time, to its properties, books, contracts and records and, during such period, the Company shall, and shall cause its Subsidiaries to, furnish promptly to Parent all information concerning its business, properties and personnel as may reasonably be requested (including information related to any exercises of exercisable securities and any conversions of convertible securities into outstanding shares of voting capital stock of the Company as of or prior to the Effective Time); provided, however, that neither any investigation by Parent pursuant to this Section 7.6, nor Parent’s knowledge or receipt of information related to the Company’s representations and warranties made herein, nor the knowledge or receipt of information of those members of the Company’s Board of Directors designated or nominated by Parent or any of Parent’s Subsidiaries (in all cases, either as of the date hereof, or prior to the Effective Time) shall affect or be deemed to modify any representation or warranty made by the Company or affect or be deemed to modify the closing condition set forth in Section 8.2(a) of this Agreement unless disclosed on the Company Disclosure Schedule; provided, further, that the foregoing shall not require the Company to permit any inspection, or to disclose any information, that in the reasonable judgment of the Company would result in the disclosure of any trade secrets of third parties or

violate any of its obligations with respect to confidentiality or result in the loss of any attorney-client privilege. At the request of Parent, throughout the period prior to the Effective Time, the Company shall use its commercially reasonable efforts to obtain waivers from Persons who are parties to Contracts with the Company or its Subsidiaries that contain confidentiality provisions in order for Parent to be provided reasonable access to such Contracts.

7.7 Consents. Subject to other provisions contained in this Agreement, Parent, Merger Sub and the Company each shall use commercially reasonable efforts to obtain consents of all third parties and Governmental Entities necessary, proper or advisable for the consummation of the transactions contemplated hereby.

7.8 Public Announcements. The initial press release regarding this Agreement shall be a joint press release mutually agreed upon, and thereafter Parent and the Company shall consult with one another before issuing any press release or otherwise making any public statements with respect to the transactions contemplated hereby, including the Merger, and shall not issue any such press release or make any such public statement prior to such consultation, except as may be required by applicable Law or by obligations pursuant to any listing agreement with any national securities exchange, as determined in good faith by such party.

7.9 Employee Benefits.

(a) Parent agrees that it shall cause the Surviving Corporation to honor, fulfill and discharge the Company’s obligations under each Benefit Plan in accordance with its terms as in effect immediately before the Effective Time, subject to any amendment or termination thereof that may be permitted by such terms and provided, however, that nothing herein shall preclude Parent from substituting substantially equivalent Benefit Plans to the full extent permitted by applicable Law.

(b) Without limiting the generality of Section 10.9, nothing expressed or implied in this Section 7.9 shall confer upon any current or former employee of the Company or any of its Subsidiaries or upon any representative of any such person, or upon any collective bargaining agent, any rights or remedies, including any third party beneficiary rights or any right to employment or continued employment for any specified period, of any nature or kind whatsoever under or by reason of this Agreement.

7.10 Indemnification; Directors’ and Officers’ Insurance.

(a) From and after the Effective Time, the Surviving Corporation shall, and Parent shall cause the Surviving Corporation to, indemnify, defend and hold harmless all individuals who on or before the Effective Time were directors or officers of the Company (each, an “Indemnified Person” and, collectively, the “Indemnified Persons”) to the fullest extent permitted under the DGCL, against any costs or expenses (including reasonable attorneys’ fees and expenses), judgments, fines, losses, claims, damages, liabilities and amounts paid in settlement in connection with any actual or threatened claim, action, suit, proceeding or investigation, whether civil, criminal, administrative or investigative, arising out of, relating to or in connection with (i) any acts or omissions occurring or alleged to occur prior to the Effective Time in their capacities as officers or directors of the Company or any of its Subsidiaries or

taken by them at the request of the Company or any of its Subsidiaries (including, without limitation, acts or omissions in connection with such persons serving as an officer, director or other fiduciary in any entity if such service was at the request or for the benefit of the Company or any of its Subsidiaries) or (ii) the adoption and approval of this Agreement, the Merger or the other transactions contemplated by this Agreement or arising out of or pertaining to the transactions contemplated by this Agreement. In the event of any such claim, action, suit, proceeding or investigation, the Surviving Corporation shall, and Parent shall cause the Surviving Corporation to, advance expenses reasonably incurred in the defense thereof; provided that any Person to whom expenses are advanced provides an undertaking, if and only to the extent required by the DGCL, to repay such advances if it is ultimately determined that such Person is not entitled to indemnification. Without limiting the foregoing, Parent and the Surviving Corporation shall cause the certificate of incorporation and By-Laws of the Surviving Corporation to include for a period of six (6) years, at a minimum, the indemnification and exculpation provisions of the certificate of incorporation and By-Laws of the Company as in effect at the Effective Time and shall cause such provisions not to be amended, repealed or otherwise modified for a period of six (6) years from the Effective Time in any manner that would adversely affect the rights thereunder of any Indemnified Person who was entitled to rights thereunder as of the Effective Time. In addition, Parent and Surviving Corporation agree that the indemnification and advancement obligations of the Company or any Subsidiary as set forth in indemnification agreements to which it is a party shall be continuing obligations of the Surviving Corporation or such Subsidiary, as applicable, and shall not be amended, repealed or otherwise modified after the Effective Time, except as permitted by the terms and provisions of those agreements.

(b) The Surviving Corporation shall, and Parent shall cause the Surviving Corporation to, obtain (or if obtained by the Company prior to the Effective Time, maintain in effect) a six-year “tail” directors’ and officers’ liability insurance policy covering the Indemnified Persons for the entire period of six (6) years after the Effective Time with terms and conditions at least as favorable as the Company’s and its Subsidiaries’ existing directors’ and officers’ liability insurance (including for acts or omissions described in clauses (i) and (ii) in Section 7.10(a)) covering each such Indemnified Person covered immediately prior to the Effective Time by the Company’s officers’ and directors’ liability insurance policy on terms with respect to coverage and amount no less favorable than those of such policy in effect on the date hereof to the extent that such insurance coverage, can be purchased at a cost of not greater than six (6) times the most recently paid annual premium of the Company’s current insurance policies and, if such insurance coverage cannot be so purchased or maintained at such cost, providing as much of such insurance as can be so purchased or maintained at such cost.

(c) If the Surviving Corporation, Parent, or any of their respective successors or assigns (i) shall consolidate with or merge into any other corporation or entity and shall not be the continuing or surviving corporation or entity of such consideration or merger or (ii) shall transfer all or substantially all of its properties and assets to any individual, corporation or other entity, then, and in each such case, proper provisions shall be made so that the successors and assigns of the Surviving Corporation or Parent, as applicable, shall assume all of the obligations set forth in this Section 7.10.

(d) The provisions of this Section 7.10 are intended to be for the benefit of, and shall be enforceable by, each of the Indemnified Persons and their heirs and legal representatives. The indemnification provided for herein shall not be deemed exclusive of any other rights to which an Indemnified Party is entitled, pursuant to law, contract or otherwise.

7.11 Funds for Cash Out Payments. Parent shall take such action as is necessary or appropriate to ensure that, immediately following the Effective Time, the Surviving Corporation shall have sufficient cash to make any and all Option Cash Out Payments and Warrant Cash Out Payments that are owed and owing as of the Effective Time.

7.12 Takeover Statutes. If any Takeover Statute is or may become applicable to the Merger or the other transactions contemplated by this Agreement, the Company and the Company Board (or the Special Committee) shall grant all approvals and take all actions as are necessary so that such transactions may be consummated as promptly as practicable on the terms contemplated by this Agreement and otherwise act to eliminate or minimize the effects of such Takeover Statute on such transactions.

7.13 Director Resignations. The Company shall use commercially reasonable efforts to obtain the written resignation from the Company Board of each member of the Company Board prior to the Effective Time, such resignations to take effect at the Effective Time.

7.14 Obligation to Notify. Between the date of this Agreement and the Closing Date, each of the Company and Parent shall promptly notify the other in writing if such party becomes aware of the occurrence or existence of any event, circumstance, fact or condition, or the failure of any event, circumstance, fact or condition to occur or exist, in each case which would give rise to a right of the other party to terminate this Agreement under Article IX hereof; provided that the Company’s breach of its obligations under this Section 7.14 shall not be a breach that affects the determination of the satisfaction of the condition to closing set forth in Section 8.2(b) of this Agreement unless such breach materially prejudices Parent and/or the Surviving Corporation and its Subsidiaries.

7.15 Debentures. The Company shall provide, or shall cause to be provided, in accordance with the terms of the Indenture, to the trustee under such Indenture and to each holder of a Debenture, any notices required by the Indenture to be delivered prior to the Effective Time by virtue of the transactions contemplated hereby. Prior to the Effective Time, the Company shall take such actions as are required under the Indenture to establish and evidence the rights of the holders of the Debentures issued under the Indenture to convert each such Debenture, after the Effective Time, into the Common Stock Merger Consideration upon the terms and subject to the conditions and other provisions of the Indenture, including the execution and delivery of supplemental indentures, officers’ and independent accountants’ certificates and opinions of counsel. Notwithstanding the foregoing, prior to the Effective Time, the Company shall take such actions as is required under the Indenture to cause the defeasance of the Debentures and the Indenture in accordance with their terms effective as of the Effective Time provided Parent deposits with the trustee under the Indenture all funds required for such defeasance.

7.16 Other Exercisable/Convertible Securities. The Company shall provide, or shall cause to be provided, to the holders of Series A Stock, Company Common Warrants and/or Company Options in accordance with the terms, rights, preferences and/or privileges of such securities, any notices required to be delivered to such holders prior to the Effective Time by virtue of the transactions contemplated hereby.

ARTICLE VIII

CONDITIONS

8.1 Conditions to the Obligations of the Company, Parent and Merger Sub to Effect the Merger. The respective obligation of each of the Company, Parent and Merger Sub to effect the Merger is subject to the satisfaction or waiver at or prior to the Closing of each of the following conditions:

(a) Stockholder Approval. This Agreement shall have been duly adopted by holders of shares of Common Stock constituting the Company Requisite Vote in accordance with applicable Law and the Company’s certificate of incorporation and By-Laws (“Company Stockholder Approval”) and at least 20 SEC Business Days shall have elapsed from the date on which the definitive Company Information Statement was first mailed to the Company’s stockholders and filed as an amendment to the Schedule 13e-3.

(b) FAS Clearance. The FAS Clearance shall have been obtained.

(c) No Injunction. No Governmental Entity of competent jurisdiction shall have enacted, issued, promulgated, enforced or entered any Law, rule, regulation, judgment, determination, decree, injunction or other order (whether temporary, preliminary or permanent) that is in effect and restrains, enjoins or otherwise prohibits the consummation of the Merger (collectively, an “Injunction”).

8.2 Conditions to Obligations of Parent and Merger Sub. The obligation of Parent and Merger Sub to effect the Merger is also subject to the satisfaction or waiver by Parent at or prior to the Closing of the following conditions:

(a) Representations and Warranties. (i) Each representation and warranty of the Company set forth in Sections 5.2 and 5.17 of this Agreement (collectively, the “Category I Specified Representations”) shall be true and correct in all respects, except for de minimus deviations, individually (A) on the date of this Agreement and (B) on the Closing Date with the same effect as though such representations and warranties had been made on and as of the Closing Date (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case as of such earlier date); (ii) each representation and warranty of the Company set forth in Sections 5.3, 5.15 and 5.16 of this Agreement (collectively, the “Category II Specified Representations”) shall be true and correct in all respects, individually and in the aggregate (A) on the date of this Agreement and (B) on the Closing Date with the same effect as though such representations and warranties had been made on and as of the Closing Date (iii) each representation and warranty of the Company set forth in this Agreement other than a Category I Specified Representation or Category II Specified Representation shall

be true and correct in all respects individually and in the aggregate (A) on the date of this Agreement and (B) as of the Closing Date with the same effect as though such representation and warranty had been made on and as of the Closing Date (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case as of such earlier date) (but solely for purposes of this subparagraph (a)(iii) without giving effect to any materiality or Company Material Adverse Effect or similar qualification contained in such representations), except in the case of this subparagraph (a)(iii) for such failures that individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect; and (iv) Parent shall have received at the Closing a certificate signed on behalf of the Company by the Chief Executive Officer or Chief Financial Officer of the Company to the effect that the conditions set forth in Sections 8.2(a)(i), 8.2(a)(ii) and 8.2(a)(iii) have been satisfied.

(b) Performance of Obligations of the Company. (i) The Company shall have performed in all material respects all agreements and obligations required to be performed by it under this Agreement at or prior to the Closing Date; and (ii) Parent shall have received a certificate signed on behalf of the Company by the Chief Executive Officer or Chief Financial Officer of the Company to the effect that the condition set forth in Section 8.2(b)(i) has been satisfied.

(c) FAS Clearance. The FAS Clearance shall have been obtained and such FAS Clearance shall not include any material restrictions on Parent’s ability to operate the business of the Company and its Subsidiaries as currently operated.

(d) No Company Material Adverse Effect. Except as a result of any state of facts, change, development, event, effect, condition or occurrence set forth in the Company Disclosure Schedule, no Company Material Adverse Effect shall have occurred on or after the date hereof.

(e) No Litigation. There shall not be any pending Action by any Governmental Entity seeking to require Parent or the Company or any Subsidiary or affiliate thereof to divest any material assets of the Company or any of its Subsidiaries, including, without limitation, any shares of any Subsidiary or, in the case of Parent, any shares of the Company, nor shall there be any Action pending in a court of competent jurisdiction brought by any Governmental Entity established under the federal laws of the United States challenging or seeking to restrain or prohibit the consummation of the Merger or any of the other transactions contemplated by this Agreement.

8.3 Conditions to Obligation of the Company. The obligation of the Company to effect the Merger is also subject to the satisfaction or waiver by the Company at or prior to the Effective Time of the following conditions:

(a) Representations and Warranties. (i) The representations and warranties of Parent and Merger Sub set forth in this Agreement shall be true and correct in all respects (A) on the date of this Agreement and (B) on the Closing Date with the same effect as though such representations and warranties had been made on and as of the Closing Date (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case, as of such earlier date) (but solely for purposes of this subparagraph (a)(i) without giving effect to

any materiality or Parent Material Adverse Effect or similar qualification contained in such representations), except in the case of this subparagraph (a)(i) for such failures that individually or in the aggregate, would not reasonably be expected to have a Parent Material Adverse Effect; and (ii) the Company shall have received at the Closing a certificate signed on behalf of each of Parent and Merger Sub by a senior executive officer of each to the effect that the condition set forth in Section 8.3(a)(i) has been satisfied.

(b) Performance of Obligations of Parent and Merger Sub. (i) Each of Parent and Merger Sub shall have performed in all material respects all agreements and obligations required to be performed by it under this Agreement at or prior to the Closing Date, and (ii) the Company shall have received a certificate signed on behalf of each of Parent and Merger Sub by an executive officer of each to the effect that the condition set forth in Section 8.3(b)(i) has been satisfied.

ARTICLE IX

TERMINATION

9.1 Termination by Mutual Consent. This Agreement may be terminated and the Merger may be abandoned at any time prior to the Effective Time, whether before or after the adoption by the stockholders of the Company referred to in Section 8.1(a), by mutual written consent of the Company (by action of the Company Board, approved by the Special Committee), and Parent.

9.2 Termination by Either Parent or the Company. This Agreement may be terminated and the Merger may be abandoned at any time prior to the Effective Time by Parent or by the Company (provided that such action is approved by the Special Committee), if (a) the Merger shall not have been consummated by July 21, 2007 (the “Termination Date”), or (b) any Injunction permanently restraining, enjoining or otherwise prohibiting consummation of the Merger shall have become final and non-appealable; provided, however, that the right to terminate this Agreement pursuant to this Section 9.2 shall not be available to any party that has breached its obligations under this Agreement in any manner that shall have proximately contributed to the occurrence of the failure of the Merger to be consummated (in the case of Section 9.2(a), by the Termination Date).

9.3 Termination by the Company. This Agreement may be terminated and the Merger may be abandoned at any time prior to the Effective Time, by the Company (provided that such action is approved by the Special Committee) (i) in the case of subsections (a)-(d) of this Section 9.3, before or after Company Stockholder Approval and (ii) and in the case of subsection (e), at any time prior to Company Stockholder Approval, if:

(a) any representations or warranties made by Parent or Merger Sub in this Agreement shall fail to be true or correct on or after the execution of this Agreement, (i) such that the conditions set forth in Section 8.3(a) would not be satisfied, and (ii) such failures are not cured, or are not reasonably capable of being cured, by the Termination Date;

(b) any of the covenants or agreements made by Parent or Merger Sub in this Agreement shall have been breached after the execution of this Agreement (i) such that the conditions set forth in Section 8.3(b) would not be satisfied, and (ii) such breaches are not cured, or are not reasonably capable of being cured, by the date that is thirty (30) days after the earlier of (1) the date Parent becomes aware of the existence of the breach and (2) the date Parent receives written notice from the Company of the Company’s belief that a breach has occurred, which notice explains in reasonable detail the basis for such belief;

(c) a Parent Material Adverse Effect occurs and such Parent Material Adverse Effect is not cured, or is not reasonably capable of being cured, within thirty (30) days after the earlier of (x) the date Parent becomes aware of the existence of the Parent Material Adverse Effect and (y) the date Parent receives written notice from the Company of the Company’s belief that a Parent Material Adverse Effect has occurred, which notice explains in reasonable detail the basis for such belief;

(d) in violation of the Bridge Facility Agreement, Bridge Finance Lender fails to fund a Loan (as defined in the Bridge Facility Agreement) required under the Bridge Facility Agreement following satisfaction of all of the conditions precedent to such Loan as provided in the Bridge Facility Agreement, provided, however, that no termination under this Section 9.3(d) shall be effective unless the Company has provided Parent and Bridge Finance Lender with written notice of such violation and such violation has not been cured by Parent or Bridge Finance Lender within thirty (30) days of Parent’s and Bridge Finance Lender’s receipt of such notice;

(e) the Company, having complied in all material respects with its obligations under this Agreement, including without limitation its obligations under Section 7.2 of this Agreement, receives a Section 7.2(a)(y)(A) Acquisition Proposal, and all of the following additional conditions are satisfied:

(i) the Special Committee or Company Board determines that such Section 7.2(a)(y)(A) Acquisition Proposal constitutes a Superior Proposal;

(ii) the Special Committee or Company Board give Parent written notice of the existence of, the nature of, and the identity of the Person making such Section 7.2(a)(y)(A) Acquisition Proposal (including, to the knowledge of the Special Committee or Company Board, as the case may be, after reasonable inquiry of the Person who has made such Section 7.2(a)(y)(A) Acquisition Proposal, all Persons Controlling such Person) and the material terms and conditions of such Section 7.2(a)(y)(A) Acquisition Proposal, including without limitation a copy of a proposed definitive written agreement to consummate the transactions contemplated by such Section 7.2(a)(y)(A) Acquisition Proposal, executed by the Person making such Section 7.2(a)(y)(A) Acquisition Proposal (the “Specified Definitive Acquisition Agreement”), and the members of the Special Committee and its financial advisor and outside legal counsel make themselves available to Parent as promptly as practicable for the purposes of engaging in good faith negotiations regarding executing a possible amendment to this Agreement or an alternative transaction if so requested by Parent;

(iii) the notice provided under Section 9.3(e)(ii) contains a written certification of the fact that the Special Committee or Company Board has determined such Section 7.2(a)(y)(A) Acquisition Proposal to be a Superior Proposal and that the Specified Definitive Acquisition Agreement has been executed and delivered to the Company by the Person making such Section 7.2(a)(y)(A) Acquisition Proposal;

(iv) on the third Business Day following the delivery to Parent of the notice referred in Section 9.3(e)(ii) and the certification specified in Section 9.3(e)(iii), (A) the Special Committee or Company Board determines that, notwithstanding delivery of any written instrument executed by Parent and Merger Sub that, if countersigned by the Company, would effect amendments to this Agreement, such Section 7.2(a)(y)(A) Acquisition Proposal continues to constitute a Superior Proposal and authorizes the Company’s officers and directors, on behalf of the Company, to execute the Specified Definitive Acquisition Agreement and deliver it to the Person who executed it, and (B) the Specified Definitive Acquisition Agreement is so executed by the Company and becomes fully effective and binding; and

(v) concurrently with the Company’s execution and delivery of the Specified Definitive Acquisition Agreement pursuant to in Section 9.3(e)(iv), the Initial Termination Fee is paid to Parent, by a deposit of immediately available funds to an account theretofore designated by Parent, by the Person with whom the Company has entered into the Specified Definitive Acquisition Agreement.

9.4 Termination by Parent. This Agreement may be terminated and the Merger may be abandoned at any time prior to the Effective Time, by Parent, if:

(a) the Company Board or the Special Committee shall have withdrawn or adversely qualified or modified the Recommendation;

(b) any representations or warranties made by the Company in this Agreement shall fail to be true or correct on or after the execution of this Agreement, (i) such that the conditions set forth in Section 8.2(a) would not be satisfied, and (ii) such failures are not cured, or are not reasonably capable of being cured, by (A) in the case of a failure to be true and correct of a Category I Specified Representation or a Category II Specified Representation, the date that is thirty (30) days after the earlier of (1) the date the Company becomes aware of the existence of the failure to be true and correct and (2) the date the Company receives written notice from Parent of Parent’s belief that a failure to be true and correct has occurred, which notice explains in reasonable detail the basis for such belief, or (B) in the case of all other failures of a representation or warranty of the Company to be true and correct, the Termination Date;

(c) any covenants or agreements made by the Company in this Agreement shall have been breached after the execution of this Agreement (i) such that the conditions set forth in Section 8.2(b) would not be satisfied, and (ii) such breaches are not cured, or are not reasonably capable of being cured, by the date that is thirty (30) days after the earlier of (1) the date the Company becomes aware of the existence of the breach and (2) the date the Company receives written notice from Parent of Parent’s belief that a breach has occurred, which notice explains in reasonable detail the basis for such belief; or

(d) if a Company Material Adverse Effect occurs and such Company Material Adverse Effect is not cured within thirty (30) days after the earlier of (x) the date the Company becomes aware of the existence of the Company Material Adverse Effect and (y) the date the Company receives written notice from Parent of Parent’s belief that a Company Material Adverse Effect has occurred, which notice explains in reasonable detail the basis for such belief.

9.5 Effect of Termination and Abandonment. In the event of a termination of this Agreement and the abandonment of the Merger pursuant to this Article IX, the provisions of Sections 5.17, 6.9 and Article X of this Agreement shall survive the termination of this Agreement, but in all other respects this Agreement shall become void and of no effect with no liability on the part of any party hereto (or of any of its directors, officers, employees, agents, legal and financial advisors or other representatives); provided, however, that, except as otherwise provided herein, no such termination shall relieve any party hereto of any liability or damages resulting from any willful or intentional breach of this Agreement.

ARTICLE X

MISCELLANEOUS AND GENERAL

10.1 Non-Survival of Representations and Warranties. None of the representations and warranties in this Agreement or in any instrument delivered pursuant to this Agreement shall survive the Effective Time or the termination of this Agreement pursuant to the terms hereof.

10.2 Modification or Amendment. Subject to the provisions of applicable Law, at any time prior to the Effective Time, (i) this Agreement may be amended, modified or supplemented only in writing executed by each of the parties hereto by action of the board of directors of each such party (in the case of the Company, approved by the Special Committee), and (ii) any provisions herein may be waived only in writing executed by the party or parties against whom such waiver is asserted by action of such party or parties’ board of directors (in the case of the Company, approved by the Special Committee).

10.3 Waiver of Conditions. The conditions to each of the parties’ obligations to consummate the Merger are for the sole benefit of such party and may be waived by such party in whole or in part to the extent permitted by applicable Law, in such party’s sole discretion.

