The Board of Directors of Mechel JSC decided to float the third and the second issues of documentary interest bearing unconvertible bonds with a par value 1,000 RUR, each issue worth 5bn RUR via Moscow Interbank Currency Exchange (MMVB Stock Exchange).

The money thus obtained would be used to cover the debts of the previous bond issue and for the long-term investments. The price of the second bond issue is set at 100% of the face value; they are valid for 7 years and provide for the retirement of bonds at face value. Coupons are given out every six months, with the first coupon rate of interest settled at the contest held on the firs day of allotment and is to be fixed until retirement of bonds or first offer. The rate of interest of the other coupons falls under the provisos stated in the documents of the issuer.

The price of the third bond issue is set at 100% of the face value; they are valid for 5 years, and coupons are given out every three months, with coupon rate of interest depending on MosPrime rate. The credit spread is determined at the contest held on the firs day of allotment and is to be fixed until retirement of bonds. The provisos stated in the documents of the issuer allow for call- and put-options.

The guarantor is Trade Firm Mechel Ltd. CJSC GasPromBank deals with the floating process.