YUKOS Receives Notice of Potential Default from Lenders

YUKOS Oil Company has received a notice dated April 23, 2004 from the lenders participating in YUKOS' $1 billion pre-export facility secured term loan that the lenders consider that a Potential Event of Default has occurred. The Potential Event of Default notice relates primarily to the tax claim for RUB 99,375,538,234 filed against YUKOS on 14 April 2004 and the order granted by the Moscow Arbitration Court dated 15 April 2004 prohibiting YUKOS from disposing of or encumbering its asserts. The notice provides that YUKOS and associated companies may continue their export trading activities related to the loan without restriction, but that the lenders may exercise their rights with respect to certain bank accounts over which security has been granted in favor of the lenders at their discretion in the future. YUKOS has been meeting repeatedly with its lenders and will continue to maintain such discussions and take such actions as it deems appropriate to ensure that all obligations under the financing agreements are met.

YUKOS CFO Bruce Misamore said, "This notice by the lending group is a direct result of the actions of the Ministry of Taxes in its attempt to claim taxes, penalty interest, fines and penalties from YUKOS which are not due. The actions of the Ministry of Taxes have reduced, in the view of YUKOS' lenders and credit rating agencies, YUKOS' creditworthiness and have also caused considerable anxiety to a number of the largest financial institutions in the world."

Societe Generale S.A. is Co-ordinating Bank, Facility Agent and a Mandated Lead Arranger for the facility. Mandated Lead Arrangers for the facility are Citibank N.A., Commerzbank AG, Credit Lyonnais S.A., Deutsche Bank AG, HSBC Bank Plc, ING Bank N.V., KBC Bank N.V., BNP Paribas, and UFJ Bank Nederland N.V. Passport banks are JSC Bank Societe General Vostok (Moscow), Commerzbank (Eurasija) SAO ( Moscow) and Credit Lyonnais Rusbank Societe Anonyme (Moscow).

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