10.4 Definitions. The definitions of capitalized terms used in this Agreement are set forth and/or listed in Annex I.

10.5 Counterparts. This Agreement may be executed in any number of counterparts, each such counterpart being deemed to be an original instrument, and all such counterparts shall together constitute the same agreement.

10.6 Governing Law and Venue; Waiver of Jury Trial.

(a) This Agreement shall be deemed to be made and in all respects shall be interpreted, construed and governed by and in accordance with the Law of the state of Delaware without regard to the conflict of law principles thereof. The parties hereto hereby irrevocably submit exclusively to the jurisdiction of the Chancery Courts of Delaware and the Federal courts

of the United States of America located in the State of Delaware solely in respect of the interpretation and enforcement of the provisions of this Agreement and of the documents referred to in this Agreement, and in respect of the transactions contemplated hereby, and hereby waive, and agree not to assert, as a defense in any action, suit or proceeding for the interpretation or enforcement hereof or of any such document, that it is not subject thereto or that such action, suit or proceeding may not be brought or is not maintainable in said courts or that the venue thereof may not be appropriate or that this Agreement or any such document may not be enforced in or by such courts, and the parties hereto irrevocably agree that all claims with respect to such action or proceeding shall be heard and determined in such a Delaware State or Federal court. The parties hereto hereby consent to and grant any such court jurisdiction over the person of such parties for purposes of the foregoing, and consent to service of process in connection therewith by notice given in accordance with the notice procedures contained in Section 10.7 of this Agreement.

(b) EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) EACH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III) EACH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (IV) EACH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 10.6.

(c) Parent hereby irrevocably appoints CT Corporation System, at its office at 1209 Orange Street, Wilmington, DE 19801, its lawful agent and attorney to accept and acknowledge service of any and all process against it in any action, suit or proceeding arising in connection with this Agreement and upon whom such process may be served, with the same effect as if Parent were a resident of the Delaware and had been lawfully served with such process in such jurisdiction. In the case of any service by the Company upon such agent and attorney, the Company shall also deliver a copy thereof to Parent at the address and in the manner specified in Section 10.7. In the event that such agent and attorney resigns or otherwise becomes incapable of acting as such, Parent will appoint a successor agent and attorney in Delaware with like powers.

10.7 Notices. Any notice, request, instruction or other document to be given hereunder by any party to the others shall be in writing and delivered personally or sent by registered or certified mail, postage prepaid, facsimile or by overnight courier:

If to Parent or Merger Sub:

Renova Media Enterprises Ltd.
Shirley House, 50 Shirley Street,
Nassau, Bahamas
Attention: Directors

and

Renova Management AG
Representative Office in Moscow
Shipok Street 18, Bld 2
Moscow 115093, Russian Federation
Attention: Chief Legal Officer
Facsimile: + 7 495 363 6074

with a copy, which will not constitute notice, to:

DLA Piper US LLP
1251 Avenue of the Americas, 29th Floor
New York, New York 10020-1104
Attention: Marjorie Adams, Esq.
Facsimile: (212) 335-4501

and

DLA Piper US LLP
2000 University Avenue
East Palo Alto, CA 94303
Attention: Henry Lesser, Esq.
Facsimile: (650) 833-2001

If to the Company:

Moscow CableCom Corp.
5 Waterside Crossing, Third Floor
Windsor, CT 06095
Attention: Chief Executive Officer
Facsimile Number: (860) 298-0685

with a copy, which will not constitute notice, to:

Covington & Burling LLP
1330 Avenue of the Americas
New York, NY 10011
Attention: Scott Smith, Esq.
Facsimile: (646) 441-9056

and

Covington & Burling LLP
1201 Pennsylvania Avenue, NW
Washington, DC 20004
Attention: Ralph Voltmer, Esq.
Facsimile: (202) 778-5479

or to such other persons or addresses as may be designated in writing by the Person to receive such notice as provided above. Any notice, request, instruction or other document given as provided above shall be deemed given to the receiving party upon actual receipt, if delivered personally; three Business Days after deposit in the mail, if sent by registered or certified mail; upon confirmation of successful transmission if sent by facsimile (provided that if given by facsimile such notice, request, instruction or other document shall be followed up within one Business Day by delivery pursuant to one of the other methods described herein); or on the next Business Day after deposit with an internationally recognized overnight courier, if sent by such a courier.

10.8 Entire Agreement. This Agreement, including the schedules, exhibits and annexes hereto, constitute the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all other prior agreements and understandings, both written and oral, between the parties with respect to the subject matter hereof; provided, however, that nothing in this Agreement shall be deemed to modify or supersede (i) the letter from Parent to the Company dated November 10, 2006, described in Amendment #7 to Schedule 13D filed with the SEC by Parent and Victor Vekselberg on November 13, 2006, (ii) the Confidentiality Agreement, or (iii) any agreement between Parent and/or an affiliate of Parent, on the one hand, and the Company or any of its Subsidiaries, on the other hand, effecting or relating to the borrowing of money or the issuance of equity securities by the Company or any of its Subsidiaries, and each instrument referred to in (i), (ii) and (iii) of this proviso shall survive any termination of this Agreement.

10.9 Enforcement; No Third Party Beneficiaries.

(a) This Agreement and all of the provisions hereto shall be binding upon and inure to the benefit of, and be enforceable by, the parties hereto and their respective successors and permitted assigns. Except as expressly set forth in Section 7.10 (Indemnification; Directors’ and Officers’ Insurance) of this Agreement, this Agreement is not intended to, and does not, confer upon any Person other than the parties who are signatories hereto any rights or remedies hereunder.

(b) The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties hereto shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce

specifically the terms and provisions of this Agreement in addition to any other remedy to which they are entitled.

10.10 Severability. The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of any provision shall not affect the validity or enforceability of the other provisions hereof. If any provision of this Agreement, or the application thereof to any Person or any circumstance is determined by a court of competent jurisdiction to be invalid, void or unenforceable the remaining provisions hereof, shall, subject to the following sentence, remain in full force and effect and shall in no way be affected, impaired or invalidated thereby, so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner adverse to either party. Upon such determination, the parties shall negotiate in good faith in an effort to agree upon such a suitable and equitable provision to effect the original intent of the parties.

10.11 Interpretation; Absence of Presumption.

(a) For the purposes hereof, (1) words in the singular shall be held to include the plural and vice versa and words of one gender shall be held to include the other gender as the context requires, (2) the terms “hereof”, “herein”, and “herewith” and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole (including the schedules and annexes hereto) and not to any particular provision of this Agreement, and Article, Section, paragraph, Schedule, and Annex references are to the Articles, Sections, paragraphs, Schedules and Annexes to this Agreement unless otherwise specified, (3) the word “including” and words of similar import when used in this Agreement shall mean “including without limitation” unless the context otherwise requires or unless otherwise specified, (4) the word “or” shall not be exclusive, and (5) all references to any period of days shall be deemed to be to the relevant number of calendar days unless otherwise specified.

(b) The parties have participated jointly in negotiating and drafting this Agreement. In the event that an ambiguity or a question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement.

10.12 Fees and Expenses.

(a) The Surviving Corporation shall pay all charges and expenses, including those of the Paying Agent, in connection with the transactions contemplated in Article IV. Whether or not the Merger is consummated, all costs and expenses incurred in connection with this Agreement and the Merger and the other transactions contemplated by this Agreement shall be paid by the party incurring such expense, except that expenses incurred in connection with the filing fee for the Schedule 13E-3 and printing and mailing the Company Information Statement and the Schedule 13E-3 shall be shared equally by Parent and the Company unless a Superior Proposal is consummated, in which case the Company shall be responsible for the expenses incurred in connection with the filing fee for the Schedule 13E-3 and printing and mailing the Company Information Statement and the Schedule 13E-3.

(b) Nothing in this Section 10.12 shall affect Parent’s right to receive and retain the Initial Termination Fee in the event it becomes payable under Section 9.3(e). In addition, if, within twelve (12) months of a termination of this Agreement under Section 9.3(e), the Company enters into a definitive agreement that provides for an Acquisition Proposal (other than the Acquisition Proposal provided for in the Specified Definitive Acquisition Agreement), then immediately upon the execution of such definitive agreement, the Company shall be obligated to pay Parent by a deposit of immediately available funds to an account theretofore designated by Parent, the sum of One Million Five Hundred Thousand Dollars ($1,500,000); provided, however, that for the purposes of this Section 10.12, any references to “15%” in the definition of Acquisition Proposal shall be deemed replaced with “50%”.

10.13 Assignment. This Agreement shall not be assignable by any party hereto; provided, however, that Parent may designate, by written notice to the Company, another Subsidiary of Parent to be a constituent corporation in lieu of Merger Sub, whereupon all references herein to Merger Sub shall be deemed references to such other Subsidiary, except that all representations and warranties with respect to Merger Sub as of the date of this Agreement shall be deemed representations and warranties with respect to such other Subsidiary as of the date of such designation. Any purported assignment in violation of this Agreement will be void ab initio.

[the rest of this page is intentionally left blank]

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the duly authorized officers of the parties hereto as of the date first written above.


		MOSCOW CABLECOM CORP.

		By:		/s/ Andrew Intrater

		Name: Andrew Intrater
		Title: Chairman

		RENOVA MEDIA ENTERPRISES LTD.

		By:		/s/ Vladimir Kuznetsov

		Name: Vladimir Kuznetsov
		Title: Chairman of the Supervisory Board

		GALAXY MERGER SUB CORPORATION

		By:		/s/ Andrey Osipov

		Name: Andrey Osipov
		Title: President

[Merger Agreement Signature Page]

ANNEX AND EXHIBITS


Annex I		Glossary of Defined Terms


Exhibit A		Certificate of Incorporation


Exhibit B		Form of Written Consent of Stockholder

ANNEX I

GLOSSARY OF DEFINED TERMS

As used in this Agreement, the following terms shall have the meanings set forth below:

“Acquisition Proposal” shall have the meaning set forth in Section 7.2(a).

“Action” shall mean any civil, criminal or administrative suit, claim, hearing, inquiry, action, proceeding or publicly announced investigation.

“Benefit Plans” shall mean with respect to the Company and each Subsidiary of the Company, (i) all employee benefit plans (as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended ERISA, (ii) each loan to any current or former non-officer employee, officer or directors or director and any stock option, stock purchase, phantom stock, stock appreciation right, equity based award, supplemental retirement, severance, termination, change in control, sabbatical, medical, dental, vision care, disability, employee relocation, cafeteria benefit (Code Section 125) or dependent care (Code Section 129), life insurance or accident insurance plans, programs or arrangements, (iii) all bonus, pension, profit sharing, savings, deferred compensation or incentive plans, programs, policies, agreements or arrangements, (iv) other fringe, welfare or employee benefit plans, programs, policies, agreements or arrangements, and (v) any current or former employment or, consulting, retention, executive compensation or severance agreements or arrangements, written or otherwise, for the benefit of, or relating to, any present or former employee, consultant or director of the Company with respect to which the Company or any Company Subsidiary has or could reasonably have any liability.

“Bridge Facility Agreement” shall have the meaning set forth in the seventh paragraph of the Recitals.

“Bridge Finance Lender” shall have the meaning set forth in the seventh paragraph of the Recitals.

“Business Day” shall mean any day other than a Saturday, Sunday, U.S. Federal holiday or any other day on which banking institutions in New York City, United States of America or Moscow, Russian Federation, are authorized or obligated by Law to be closed.

“By-Laws” shall have the meaning set forth in Section 2.2.

“Category I Specified Representations” shall have the meaning set forth in Section 8.2(a).

“Category II Specified Representations” shall have the meaning set forth in Section 8.2(a).

“Certificate” shall have the meaning set forth in Section 4.1(a)(iii).

“Certificate of Merger” shall have the meaning set forth in Section 1.3.

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“Charter” shall have the meaning set forth in Section 2.1.

“Closing” shall have the meaning set forth in Section 1.2.

“Closing Date” shall have the meaning set forth in Section 1.2.

“Code” shall mean the U.S. Internal Revenue Code, as amended.

“Common Stock” shall mean the common stock, par value $0.01 per share, of the Company.

“Common Stock Merger Consideration” shall have the meaning set forth in Section 4.1(a)(i).

“Company Board” shall have the meaning set forth in the Recitals.

“Company Common Warrant” shall have the meaning set forth in Section 4.4(b).

“Company Disclosure Schedule” shall have the meaning set forth in the opening paragraph of ARTICLE V.

“Company Information Statement” shall have the meaning set forth in Section 7.3(a).

“Company Material Adverse Effect” shall mean any state of facts, change, development, event, effect, condition or occurrence (including, without limitation, any breach of a representation or warranty contained herein by the Company) that, individually or in the aggregate, materially and adversely affects (i) the business, assets, liabilities, property, financial condition or results of operations of the Company and its Subsidiaries, taken as a whole or (ii) the ability of the Company to perform its obligations hereunder or to consummate the Merger and the other transactions contemplated by this Agreement; provided, however, that none of the following shall be deemed in and of themselves, either alone or in combination, to constitute, and none of the following shall be taken into account, alone or in combination, in determining whether there has been or will be, a Company Material Adverse Effect: (1) any change in general economic or political conditions not specifically relating to the Company or any Company Subsidiary and not disproportionately adversely affecting the Company or any Company Subsidiary, (2) any change in prevailing interest rates or currency exchange rates, (3) any change in GAAP, (4) any change proximately resulting from the execution of this Agreement, the consummation of the transactions contemplated hereby and the announcement hereof, (5) any change resulting from the Company’s failure to meet internal forecasts or third party analyst estimates or projections, provided however that the exception in this clause (5) shall not in any way prevent or otherwise affect a determination that any change, effect, event, occurrence, state of facts or development underlying such failure constitutes a Company Material Adverse Effect, and (6) only for the purposes of Section 8.2 and Section 9.3, (i) any change resulting from actions taken by the City of Moscow or its employees and agents in compliance with and in furtherance of Decree #2114RP dated October 17, 2006, (ii) any change resulting from (x) private civil litigation commenced by a stockholder or purported stockholder of the Company or (y) any Action pending in a court of competent jurisdiction brought by any Governmental Entity other than a Governmental Entity established under the federal laws of the United States, in each

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case challenging this Agreement or the transactions contemplated hereby, or (iii) any change or development arising out of or resulting from any review by the Russian tax authorities of the Company’s value added tax payments during the Company’s 2004 and 2006 fiscal years.

“Company Option” shall have the meaning set forth in Section 4.4(a).

“Company Reports” shall mean each registration statement, report, notification, proxy statement or information statement filed by the Company since December 31, 2003, including without limitation the Company’s Annual Reports on Form 10-K for the years ended December 31, 2003, December 31, 2004 and December 31, 2005, respectively, and the Company’s Reports on Form 10-Q for the quarterly periods ended March 31, 2004, June 30, 2004, September 30, 2004, March 31, 2005, June 30, 2005, September 30, 2005, March 31, 2006, June 30, 2006, and September 30, 2006, respectively and the Company’s reports on Form 8-K, each in the form (including exhibits, annexes and any amendments thereto) filed with the SEC, which, together with any such reports filed subsequent to the date hereof.

“Company Requisite Vote” shall mean the affirmative vote of the holders of a majority of the outstanding voting power of the then outstanding shares of Common Stock and Series B Stock, voting together as a single class.

“Company Restricted Stock” shall have the meaning set forth in Section 4.4(d).

“Company Stockholder Approval” shall have the meaning set forth in Section 8.1(a).

“Company Sub” shall mean ZAO ComCor-TV, a closed joint stock company duly organized and validly existing under the Laws of the Russian Federation, and a wholly-owned direct Subsidiary of the Company.

“Confidentiality Agreement” shall have the meaning set forth in Section 7.2(a).

“Contract” shall mean any note, bond, mortgage, indenture, lease, license, contract, agreement or other instrument or obligation, whether written or oral.

“Control” (including the terms “Controlling,” “Controlled by” and “under common Control with”) shall mean the possession, directly or indirectly or as trustee or executor, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, as trustee or executor, by contract or credit arrangement or otherwise;

“Debenture” shall have the meaning set forth in Section 4.4(e).

“DGCL” shall mean the Delaware General Corporation Law, as amended.

“Dissenting Common Shares” shall have the meaning set forth in Section 4.1(a)(i).

“Dissenting Common Stockholders” shall have the meaning set forth in Section 4.1(a)(i).

“Dissenting Series A Shares” shall have the meaning set forth in Section 4.1(a)(ii).

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“Dissenting Series A Stockholders” shall have the meaning set forth in Section 4.1(a)(ii).

“Effective Time” shall have the meaning set forth in Section 1.3.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended.

“ERISA Affiliate” shall mean any trade or business (whether or not incorporated) which is treated as a single employer with the Company (within the meaning of Section 414(b), (c), (m) or (o) of the Code.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended (including the rules and regulations promulgated thereunder).

“Excluded Common Shares” shall have the meaning set forth in Section 4.1(a)(i).

“Excluded Series A Shares” shall have the meaning set forth in Section 4.1(a)(ii).

“FAS Clearance” shall mean any clearance required from the Federal Antimonopoly Service of the Russian Federation under the laws of the Russian Federation for the transactions contemplated by this Agreement.

“Financial Advisor” shall have the meaning set forth in Section 5.16.

“GAAP” shall mean U.S. generally accepted accounting principles.

“Governmental Consents” shall mean all notices, reports, and other filings required to be made prior to the Effective Time by the Company or Parent or any of their respective Subsidiaries with, and all consents, registrations, approvals, permits, clearances and authorizations required to be obtained prior to the Effective Time by the Company or Parent or any of their respective Subsidiaries from, any Governmental Entity in connection with the execution and delivery of this Agreement and the consummation of the Merger and the other transactions contemplated hereby.

“Governmental Entity” shall mean any court, tribunal, arbitrator, authority, agency, commission, governmental or regulatory body, official or other instrumentality of the United States, the Russian Federation, any other foreign country or any domestic or foreign state, county, city or other political subdivision.

“Governmental Antitrust Entity” shall mean any Governmental Entity with jurisdiction over enforcement of any applicable antitrust and merger control Laws.

“HSR Act” shall have the meaning set forth in Section 6.7.

“Indemnified Persons” shall have the meaning set forth in Section 7.10.

“Indenture” shall mean the Indenture, dated as of February 26, 1998, between the Company and The Chase Manhattan Bank, as Trustee, in respect of $4,311,000, aggregate principal amount, 10 1/2% Convertible Subordinated Debentures Due 2007.

I-4

“Initial Termination Fee” shall mean Four Million Five Hundred Thousand Dollars ($4,500,000).

“Injunction” shall have the meaning set forth in Section 8.1(b).

“Insolvency Proceeding” shall mean a proceeding pending before any Governmental Entity that involves any bankruptcy, arrangement, reorganization or similar proceeding relating to the insolvency of the Company and/or the inability of the Company to pay its debts as they become due.

“Intellectual Property” shall mean all U.S. and foreign (i) trademarks, service marks, trade names, Internet domain names, designs, slogans, and general intangibles of like nature, together with all goodwill related to the foregoing and including any registrations, renewals and applications for any of the foregoing; (ii) patents (including any registrations, renewals and applications therefor, (iii) copyrights (including any registrations, renewals and applications therefor), and (iv) Trade Secrets, in each case to the extent recognized as intellectual property under applicable Law.

“Interested Stockholders” shall mean Parent, Moskovskaya Telecommunikationnaya Corporatsiya (“COMCOR”), any affiliate of Parent or COMCOR (other than the Company) and any officers or directors of Parent, COMCOR or such affiliates (other than the Company).

“Knowledge of the Company” or “to the Company’s Knowledge” or words of similar import shall mean the personal knowledge, after reasonable inquiry, of the executives of the Company and of the Company’s Subsidiaries named in the Company Disclosure Schedule.

“Law” shall mean any order, writ, injunction, judgment, arbitration award, agency requirement, decree, law (including the common law), statute, ordinance, rule or regulation, concession, franchise, permit, license or other governmental authorization or approval of any Governmental Entity.

“Lien” shall mean, with respect to any asset (including any security) any option, claim, mortgage, lien, pledge, charge, security interest or encumbrance or restrictions of any kind in respect of such asset, other than: (i) statutory Liens of landlords, statutory Liens of banks and statutory rights of set-off of banks, statutory Liens of carriers, warehousemen, mechanics, repairmen, workmen and materialmen, retention of title arrangements and other Liens imposed by Law, in each case incurred in the ordinary course of business (A) for amounts not yet overdue or (B) for amounts that are overdue and that (in the case of such amounts overdue for a period in excess of 30 days) are being contested in good faith by appropriate proceedings, so long as such reserves or other appropriate provisions, if any, will have been made for any such contested amounts; (ii) easements, rights-of-way, restrictions, encroachments, and other minor defects or irregularities in title, in each case which do not and will not interfere in any material respect with the ordinary conduct of the business of the Company or any of its Subsidiaries; (iii) any zoning or similar Law or right reserved to or vested in any governmental office or agency to control or regulate the use of any real property; and (iv) Liens that do not either adversely affect the value of the real property subject to such Lien or prohibit or interfere with the operations of that real property or the business of the Company or the Subsidiaries.

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“Material Contract” shall mean any Contract currently in effect to which the Company or any of its Subsidiaries is a party or by which any of them or any of their respective properties or assets may be bound that (i) is required to be described in, or filed as an exhibit to, any Company Report, (ii) provides for, or has provided for, the receipt or payment by the Company or any of its Subsidiaries of more than $250,000 per year, (iii) provides for the receipt or payment by the Company or any of its Subsidiaries of more than $500,000 in the aggregate during the term (whether fixed or indefinite) of the Contract, (iv) provides for the receipt by the Company or any of its Subsidiaries of more than $250,000 in the aggregate during the balance of the term (whether fixed or indefinite) of the Contract and does not provide the other party to the contract with the right to terminate the Contract for a payment of less than $50,000; (v) provides for the payment by the Company or any of its Subsidiaries of more than $250,000 in the aggregate during the balance of the term (whether fixed or indefinite) of the Contract and does not provide the Company or a Company Subsidiary with the right to terminate the Contract for a payment of less than $50,000, or (vi) if terminate, would reasonably be expected to result in a Company Material Adverse Effect.

“Merger” shall have the meaning set forth in the Recitals.

“Option Cash Out Payment” shall have the meaning set forth in Section 4.4(a).

“Parent Material Adverse Effect” shall mean any state of facts, change, development, event, effect, condition or occurrence (including, without limitation, any breach of a representation or warranty contained herein by Parent) that, individually or in the aggregate, materially and adversely affects the ability of the Parent to perform timely its obligations hereunder or to consummate the Merger and the other transactions contemplated by this Agreement; provided, however, that only for the purposes of Section 8.3(a) and Section 9.4, a state of facts, change, development, event, effect, condition or occurrence resulting from (x) private civil litigation commenced by a stockholder or purported stockholder of the Company or (y) any Action pending in a court of competent jurisdiction brought by any Governmental Entity other than a Governmental Entity established under the federal laws of the United States, in each case challenging this Agreement or the transactions contemplated hereby, shall not be deemed in and of itself to constitute, and shall not be taken into account in determining whether there has been or will be, a Parent Material Adverse Effect.

“Paying Agent” shall have the meaning set forth in Section 4.2(a).

“Payment Fund” shall have the meaning set forth in Section 4.2(a).

“Person” shall mean any individual, corporation (including not-for-profit), general or limited partnership, limited liability company, joint venture, estate, trust, association, organization, Governmental Entity or other entity of any kind or nature.

“Preferred Stock” shall mean the preferred stock, par value $0.01 per share, of the Company.

“Record Date” shall have the meaning set forth in Section 7.3(d).

“Representatives” shall have the meaning set forth in Section 7.2(a).

I-6

“Recommendation” shall have the meaning set forth in Section 7.3(c).

“Record Date” shall have the meaning set forth in Section 7.3(d).

“Schedule 13E-3” shall have the meaning set forth in Section 7.3(b).

“SEC” shall mean the United States Securities and Exchange Commission.

“SEC Business Day” shall mean any day other than a Saturday, Sunday, U.S. Federal holiday or any other day on which the SEC is obligated by Law to be closed.

“Section 7.2(a)(y)(A) Acquisition Proposal” shall have the meaning set forth in Section 7.2(a).

“Securities Act” shall mean the Securities Act of 1933, as amended (including the rules and regulations promulgated thereunder).

“Series A Stock” shall have the meaning set forth in Section 4.1(a)(ii).

“Series A Merger Consideration” shall have the meaning set forth in Section 4.1(a)(ii).

“Series B Stock” shall mean the Series B Convertible Preferred Stock, par value $0.01 per share, of the Company.

“Special Committee” shall have the meaning set forth in the Recitals.

“Specified Definitive Acquisition Agreement” shall have the meaning set forth in Section 9.3(e).

“Subsidiary” shall mean, with respect to any party, any corporation or other organization, whether incorporated or unincorporated or domestic or foreign to the United States, of which (x) such party or any other Subsidiary of such party is a general partner or (y) at least a majority of the total voting power of the securities (or other interests having by their terms ordinary voting power to elect at least a majority of the board of directors or others performing similar functions with respect to such corporation or other organization) is, directly or indirectly, owned or controlled by such party or by any one or more of its Subsidiaries, or by such party and one or more of its Subsidiaries.

“Superior Proposal” shall have the meaning set forth in Section 7.2(a).

“Surviving Corporation” shall have the meaning set forth in Section 1.1.

“Takeover Statute” shall have the meaning set forth in Section 5.15.

“Tax” (including, with correlative meaning, the term “Taxes”) shall mean all U.S. federal, state, local and foreign (including taxes imposed by the Russian Federation and the City of Moscow) income, profits, franchise, gross receipts, environmental, customs duty, capital stock, severances, stamp, payroll, sales, employment, unemployment, disability, use, property, withholding, excise, production, value added, occupancy and other taxes, duties or assessments

I-7

of any nature whatsoever, together with all interest, penalties and additions imposed with respect to such amounts and any interest in respect of such penalties and additions, whether disputed or not.

“Tax Return” shall mean all returns and reports (including elections, declarations, disclosures, schedules, estimates and information returns) required to be filed with, or supplied to, any Tax authority under applicable Law.

“Termination Date” shall have the meaning set forth in Section 9.2.

“Trade Secrets” shall mean all inventions, trade secrets and other confidential information, know-how, proprietary processes, formulae, algorithms, models, and methodologies.

“Warrant Cash Out Payment” shall have the meaning set forth in Section 4.4(b).

“Written Consent” shall have the meaning set forth in Section 7.4(b).

I-8

EXHIBIT A

CERTIFICATE OF INCORPORATION

MOSCOW CABLECOM CORP.

FIRST: The name of the corporation is Moscow CableCom Corp.

SECOND: The address of the corporation’s registered office in the State of Delaware is Corporation Trust Center, 1209 Orange Street, in the City of Wilmington (19801), County of New Castle. The name of the corporation’s registered agent at such address is The Corporation Trust Company.

THIRD: The purpose of the corporation is to engage in any lawful act or activity for which corporations may be organized under the Delaware General Corporation Law.

FOURTH: The total number of shares of stock which the corporation is authorized to issue is 40,000,000 shares of common stock, having a par value of $.01 per share.

FIFTH: The business and affairs of the corporation shall be managed by or under the direction of the board of directors, and the directors need not be elected by ballot unless required by the by-laws of the corporation.

SIXTH: In furtherance and not in limitation of the powers conferred by the laws of the State of Delaware, the board of directors is expressly authorized to make, amend and repeal the by-laws.

SEVENTH: A director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director,

A-1

except for liability (i) for any breach of the director’s duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware General Corporation Law, or (iv) for any transaction from which the director derived an improper personal benefit. If the Delaware General Corporation Law is amended to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of a director of the corporation shall be eliminated or limited to the fullest extent permitted by the Delaware General Corporation Law, as so amended. Any repeal or modification of this provision shall not adversely affect any right or protection of a director of the corporation existing at the time of such repeal or modification.

EIGHTH: The corporation reserves the right to amend and repeal any provision contained in this Certificate of Incorporation in the manner from time to time prescribed by the laws of the State of Delaware. All rights herein conferred are granted subject to this reservation.

NINTH: The name and mailing address of the incorporator is as follows:


		Bruce S. Pailet
		Robinson & Cole LLP
		One Commercial Plaza
		Hartford, Connecticut 06103

A-2

EXHIBIT B

FORM OF WRITTEN CONSENT OF STOCKHOLDER

MOSCOW CABLECOM CORP.

The undersigned, being the holder of at least a majority of the voting power of the outstanding shares of capital stock of Moscow CableCom Corp., a Delaware corporation (the “Corporation”), does hereby consent to the adoption of and does hereby adopt the following resolutions by written consent in lieu of a meeting pursuant to Section 228 of the Delaware General Corporation Law:

WHEREAS, the Agreement and Plan of Merger, attached hereto as Exhibit A, by and among Parent, a Bahamian corporation, Galaxy Merger Sub Corporation, a Delaware corporation and a wholly owned subsidiary of Parent, and the Corporation (the “Merger Agreement”) has been approved and declared advisable by the Board of Directors of the Corporation, and the Board has directed that the Merger Agreement be executed by a duly authorized officer of the Corporation and thereafter submitted to the stockholders for their approval; it is hereby

RESOLVED, that the Merger Agreement be, and hereby is, adopted, and the Merger (as defined in the Merger Agreement) be, and hereby is, approved.

The Secretary of the Corporation is hereby authorized to file an executed copy of this Consent in the minute book of the Corporation.

IN WITNESS WHEREOF, the undersigned hereby consents to, approves and adopts the foregoing actions.


	RENOVA MEDIA ENTERPRISES LTD.

Dated: , 2007	By:

		Name:
		Title:

B-1

EX-99.31 3 f27637a9exv99w31.htm EXHIBIT 31 exv99w31

Exhibit 31

DEED OF AMENDMENT

between

Renova Industries Ltd.

CMCR Management Limited

and

Renova Media Enterprises, Ltd.

in respect of

THE AMENDED AND RESTATED
UP TO US$ 216,000,000 CREDIT FACILITY AGREEMENT
OF NOVEMBER 3, 2006

Dated February 13, 2007

DEED OF AMENDMENT

This Deed of Amendment (this “Deed”) is made and entered into on February 13, 2007, between RENOVA INDUSTRIES LTD, a company registered in the Bahamas and whose registered office is at 2^ND Terrace West Centreville, P.O. Box N-7755, Nassau, Bahamas (“Renova”), CMCR MANAGEMENT LIMITED, a company registered in the Bahamas and whose registered office is at Winterbotham Place, Marlborough & Queen Street, P.O. Box N^o 10429, Nassau, Bahamas (“CMCR” and together with Renova, the “Principals” and each individually, a “Principal”), and RENOVA MEDIA ENTERPRISES LTD., a company registered in the Bahamas, and whose registered office is at 2^nd Terrace West Centreville, P.O. Box N-7755, Nassau, Bahamas (the “Company”, and together with Renova and CMCR, the “Parties” and each individually, a “Party”).

WHEREAS, on 19 April 2006 the Parties entered into a Credit Facility Agreement Up To US$ 59,140,000 pursuant to which Renova and CMCR being as of Completion 51% and 49% shareholders of the Company have agreed to make available to the Company a loan facility in the aggregate amount of US$59,140,000 (the “Original Credit Facility Agreement

WHEREAS, on November 3, 2006 the Parties executed an Amended and Restated Up to US$ 216,000,000 Credit Facility Agreement (the “Amended and Restated Credit Facility Agreement”) by which the Parties consolidated all amendments made to the Original Credit Facility Agreement up to the date of the Amended and Restated Credit Facility Agreement and increased the facility amount available to the Company to US$ 216,000,000 (two hundred sixteen million US dollars);

WHEREAS, the Company requires additional funds in order to finance its acquisition of the remaining outstanding shares of common stock of Moscow Cablecom Corp. (“MOCC”), not already owned by it, pursuant to a negotiated merger between the Company and MOCC (the “Merger”);

WHEREAS, the Principals are willing to provide the Company with additional financing for the purpose of the Merger on the terms of the Amended and Restated Credit Facility Agreement;

NOW, THEREFORE, in consideration of the premises and the mutual promises herein made, the Parties agree as follows:

Certain Definitions

In this Deed, the following words shall have the following meanings:

“CMCR” has the meaning set forth in the Preamble.

“Company” has the meaning set forth in the Preamble.

“Deed” has the meaning set forth in the Preamble.

“Original Credit Facility Agreement” has the meaning assigned to it the Preamble.

“Party” or “Parties” has the meaning set forth in the Preamble.

“Person” means any natural person, firm, partnership, association, corporation, company, limited liability company, trust, business trust, Governmental Authority or other entity.

“Principal” or “Principals” has the meaning set forth in the Preamble.

“Renova” has the meaning set forth in the Preamble.

“US$” and “United States Dollars” means the lawful currency of the United States of America that at the time of payment is legal tender.

Interpretation

In this Deed, unless otherwise specified:

	(a)		the singular includes the plural and vice versa and any gender includes either gender;

	(b)		the headings in this Deed are inserted for convenience only and shall not affect its construction;

	(c)		references to this Deed or to any other document include a reference to this Deed or such other document as varied, amended, modified, novated or supplemented from time to time;

	(d)		references to any gender shall include all other genders;

	(e)		references to the word “include” or “including” are to be construed without limitation;

	(f)		references to any Clause, paragraph or Schedule are to those contained in this Deed and all Schedules to this Deed are an integral part of this Deed;

	(g)		in writing includes, unless otherwise provided in this Deed, any communication made by letter or facsimile transmission, but not

electronic mail;

(h)

U.S. Dollar amounts include the equivalents in any other currency unless otherwise specified herein.

Amendments to the Amended and Restated Credit Facility Agreement

2.1 The Parties hereby agree to amend the definition of “CMCR Commitment” in Clause 1.1. (Interpretation) of the Amended and Restated Credit Facility Agreement to read as follows:

“CMCR Commitment” means one hundred nineteen million five hundred sixty thousand United States Dollars (US$ 119,560,000) to the extent not cancelled, transferred or reduced under this Agreement.”

2.2 The Parties hereby agree to amend the definition of “Facility Amount” in Clause 1.1. (Interpretation) of the Amended and Restated Credit Facility Agreement to read as follows:

“Facility Amount” means two hundred forty four million United States Dollars (US$ 244,000,000).”

3.2 The Parties hereby agree to amend the definition of “Renova Commitment” in Section 1.1. (Interpretation) of the Amended and Restated Credit Facility Agreement to read as follows:

“Renova Commitment” means one hundred twenty four million four hundred forty thousand United States Dollars (US$ 124,440,000) to the extent not cancelled, transferred or reduced under this Agreement.”

Continuing Effect

Except as specifically provided in this Deed, all of the provisions of the Amended and Restated Credit Facility Agreement shall remain in full force and effect.

Costs; Fees; Expenses

Each of the Parties shall bear its own legal, accountant and other costs, fees, charges and expenses connected with negotiation, preparation, execution and performance of this Deed.

Amendments and Waivers

No amendment of any provision of this Deed shall be valid unless the same shall be in writing and signed by the Parties. No waiver by any Party of any default, misrepresentation or breach of warranty or covenant hereunder, whether intentional or

not, shall be deemed to extend to any prior or subsequent default, misrepresentation or breach of warranty or covenant hereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence.

Severability

Any term or provision of this Deed that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction.

Entire Agreement

This Deed and the Amended and Restated Credit Facility Agreement constitute the entire agreement and understanding among the Parties with respect to the subject matter hereof, and supersede all prior oral and written agreements or understandings of the Parties relating hereto, all of which shall be deemed terminated, null and void and of no further effect from the date hereof. This Deed shall be binding on all successors and permitted assignees of the Parties.

Further Assurances

Each Party shall perform and execute, or arrange for the performance and execution of, each necessary act, document and thing reasonably within its power for the purposes of implementing the provisions of this Deed.

Counterparts

This Deed may be executed in counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.

10.

Governing Law and Language

This Deed shall be governed by, and construed in accordance with, English law.

11.

Arbitration

Clause 27 of the Amended and Restated Credit Facility Agreement (Interpretation) shall apply mutatis mutandis to this Deed.

12.

Confidentiality

Clause 19 of the Amended and Restated Credit Facility Agreement (Disclosure of Information) shall apply mutatis mutandis to this Deed.

13.

Third Party Rights

The Parties do not intend that any term of this Deed shall be enforceable solely by virtue of the Contracts (Rights of Third Parties) Act 1999 by any Person who is not a party to this Deed.

IN WITNESS WHEREOF, the Parties hereto have executed this Deed as of the date first written above.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]


Executed as a Deed on behalf	)
of	)
	)
CMCR MANAGEMENT	)	N. Andriyanova
LIMITED,	)	Attorney
a company incorporated in	)
the Bahamas by N.	)
Andriyanova and — , being	)
persons who, in accordance
with the laws of that	)
territory are acting under	)
the authority of CMCR
Management Limited

Executed as a Deed on behalf	)
of	)
	)
RENOVA INDUSTRIES	)	/s/ M. Montanari
LIMITED,	)	Director
a company incorporated in	)
the Bahamas by M.	)
Montinari and S. Burrows,	)
being persons who, in	)	/s/ Shakira Burrows
accordance with the laws of	)	Director/Secretary
that territory are acting	)
under the authority of
Renova Industries Limited


Executed as a Deed on behalf	)
of	)
	)
RENOVA MEDIA	)	/s/ O. Chaponnier
ENTERPRISES LTD.,	)	Director
	)
a company incorporated in	)
the Bahamas by O.	)
Chaponnier and S. Burrows,	)	/s/ Shakira Burrows
being persons who, in	)	Director/Secretary
accordance with the laws of	)
that territory are acting	)
under the authority of	)
Renova Media Enterprises
Ltd.

EX-99.32 4 f27637a9exv99w32.htm EXHIBIT 32 exv99w32

Exhibit 32

BRIDGE FACILITY AGREEMENT

This Bridge Facility Agreement (“Agreement”) is made as of February 21, 2007 by and between MOSCOW CABLECOM CORP., a Delaware corporation (the “Company”), ZAO COMCOR-TV, a closed joint stock company organized under the laws of the Russian Federation and a wholly-owned subsidiary of the Company (“Borrower” and together with the Company, the “Obligors”), and RME FINANCE LTD, a company incorporated under the laws of Cyprus (the “Lender”). In consideration of the mutual covenants contained in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

ARTICLE I

LOANS

1.1.

TERM LOANS

On the terms and subject to the conditions of this Agreement, from the date hereof through the Availability End Date, the Lender agrees to make to the Borrower up to nine (9) working capital bridge loans (each a “Loan” and collectively, the “Loans”) in an aggregate principal amount not to exceed the Total Commitment, as adjusted from time to time in accordance with the terms of this Agreement, in nine (9) tranches, Tranche I, Tranche II, Tranche III, Tranche IV, Tranche V, Tranche VI, Tranche VII, Tranche VIII and Tranche IX. The aggregate principal amount of the Loan advanced under each tranche shall not exceed the Tranche Commitment in effect on the Funding Date of such Loan. Borrower may request, prior to the Availability End Date, one (1) Loan under each tranche during the Availability Periods specified below:



	Tranche			Availability Period
	Tranche I			The date that is 3 Business Days after the Closing Date to February 28, 2007
	Tranche II			March 15, 2007 to March 31, 2007
	Tranche III			April 15, 2007 to April 30, 2007
	Tranche IV			May 15, 2007 to May 31, 2007
	Tranche V			June 15, 2007 to June 30, 2007
	Tranche VI			July 15, 2007 to July 31, 2007
	Tranche VII			August 15, 2007 to August 31, 2007
	Tranche VIII			September 15, 2007 to September 30, 2007
	Tranche IX			October 15, 2007 to October 31, 2007

When the Borrower desires to obtain a Loan, the Borrower shall notify Lender (which notice shall be irrevocable) by facsimile transmission to be received no later than 1:00 p.m. New York City time five (5) Business Days before the proposed Funding Date on which the Loan is to be made, provided, however, that the notice for the Loan under Tranche I shall be delivered by the Borrower no later than 9.00 p.m. New York City time on the date hereof. The notice shall specify a proposed Funding Date that is within the Availability Period for such Loan and shall be signed by the General Director of the Borrower. Lender shall be entitled to rely on any notice given by a person who Lender believes to be the General Director of the Borrower or a designee thereof, and the Borrower shall indemnify and hold Lender harmless for any damages or loss suffered by Lender as a result of such reliance.

1.2.

NOTES

The Borrower’s unconditional and absolute obligation to repay to the Lender the principal of the Loans and interest thereon shall be evidenced by one or more unsecured subordinated promissory notes (as the same may be amended, supplemented or otherwise modified from time to time in accordance with the terms hereof, and together with any renewals thereof or substitutions therefor, each a “Note”, and collectively, the “Notes”), in substantially the

form of Exhibit A hereto with appropriate insertions. The date and amount of each repayment and prepayment of principal thereon received by the Lender with respect to each Note shall be recorded by the Lender in its records or, at its option, on the schedule attached to the applicable Note. The aggregate unpaid principal amount so recorded shall be prima facie evidence of the principal amount owing and unpaid on such Note to the Lender absent manifest error. The failure to so record any such amount or any error in so recording any such amount, however, shall not limit or otherwise affect the Borrower’s obligations hereunder or under any Note to repay the principal amount of the Loan together with all interest accruing thereon.

1.3.

CLOSING

The closing (the “Closing”) will take place at the offices of Porzio, Bromberg & Newman P.C., 156 W. 56^th Street, New York, New York 10019 upon the satisfaction of the conditions to Closing set forth in this Agreement on the date hereof, or such other place, time and date as shall be mutually agreed to by the Borrower and the Lender (the “Closing Date”). On or before the Funding Date of each Loan, the Borrower shall deliver to the Lender a Note with respect to such Loan, dated as of the Funding Date, in the principal amount equal to the amount of such Loan. The Borrower shall deliver each Note against receipt by the Borrower from the Lender of an amount equal to the Loan corresponding to the tranche for with the Loan is made, by wire transfer in immediately available funds in U.S. dollars to an account designated in writing by the Borrower in its request for such Loan.

1.4.

USE OF PROCEEDS

The proceeds of the Loans shall be used solely for the purpose of funding the Borrower’s capital expenditures, operations and working capital requirements and of the Borrower, in each case, incurred in the ordinary course of business as presently conducted, and consistent with Schedule 7.1 of the Company Disclosure Schedules (as defined below). None of the proceeds of any Loan will be used to prepay or repurchase outstanding debt, make any payments to stockholders, directors, officers, employees, contractors or affiliates (other than ordinary course of business operating expenses, salary and wage payments), or make any dividend or other distribution with respect to capital stock, or for any personal, family or household purposes; provided, however, the Borrower may use proceeds of the Loans to repay existing intercompany debt owing to the Company up to the amount set forth on Section 1.4 of the Disclosure Schedule.

1.5.

SUBORDINATION

The Notes and the indebtedness evidenced by each Note are subordinated to all Senior Debt pursuant to the terms of a Subordination Agreement, dated as of the date hereof, by and between the Lender and the Agent under the 2004 Facility Agreement (as that term is defined therein).

ARTICLE II

REPAYMENT; PREPAYMENTS; INTEREST

2.1.

REPAYMENT OF THE LOAN

The Borrower shall repay the aggregate outstanding principal amount of the Loans, together with all accrued but unpaid interest thereon, and all other obligations arising under this Agreement or the other Transaction Documents, in full, in lawful money of the United States of America, on the earliest of (the “Maturity Date”): (a) October 31, 2009, (b) the second anniversary of the Availability End Date, or (c) the date upon which the Loans become or are declared due and payable pursuant to Article VII of this Agreement or pursuant to any Note or other Transaction Document.

2.2.

PREPAYMENTS

(a) The Borrower shall have the right to prepay the principal amount of each Loan, in whole or in part, at any time without penalty or premium so long as the Borrower does each of the following: (i) except in connection with a prepayment as contemplated by Section 7.1(h) (in which case the Borrower shall provide as much prior notice as is reasonably practicable under the circumstances), provides Lender with not less than five (5) Business Days’ prior written notice of its intent to prepay the Loans, which notice shall be irrevocable and shall state the principal amount to be prepaid, date on which prepayment will be made and shall state that the Borrower terminates the unfunded portion of the Total Commitment and any right to receive Loans or other extensions of credit from Lender (the “Prepayment Notice”), and (ii) tenders to Lender payment, in respect of the Loans being prepaid: (i) the principal amount of the Loans to be prepaid, (ii) all accrued and unpaid interest, fees and expenses then outstanding hereunder or any Transaction Document on the date of prepayment; and (iii) all other amounts, if any, that shall have become due and payable hereunder, under the Notes or under any other Transaction Document.

(b) Restrictions on prepayment:

(i) No amounts paid or prepaid with respect to any Loan may be reborrowed.

(ii) No amounts of the Commitment cancelled may be subsequently reinstated.

2.3.

INTEREST

(a) The Loans shall bear interest on the outstanding principal amount thereof at a rate of ten percent (10%) per annum from the Closing Date. All accrued interest on the Loans shall be, at the option of the Borrower (unless required to be paid earlier by the terms hereof or any Note): (i) upon not less than five (5) Business Days’ prior written notice to the Lender, paid by the Borrower to the Lender in arrears on the last day of each calendar quarter, or (ii) if not paid pursuant to clause (i) above, capitalized with, and added to, the principal amount of such Loan on the last day of each calendar quarter, and shall thereafter be deemed for all purposes to be a part of the principal amount thereof (and the principal amount shall be increased by the amount of such capitalized interest at the end of such calendar quarter); provided that (1) interest accrued pursuant to Section 2.3(b) shall be payable on demand, and (2) in the event of any repayment or prepayment of the Loans, accrued interest on the principal amount repaid or prepaid (not previously capitalized and added to the principal amount of the Loans) shall be payable on the date of such repayment or prepayment. All computations of interest shall be made on the basis of a year of 360 days, and actual days elapsed.

(b) Notwithstanding the rate of interest specified above, after an Event of Default and during the continuance thereof (regardless of whether the Loans have been accelerated), the Borrower agrees to pay interest (after as well as before judgment to the extent permitted by applicable law) on all unpaid principal, interest or other amounts owing under the Transaction Documents, at a rate of thirteen percent (13%) per annum. Unpaid interest on such amounts will continue to accrue and will (to the extent permitted by applicable law) be compounded daily.

2.4.

USURY

Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to the Loan, together with all fees, charges and other amounts which are treated as interest on the Loans under applicable law shall exceed the maximum lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by the Lender in accordance with applicable law, the rate of interest payable in respect of such Loan hereunder, together with all charges payable in respect thereof, shall be limited to the Maximum Rate.

2.5

TAX GROSS UP

Any and all payments or reimbursements made hereunder, under the Notes, under the Guaranty or any other Loan Document shall be made free and clear of and without deduction for any and all Taxes or other charges or withholding and all liabilities with respect thereto of any nature whatsoever imposed by any taxing authority, excluding such taxes to the extent imposed on the Lender’s gross or net income by the jurisdiction in which the Lender is organized, doing business or otherwise is subject to tax without regard to the transactions contemplated by this Agreement (any such taxes described herein as “Excluded Taxes”). Except with respect to Excluded Taxes, if any Obligor shall be required by law to deduct any such amounts from or in respect of any sum payable hereunder to the Lender, then the sum payable hereunder or under such other Transaction Document shall be increased as may be necessary so that, after making all required deductions, the Lender receives an amount equal to the sum it would have received had no such deductions been made. Each Obligor shall (within three (3) Business Days of demand by the Lender) pay to the Lender an amount equal to the loss, liability or cost that the Lender determines will be or has been, directly or indirectly, suffered for or on account of any Tax (other than Excluded Taxes) in respect of a Loan Document.

2.6

OBLIGATIONS ABSOLUTE.

The payment obligations of the Obligors hereunder and under the Transaction Documents shall be absolute, unconditional and irrevocable under all circumstances whatsoever, including, the existence of any claim, set-off, defense or other rights which an Obligor may have at any time against the Lender or any other Person whether in connection with this Agreement or any related or unrelated transaction.

ARTICLE III

CONDITIONS TO CLOSING AND FUNDING

3.1. CONDITIONS TO CLOSING. The obligation of the Lender to make the Tranche I Loan, is subject to the fulfillment to the Lender’s satisfaction, on or prior to the Closing Date, of each of the following conditions, unless otherwise waived in writing by the Lender:

(a) Loan Documents. The Lender shall have received, in form and substance satisfactory to the Lender each of the following:

(i) this Agreement;

(ii) the Tranche I Note;

(iii) the Guaranty;

(iv) certificates of the Secretary of the Borrower and the Company with respect to incumbency and resolutions authorizing the execution and delivery of this Agreement and the other Transaction Documents; and

(v) such other documents, instruments and certificates as the Lender may reasonably request.

(b) Execution of Merger Agreement. The Merger Agreement shall have been fully executed and delivered.

(c) Consents and Waivers. The Obligors shall have obtained all necessary consents or waivers, if any, from all parties governmental and private to any Material Contracts to which either Obligor is a party or by which it is bound immediately prior to the Closing in order that the transactions contemplated by the Transaction Documents may be consummated.

(d) Corporate Proceedings. All corporate and other proceedings taken or required to be taken by the Obligors in connection with the transactions contemplated by this Agreement and the other Transaction Documents to be consummated prior to the Closing shall have been taken, and the Lender shall have received such other documents, in form and substance reasonably satisfactory to the Lender and its counsel, as to such other matters incident to the transactions contemplated hereby as the Lender may reasonably request.

3.2. CONDITIONS TO FUNDING EACH LOAN. The obligation of the Lender to make each Loan, including the Tranche I Loan, is subject to the fulfillment to the Lender’s satisfaction, on or prior to the Funding Date for such Loan, of each of the following conditions, unless otherwise waived in writing by the Lender:

(a) Delivery of a Note. The Borrower shall have executed and delivered a Note prepared by the Lender setting forth the terms of the Loan.

(b) Representations and Warranties Correct; No Default. The representations and warranties of the Obligors set forth in Article IV hereof (including without limitation the representations set forth in the Merger Agreement incorporated herein) shall be true and correct when made, and shall be true and correct on the Closing Date and each Funding Date with the same force and effect as if they had been made on and as of the Closing Date and each Funding Date. No Event of Default, or any other event which, with the giving of notice, the lapse of time, or both, would constitute an Event of Default, shall have occurred and be continuing on the date of this Agreement, on the Closing Date, on the date any request for a Loan is submitted to Lender, or on any Funding Date.

(c) Performance. All covenants, agreements and conditions contained in this Agreement to be performed or complied with by the Obligors on or prior to the Closing Date or any Funding Date shall have been performed or complied with by the Obligors.

(d) No Impediments. Neither the Obligors, nor the Lender shall be subject to any order, decree or injunction of a court or administrative or governmental body or agency of competent jurisdiction directing that the transactions provided for in the Transaction Documents or any material aspect thereof not be consummated as contemplated by the Transaction Documents. There shall not be any action, suit, proceeding, complaint, charge, hearing, inquiry or investigation before or by any court or administrative or governmental body or agency pending or, to the Obligors’ best knowledge, threatened, wherein an unfavorable order, decree or injunction would prevent the performance of any of the Transaction Documents or the consummation of any material aspect of the transactions or events contemplated thereby, declare unlawful any aspect of the transactions or events contemplated by the Transaction Documents, cause any material aspect of the transactions contemplated by the Transaction Documents to be rescinded or have a Material Adverse Effect.

(e) Satisfaction of Milestones. With respect to Tranches II through IX, the Borrower shall have delivered a certificate of the General Director of the Borrower, in form and substance satisfactory to the Lender, certifying that the Borrower has, for the immediately preceding calendar month, achieved or exceeded the required operating benchmarks set forth on Schedule I hereto, together with such supporting information, worksheets and documentation as the Lender may reasonably request in connection therewith.

(g) Availability Period. The Availability End Date shall not have occurred.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE OBLIGORS

The Borrower, on behalf of itself, and the Company, on behalf of itself and the Borrower hereby: (a) represent and warrant that each Obligor has read and is aware of all of the terms, conditions, representations, warranties, covenants and other undertakings set forth in the Merger Agreement, (b) represent and warrant that each of the representations and warranties set forth in Article V of the Merger Agreement, as qualified or limited by the Company Disclosure Schedule (as that term is defined in the Merger Agreement), are true, correct and complete, and (c) make, for purposes of this Agreement, and incorporate herein by this reference as though fully set forth

herein, each of the representations and warranties set forth in Article V of the Merger Agreement with the intent that such representations shall have independent force and effect under this Agreement notwithstanding the cancellation, expiration or termination of the Merger Agreement, the enforceability of any term or provision thereof, or any determination that the Merger Agreement is no longer in force or effect. Without limiting the generality of the foregoing, the Obligors shall be deemed to have made each of the representations and warranties set forth in Article V of the Merger Agreement as of the Closing Date, date of delivery of each request for a Loan and as of each Funding Date.

Except as set forth in (i) the Company Reports (as defined below) filed prior to the date hereof; or (ii) the applicable section of the disclosure schedule delivered by the Company to Lender on the date hereof (the “Disclosure Schedule”) (it being understood that any matter disclosed in any section or subsection of the Disclosure Schedule with respect to the corresponding section or subsection of this Agreement shall be deemed to be disclosed under any other section or subsection of this Agreement, as long as the relevance of such disclosure to such other section or subsection of the Agreement is reasonably apparent, the Obligors hereby jointly and severally represent and warrants to the Lender as follows:

4.1.

AUTHORIZATION

Each of the Obligors has all requisite corporate power and authority (i) to execute and deliver, and to perform and observe their respective obligations under, the Transaction Documents to which it is a respective party, and (ii) to consummate the transactions contemplated hereby and thereby. This Agreement has been duly and validly executed and delivered by the Obligors.

4.2.

BINDING OBLIGATIONS; NO MATERIAL ADVERSE CONTRACTS; NO CONSENTS

The Transaction Documents constitute valid and binding obligations of the Obligors enforceable in accordance with their respective terms subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to affecting creditors’ rights and to general equity principles. Except as set forth in Section 4.2 of the Disclosure Schedule, the execution, delivery and performance by the Obligors of the Transaction Documents and compliance therewith will not result in any violation of and will not conflict with, or result in a breach of any of the terms of, or constitute a default, or accelerate or permit the acceleration of any rights or obligations, under, any provision of state, local, federal or foreign Law to which any Obligor is subject, the Certificate of Incorporation, as amended, or the By-Laws, as amended, of any Obligor, or any Material Contract judgment, decree, order, rule or regulation or other restriction to which any Obligor is a party or by which it is bound, result in the creation of any mortgage, pledge, lien, encumbrance or charge upon any of the properties or assets of such Obligor pursuant to any such term. No stockholder of the Obligors has or will have any preemptive rights or rights of first refusal by reason of the issuance of the Notes. No filing with or notice to, and no permit, authorization, registration, consent or approval of, any governmental entity is required on the part of either Obligor or any of their respective Subsidiaries for the execution, delivery and performance by Obligors of this Agreement or the consummation by the Obligors of the transactions contemplated hereby except such filings, notices, permits, authorizations, registrations, consents or approvals, the failure of which to make, give or obtain would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

4.3

ABSENCE OF CERTAIN CHANGES OR EVENTS.

Since December 31, 2005 and through the date hereof and each Funding Date, except as disclosed in the Company Reports and Section 4.3 of the Disclosure Schedule, each of the Company and its Subsidiaries has conducted its business only in the ordinary course of such business, and there has not been any change in or effect on the business, assets, liabilities, property, financial condition or results of operations of any of the Company and its Subsidiaries that individually or in the aggregate, has had or would reasonably be expected to have a Material Adverse Effect.

ARTICLE V

AFFIRMATIVE COVENANTS

The Obligors hereby jointly covenant and agree, so long as any obligations hereunder, under any Note or any other Transaction Document remain outstanding or the Lender has any obligation to make additional Loans, as follows:

5.1.

MAINTENANCE OF CORPORATE EXISTENCE; TAXES

(a) The Obligors shall maintain in full force and effect their respective corporate existence, rights and franchises and all terms of licenses and other rights to use licenses, trademarks, trade names, service marks, copyrights, patents, processes or any other Intellectual Property owned or possessed by it and necessary to the conduct of its business, except where failure to maintain such rights, franchises and terms of licenses and other rights to use such Intellectual Property could not reasonably be expected to have a Material Adverse Effect.

(b) The Obligors shall (i) promptly pay and discharge, or cause to be paid and discharged when due and payable, all lawful Taxes, assessments and governmental charges or levies imposed upon the income, profits, assets, property or business of the Obligors and the Subsidiaries, (ii) withhold and promptly pay to the appropriate tax authorities all amounts required to be withheld from wages, salaries and other remuneration to employees, and (iii) promptly pay all claims or indebtedness (including, without limitation, claims or demands of workmen, materialmen, vendors, suppliers, mechanics, carriers, warehousemen and landlords) which, if unpaid might become a Lien upon the assets or property of the Obligors; provided, however, that any such Tax, Lien, assessment, charge or levy need not be paid if (1) the validity thereof shall be contested timely and in good faith by appropriate proceedings, (2) the Obligors shall have set aside on its books adequate reserves with respect thereto, and (3) the failure to pay shall not be prejudicial in any material respect to the holders of the Notes, and provided further that the Obligors will pay or cause to be paid any such tax, lien, assessment, charge or levy forthwith upon the commencement of proceedings to foreclose any lien which may have attached as security therefore. Except to the extent prohibited by Article VI of this Agreement, the Obligors shall pay or cause to be paid all other indebtedness incident to the operations of the Obligors or the Subsidiaries.

5.2.

BASIC FINANCIAL INFORMATION

The Obligors shall furnish the following reports to the Lender, so long as it is a holder of any Note:

(a) as soon as practicable, but in any event within 90 days after the end of each fiscal year of the Obligors, (i) audited balance sheets of the Obligors as at the end of such year, together with audited statements of income and retained earnings and statements of cash flows of the Obligors for such year, together with notes related thereto, each prepared in accordance with GAAP, consistently applied, and setting out in each case in comparative form the figures for the previous fiscal year, all in reasonable detail and certified by certified independent public accountants of established national reputation, and (ii) a report of the principal financial officer of the Company containing a management discussion and analysis of the Company’s consolidated financial condition at the end of such year and the results of operations for such year, including, but not limited to, a description of significant events with respect to the Company and its Subsidiaries, if any, during the preceding year and any planned or anticipated significant activities or events during the upcoming months;

(b) as soon as practicable, but in any event within 45 days after the end of each of the first three fiscal quarters of the Obligors in each year, (i) an unaudited balance sheet at the end of such quarter, and unaudited statements of income, of profit and loss and of changes in financial condition of the Obligors (including cash flow statements) for such period and for the current fiscal year to date, in each case prepared in accordance with GAAP, consistently applied (other than for accompanying notes and subject to changes resulting from year-end audit adjustments), and (ii) a report of the principal financial officer of the Company containing a management discussion and analysis of the Company’s consolidated financial condition at the end of such quarter and the results of

operations for such quarter and the year to date, including, but not limited to, a description of significant events with respect to the Company and its Subsidiaries, if any, during such periods and any planned or anticipated significant activities or events during the upcoming months; and

(c) with reasonable promptness such other information and financial data concerning the Obligors as any Person entitled to receive materials under this Section 5.2 may reasonably request.

5.3.

NOTICE OF ADVERSE CHANGE

The Obligors shall promptly give notice to the Lender (but in any event within two days) after becoming aware of the existence of any condition or event which constitutes, or the occurrence of, any of the following:

(a) any Event of Default or any default that with the passage of time or the giving of notice would constitute an Event of Default;

(b) the institution or threatening of institution of any action, suit or proceeding against the Obligors or any Subsidiary before any court, administrative agency or arbitrator, including, without limitation, any action of a foreign government or instrumentality, which, if adversely decided, could reasonably be expected to have a Material Adverse Effect;

(c) any information relating to the Obligors or any Subsidiary which could reasonably be expected to have a Material Adverse Effect; or

(d) any failure by the Obligors or any Subsidiary to comply with the provisions of Section 5.4 below.

Any notice given under this Section 5.3 shall specify the nature and period of existence of the condition, event, information, development or circumstance, the anticipated effect thereof and what actions the Company and the Borrower, as the case may be, has taken and proposes to take with respect thereto.

5.4.

COMPLIANCE WITH AGREEMENTS; COMPLIANCE WITH LAWS

The Company shall, and shall cause its Subsidiaries to, comply with the terms and conditions of all Material Contracts. The Company shall, and shall cause each Subsidiary to, duly comply with any Laws relating to the conduct of their respective businesses, properties or assets, in each case except for any such noncompliance that could not reasonably be expected to have a Material Adverse Effect.

5.5.

PROTECTION OF LICENSES

The Company shall, and shall cause its Subsidiaries to, maintain, defend and protect to the best of their ability licenses and sublicenses (and to the extent the Company or a Subsidiary is a licensee or sublicensee under any license or sublicense, as permitted by the license or sublicense agreement), trademarks, trade names, service marks, patents and applications therefore and other proprietary information or Intellectual Property owned or used by it or them and shall keep duplicate copies of any licenses, trademarks, service marks or patents owned or used by it, if any, at a secure place selected by the Company.

5.6.

ACCOUNTS AND RECORDS; INSPECTIONS

(a) The Company shall keep true records and books of account in which full, true and correct entries will be made of all dealings or transactions in relation to the business and affairs of the Company and its Subsidiaries in accordance with GAAP applied on a consistent basis.

(b) The Obligors shall permit the Lender or any of such Lender’s officers, employees or representatives during regular business hours of the Obligors, upon reasonable notice and as often as the Lender may reasonably request, to visit and inspect the offices and properties of the Obligors and to make extracts or copies of the books, accounts and records of the Obligors or the Subsidiaries, and to discuss the affairs, finances and accounts of the Obligors and the Subsidiaries, with the Obligors’ directors and officers, its independent public accountants, consultants and attorneys.

(c) Nothing contained in this Section 5.6 shall be construed to limit any rights that the Lender may have with respect to the books and records of the Obligors and the Subsidiaries, to inspect its properties or to discuss its affairs, finances and accounts.

5.7.

MAINTENANCE OF OFFICE

The Obligors will maintain its principal office at the address of the Obligors set forth in Section 10.4 of this Agreement where notices, presentments and demands in respect of this Agreement, the Notes and the other Transaction Documents may be made upon the Obligors, until such time as the Obligors shall notify the Lender in writing, at least 30 days prior thereto, of any change of location of such office.

5.8.

FURTHER ASSURANCES

From time to time the Obligors shall execute and deliver to the Lender such other instruments, certificates, agreements and documents and take such other action and do all other things as may be reasonably requested by the Lender in order to implement or effectuate the terms and provisions of this Agreement and the transactions contemplated hereby.

5.9.

SEC REPORTS

The Company will file, on a timely basis, any SEC Reports and keep all such SEC Reports and public information current, provided that, without limiting any obligations or requirements of the Merger Agreement, if the Company is unable to timely file any such SEC Report, so long as the Company files a Form 12b-25 in the time frame required by Rule 12b-25 promulgated under the Securities Exchange Act of 1934, as amended, the Company shall not be in violation of this Section 5.9 if it is using reasonable diligence to file such SEC Report as soon as practicable. The Company agrees that none of the SEC Reports filed by the Company will, at the time of filing, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they are made, not misleading.

ARTICLE VI

NEGATIVE COVENANTS

Each Obligor hereby covenants and agrees, so long as any obligations hereunder, under any Note or any other Transaction Document remain outstanding, or the Lender has any obligation to make additional Loans, it will not, and will not permit any of its Subsidiaries, directly or indirectly, without the prior written consent of the Lender:

6.1.

STAY, EXTENSION AND USURY LAWS

At any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereinafter in force, which may affect the covenants or the performance of the Notes, this Agreement or the other Transaction Documents, the Obligors hereby expressly waiving all benefit or advantage of any such law, or by resort to any such law, hinder, delay or impede the

execution of any power herein granted to the Lender but will suffer and permit the execution of every such power as though no such law had been enacted.

6.2.

LIENS

Except as otherwise provided in this Agreement or any other Transaction Document, create, incur, assume or permit to exist any Lien on any part of its properties or assets, or on any interest it may have therein, now owned or hereafter acquired.

6.3.

INDEBTEDNESS

Create, incur, assume, suffer, permit to exist, or guarantee, directly or indirectly, any indebtedness, excluding:

(a) indebtedness existing on the date hereof and described in Section 6.3 of the Disclosure Schedule;

(b) indebtedness incurred by the Borrower relating to vendor financing provided that such vendor financing is incurred in its ordinary course of business for the purposes of building out the Broadband Cable Network and has been consented to by the Lender;

(d) indebtedness relating to trade credit in the ordinary course of business; or

(e) the Notes.

6.4.

ARM’S LENGTH TRANSACTIONS

Enter into any transaction, contract or commitment or take any action other than at Arm’s Length, unless such transaction, contract or arrangement is entered into with an Obligor.

6.5.

LOANS AND ADVANCES

Make any advance or loan to, or guarantee any obligation of, or make any investment in any Person, except for an intercompany loans or advances in the ordinary course of business and those provided for in this Agreement.

6.6.

OTHER BUSINESS

Enter into or engage, directly or indirectly, in any business other than the business currently conducted or proposed to be conducted as disclosed to the Lender prior to the date hereof by the Obligors.

6.7.

OTHER NEGATIVE PLEDGES

(a) Except as set forth in Section 7.1 of the Company Disclosure Schedule, the business of the Company and the Subsidiaries shall be conducted only in the ordinary course and, to the extent consistent therewith, the Company and its Subsidiaries shall use their respective commercially reasonable efforts to preserve their business organizations intact and maintain their existing relations and goodwill with customers, suppliers, distributors, creditors, lessors, key employees and business associates and keep available the services of the present key employees of the Company and the Subsidiaries.

(b) Without limiting the generality of Section 6.7(a) and in furtherance thereof, the Company shall not and shall not permit its Subsidiaries to (unless the Lender shall otherwise approve in writing, in its sole discretion):

(i) adopt or propose any change in its certificate of incorporation or By-Laws (or similar governing documents);

(ii) merge or consolidate the Company or any of its Subsidiaries with any other Person, except for any such transactions among wholly-owned Subsidiaries of the Company;

(iv) other than (A) as required by the terms of Contracts in effect as of the date of this Agreement, (B) upon the exercise of outstanding Company Options or Company Common Warrants or warrants to purchase Series B Stock, (C) pursuant to the terms of the Debentures (to the extent required by such terms) or (D) upon conversion of outstanding shares of Series A Stock and Series B Stock, in each case, in accordance with their terms, issue, sell, pledge, dispose of, grant, transfer, lease, license, guarantee, encumber, or authorize the issuance, sale, pledge, disposition, grant, transfer, lease, license, guarantee or encumbrance of, any shares of capital stock of the Company or any Subsidiary (other than the issuance of shares by a wholly-owned Subsidiary of the Company to the Company or another wholly-owned Subsidiary), or securities convertible or exchangeable or exercisable for any shares of such capital stock, or any options, warrants or other rights of any kind to acquire any shares of such capital stock or such convertible or exchangeable securities;

(v) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to any of its capital stock (except for (i) dividends or other distributions by any direct or indirect wholly-owned Subsidiary of the Company to the Company or to any other direct or indirect wholly-owned Subsidiary of the Company, (ii) periodic dividends and other periodic distributions by non-wholly-owned Subsidiaries of the Company in the ordinary course of business and (iii) declaration and payment of scheduled dividends with respect to the Series A Stock);

(ix) other than in the ordinary course of business, amend or modify in any material respect, or terminate or waive any material right or benefit under, any Material Contract;

(x) make any changes with respect to accounting policies or practices, except as required by changes in GAAP or by Legal Requirement;

likely to have any material adverse impact on the operations of the Company or any of its Subsidiaries or on any current or future litigation or other proceeding of the Company or any of its Subsidiaries;

(xiii) engage in the conduct of any new line of business; or

(xiv) agree, resolve or commit to do any of the foregoing.

(c) Without limiting the generality of Section 6.7(a) and in furtherance thereof, the Company shall not and shall not permit its Subsidiaries to (unless the Lender shall otherwise approve in writing, which approval shall not be unreasonably withheld or delayed):

(i) other than pursuant to Contracts in effect as of the date of this Agreement and disclosed on the Disclosure Schedule, make any loan, advance or capital contribution to or investment in any Person (other than a wholly-owned Subsidiary of the Company) outside the ordinary course of business;

(ii) make or authorize any capital expenditure in excess of $100,000 in the aggregate;

(iv) other than pursuant to Contracts in effect as of the date of this Agreement and identified on the Disclosure Schedule or as otherwise required by Law, (A) enter into any new employment or compensatory agreements with, or increase the compensation and employee benefits of, any employee, consultant, or director of the Company or any Subsidiary (including entering into any bonus, severance, change of control, termination, reduction-in-force or consulting agreement or other employee benefits arrangement or agreement pursuant to which such person has the right to any form of compensation from the Company or any Subsidiary), (B) hire any employee to fill a position at the level of (i) executive officer or (ii) vice president or above who reports directly to an executive officer, or (C) adopt or amend in any respect, or accelerate vesting or payment under, any Benefit Plan in the case of clauses (A) and (C) above other than in the ordinary course of business consistent with past practice; or

(v) agree, resolve or commit to do any of the foregoing.

ARTICLE VII

EVENTS OF DEFAULT

7.1.

EVENTS OF DEFAULT

If any of the following events shall occur and be continuing, an “Event of Default” shall be deemed to have occurred:

(a) if the Borrower shall default in the payment of any part of the principal or interest of any Note, when the same shall become due and payable, whether at maturity or at a date fixed for payment or prepayment or by acceleration or otherwise;

(b) if the Obligors shall default in the performance of any of the covenants contained in Articles V or VI and, in a case of a default under Section 5.1 through and including Section 5.7 (exclusive of Section 5.1(c)), such default shall have continued without cure for fifteen (15) days after written notice (“Default Notice”) is given to the Borrower with respect to such covenant by the Lender (and the Borrower shall give to all of the holders of the Notes at the time outstanding prompt written notice of the receipt of such Default Notice, specifying the default referred to therein); provided, however, that such 15 day grace period shall not apply in the event the Borrower fails to give notice as provided in Section 5.3; provided, further, that no Loans may be requested and Lender shall have no obligation to fund Loans during such grace period;

(c) except as provided in Section 7.1(b), if the Company or the Borrower shall default in the performance of any other agreement contained in any Transaction Document or in any other agreement executed in connection with this Agreement and such default shall not have been remedied to the satisfaction of the Lender within 15 days after notice thereof shall have been given to the Borrower; provided, however, that such 15 day grace period shall not apply in the event the Borrower fails to give notice as provided in Section 5.3; provided, further, that no Loans may be requested and Lender shall have no obligation to fund Loans during such grace period;

(d) if any representation or warranty made by the Obligors or any of their officers in any Transaction Document or in or any certificate delivered pursuant thereto shall prove to have been incorrect in any material respect when made or deemed made;

(e) if any default shall occur under any indenture, mortgage, agreement, instrument or commitment evidencing, or under which there is at the time outstanding, any indebtedness of the Company or its Subsidiaries, in excess of $250,000, or which results in such indebtedness, in an aggregate amount (with other defaulted indebtedness) in excess of $250,000 becoming (or being declared by its holders or, on its behalf, by an agent or trustee therefore to be) due and payable prior to its due date;

(f) if a Change of Control occurs;

(g) if there shall occur a termination of the Merger Agreement under Section 9.4 (other than 9.4(a)) thereof;

(h) if there shall occur a termination of the Merger Agreement under Section 9.3(e) thereof and the Lender has not, within five (5) Business Days after such termination, waived in writing the Event of Default that would result from such termination with the passage of time; provided, however, such termination shall not be an Event of Default hereunder until ten (10) Business Days shall have passed after the date of such termination and the Loans shall not have been prepaid in accordance with Section 2.2 hereof; provided, further, that no Loans may be requested and Lender shall have no obligation to fund Loans from and after the date of such termination;

(i) if any of the Company or its Subsidiaries shall default in the observance or performance of any term or provision of any other Material Contract to which it is a party or by which it is bound which default could reasonably be expected to have a Material Adverse Effect and such default is not waived or cured within the applicable grace period; provided, however, that no Loans may be requested and Lender shall have no obligation to fund Loans during such grace period;

(j) if a final judgment which, either alone or together with other outstanding final judgments against the Company and its Subsidiaries, exceeds an aggregate of $250,000 shall be rendered against the Company or any Subsidiary and such judgment shall have continued undischarged or unstayed for 10 days after entry thereof; provided, further, that no Loans may be requested and Lender shall have no obligation to fund Loans during such grace period;

(j) if the Company or any Subsidiary shall generally not pay its debts as such debts become due, or otherwise become insolvent, or shall make an assignment for the benefit of creditors generally, or shall admit in writing its inability to pay its debts generally; or if any proceeding shall be instituted by or against the Company or

any Subsidiary seeking to adjudicate it as bankrupt or insolvent, or seeking liquidation, winding up, reorganization, arrangement, adjustment, protection, relief or composition of it or its debts under any law relating to bankruptcy, insolvency or the reorganization or relief of debtors, or seeking entry of an order for relief or the appointment of a receiver, trustee, custodian or other similar official for it or for any substantial part of its property and, in the case of such proceeding instituted against it (but not instituted by it) that is being diligently contested by it in good faith, either such proceeding shall remain undismissed or unstayed for a period of 45 days (provided that no Loans may be requested and Lender shall have no obligation to fund Loans prior to the dismissal of such proceeding) or any of the actions sought in such proceeding (including, without limitation, the entry of an order for relief against, or the appointment of a receiver, trustee, custodian or other similar official for, it or any substantial part of its property) shall occur; or if any writ of attachment or execution or any similar process shall be issued or levied against it or any substantial part of its property which is either not released, stayed, bonded or vacated within 45 days after its issue or levy or any of the actions sought or relief sought in any proceeding pursuant to which such writ or similar process shall be issued or initiated shall occur or be granted; or if the Company or any Subsidiary takes corporate action in furtherance of any of the aforesaid purposes or conditions;

(k) if any provision of any Transaction Document shall for any reason cease to be valid and binding on, or enforceable against, the Obligors; or

(l) any Transaction Document (or any financing statement) which purports to provide for the priority in right of payment of the Borrower’s obligations under the Transaction Documents to or in favor of the Lender shall cease to preserve such priority.

7.2.

REMEDIES

Upon the occurrence and during the continuance of an Event of Default, the Lender may at any time, at its option, by written notice or notices to the Obligors (a) declare the Notes to be due and payable, whereupon the same shall forthwith mature and become due and payable, together with interest accrued thereon, without presentment, demand, protest or notice, all of which are hereby waived by the Obligors; and (b) declare any other amounts payable to the Lender under this Agreement or the other Transaction Documents or as contemplated hereby or thereby immediately due and payable; provided, however, that upon the occurrence of an Event of Default under Section 7.1(j), the Notes, together with interest accrued thereon, and all other amounts owing hereunder or under any other Transaction Document shall automatically become and be due and payable, without presentment, demand, protest or notice of any kind, or any other action of the Lender of any kind, all of which are hereby waived by the Obligors.

7.3.

ENFORCEMENT

In case any one or more Events of Default shall occur and be continuing, the Lender or its agents may proceed to protect and enforce the rights of the Lender (granted to it or to its agent) by an action at law, suit in equity or other appropriate proceeding, whether for the specific performance of any agreement in favor of the Lender or its agent which is contained in any of the Transaction Documents or in any Note or for an injunction against a violation of any of the terms hereof or thereof, or in aid of the exercise of any power granted hereby or thereby or by law (including, without limitation, the right to enforce the Guaranty in accordance with its terms). In case of a default in the payment of any principal of or interest on the Note, the Obligors will pay to the holder thereof such further amount as shall be sufficient to cover the cost and the expenses of collection, including, without limitation, reasonable attorney’s fees, expenses and disbursements. No course of dealing and no delay on the part of the Lender or its agents in exercising any rights shall operate as a waiver thereof or otherwise prejudice the Lender’s or its agent’s rights. No right conferred hereby or by the Notes or any other Transaction Document upon any holder thereof shall be exclusive of any other right referred to herein or therein or now available at law or in equity, by statute or otherwise.

ARTICLE VIII

INDEMNIFICATION

To the greatest extent permitted by applicable law, the Obligors agree jointly and severally to indemnify the Lender and each of its officers, directors, agents, partners and stockholders, against and hold it and them harmless from all Losses arising out of or resulting from: (i) the breach of any representation or warranty of the Obligors in any Transaction Document or in any agreement, certificate or instrument delivered pursuant thereto; (ii) the breach of any agreement by the Obligors contained in any Transaction Document or any agreement, certificate of instrument delivered pursuant thereto; (iii) all obligations, demands, claims, and liabilities claimed or asserted by any other party in connection with the transactions contemplated by this Agreement.

ARTICLE IX

AMENDMENT AND WAIVER

No amendment of any provision of this Agreement, including any amendment of this Article IX, shall be valid unless the same shall be in writing and signed by the Obligors and the Lender. No waiver by any party of any default, misrepresentation, or breach of warranty or covenant hereunder or under any other Transaction Document, whether intentional or not, shall be deemed to extend to any prior or subsequent default, misrepresentation, or breach of warranty or covenant hereunder or thereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence.

ARTICLE X

MISCELLANEOUS

10.1.

GOVERNING LAW

This Agreement and the rights of the parties hereunder shall be governed in all respects by the laws of the State of New York wherein the terms of this Agreement were negotiated, excluding to the greatest extent permitted by law any rule of law that would cause the application of the laws of any jurisdiction other than the State of New York.

10.2.

SUCCESSORS AND ASSIGNS

Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of, and be binding upon and enforceable by and against, the parties hereto and their respective successors, assigns, heirs, executors and administrators. No party may assign any of its rights hereunder without the prior written consent of the other parties; provided, however, that the Lender may assign any of its rights under any of the Transaction Documents to (a) any Affiliate of the Lender or (b) any Person to whom such Lender shall transfer the Notes, provided, that in each case the transferee will be subject to the applicable terms of the Transaction Documents to the same extent as if such transferee were an original Lender hereunder.

10.3.

ENTIRE AGREEMENT

This Agreement (including the Exhibits and/or Schedules hereto), the other Transaction Documents and any other documents delivered pursuant hereto and simultaneously herewith constitute the full and entire understanding and agreement between the parties with regard to the subject matter hereof and thereof.

10.4.

NOTICES

All notices, demands or other communications given hereunder shall be in writing and shall be sufficiently given if transmitted by facsimile or delivered either personally or by a nationally recognized courier service marked for next business day delivery or sent in a sealed envelope by first class mail, postage prepaid and either registered or certified, return receipt requested, addressed as follows:


(a)	if to the Company:

		MOSCOW CABLECOM CORP.
		153 East 53rd Street, 58th Floor,
		New York, NY 10022
		Attention: Chief Financial Officer
		Facsimile: 860-298-0685

(b)	if to the Borrower:

		ZAO COMCOR-TV
		Neglinnaya Street, 17, Building 2
		103051, Moscow, Russian Federation
		Attention: Mr. Mikhail Silin
		General Director
		Facsimile: 7-495-231-3086

(b)	if to the Lender:

		RME FINANCE LTD
		3, Chrysanthou Mylona Street
		P.C. 3030, Limassol
		Republic of Cyprus
		Attention: Director

	with a copy to:

		RME MANAGEMENT LIMITED
		Representative Office in Russia
		Obraztsova Street, 4A
		Moscow 127055, Russian Federation
		Attention: Head of Representative Office
		Facsimile: 7-495-657-9672

Any such notice, demand or communication shall be deemed to have been given (i) on the date of delivery, if delivered personally, (ii) on the date of facsimile transmission, receipt confirmed, (iii) one business day after delivery to a nationally recognized overnight courier service, if marked for next day delivery, or (iv) five business days after the date of mailing, if mailed.

(c) Copies of any notice, demand or communication given to the Company and the Borrower shall also be delivered to Porzio, Bromberg & Newman P.C., 156 W. 56^th Street, New York, New York 10019, Attn: Christopher F. Schultz, Esq., or such other address as may be directed.

10.5.

DELAYS, OMISSIONS OR WAIVERS

No delay or omission to exercise any right, power or remedy accruing to the Lender upon any breach or default of the Obligors under this Agreement shall impair any such right, power or remedy of the Lender nor shall it be construed to be a waiver of any such breach or default, or an acquiescence, therein, or of or in any similar breach or default thereafter occurring. Any permit, consent or approval of any kind or character on the part of the Lender of any breach or default under this Agreement must be made in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement or by law or otherwise afforded to the Lender, shall be cumulative and not alternative. The Lender shall have all other rights and remedies not inconsistent herewith as provided under the Uniform Commercial Code in effect from time to time, by law, or in equity. No exercise by the Lender of one right or remedy shall be deemed an election, and no waiver by the Lender of any Event of Default shall be deemed a continuing waiver.

10.6.

INDEPENDENCE OF COVENANTS AND REPRESENTATIONS AND WARRANTIES

All covenants hereunder shall be given independent effect so that if a certain action or condition constitutes a default under a certain covenant, the fact that such action or condition is permitted by another covenant shall not affect the occurrence of such default. In addition, all representations and warranties hereunder shall be given independent effect so that if a particular representation or warranty proves to be incorrect or is breached, the fact that another representation or warranty concerning the same or similar subject matter is correct or is not breached will not affect the incorrectness of or a breach of a representation and warranty hereunder.

10.7.

RIGHTS AND OBLIGATIONS; SEVERABILITY

Unless otherwise expressly provided herein, the Lender’s rights and obligations hereunder are several rights and obligations, not rights and obligations jointly held with any other Person. In case any provision of this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

10.8.

JURISDICTION

(a) Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the United States District Court for the Southern District of New York (the “Court”) in any action or proceeding arising out of or relating to this Agreement or any of the other Transaction Documents to which it is a party or to whose benefit it is entitled, or for recognition or enforcement of any judgment, and each of the parties hereto irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such Court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the right that any party may otherwise have to bring any action or proceeding relating to this Agreement or any of the other Transaction Documents in the courts of any other jurisdiction.

(b) Each of the parties hereto irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or in relation to this Agreement or any other Transaction Document to which it is a party in such Court. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in such Court.

10.9.

WAIVER OF JURY TRIAL

EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO ANY TRANSACTION DOCUMENT OR THE

ACTIONS OF ANY PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.

10.10.

TITLES AND SUBTITLES

The titles of the articles, sections and subsections of this Agreement are for convenience of reference only and are not to be considered in construing this Agreement.

10.11.

COUNTERPARTS

This Agreement may be executed in any number of counterparts, including by facsimile copy, each of which shall be deemed an original, but all of which together shall constitute one instrument.

10.12.

MARSHALLING; RECOURSE TO SECURITY; PAYMENTS SET ASIDE

The Lender shall not be under any obligation to marshal any assets in favor of the Obligors or any of its Affiliates or any other party or against or in payment of any or all of the Loans or other obligations hereunder. Recourse to security shall not be required at any time. To the extent that the Borrower makes a payment or payments to the Lender or the Lender enforces its security interests, if any, or exercises its rights of setoff, and such payment or payments or the proceeds of such enforcement or setoff or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any bankruptcy law, state or federal law, common law or equitable cause, then to the extent of such recovery, the obligation or part thereof originally intended to be satisfied, and all liens, rights and remedies therefor, shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.

10.13.

ENGLISH LANGUAGE VERSION CONTROLS

The parties may execute a copy of this Agreement in both the English and the Russian language. The parties hereto acknowledge and agree that, in the event of a discrepancy or conflict, between the English and the Russian language versions, in all cases, the English language version shall control and prevail in all respects.

ARTICLE XI

CERTAIN DEFINED TERMS

For purposes of this Agreement, the following terms have the meanings indicated (unless otherwise expressly provided herein):

“2004 Facility Agreement” means that certain Facility Agreement, dated as of August 24, 2004 by and among the RME FINANCE LTD, formerly known as AMATOLA ENTERPRISES LIMITED, the Company, the Borrower, and the other parties thereto, as the same may be amended, modified, supplemented or restated from time to time.

“Affiliate” has the meaning specified in Rule 501(b) under the Securities Act.

“Availability End Date” means the earliest to occur of: (a) October 31, 2007, (b) the occurrence of an Event of Default, (c) the date that is ninety (90) days after the effective date of a termination of the Merger Agreement pursuant to Sections 9.1 or 9.3 thereof (other than a termination pursuant to Section 9.3(e)), (d) the date that is sixty (60) days after the effective date of a termination of the Merger Agreement pursuant to Section 9.2 thereof, (e) the effective date of a termination of the Merger Agreement pursuant to Sections 9.3(e) or Section 9.4 thereof, or (f) the occurrence of the Closing, as that term is defined in the Merger Agreement.

“Benefit Plans” shall mean with respect to the Company and each Subsidiary of the Company, (i) all employee benefit plans (as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended ERISA, (ii) each loan to any current or former non-officer employee, officer or directors or director and any stock option, stock purchase, phantom stock, stock appreciation right, equity based award, supplemental retirement, severance, termination, change in control, sabbatical, medical, dental, vision care, disability, employee relocation, cafeteria benefit (Code Section 125) or dependent care (Code Section 129), life insurance or accident insurance plans, programs or arrangements, (iii) all bonus, pension, profit sharing, savings, deferred compensation or incentive plans, programs, policies, agreements or arrangements, (iv) other fringe, welfare or employee benefit plans, programs, policies, agreements or arrangements, and (v) any current or former employment or, consulting, retention, executive compensation or severance agreements or arrangements, written or otherwise, for the benefit of, or relating to, any present or former employee, consultant or director of the Company with respect to which the Company or any Company Subsidiary has or could reasonably have any liability.

“Board of Directors” means the board of directors of an Obligor.

“Business Day” shall mean any day other than a Saturday, Sunday, U.S. Federal holiday or any other day on which banking institutions in New York City, United States of America or Moscow, Russian Federation, are authorized or obligated by Law to be closed.

“Change of Control” means the occurrence of any of the following: (a) the Borrower ceases to be a wholly-owned Subsidiary of the Company; (b) any “person” or “group” (within the meaning of Section 13(d) and 14(d)(2) of the Securities Exchange Act of 1934) becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934), directly or indirectly, of a sufficient number of shares of all classes of Voting Stock then outstanding of the Company, empowering such “person” or “group” to elect a majority of the Board of Directors of the Company, who did not have such power before such transaction, (c) an Obligor consolidates with, or merges with or into, another Person (other than a direct or indirect wholly owned Subsidiary where the Obligor is the surviving entity and no default or Event of Default exists or would exist immediately after giving effect thereto) or sells, assigns, conveys, transfers, leases or otherwise disposes of all or substantially all of an Obligor’s assets or the assets of the Company and its Subsidiaries taken as a whole to any Person, or any Person consolidates with, or merges with or into, an Obligor, in any such event pursuant to a transaction in which the outstanding Voting Stock of the Obligor, as the case may be, is converted into or exchanged for cash, securities or other property, or (d) an Obligor, either individually or in conjunction with one or more Subsidiaries sells, assigns, conveys, transfers, leases or otherwise disposes of, or the Subsidiaries sell, assign, convey, transfer, lease or otherwise dispose of, all or substantially all of the properties and assets of the Company and its Subsidiaries, taken as a whole (either in one transaction or a series of related transactions), including capital stock of the Subsidiaries, to any Person (other than an Obligor or a wholly owned Subsidiary of an Obligor), provided that the aforesaid shall not apply to any merger or consolidation of an Obligor or the Subsidiaries with the Lender or any Affiliate of the Lender. For purposes of this definition, the term “Voting Stock” of an Obligor means securities of any class of capital stock of such Obligor entitling the holders thereof to vote in the election of members of the Board of Directors.

“Code” means the Internal Revenue Code of 1986, as amended, and any applicable rules and regulations thereunder, and any successor to such statute, rules or regulations. Any reference herein to a specific section, rule or regulation of the Code shall be deemed to include any corresponding provisions of future law.

“Common Stock” means the common stock, $0.01 par value, of the Company (now or hereafter issued).

“Company Options” means outstanding stock option to purchase shares of Common Stock

“Company Reports” means each registration statement, report, notification, proxy statement or information statement filed by the Company since December 31, 2003 including without limitation the Company’s Annual Reports on Form 10-K for the years ended December 31, 2003, December 31, 2004 and December 31, 2005, respectively, and the Company’s Reports on Form 10-Q for the quarterly periods ended March 31, 2004, June 30, 2004, September 30, 2004, March 31, 2005, June 30, 2005, September 30, 2005, March 31, 2006, June 30, 2006, and September 30, 2006, respectively and the Company’s reports on Form 8-K, each in the form (including exhibits,

annexes and any amendments thereto) filed with the SEC, together with any such reports filed subsequent to the date hereof.

“Company Warrants” means each warrant to purchase shares of Common Stock

“Contracts” means any note, bond, mortgage, indenture, lease, license, contract, agreement or other instrument or obligation, whether written or oral.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended and any applicable rules and regulations thereunder, and any successor to such statute, rules or regulations. Any reference herein to a specific section, rule or regulation of ERISA shall be deemed to include any corresponding provisions of future law.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and any applicable rules and regulations thereunder, and any successor to such statute, rules or regulations. Any reference herein to a specific section, rule or regulation of the Exchange Act shall be deemed to include any corresponding provisions of future law.

“Funding Date” means any date on which a Loan is made to or on account of the Borrower under this Agreement.

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

“Guaranty” means the Continuing Unconditional Guaranty, dated as of the date hereof, by the Company in favor of the Lender, as the same may be amended, modified, supplemented, restated or extended from time to time.

“Intellectual Property” means any and all patents, patent applications, trademarks, copyrights, trademark registrations and applications therefore, patent, trademark or trade name licenses, service marks, domain names, contracts with employees or others relating in whole or in part to disclosure, assignment or patenting of any inventions, discoveries, improvements, processes, formulae or other know-how, and all patent, trademark or trade names or copyright licenses which are in force.

“IRS” means the Internal Revenue Service.

“Laws” means any federal, state, local, municipal, foreign or other law, statute, constitution, principle of common law, resolution, ordinance, code, order, edict, judgment, decree, rule, regulation, ruling or requirement issued, enacted, adopted, promulgated, implemented or otherwise put into effect by or under the authority of any governmental entity.

“Lien” means with respect to any asset (including any security) any option, claim, mortgage, lien, pledge, charge, security interest or encumbrance or restrictions of any kind in respect of such asset, other than: (i) statutory Liens of landlords, statutory Liens of banks and statutory rights of set-off of banks, statutory Liens of carriers, warehousemen, mechanics, repairmen, workmen and materialmen, retention of title arrangements and other Liens imposed by law, in each case incurred in the ordinary course of business (A) for amounts not yet overdue or (B) for amounts that are overdue and that (in the case of such amounts overdue for a period in excess of 30 days) are being contested in good faith by appropriate proceedings, so long as such reserves or other appropriate provisions, if any, will have been made for any such contested amounts and such Liens do not have priority over any Liens of Lender; (ii) easements, rights-of-way, restrictions, encroachments, and other minor defects or irregularities in title with respect to real property, in each case which do not and will not interfere in any material respect with the ordinary conduct of the business of the Company or any Subsidiary; (iii) any zoning or similar law or right reserved to or vested in any governmental office or agency to control or regulate the use of any real property; and (iv) Liens that do not either adversely affect the value of the real property subject to such Lien or prohibit or interfere with the operations of that real property or the business of the Company or the Subsidiaries.

“Losses” means any claims, losses, damages, liabilities (or actions in respect thereof), obligations, penalties, awards, judgments, expenses (including, without limitation, reasonable fees and expenses of counsel) or disbursements.

“Material Adverse Effect” means any state of facts, change, development, event, effect, condition or occurrence (including, without limitation, any breach of a representation or warranty contained herein by the Company) that, individually or in the aggregate, materially and adversely affects (i) the business, assets, liabilities, property, financial condition or results of operations of the Company, the Borrower and their respective Subsidiaries, taken as a whole or (ii) the ability of the Company or its Subsidiaries to perform its obligations hereunder or under the Notes the Guaranty or the other Transaction Documents, provided, however, that none of the following shall be deemed in and of themselves, either alone or in combination, to constitute, and none of the following shall be taken into account, alone or in combination, in determining whether there has been or will be, a Material Adverse Effect: (1) any change in general economic or political conditions not specifically relating to the Company or the Borrower and not disproportionately adversely affecting the Company or the Borrower, (2) any change in prevailing interest rates or currency exchange rates, (3) any change in GAAP, (4) any change proximately resulting from the execution of the Merger Agreement, the consummation of the transactions contemplated thereby and the announcement thereof, and (5) any change resulting from the Company’s failure to meet internal forecasts or third party analyst estimates or projections, provided however that the exception in this clause (5) shall not in any way prevent or otherwise affect a determination that any change, effect, event, occurrence, state of facts or development underlying such failure constitutes a Material Adverse Effect.

“Merger Agreement” means the Agreement and Plan of Merger, dated as of the date hereof, by and among Renova Media Enterprises Ltd., the Company and Galaxy Merger Sub Corporation, a Delaware corporation, as the same may be amended, modified or supplemented from time to time in accordance with the terms thereof.

“Person” means any individual, corporation, limited liability company, partnership, association, trust or any other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.

“Preferred Stock” means the Series A Stock and the Series B Stock.

“SEC” means the Securities and Exchange Commission.

“SEC Reports” means any reports, statements, releases or other documents required to be filed by the Borrower with the SEC under the Exchange Act.

“Securities Act” means the Securities Act of 1933, as amended, and any applicable rules and regulations thereunder, and any successor to such statute, rules or regulations. Any reference herein to a specific section, rule or regulation of the Securities Act shall be deemed to include any corresponding provisions of future law.

“Senior Debt” means any and all loans, advances, obligations and liabilities of the Company and the Borrower now existing or hereafter arising, primary or secondary, arising under or relating to the 2004 Facility Agreement, any Finance Document (as that term is defined in the 2004 Facility Agreement) and any and all documents, instruments and agreements entered into in connection therewith, in each case as amended from time to time including (i) all principal of and interest (including any interest which accrues after the commencement of any case, proceeding or other actions relating to the bankruptcy, insolvency or reorganization of the Borrower, the Company or any other “Obligor” as that term is defined therein) on any loans or other extensions of credit under the 2004 Facility Agreement, or any notes or instruments issued thereunder and any and all costs of collection, fees and expenses associated therewith, (ii) all other amounts payable by the Borrower, the Company or any other Obligor thereunder.

“Series A Stock” means the Series A Convertible Preferred Stock, $.01 par value, of the Company (now or hereafter issued).

“Series B Stock” means the Series B Convertible Preferred Stock, $.01 par value, of the Company (now or hereafter issued).

“Subsidiary” means any entity in which the Company or the Borrower, directly or indirectly, owns securities having a majority of the voting power in the election of directors or persons serving equivalent functions.

“Tax” (including, with correlative meaning, the term “Taxes”) shall mean all U.S. federal, state, local and foreign (including taxes imposed by the Russian Federation and the City of Moscow) income, profits, franchise, gross receipts, environmental, customs duty, capital stock, severances, stamp, payroll, sales, employment, unemployment, disability, use, property, withholding, excise, production, value added, occupancy and other taxes, duties or assessments of any nature whatsoever, together with all interest, penalties and additions imposed with respect to such amounts and any interest in respect of such penalties and additions, whether disputed or not.

“Tax Return” means all returns and reports (including elections, declarations, disclosures, schedules, estimates and information returns) required to be filed with, or supplied to, any Tax authority under applicable Law.

“Total Commitment” means an extension of credit in an amount not to exceed Forty-Five Million Dollars (US$45,000,000.00), minus an amount equal to the aggregate Warrant Proceeds paid to the Company after the date hereof.

“Tranche Commitment” means, as of any date of determination, an amount equal to: (a) Five Million Dollars (US$5,000,000.00), minus (b) the quotient obtained by dividing (i) the aggregate amount of Warrant Proceeds paid to the Company between the Closing Date and such date of determination, by (ii) the difference between 9 and the number of tranches of Loans funded prior to such date of determination.

“Transaction Documents” means, collectively, (a) this Agreement, (b) the Notes, (c) the Guaranty, and (d) any other document, instrument or agreement entered into in connection with this Agreement, all as amended, modified, supplemented, restated or extended from time to time.

“Warrant Proceeds” means the cash proceeds paid to the Company by Renova Media Enterprises Ltd. or any of its affiliates, or their successor or assigns, in connection with the exercise of warrants issued by the Company to purchase its capital stock.

[Remainder of Page Left Blank]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.


		MOSCOW CABLECOM CORP.

		By:		/s/ Andrew Intrater

		Name:		Andrew Intrater
		Title:		Chairman

		ZAO COMCOR-TV


		By:		/s/ Mikhail Silin

		Name:		Mikhail Silin
		Title:		General Director


		By:		/s/ Elena Shatalova

		Name:		Elena Shatalova
		Title:		Chief Accountant

		RME FINANCE LTD


		By:		/s/ Vladimir Kuznetsov

		Name:		Vladimir Kuznetsov
		Title:		Attorney in Fact

Signature Page to Bridge Facility Agreement

EXHIBIT A
TO BRIDGE FACILITY AGREEMENT

FORM OF
SUBORDINATED PROMISSORY NOTE

THIS SUBORDINATED PROMISSORY NOTE IS SUBORDINATED IN ALL RESPECTS TO THE INDEBTEDNESS, LIABILITIES AND OBLIGATIONS OWING BY THE BORROWER ARISING UNDER OR IN CONNECTION WITH THAT CERTAIN FACILITY AGREEMENT DATED AS OF AUGUST 26, 2004, AS AMENDED FROM TIME TO TIME (THE “FACILITY AGREEMENT”), AND MAY BE COLLECTED AND ENFORCED ONLY IN ACCORDANCE WITH THE TERMS OF THE SUBORDINATION AGREEMENT, DATED AS OF FEBRUARY 21, 2007, BY AND AMONG THE HOLDER, AS DEFINED BELOW, AND THE AGENT UNDER THE FACILITY AGREEMENT (THE “SUBORDINATION AGREEMENT”).

TRANCHE
SUBORDINATED PROMISSORY NOTE

ZAO COMCOR-TV


$		No. N-
, 2007

ZAO COMCOR-TV, a corporation organized under the laws of the Russian Federation (the “Borrower”), for value received, hereby promises to pay to the order of RME FINANCE LTD, a company incorporated under the laws of Cyprus, or its registered assigns (the “Holder”), on the Maturity Date, the principal amount of [ ] ($ ), as adjusted from time to time pursuant to the terms hereof (the “Principal Amount”) and all accrued but unpaid interest thereon as hereinafter provided.

This Tranche Subordinated Promissory Note (this “Note”) was issued by the Borrower pursuant to a certain Bridge Facility Agreement dated as of February 21, 2007 among Moscow CableCom Corp. (the “Company” and together with the Borrower, the “Obligors”), the Borrower and the Holder (together with the Schedules and Exhibits thereto, the “Loan Agreement”). The Holder is entitled to the benefits of the Loan Agreement, including, without limitation, the rights upon the occurrence and during the continuance of an Event of Default and the benefits of guaranties referred to therein or below. Reference is made to the Loan Agreement and the documents entered into pursuant thereto or in connection therewith with respect to certain additional rights of the Holder and obligations of the Obligors and the Subsidiaries not expressly set forth herein. Capitalized terms used herein but not otherwise defined herein shall have the meaning ascribed thereto in the Loan Agreement. All such rights of Holder and obligations of Borrower set forth in the Loan Agreement are incorporated herein by reference.

ARTICLE I

PAYMENT OF PRINCIPAL AND INTEREST; METHOD OF PAYMENT

1.1. Payment of the Principal Amount and accrued interest on this Note shall be made in cash, in immediately available funds, in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts. Interest (computed on the basis of a 360-day year of twelve 30-day months) shall accrue on the unpaid portion of the Principal Amount from time to time outstanding at the Stated Interest Rate (as defined below), and shall be, at the option of the Borrower (unless required to be paid earlier by the terms of the Loan Agreement): (a) upon not less than five (5) Business Days’ prior written notice to the Holder, paid by the Borrower to the Holder in arrears on the last day of

each calendar quarter, or (b) if not paid pursuant to clause (a) above, capitalized with, and added to, the Principal Amount on the last day of each calendar quarter, and shall thereafter be deemed for all purposes to be a part of the Principal Amount (and the Principal Amount shall be increased by the amount of such capitalized interest at the end of such calendar quarter). On the Maturity Date the outstanding Principal Amount, as so adjusted, together with all accrued and unpaid interest thereon, and all other amounts due hereunder or under the other Transaction Documents shall be immediately due and payable. Both principal hereof and interest hereon are payable at such address as the Holder shall designate from time to time by written notice to the Borrower. The Borrower will pay or cause to be paid all sums becoming due hereon for principal and interest by check or wire transfer, at the Holder’s election, and, without any requirement for the presentation of this Note or making any notation thereon, except that the Holder hereof agrees that, subject to Section 3.10 hereof, it shall surrender this Note to the Borrower for cancellation promptly following payment of the final amount due. Prior to any sale or other disposition of this instrument, the Holder hereof agrees to endorse hereon the amount of principal paid hereon and the last date to which interest has been paid hereon and to notify the Borrower of the name and address of the transferee; provided however, failure to provide such notice shall not impair or limit Holder’s rights or remedies hereunder. As used herein, the “Stated Interest Rate” means the rate of (i) ten percent (10%) per annum prior to the occurrence of an Event of Default, and (ii) thirteen percent (13%) per annum after the occurrence of an Event of Default and during the continuance thereof (regardless of whether the Loans have been accelerated), in each case subject to the limitations of applicable law.

1.2. If this Note or any portion hereof becomes due and payable on a Saturday, Sunday or public holiday under the laws of the State of New York, the due date hereof shall be extended to the next succeeding full business day and interest shall be payable at the Stated Interest Rate per annum during such extension. All payments received by the Holder shall be applied first to the payment of all accrued interest payable hereunder or in such other order as Holder shall determine in its sole discretion.

1.3 Subject to the restrictions imposed under the Subordination Agreement, the Borrower shall have the right to prepay the Principal Amount of this Note, in whole or in part, at any time without penalty or premium, subject to Section 2.2(a) of the Loan Agreement. Any prepayment of principal shall be accompanied by a payment of all interest accrued and unpaid on the portion of the principal amount being prepaid. In addition, this Note is subject to mandatory prepayment as provided in the Loan Agreement.

ARTICLE II

[RESERVED]

ARTICLE III

MISCELLANEOUS

3.1. Default. Subject to the terms of the Loan Agreement, upon the occurrence of any one or more of the Events of Default specified in the Loan Agreement all amounts then remaining unpaid on this Note may be declared to be, or automatically become, immediately due and payable as provided in the Loan Agreement.

3.2. Collection Costs. In the event that this Note shall be placed in the hands of an attorney for collection by reason of any event of default hereunder, the undersigned agrees to pay reasonable attorney’s fees, expenses and disbursements and any other reasonable expenses incurred by the Holder or its agent in connection with the collection of this Note. In addition, the undersigned shall be responsible for all other expenses of the Holder and its agent, if any, to the extent provided by the Loan Agreement.

3.3. Rights Cumulative; Specific Performances. The rights, powers and remedies given to the Holder under this Note shall be in addition to all rights, powers and remedies given to it by virtue of the Loan Agreement, Transaction Documents, any document or instrument executed in connection therewith, or any statute, regulation or other applicable law.

3.4. No Waivers. Any forbearance, omission, failure or delay by the Holder in exercising any right, power or remedy under this Note, the Loan Agreement, any documents or instruments executed in connection therewith or otherwise available to the Holder shall not be deemed to be a waiver of such right, power or remedy, nor shall any single or partial exercise of any right, power or remedy preclude the further exercise thereof.

3.5. Amendments in Writing. Subject to the terms of the Loan Agreement, no amendment, modification or waiver of any provision of this Note shall be effective unless it shall be in writing and signed by the Holder, and any such amendment, modification or waiver shall apply only in the specific instance for which given.

3.6. Governing Law; Jurisdiction. (a) This Note and the rights of the holders hereof shall be governed by, and construed in accordance with, the laws of the State of New York wherein the terms of this Note were negotiated, excluding to the greatest extent permitted by law any rule of law that would cause the application of the laws of any jurisdiction other than the State of New York.

(b) Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the United States District Court for the Southern District of New York (the “Court”) in any action or proceeding arising out of or relating to this Agreement or any of the other Transaction Documents to which it is a party or to whose benefit it is entitled, or for recognition or enforcement of any judgment, and each of the parties hereto irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such Court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the right that any party may otherwise have to bring any action or proceeding relating to this Agreement or any of the other Transaction Documents in the courts of any other jurisdiction.

(c) Each of the parties hereto irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or in relation to this Agreement or any other Transaction Document to which it is a party in such Court. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in such Court.

3.7. No Counterclaims. The Borrower waives the right to interpose counterclaims or set-offs of any kind and description in any litigation arising hereunder (whether or not arising out of or relating to this Note).

3.8. Successors. The term “Holder” as used herein shall be deemed to include the Holder and its successors, endorsees and assigns.

3.9. Certain Waivers. The Borrower hereby waives presentment, demand for payment, protest, notice of protest and notice of non-payment hereof.

3.10. Mutilated, Lost, Stolen or Destroyed Notes. In case this Note shall be mutilated, lost, stolen or destroyed, the Borrower shall issue and deliver in exchange and substitution for and upon cancellation of the mutilated Note, or in lieu of and substitution for the Note, mutilated, lost, stolen or destroyed, a new Note of like tenor and representing an equivalent right or interest, but only upon receipt of evidence reasonably satisfactory to the Borrower of such loss, theft or destruction and an indemnity, if requested, also reasonably satisfactory to it (but without requirement of posting any bond).

3.11. Maintenance of Office. The Borrower covenants and agrees that so long as this Note shall be outstanding, it will maintain its principal office at the address set forth in Section 10.4 of the Loan Agreement (or such other place as the Borrower may designate in writing at least 30 days prior to any change of location of such office to the Holder of this Note) where notices, presentations and demands to or upon the Borrower in respect of this Note may be given or made.

3.12. WAIVER OF JURY TRIAL. THE BORROWER IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS NOTE OR ANY OTHER TRANSACTION DOCUMENT TO WHICH IT IS A PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.

IN WITNESS WHEREOF, ZAO COMCOR-TV has caused this Note to be signed by its authorized officer and to be dated the day and year first above written.


ATTEST [SEAL]		ZAO COMCOR-TV.

	By:
		Name:
		Title:

ATTACHMENT I
TO TRANCHE PROMISSORY NOTE

Assignment

For value received, the undersigned hereby assigns subject to the provisions of the Loan Agreement, to
$ principal amount of the Subordinated Promissory Note evidenced hereby and hereby irrevocably appoints attorney to transfer the Note on the books of the within named corporation with full power of substitution in the premises.

Dated:

In the presence of:

EX-99.33 5 f27637a9exv99w33.htm EXHIBIT 33 exv99w33

Exhibit 33

THIS CONTINUING UNCONDITIONAL GUARANTY IS SUBORDINATED IN ALL RESPECTS TO THE INDEBTEDNESS, LIABILITIES AND OBLIGATIONS OWING BY THE GUARANTOR ARISING UNDER OR IN CONNECTION WITH THAT CERTAIN FACILITY AGREEMENT DATED AS OF AUGUST 26, 2004, AS AMENDED FROM TIME TO TIME (THE “FACILITY AGREEMENT”), AND MAY BE COLLECTED AND ENFORCED ONLY IN ACCORDANCE WITH THE TERMS OF THE SUBORDINATION AGREEMENT, DATED AS OF FEBRUARY 21, 2007, BY AND AMONG THE LENDER, AS DEFINED BELOW, AND THE AGENT UNDER THE FACILITY AGREEMENT (THE “SUBORDINATION AGREEMENT”).

CONTINUING UNCONDITIONAL GUARANTY

This Continuing Unconditional Guaranty (“Guaranty”) is made on February 21, 2007 by MOSCOW CABLECOM CORP., a Delaware corporation (“Guarantor”), in favor of RME FINANCE LTD, a company incorporated under the laws of Cyprus (the “Lender”).

PRELIMINARY STATEMENTS

The Guarantor and ZAO COMCOR-TV, a joint-stock corporation organized under the laws of the Russian Federation (the “Borrower”), entered into a Bridge Facility Agreement of even date herewith (the “Loan Agreement;” terms used in this Guaranty and not otherwise defined shall have the meanings given to them in the Loan Agreement) with the Lender. Pursuant to the Loan Agreement, the Lender has made, and may in the future make, financial accommodations to the Borrower in accordance with the terms of the Loan Agreement. The Guarantor will continue to receive certain benefits from such accommodations and is therefore willing to guaranty the prompt payment and performance of the obligations of the Borrower, on the terms set forth in this Guaranty. The extension of credit by the Lender to the Borrower is necessary and desirable to the conduct and operation of the business of the Borrower and will inure to the financial benefit of the Guarantor.

AGREEMENT

For value received and in consideration of any loan, advance, or financial accommodation of any kind whatsoever heretofore, now or hereafter made, given or granted to the Borrower by the Lender (including, without limitation, the loans evidenced by the Notes as made by the Lender to the Borrower pursuant to the Loan Agreement) and other good and valuable consideration (the sufficiency and receipt of which are hereby acknowledged), the Guarantor hereby agrees as follows:

ARTICLE 1

GUARANTY

1.1 GUARANTY

The Guarantor unconditionally guarantees to the Lender (a) the full and prompt payment and performance when due, whether at maturity or earlier, by reason of acceleration or otherwise, and at all times thereafter, of all liabilities of the Borrower to the Lender and (b) the prompt, full and faithful discharge by the Borrower of each and every term, condition, agreement, representation, warranty or covenant now or hereafter made by the Obligors to the Lender, in each case, under these clauses (a) and (b), pursuant to the Loan Agreement, the Notes, the other Transaction Documents or any document or instrument delivered by the Borrower to the Lender in connection therewith or pursuant thereto (which, together with the liabilities described in clause (a) of this Section 1.1, are collectively referred to in this Guaranty as the “Borrower’s Liabilities”). The Guarantor further agrees to pay all reasonable out-of-pocket costs and expenses, including, without limitation, all court costs and reasonable attorneys’ and paralegals’ fees paid or incurred by the Lender, in endeavoring to collect all or any part of the Borrower’s Liabilities from, or in prosecuting any action against the Guarantor or any other guarantor of all or any part of the Borrower’s Liabilities. Guarantor indemnifies the Lender from and against and will pay, immediately upon demand, any cost, loss or liability suffered by the Lender if any obligation guarantied by it is or becomes unenforceable, invalid or illegal.

1.2 [RESERVED]

1.3 GUARANTY UNCONDITIONAL

The Guarantor hereby agrees that, except as hereinafter provided, and to the extent permitted by applicable law, its obligations under this Guaranty shall be unconditional, irrespective of (a) the validity or enforceability of the Borrower’s Liabilities or any part thereof, or of any Note or other document evidencing all or any part of the Borrower’s Liabilities, (b) the absence of any attempt to collect the Borrower’s Liabilities from the Borrower or any other guarantor or other action to enforce the same or the release of such person from liability, (c) the waiver or consent by the Lender with respect to any provision of any instrument evidencing the Borrower’s Liabilities, or any part thereof, or any other agreement heretofore, now or hereafter executed by the Borrower and delivered to Lender, (d) the failure by the Lender to take any steps to perfect and maintain its security interest in, or to preserve its rights to, any security or collateral for the Borrower’s Liabilities, (e) the institution of any proceeding under Chapter 11 of Title 11 of the United States Code (11 U.S.C. §101 et seq.), as amended (the “Bankruptcy Code”), or any similar domestic or foreign case or proceeding, by or against the Borrower, or the Lender’s election in any such proceeding of the application of Section 1111(b)(2) of the Bankruptcy Code, (f) any borrowing or grant of a security interest by the Borrower as debtor-in-possession, under Section 364 of the Bankruptcy Code, (g) the disallowance, under Section 502 of the Bankruptcy Code, of all or any portion of the Lender’s claim(s) for repayment of the Borrower’s Liabilities, or (h) any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a guarantor.

1.4 WAIVERS

(a) The Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of receivership or bankruptcy of the Borrower, protest or notice with respect to the Borrower’s Liabilities and all demands whatsoever, and covenants that this Guaranty will not be discharged, except by complete performance of the obligations and liabilities contained herein. Upon the occurrence and during the continuance of an Event of Default under the Loan Agreement, the Lender may, at its sole election, proceed directly and at once, without notice, against the Guarantor to collect and recover the full amount or any portion of the Borrower’s Liabilities, without first proceeding against any other Person, or against any security or collateral for the Borrower’s Liabilities.

(b) The Guarantor hereby waives any and all claims (including, without limitation, any claim for reimbursement, contribution or subrogation) of the Guarantor against the Borrower, any endorser or any other guarantor of all or any part of the Borrower’s Liabilities, or against any of the Borrower’s properties, arising by reason of any payment by the Guarantor to the Lender pursuant to the provisions hereof.

(c) The Guarantor hereby waives the benefit of any act or omission by Lender which directly or indirectly results in or aids the discharge of Borrower from any Obligations by operation of law or otherwise. The Guarantor waives any defense arising by reason of any disability or other defense of the Borrower or by reason of the cessation from any cause whatsoever of the liability of the Borrower. The Guarantor waives any setoff, defense or counterclaim that the Guarantor or the Borrower may have against the Lender.

1.5 NO SUBROGATION

The Guarantor hereby unconditionally and irrevocably agrees not to exercise any rights that it may now have or hereafter acquire against the Borrower that arise from the existence, payment, performance or enforcement of the Borrower’s Liabilities under or in respect of this Guaranty, the Loan Agreement, the Notes, the other Transaction Documents or any document or instrument delivered by the Borrower to the Lender in connection therewith or pursuant thereto, including, without limitation, any right of subrogation, reimbursement, exoneration, contribution or indemnification and any right to participate in any claim or remedy of the Lender against the Borrower or any collateral, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, including, without limitation, the right to take or receive from the Borrower, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or security on account of such claim, remedy or right. If any amount shall be paid to any Guarantor in violation of the immediately preceding sentence at any time prior to the indefeasible payment in full in cash of the Borrower’s Liabilities and all other amounts payable under

this Guaranty, such amount shall be received and held in trust for the benefit of the Lender, shall be segregated from other property and funds of the Guarantor and shall forthwith be paid or delivered to the Lender in the same form as so received (with any necessary endorsement or assignment) to be credited and applied to the Borrower’s Liabilities and all other amounts payable under this Guaranty, whether matured or unmatured, in accordance with the terms of the Notes and the Loan Agreement, or to be held as collateral for any Borrower’s Liabilities or other amounts payable under this Guaranty thereafter arising. After the Loan Agreement has been terminated and the Notes canceled and the indefeasible payment in full in cash of the Borrower’s Liabilities and all other amounts payable under this Guaranty has occurred, except in the case of a Reinstatement Event (as defined below), the Agent and the Lender will, at the Guarantor’s request and expense, execute and deliver to the Guarantor appropriate documents, without recourse and without representation or warranty, necessary to evidence the transfer by subrogation to the Guarantor of an interest in the Borrower’s Liabilities resulting from such payment made by the Guarantor pursuant to this Guaranty.

1.6 LENDER RIGHTS WITH RESPECT TO BORROWER’S LIABILITIES

The Lender is hereby authorized, without notice or demand and without affecting the liability of the Guarantor hereunder, at any time and from time to time to (a) increase the amount of, renew, extend, accelerate or otherwise change the time for payment of, or other terms relating to the Borrower’s Liabilities or otherwise modify, amend or change the terms of any debenture, note or other agreement, document or instrument now or hereafter executed by the Borrower and delivered to the Lender; (b) accept partial payments on the Borrower’s Liabilities; (c) take and hold security or collateral for the payment of the Borrower’s Liabilities guaranteed hereby, or for the payment of this Guaranty, or for the payment of any other guaranties of the Borrower’s Liabilities or other liabilities of the Borrower, and exchange, enforce, waive and release any such security or collateral; (d) apply such security or collateral and direct the order or manner of sale thereof as in their sole discretion they may determine; and (e) settle, release, compromise, collect or otherwise liquidate the Borrower’s Liabilities and any security or collateral therefor in any manner, without affecting or impairing the obligations of the Guarantor hereunder. The Lender shall have the exclusive right to determine the time and manner of application of any payments or credits, whether received from the Borrower or any other source, and such determination shall be binding on the Guarantor. All such payments and credits may be applied, reversed and reapplied, in whole or in part, to any of the Borrower’s Liabilities as the Lender shall determine in its sole discretion without affecting the validity or enforceability of this Guaranty.

1.7 INFORMATION

The Guarantor hereby assumes responsibility for keeping itself informed of the financial condition of the Borrower, and any and all endorsers of any instrument or document evidencing all or any part of the Borrower’s Liabilities and of all other circumstances bearing upon the risk of nonpayment of the Borrower’s Liabilities or any part thereof that diligent inquiry would reveal, and the Guarantor hereby agrees that the Lender shall not have any duty to advise the Guarantor of information known to any of them regarding such condition or any such circumstances or to undertake any investigation not a part of its respective regular business routines. If the Lender, in its sole discretion, undertakes at any time or from time to time to provide any such information to the Guarantor, the Lender shall not be under any obligation to update any such information or to provide any such information to the Guarantor on any subsequent occasion.

1.8 REINSTATEMENT

The Guarantor consents and agrees that the Lender shall not be under any obligation to marshal any assets in favor of the Guarantor or against or in payment of any or all of the Borrower’s Liabilities. The Guarantor further agrees that, to the extent that the Borrower makes a payment or payments to the Lender or the Lender receives any proceeds of collateral, which payment or payments or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to the Borrower, its estate, trustee, receiver or any other party, including, without limitation, the Guarantor, under any bankruptcy law or state or federal statutory or common law, then to the extent of such payment or repayment, the Borrower’s Liabilities or the part thereof which has been paid, reduced or satisfied by such amount, and the Guarantor’s obligations hereunder with respect to such portion of the Borrower’s Liabilities, shall be reinstated and continued in full force and effect as of the date such initial payment, reduction or satisfaction occurred. Notwithstanding anything else to the contrary contained herein, the Guarantor consents and agrees that this Guaranty shall continue to be effective or be reinstated, as the case may

be, if at any time any payment of any of the Borrower’s Liabilities is rescinded or must otherwise be returned by any Lender or any other Person upon the insolvency, bankruptcy or reorganization of the Borrower or the Guarantor or otherwise, all as though such payment had not been made (each such continuation or reinstatement, a “Reinstatement Event”).

1.9 ASSIGNMENTS BY LENDER

The Lender may, to the extent and in the manner set forth in the Loan Agreement, sell or assign the Borrower’s Liabilities or any part thereof, or grant participations therein, and in any such event each and every permitted assignee or holder of, or participant in, all or any of the Borrower’s Liabilities shall have the right to enforce this Guaranty, by suit or otherwise for the benefit of such assignee, holder, or participant, as fully as if herein by name specifically given such right.

ARTICLE 2

REPRESENTATIONS AND WARRANTIES

The Guarantor hereby represents and warrants that:

(a) it is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware;

(b) it is duly authorized and empowered to execute and deliver this Guaranty;

(c) all corporate action on the part of the Guarantor requisite for the due execution and delivery of this Guaranty and the due granting and creation of the security interests referred to herein has been duly and effectively taken;

(d) the principal business address is located at c/o Moscow CableCom Corp., 595 Madison Ave., 38^th Floor, New York, NY 10022;

(e) the execution, delivery and performance of this Guaranty will not result in any violation of, conflict with, or result in a breach of, any of the terms of, or constitute a default under, any Material Contracts, court orders or consent decrees, the Certificate of Incorporation or the By-laws, as amended, of the Guarantor;

(f) this Guaranty is a valid and binding obligation of Guarantor, enforceable against Guarantor in accordance with its terms, except as the enforceability thereof may be subject to or limited by bankruptcy, insolvency, reorganization, arrangement, moratorium or other similar laws relating to or affecting the rights of creditors generally;

(g) neither Guarantor nor its property has any immunity from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) under applicable law;

(h) the incurrence of Guarantor’s obligations under this Guaranty will not cause Guarantor to (i) become insolvent; (ii) be left with unreasonably small capital for any business or transaction in which Guarantor is presently engaged or plans to be engaged; or (iii) be unable to pay its debts as such debts mature; and

(i) all representations and warranties contained in this Guaranty shall be true at the time of Guarantor’s execution of this Guaranty, and shall continue to be true so long as this Guaranty is in effect.

ARTICLE 3

MISCELLANEOUS

3.1 SUCCESSORS AND ASSIGNS; ASSIGNMENT BY GUARANTOR

This Guaranty shall be binding upon the Guarantor and upon the successors (including without limitation, any receiver, trustee or debtor in possession of or for the Guarantor) of the Guarantor and shall inure to the benefit of the Lender and their respective successors and permitted assigns. Notwithstanding anything contained herein to the contrary, this Guaranty may not be assigned by the Guarantor without the prior written consent of the Lender.

3.2 TERM OF GUARANTY

This Guaranty shall continue in full force and effect, and the Lender shall be entitled to make loans and advances and extend financial accommodations to the Borrower on the faith hereof, until the Loan Agreement has been terminated and the Notes canceled and the indefeasible payment in full in cash of the Borrower’s Liabilities and all other amounts payable under this Guaranty has occurred. The Guarantor hereby unconditionally and irrevocably waives any right to revoke this Guaranty and acknowledges that this Guaranty is continuing in nature and applies to all Borrower’s Liabilities, whether existing now or in the future.

3.3 SEVERABILITY

Wherever possible each provision of this Guaranty shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Guaranty shall be prohibited by or invalid under such law, such provision shall be ineffective to the extent of such prohibition or invalidity without invalidating the remainder of such provision or the remaining provisions of this Guaranty.

3.4 GOVERNING LAW

THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WHEREIN THE TERMS OF THIS GUARANTY WERE NEGOTIATED, EXCLUDING TO THE GREATEST EXTENT PERMITTED BY LAW ANY RULE OF LAW THAT WOULD CAUSE THE APPLICATION OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK.

3.5 CONSENT TO JURISDICTION

3.6 WAIVER OF JURY TRIAL

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, this Guaranty has been duly executed by the undersigned as of the date first written above.


MOSCOW CABLECOM CORP.
By:	/s/ Andrew Intrater
	Name:	Andrew Intrater
	Title:	Chairman

EX-99.34 6 f27637a9exv99w34.htm EXHIBIT 34 exv99w34

Exhibit 34

DATED 21 FEBRUARY, 2007

	(1)		MOSCOW CABLECOM CORP. (as “Company”)

	(2)		ZAO COMCOR-TV (as “Borrower”)

	(3)		OTHERS (as referred to herein)

	(4)		RME FINANCE LTD (formerly known as COLUMBUS NOVA DF LIMITED) (as “Original Lender”)

	(5)		RME FINANCE LTD (formerly known as COLUMBUS NOVA DF LIMITED) (as “Agent” and “Security Agent”)

AMENDMENT AGREEMENT No. 5
TO $28,500,000 FACILITY AGREEMENT
DATED 26 AUGUST 2004

This Amendment Agreement is made and entered into as of February 21, 2007 (this “Agreement”), by and among:

(1)

MOSCOW CABLECOM CORP., a Delaware corporation (the “Company”),

(2)

ZAO COMCOR-TV, a closed joint stock company organized under the laws of the Russian Federation and a wholly-owned subsidiary of the Company (the “Borrower”),

(3)

THE SUBSIDIARIES of the Company identified on the signature pages hereto (collectively, the “Subsidiary Guarantors”),

(4)

RME FINANCE LTD, formerly known as Columbus Nova DF Limited, a company incorporated under the laws of Cyprus (the “Original Lender”),

(5)

RME FINANCE LTD, formerly known as Columbus Nova DF Limited, as Agent and Security Agent of the Finance Parties (in such capacity the “Agent”),

(collectively, the “Parties”).

WHEREAS:

(A) The Company, the Borrower, the Obligors, the Original Lender, the Agent and the Security Agent entered into a $28,500,000 Facility Agreement on the 26th day of August 2004 (as amended and supplemented from time to time, the “Loan Agreement”).

(B) The Original Lender, Agent and Security Agent, changed its legal name from “COLUMBUS NOVA DF LIMITED” to “RME FINANCE LTD” such change of name having been certified by the certificate of change of name No. HE149098/HE46, dated February 1, 2006, by the Registrar of Companies, Republic of Cyprus.

(C) The Company, the Borrower and RME FINANCE LTD have proposed to enter into a Bridge Facility Agreement, of even date herewith (as amended, modified or supplemented from time to time in accordance with the terms thereof the “Bridge Loan Agreement”), providing for, among other things the incurrence of indebtedness by the Borrower and the guaranty of such indebtedness by the Company pursuant to the terms thereof and the other Transaction Documents, as that term is defined therein (collectively, as amended, modified or supplemented from time to time in accordance with the terms thereof, together with the Bridge Loan Agreement, the “Bridge Loan Documents”).

(D) The Company, Renova Media Enterprises Ltd., a Bahamian corporation, and Galaxy Merger Sub Corporation, a Delaware corporation (“Sub”), have entered into that certain Agreement and Plan of Merger, dated as of the date hereof (as amended, modified or supplemented from time to time in accordance with the terms thereof, the “Merger Agreement”), providing for the merger of Sub, in accordance with and subject to the terms thereof, with and into the Company, with the Company being the surviving corporation (the “Merger”).

(E) The Company has advised the Agent that certain Events of Default have occurred and exist under the Loan Agreement resulting from (collectively, the “Existing Defaults”) the matters identified on Schedule 1 attached hereto.

(F) Pursuant to the Loan Agreement, the Borrower and the Company are prohibited from incurring indebtedness under the Bridge Loan Agreement and the Company is prohibited from entering into the Merger Agreement and from consummating the Merger (the “Proposed Transactions”). The Obligors have requested that the Original Lender and Agent consent to the Pending Transactions and waive the Existing Defaults. Subject to and on the terms set forth herein, the Original Lender and Agent have agreed to provide such consents and waivers.

(G) The Parties have further agreed to amend the Loan Agreement on the terms set out below.

NOW IT IS HEREBY AGREED as follows:

DEFINITIONS AND INTERPRETATION.

1.1.

Capitalized terms used and not otherwise defined herein shall have the respective meanings set forth in the Loan Agreement.

1.2.

“Effective Date”. This Agreement shall become effective on the date on which the Agent has notified the Company that it has received in form and substance satisfactory to the Agent appropriate corporate authorizations of the Obligors party hereto authorizing the entry into and the performance of this Agreement.

1.3.

References to Clauses and Schedules herein are to Clauses and Schedules in the Loan Agreement. References to Sections herein are to sections in this Agreement.

1.4.

The Original Lender’s, the Agent’s and the Security Agent’s previous legal name “COLUMBUS NOVA DF LIMITED” shall be deleted in all instances it appears in the Loan Agreement, and the Original Lender’s, the Agent’s and the Security Agent’s new legal name “RME FINANCE LTD” shall be inserted in place thereof. The Parties acknowledge and agree that the references to “RME MANAGEMENT LTD.” and “RME MNAGEMENT LTD.” in Amendment No. 3 to the Loan Agreement dated as of May 5, 2006 and in Amendment No. 4 to the Loan Agreement dated as of September 21, 2006 were in error, and all such references are, and shall be deemed to be, to “RME FINANCE LTD, formerly known as COLUMBUS NOVA DF LIMITED”.

LIMITED CONSENT AND WAIVER

2.1.

The Original Lender and the Agent hereby consent to the Proposed Transactions. The Agent and the Original Lender further agree that a cancellation or suspension of the obligation of RME FINANCE LTD, as lender under the Bridge Loan Agreement, to provide a Loan on a Funding Date, as that term is defined in the Bridge Loan Agreement, in accordance with its terms (other than as a result of an Event of Default under the Bridge Loan Agreement) shall not, by itself, give rise to an Event of Default under the Loan Agreement.

2.2.

The Original Lender and the Agent hereby waive the Existing Defaults.

2.3.

The Obligors party hereto consent to the dissolution of Ney Technology, Inc. and New Jersey Precious Metals, Inc., and waive any rights to notice of, or rights to consent to, such entities’ dissolution or retirement from the Loan Agreement.

AMENDMENTS TO THE LOAN AGREEMENT.

3.1.

The Parties hereby agree that the provisions of the Loan Agreement are hereby amended or supplanted, as applicable, with effect on and from the Effective Date in the following manner:

	3.1.1.		The following new defined terms are inserted into Section 1.1 of the Loan Agreement in alphabetical order:

			“2007 Bridge Debt” means any and all loans, advances, obligations and liabilities of the Company and the Borrower now existing or hereafter arising, primary or secondary, arising under or relating to the 2007 Bridge Loan Agreement, the Notes (as that term is defined therein), the Guaranty (as that term is defined therein), and any other Transaction Document (as that term is defined therein), in each case as amended from time to time including (i) all principal of and interest (including any interest which accrues after the commencement of any case, proceeding or other actions relating to the bankruptcy, insolvency or reorganization of the Borrower or the Company) on any loans or other extensions of credit under the 2007 Bridge Loan Agreement, or any Notes issued thereunder and all costs of collection, fees and expenses associated therewith, (ii)

			all other amounts payable by the Borrower or the Company under any such Transaction Document.
			“2007 Bridge Loan Agreement” means the Bridge Facility Agreement dated as of February 21, 2007, by and among the Borrower, the Company and RME FINANCE LTD, a corporation formed under the laws of Cyprus, as the same may be amended, modified or supplemented from time to time in accordance with the terms thereof.

			“Amendment No. 5” means the Amendment Agreement No. 5 to $28,500,000 Facility Agreement, dated as of February 21, 2007, by and among the Company, the Borrower, the other Obligors, the Original Lender, the Agent and the Security Agent.

			“Merger Agreement” means the Agreement and Plan of Merger, dated as of February 21, 2007, by and among RENOVA MEDIA ENTERPRISES LTD., the Company and GALAXY MERGER SUB CORPORATION, a Delaware corporation, as the same may be amended, modified or supplemented from time to time in accordance with the terms thereof.

			“Qualified Take-Out Lender” means the Person making a “Superior Proposal” (as that term is defined in the Merger Agreement), an Affiliate of such Person or an investment bank or commercial or finance lender (regularly engaged in the business of lending money, and is not a direct competitor of the Original Lender or its Affiliates), who extends a loan to the Borrower to prepay the 2007 Bridge Debt in connection with such Superior Proposal (“Third Party Lender”), which Superior Proposal has been memorialized in a definitive written agreement to consummate the transactions contemplated thereby, duly executed and delivered by the Company and such Person, and on the basis of which the Company has caused the Merger Agreement to be terminated pursuant to Section 9.3(e) thereof.

	3.1.2.		The word “and” is deleted from the end of Clause 17.7(d), and the period at the end of Clause 17.7(e) is replaced with “; and”.

	3.1.3.		New Clauses 17.7(f) and 17.7(g) are inserted into the Loan Agreement immediately following Clause 17.7(e), that read as follows:

			“(f) indebtedness of the Borrower owing to RME FINANCE LTD or its permitted successors and assigns that, at all times, satisfies each and all of the following requirements:

(i) the aggregate original principal amount of such indebtedness does not exceed $45,000,000;

(ii) such indebtedness is not secured by any form of Security over any assets of the Borrower, any Guarantor, or any other member of the Group;

(iii) such indebtedness is not guarantied by, and no credit support is provided by, any Person other than the Company;

(iv) all of such indebtedness is incurred pursuant to, and is on substantially the terms and conditions set forth in, the 2007 Bridge Loan Agreement and evidenced by one or more unsecured subordinated promissory notes in the form attached to the 2007 Bridge Loan Agreement as Exhibit A thereto (collectively the “2007 Bridge Notes”); and

(v) such indebtedness, and any rights and powers of the holder with respect thereto, are, at all times, subject to a valid and binding subordination agreement in substantially the form attached as Exhibit A to the Amendment No. 5.

(g) indebtedness of the Borrower owing to the Qualified Take-Out Lender that satisfies each and all of the following requirements:

(i) prior to or simultaneously with the incurrence of such indebtedness, the 2007 Bridge Debt is indefeasibly repaid in full, in cash;

(ii) all of the proceeds of such indebtedness are first used exclusively to repay the 2007 Bridge Debt;

(iii) the aggregate principal amount of such indebtedness does not exceed the outstanding amount of the 2007 Bridge Debt plus an amount equal to any remaining unfunded principal under the 2007 Bridge Loan Agreement (which sum, in any event, shall not exceed $45,000,000 in the aggregate);

(iv) such indebtedness is not secured by any form of Security over any assets of the Borrower, any Guarantor, or any other member of the Group;

(v) such indebtedness is not guarantied by, and no credit support is provided by, any Person other than the Company or the Person or an Affiliate of such Person making a Superior Proposal, if applicable;

(vi) all of such indebtedness is incurred pursuant to, and is on terms and conditions that, both individually and in the aggregate, are the same or better (from the prospective of the Borrower and the Company) than those set forth in the 2007 Bridge Loan Agreement and the 2007 Bridge Notes; and

(vii) such indebtedness, and any rights and powers of the holder with respect thereto, are at all times subject to a valid and binding subordination agreement in substantially the form attached as Exhibit A to Amendment No. 5.”

CONTINUING OBLIGATIONS.

The Obligors acknowledge and agree that the Loan Agreement and the guaranties, security agreements, pledge agreements, documents, instruments and other agreements entered into in connection therewith, each as amended from time to time, shall be and continue in full force and effect in accordance with their respective terms and hereby are ratified and confirmed in all respects. Neither the execution, delivery, and performance of this Agreement and nor any Bridge Loan Document shall operate, or be construed to operate, as a waiver of, or, other than as expressly set forth herein, as an amendment of, any right, power, or remedy of the Original Lender or Agent under the Loan Agreement or any of the documents, deeds, instruments or agreements entered into in connection therewith. The consents and waivers provided herein: (a) in no way shall be deemed an agreement by the Agent or the Original Lender to waive any covenant, liability or obligation of any Obligor or any third party or to waive any right, power, or remedy of the Agent or the Original Lender; (b) shall not limit or impair the Agent or the Original Lender’s right to demand strict performance of each Obligor’s liabilities and obligations to the Agent and the Original Lender under the Loan Agreement at all times following consummation of the Proposed Transactions; (c) in no way shall obligate the Agent or the Original Lender to make any future waivers, consents or modifications to the Loan Agreement, and (d) is not a continuing waiver with respect to any failure to perform any obligation. Nothing in this Agreement shall constitute a satisfaction of any Obligor’s obligations under the Loan Agreement.

REPRESENTATIONS AND WARRANTIES.

Each Obligor hereby represents and warrants to the Original Lender and the Agent that: (a) each of the representations and warranties set forth in the Loan Agreement are true and correct as of the date hereof, (b) that, other than the Existing Defaults, no default or Event of Default or failure of condition has occurred or exists, or would exist with notice or lapse of time or both under the Loan Agreement.

COSTS.

The Company shall, within three Business Days of demand, reimburse the Original Lender for the amount of all costs and expenses (including reasonable legal fees) incurred by the Original Lender, the Agent and the Security Agent in connection herewith.

NO THIRD PARTY RIGHTS.

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

COUNTERPARTS.

This Amendment may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one instrument.

GOVERNING LAW.

This Agreement shall be governed by English law. The provisions of Clause 34 of the Loan Agreement shall be incorporated herein, mutatis mutandis. Each of the Parties shall do all such things as may reasonably be with in its power and execute and deliver all such deeds and documents as may be necessary to give effect to this Agreement.

[The Remainder of Page Left Blank]

IN WITNESS whereof the parties have executed and delivered this Agreement as a deed the day and year first written above.


		MOSCOW CABLECOM CORP., as Company and Original Guarantor

		By:		/s/ Andrew Intrater

		Name:		Andrew Intrater
		Title:		Chairman

		ZAO COMCOR-TV, as Borrower

		By:		/s/ Mikhail Silin

		Name:		Mikhail Silin
		Title:		General Director

		AGI TECHNOLOGY, INC., as Original Guarantor

		By:		/s/ Andrew M. O’Shea

		Name:		Andrew M. O’Shea
		Title:		President

		ANDERSEN LAND CORP., as Original Guarantor

		By:		/s/ Andrew M. O’Shea

		Name:		Andrew M. O’Shea
		Title:		President

		ABC MOSCOW BROADBAND COMMUNICATION LIMITED, as Original Guarantor

		By:		/s/ Andrew M. O’Shea

		Name:		Andrew M. O’Shea
		Title:		Treasurer

Signature Page to Amendment Agreement No. 5


		RME FINANCE LTD, as Original Lender

		By:		/s/ Vladimir Kuznetsov

		Name:		Vladimir Kuznetsov
		Title:		Attorney in Fact

		RME FINANCE LTD, as Agent and Security Agent

		By:		/s/ Vladimir Kuznetsov

		Name:		Vladimir Kuznetsov
		Title:		Attorney in Fact

Signature Page to Amendment Agreement No. 5

EXHIBIT A
TO AMENDMENT NO. 5

FORM OF SUBORDINATION AGREEMENT

[TEXT OMITTED: SEE EXHIBIT 35 OF SCHEDULE 13D]

EX-99.35 7 f27637a9exv99w35.htm EXHIBIT 35 exv99w35

Exhibit 35

SUBORDINATION AGREEMENT

This Subordination Agreement (this “Subordination Agreement”) is made as of February 21, 2007 by and between RME FINANCE LTD, formerly known as AMATOLA ENTERPRISES LIMITED, a company incorporated under the laws of Cyprus, as and in its capacity as Agent and Security Agent pursuant to that certain Facility Agreement, defined below (in such capacity, the “Agent”) and RME FINANCE LTD, as lender pursuant to that certain Bridge Agreement as defined below (“Subordinated Creditor”).

A. Pursuant to the Facility Agreement dated as of August 26, 2004 (as amended, modified, supplemented, restated or extended from time to time, the “Facility Agreement”), by and among MOSCOW CABLECOM CORP., a Delaware corporation (the “Company”), ZAO COMCOR-TV, a closed joint stock company organized under the laws of the Russian Federation and a wholly-owned subsidiary of the Company (the “Borrower”), and certain subsidiary guarantors of the Company from time to time party thereto (together with the Company, the “Guarantors” and together with the Company and the Borrower, the “Obligors”), and RME FINANCE LTD, as Agent for itself and the other lenders from time to time party thereto (the “Senior Lenders” or collectively with the Agent, the “Senior Creditors”), the Senior Creditors have made loans or have extended other credit accommodations to the Borrower that have been unconditionally guarantied by the Guarantors. The obligations of the Obligors under the Facility Agreement and the documents and instruments entered into in connection therewith are or may be from time to time secured by assets and properties of the Obligors.

B. The Borrower and the Company propose to enter into that certain Bridge Facility Agreement, dated as of February 21, 2007 (as amended from time to time, the “Bridge Agreement”) with Subordinated Creditor providing for the extension of unsecured loans by Subordinated Creditor to the Borrower in an amount up to $45,000,000.00 on and subject to the terms and conditions set forth therein, which loans will be guarantied by the Company pursuant to a Continuing Unconditional Guaranty, of even date with the Bridge Agreement, in favor of Subordinated Creditor (as amended from time to time, the “Guaranty”). Loans made pursuant to the Bridge Agreement will be further evidenced by one or more unsecured subordinated promissory notes (each a “Note” and collectively, the “Notes”).

C. It is a condition to the Agent’s consent to, among other things, the incurrence of indebtedness under the Bridge Agreement that Subordinated Creditor enter into this Subordination Agreement to confirm that, among other things, any and all amounts owing to Subordinated Creditor (or any subsequent holder of any Note) under or pursuant to the Bridge Agreement or any Note be subordinated in right of payment to the prior payment in full of any and all Senior Debt of the Company and the Borrower (as defined below).

D. Subordinated Creditor is willing to subordinate: (i) all of the Borrower’s and all of the Company’s respective indebtedness, obligations and liabilities to Subordinated Creditor now existing or hereafter arising, primary or secondary, arising under or relating to the Bridge Agreement, the Notes, the Guaranty or any other “Transaction Document” (as that term is defined in the Bridge Agreement in effect on the date hereof) and any and all documents, instruments and agreements entered into in connection therewith, in each case as amended from time to time including all principal of and interest (including any interest which accrues after the commencement of any case, proceeding or other actions relating to the bankruptcy, insolvency or reorganization of the Borrower or the Company) on any loans or other extensions of credit under or in connection with the Bridge Agreement, and any all costs of collection, fees and expenses associated therewith (the “Subordinated Debt”) to all of the Borrower’s and all of the Company’s respective indebtedness, obligations, and liabilities to the Senior Creditors now existing or hereafter arising, primary or secondary, arising under or relating to the Facility Agreement, the other “Finance Documents” (as that term is defined in the Facility Agreement) and any and all documents, instruments and agreements entered into in connection therewith, in each case as amended from time to time including all principal of and interest (including any interest which accrues after the commencement of any case, proceeding or other actions relating to the bankruptcy, insolvency or reorganization of the Borrower or the Company) on any loans or other extensions of credit under or in connection with the Facility Agreement, and any all costs of collection, fees and expenses associated therewith (the “Senior Debt”), and (ii) all of Subordinated Creditor’s liens and security interests, if any, in any Obligor’s property, to all of Agent’s or any other Senior Creditor’s liens and security interests in such property. Capitalized terms not otherwise defined herein, shall have the meanings given in the Facility Agreement.

Now, therefore, the parties agree as follows:

1. Subordination of Security. Subordinated Creditor hereby subordinates to the Senior Creditors any Security that Subordinate Creditor may have on any property of any Obligor. Notwithstanding the respective dates of attachment or perfection of the Security of Subordinated Creditor, if any, and the Security of the Senior Creditors, the Security held by or in favor of any Senior Creditor, shall at all times be prior to the Security of Subordinated Creditor. Nothing herein shall, or be deemed to, impair or prejudice the terms and restrictions under Clauses 17.3 or 17.7 of the Facility Agreement.

2. Subordination to Senior Debt.

(a) Notwithstanding anything to the contrary contained in the Bridge Agreement or the other Transaction Documents, Subordinated Creditor covenants and agrees, that the Bridge Agreement, the Notes, the Guaranty and the other Transaction Documents shall be and are issued subject to the provisions of this Subordination Agreement; and each person holding any Note, whether upon original issuance or upon transfer, assignment or exchange thereof accepts and agrees that all payments on or in respect of the Subordinated Debt shall, to the extent and in the manner set forth in this Subordination Agreement, be subordinated and junior in right of payment, to the prior and indefeasible payment in full in cash of all amounts payable on or under any and all Senior Debt (including principal, interest, fees, commissions, expenses and indemnities in respect thereof and any interest accruing subsequent to the commencement or filing of any petition in any bankruptcy or insolvency proceeding at the rate provided for in the documents governing such Senior Debt, whether or not such interest is an allowed claim enforceable against the debtor in a bankruptcy or insolvency proceeding).

(b) The Subordinated Creditor will not demand or receive from, or on behalf of, any Obligor (and no Obligor will pay to Subordinated Creditor), directly or indirectly, all or any part of the Subordinated Debt, by way of payment, prepayment, setoff, lawsuit or otherwise, nor will the Subordinated Creditor exercise any right or remedy with respect to the any Obligor or any of their assets or properties, nor will the Subordinated Creditor commence, or cause to commence, prosecute or participate in any administrative, legal or equitable action against any Obligor, for so long as any portion of the Senior Debt remains outstanding. Notwithstanding the foregoing, Subordinated Creditor shall be entitled to receive each regularly scheduled quarterly payment of interest under the Bridge Agreement, as in effect on the date hereof, provided that no Event of Default or event or circumstance which, with the giving of notice, the lapse of time, or both, would constitute an Event of Default, exists immediately before or after giving effect to such payment.

(c) To the extent any payment of Senior Debt (whether by or on behalf of the Company or any other Obligor, as proceeds of Security or enforcement of any right of setoff or otherwise) is declared to be fraudulent or preferential, set aside or required to be paid to a trustee, receiver, liquidator or other similar party under any bankruptcy, insolvency, receivership, liquidation, fraudulent conveyance or similar law, then if such payment is recovered by, or paid over to, such trustee, receiver, liquidator or other similar party, the Senior Debt or part thereof originally intended to be satisfied shall be deemed to be reinstated and outstanding as if such payment had not occurred. To the extent the obligation to repay any Senior Debt is declared to be fraudulent, invalid or otherwise set aside under any bankruptcy, insolvency, receivership, liquidation, fraudulent conveyance or similar law, then the obligations so declared fraudulent, invalid or otherwise set aside (and all other amounts which would come due with respect thereto had such obligations not been so affected) shall be deemed to be reinstated and outstanding as Senior Debt for all purposes hereof as if such declaration, invalidity or setting aside had not occurred.

3. Turnover. The Subordinated Creditor shall immediately deliver to the Agent in the form received (except for endorsement or assignment by the Subordinated Creditor where required by the Agent) for application to the Senior Debt, any payment, distribution, Security or proceeds received by the Subordinated Creditor in respect of the Subordinated Debt, other than in strict accordance with this Subordination Agreement. Without limiting the foregoing, in the event that, notwithstanding the foregoing, any payment shall be received by Subordinated Creditor when such payment is prohibited by this Subordination Agreement, such payment shall be held in trust for the sole benefit of, and shall be paid over or delivered to, the Agent for the benefit of the Senior Lenders.

4. Payment Over of Proceeds Upon Dissolution, Etc.

(a) Upon any payment or distribution of assets or securities of any Obligor, of any kind or character, whether in cash, property or securities, upon any dissolution or winding-up or total or partial liquidation or reorganization of any Obligor, whether voluntary or involuntary or in bankruptcy, insolvency, receivership, liquidation or other proceeding, all amounts due or to become due upon all Senior Debt (including interest accruing subsequent to the commencement or filing of any petition in any bankruptcy or insolvency proceeding at the rate provided for in the documents governing such Senior Debt, whether or not such interest is an allowed claim enforceable against the debtor in a bankruptcy case under Title 11 of the United States Code) shall first be indefeasibly paid in full, in cash, before Subordinated Creditor shall be entitled to receive any payment on account of the Subordinated Debt, or any payment to acquire the Subordinate Debt or any Note for cash, property or securities or any distribution with respect to the Subordinated Debt or any Note of any cash, property or securities. Before any payment may be in respect of the Subordinated Debt, upon any such dissolution, winding-up, liquidation or reorganization, any payment or distribution of assets or securities of any Obligor of any kind or character, whether in cash, property or securities, to which Subordinated Creditor the holder of any Note would be entitled, except for the provisions of this Subordination Agreement, shall be made by such Obligor or by any receiver, liquidator, administrator, trustee in bankruptcy, liquidating trustee, agent or other Person making such payment or distribution, or by Subordinated Creditor or the holder of a Note if received by it, directly to the holders of Senior Debt (pro rata to such holders on the basis of the respective amounts of Senior Debt held by such holders) or their respective representatives, including the Agent, as their respective interests may appear, to the extent necessary to pay all such Senior Debt indefeasibly in full, in cash, after giving effect to any concurrent payment, distribution or provision therefor to or for the holders of such Senior Debt.

(b) In the event that, notwithstanding the foregoing provision prohibiting such payment or distribution, any payment or distribution of assets or securities of an Obligor of any kind or character, whether in cash, property or securities, shall be received by the Subordinated Creditor or any holder of any Note at a time when such payment or distribution is prohibited by Section 4(a) of this Subordination Agreement and before all obligations in respect of Senior Debt are indefeasibly paid in full, in cash, such payment or distribution shall be received and held in trust for the sole benefit of, and shall be paid over or delivered to, the holders of Senior Debt (pro rata to such holders on the basis of the respective amount of Senior Debt held by such holders) or their respective representatives, including the Agent, as their respective interests may appear, for application to the payment of Senior Debt remaining unpaid until all such Senior Debt has been indefeasibly paid in full in cash or cash equivalents, after giving effect to any concurrent payment, distribution or provision therefor to or for the holders of such Senior Debt.

5. Subrogation. Upon the indefeasible payment in full of all Senior Debt in cash, the Subordinated Creditor shall be subrogated to the rights of the holders of Senior Debt to receive payments or distributions of cash, property or securities of the Borrower and the Company made on such Senior Debt until the principal of, premium, if any, and interest on the Subordinated Debt shall be paid in full; and, for the purposes of such subrogation, no payments or distributions to the holders of the Senior Debt of any cash, property or securities to which the Subordinated Creditor would be entitled except for the provisions of this Subordination Agreement and no payment over pursuant to the provisions of this Subordination Agreement to the holders of Senior Debt by the Subordinated Creditor shall, as between the Borrower or the Company, their respective creditors, other than the Senior Creditors, and the Subordinated Creditor, be deemed to be a payment by the Borrower or the Company to or on account of the Senior Debt; and no payments or distributions of cash, property or securities to or for the benefit of the Subordinated Creditor pursuant to the subrogation provisions hereof which would otherwise have been paid to the Senior Creditors shall be deemed to be a payment by the Borrower or the Company to or for the account of the holder of the Subordinated Creditor. It is understood that the provisions of this Subordination Agreement are and are intended solely for the purpose of defining the relative rights of the Subordinated Creditor, on the one hand, and the Senior Creditors, on the other hand.

6. Obligations of Company Unconditional. Nothing contained in this Subordination Agreement is intended to or shall impair, as among the Borrower, the Company and the Subordinated Creditor, the obligations of the Borrower or the Company, which are absolute and unconditional, to pay to the Subordinated Creditor the principal of and interest on the Subordinated Debt as and when the same shall become due and payable

in accordance with its terms, or is intended to or shall affect the relative rights of the Subordinated Creditor and creditors of the Borrower or the Company other than the Senior Creditors.

7. Subordination Rights Not Impaired by Acts or Omissions of the Company or Holders of Senior Debt. No right of any present or future Senior Creditors to enforce subordination as provided herein will at any time in any way be prejudiced or impaired by any act or failure to act on the part of any Obligor or by any act or failure to act by any Senior Creditor, or by any noncompliance by the Borrower or the Company with the terms of the Subordinated Debt, regardless of any knowledge thereof which any such Senior Creditor may have or otherwise be charged with. The provisions of this Subordination Agreement are intended to be for the benefit of, and shall be enforceable directly by, the Senior Creditors.

8. Reliance of Holders of Senior Debt. Subordinated Creditor acknowledges and agrees that these subordination provisions are, and are intended to be, an inducement to and a consideration of each Senior Creditor, whether such Senior Debt was created or acquired before or after the creation of the indebtedness evidenced by the Bridge Agreement or the Notes, and each such holder of Senior Debt shall be deemed conclusively to have relied on such subordination provisions in acquiring and holding, or in continuing to hold, such Senior Debt.

9. No Waiver of Subordination Provisions. Without in any way limiting the generality of Section 7, the Senior Creditors may, at any time and from time to time, without the consent of or notice to the Subordinated Creditor, without incurring responsibility to the Subordinated Creditor and without impairing or releasing the subordination provided in this Subordination Agreement or the obligations hereunder of the Subordinated Creditor to the Senior Creditors, take such actions with respect to the Senior Debt as they, or any one of them, may deem appropriate, including, without limitation: (a) change the manner, place or terms of payment or extend the time of payment of, or renew, amend or alter, the Senior Debt (including increasing the principal amount, increasing applicable interest rates) or any instrument evidencing the same or any agreement under which Senior Debt is outstanding or secured; (b) sell, exchange, release or otherwise deal with any property pledged, mortgaged or otherwise securing Senior Debt; (c) release any Person liable in any manner for the payment or collection of Senior Debt, (d) exercise or refrain from exercising any rights against the Borrower, Company or any other Person, (e) terminating advances to the Borrower, (f) compromising the Senior Debt. No such action or inaction shall impair or otherwise affect the Senior Creditors’ rights hereunder.

10. Legend; Amendments. Subordinated Creditor shall immediately affix a legend to the instruments evidencing the Subordinated Debt stating that the instruments are subject to the terms of this Subordination Agreement. No amendment of the documents evidencing or relating to the Subordinated Debt shall directly or indirectly modify the provisions of this Subordination Agreement in any manner which might terminate. By way of example, such instruments shall not be amended to (i) increase the rate of interest with respect to the Subordinated Debt, or (ii) accelerate the payment of the principal or interest or any other portion of the Subordinated Debt. The Subordinated Creditor represents, warrants and covenants to the Agent that it does not, and will not, at any time hold Security for payment of the Subordinated Debt.

11. Amendment, Supplement and Waiver. This Subordination Agreement may only be amended, modified or supplemented by a written instrument executed by the Agent and the Subordinated Creditor. Any amendment or waiver effected in accordance with this Section 11 shall be binding upon the Subordinated Creditor and the Obligors.

12. Successors and Assigns. This Subordination Agreement shall be binding upon and inure to the benefit of the successors and assigns of the parties hereto.

13. Governing Law. This Subordination Agreement shall be construed and enforced in accordance with, and governed by, the internal laws of the State of New York, excluding that body of law applicable to conflicts of laws.

[The Remainder of Page Left Blank]

IN WITNESS WHEREOF, each party has caused this Subordination Agreement to be executed as of the date first set forth above.


		AGENT:

		RME FINANCE LTD, AS AGENT

		By:		/s/ Vladimir Kuznetsov

		Name:		Vladimir Kuznetsov
		Title:		Attorney in Fact


		SUBORDINATED CREDITOR:

		RME FINANCE LTD

		By:		/s/ Vladimir Kuznetsov

		Name:		Vladimir Kuznetsov
		Title:		Attorney in Fact


Acknowledged and Agreed:

THE BORROWER:

ZAO COMCOR-TV

By:		/s/ Mikhail Silin

Name:		Mikhail Silin
Title:		General Director


THE COMPANY:

MOSCOW CABLECOM CORP.

By:		/s/ Andrew Intrater

Name:		Andrew Intrater
Title:		Chairman

Signature Page to Subordination Agreement

EX-99.36 8 f27637a9exv99w36.htm EXHIBIT 36 exv99w36

Exhibit 36

FOR IMMEDIATE DISTRIBUTION


MOSCOW CABLECOM Contact(s):		RENOVA MEDIA Contacts:

Andrew M. O’Shea		English Language Media:
Secretary		Stan Neve or Erin Becker
860.298.0444		Brunswick Group, New York
aoshea@moscowcablecom.com		Phone: + 1 212 333 3810

Barbara Cano		Russian Language Media:
Breakstone Group International		Andrey A. Shtorkh
646.452.2334		Renova Group, Moscow
bcano@breakstone-group.com		Phone: + 7 495 975 0240

MOSCOW CABLECOM AND RENOVA MEDIA SIGN
DEFINITIVE MERGER AGREEMENT

Negotiated Price of $12.90 in Cash Per Common Share
for Moscow CableCom Shares Not Directly Owned by Renova Media

New York, United States, February 21, 2007 — Moscow CableCom Corp. (NASDAQ: MOCC) and Renova Media Enterprises Ltd. jointly announced today that they have entered into a definitive merger agreement under the terms of which Renova Media, the largest single holder of Moscow CableCom’s voting securities, would acquire the equity interest in Moscow CableCom that it does not currently own at a cash price of $12.90 per share of Moscow CableCom’s common stock and an equivalent as-converted price for Moscow CableCom’s Series A convertible preferred stock.

The merger agreement was approved by Moscow CableCom’s board of directors upon the unanimous recommendation of a special committee of independent directors formed to review and evaluate Renova Media’s previously announced November 4, 2006 proposal for a negotiated acquisition of the company and to consider the company’s options.

The $12.90 price per share of Moscow CableCom’s common stock represents a 29.1% premium over the November 3, 2006 closing price (the day prior to Moscow CableCom’s receipt of Renova Media’s original proposal), a 34.3% premium over the one-month volume-weighted average closing price for the month preceding Renova Media’s original proposal, a 19.4% increase in the $10.80 price per common share originally proposed by Renova Media and a 7.5% increase in the revised proposed price of $12.00 per common share announced on January 19, 2007. The aggregate consideration payable under the agreement for shares not owned by Renova Media will be approximately $152 million (excluding the amounts required to exercise convertible securities, as described below), which Renova Media has arranged to borrow from its shareholders.

The merger agreement contains customary closing conditions including adoption of the merger agreement by Moscow CableCom’s stockholders (which is assured, as discussed below), and the absence of an injunction. The transaction will require Federal Antimonopoly Service pre-clearance under the laws of the Russian Federation but is not subject to the pre-merger notification requirements of the U.S. antitrust laws (the Hart-Scott-Rodino Act). The transaction is not conditioned on Renova Media obtaining financing. The transaction is anticipated to close during the second quarter of 2007.

Concurrently with the execution of the merger agreement, a subsidiary of Renova Media, and Moscow CableCom’s principal subsidiary ZAO COMCOR-TV entered into a bridge facility agreement under which Renova Media’s subsidiary will provide up to $45 million of interim unsecured debt financing to ZAO COMCOR-TV to finance its operations during the pendency of the merger through monthly loans of $5 million, subject to certain conditions. This bridge financing, which is guaranteed by Moscow CableCom, is subordinate to the amounts payable to Renova Media’s subsidiary under the $28.5 million senior secured credit facility entered into between the parties in 2004.

The merger agreement provides for a wholly-owned subsidiary of Renova Media to be merged into Moscow CableCom and for Moscow CableCom to become a wholly-owned direct subsidiary of Renova Media. Upon completion of the transaction, there will be no public market for Moscow CableCom’s common stock and Moscow CableCom will no longer file reports with the SEC.

In the merger transaction, each share (subject to statutory appraisal rights) of Moscow CableCom’s common stock not owned by Renova Media will be converted into the right to receive $12.90 in cash, and each share of Moscow CableCom’s Series A convertible preferred stock will be converted into the right to receive $39.4095 in cash, based on the current Series A stock conversion ratio of 3.055 shares of common stock per one share of preferred stock. Renova Media’s shares of Moscow CableCom Series B preferred stock will be canceled in the transaction.

Renova Media owns approximately 40% of the voting power of the currently-outstanding voting securities of Moscow CableCom and, upon exercise of all its rights to acquire additional voting securities of Moscow CableCom, would directly own a majority of the voting power of the company’s then-outstanding voting securities. The merger agreement provides that, prior to the closing, Renova Media will exercise these rights to the extent necessary to assure that it owns of record a majority of the then-outstanding Moscow CableCom securities entitled to vote on the transaction. The merger agreement also provides that Renova Media will execute a written consent with respect to all such voting securities in favor of adoption of the merger agreement so as to assure the requisite stockholder approval of the transaction without the need for any other stockholder vote.

Accordingly, Moscow CableCom will not be soliciting proxies from its stockholders, though it will distribute to all of its stockholders an Information Statement containing detailed information from Moscow CableCom and Renova Media about the transaction and stockholders’ right to appraisal of their shares under Delaware law. Stockholders are encouraged to read the Information Statement as it will contain important information.

Renova Media is the controlling stockholder of OAO Moskovskaya Telecommunikatsionnaya Corporatsiya (COMCOR), which directly owns approximately 24% of the voting power of Moscow CableCom’s outstanding voting securities. COMCOR’s 24% interest is in addition to the voting securities of Moscow CableCom which Renova Media directly owns or has the right to acquire. COMCOR is not a party to the merger agreement and has no agreement with Moscow CableCom or Renova Media relating to the transaction. Upon the closing of the transaction, COMCOR will be entitled to receive the same cash price for its shares as all other stockholders of Moscow CableCom other than Renova Media.

The merger agreement provides that options (both vested and unvested) to acquire shares of Moscow CableCom common stock that are “in the money” based on the excess of $12.90 over the exercise price, to the extent the holders of those options so consent, will be cashed out for the excess at Renova Media’s expense. All other options will remain outstanding in accordance with their terms following the closing. Holders of restricted shares of Moscow CableCom common stock will receive $12.90 in cash at the closing, without further restriction.

In accordance with the terms of Moscow CableCom’s outstanding warrants, to the extent these warrants are not exercised prior to the closing of the transaction at the applicable exercise price and are not held by Renova Media they will remain outstanding prior to their expiration dates and will entitle the holder to receive, upon exercise, $12.90 for each share previously issuable upon exercise.

In accordance with the terms of Moscow CableCom’s outstanding 10-1/2% Convertible Subordinated Debentures Due 2007, to the extent they are not converted into shares of Moscow CableCom’s common stock prior to the closing of the transaction they will remain outstanding and become convertible into the right to receive $12.90 in cash for each share of Moscow CableCom common stock into which they were previously convertible. Renova Media intends, immediately following the closing, to cause Moscow CableCom to deposit in trust with the trustee under the governing indenture, at Renova Media’s expense, sufficient cash to satisfy Moscow CableCom’s remaining obligations with respect to principal and interest through the October 15, 2007 maturity date of the remaining Debentures and thereby, in accordance with the terms of the indenture, cause all of its provisions to cease to apply to Moscow CableCom other than those relating to payment and conversion rights.

Lazard Frères & Co. LLC and Lazard & Co., Limited are serving as financial advisor to the special committee and Covington & Burling LLP is serving as the Special Committee’s legal advisor. Goldman Sachs (AO) LLC is serving as Renova Media’s financial advisor and DLA Piper US LLP is serving as its legal advisor.

The full text of the merger agreement and the bridge financing documents will be filed with the U.S. Securities and Exchange Commission in the near future and the description of those agreements in this joint press release is qualified by the terms and conditions of those agreements.

About Moscow CableCom Corp.

Moscow CableCom Corp. (NASDAQ: MOCC) is the U.S.-based parent of a Moscow, Russia-based company that provides access to pay-TV and Internet services under the brand name “AKADO.” AKADO is in the process of expanding its hybrid fiber-coaxial network in Moscow to provide residential and business customers with comprehensive broadband services in digital cable TV and radio, and high-speed data transmission and Internet access. The Company has licenses to provide its services to 1.5 million homes and businesses in Moscow, through its proprietary agreements for use of the Moscow Fiber Optic Network (MFON), the largest high-speed network in Moscow. For more information on Moscow CableCom Corp. and AKADO, visit: http://www.moscowcablecom.com and http://www.akado.ru.

About Renova Media Enterprises Ltd.

Renova Media Enterprises Ltd. is the telecommunications arm of Renova Group, a leading Russian private equity investor.

Renova Media provides cable television, high-speed Internet access and Internet protocol-based telephony to residential and business customers in the City of Moscow. Renova Media is the City of Moscow’s second largest provider of broad-range access to Internet and the largest Triple Play provider. Renova Media currently serves over 500,000 subscribers. Renova Media has stakes in Moscow CableCom, COMCOR, Teleinform, and Belarus-based Cosmos-TV.

Availability of Information Regarding the Transaction

In connection with the proposed merger transaction, Moscow CableCom will file an Information Statement with the SEC. In addition, Moscow CableCom and Renova Media will file with the SEC a Transaction Statement on Schedule 13E-3. The parties will also make certain other SEC filings regarding the transaction. These documents will contain important information about the transaction. Moscow CableCom and Renova Media urge investors to read these documents when they become available. Copies of these filings will be available, free of charge, at the SEC’s website (www.sec.gov).

Forward Looking Statements

This press release contains forward-looking statements regarding the merger agreement between Moscow CableCom and Renova Media. All forward-looking statements contained in this press release are subject to various risks and uncertainties that could materially affect these matters including, without limitation, the risk that the transaction contemplated by the merger agreement will not be consummated on the terms announced or at all.

Moscow CableCom has disclosed in its filings with the United States Securities and Exchange Commission (including its Form 10K/A for its fiscal year ended December 31, 2005, and a Form 10Q for its fiscal quarter ended September 30, 2006) important risks and uncertainties that may affect its business and investors should refer to those filings, which Moscow CableCom incorporates by reference herein, for Moscow CableCom’s statements regarding such matters (for which Renova Media assumes no responsibility).

There may be other risks that have not been described in this press release or those filings. Moscow CableCom and Renova Media each disclaims any obligation to update developments affecting these risks or to publicly announce any revision to the forward-looking statements contained or referred to in this release to reflect future events or developments.

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