Effective of 27.06.2017 “ARMBUSINESSBANK” CJSC Executive Board decision dated 22.06.2017 ABB – STANDARD + Terms and fee schedule applicable for issuing credit lines to individuals under security of immovable property (on the account of Bank resources) 1. Terms and Conditions Credit lines under security of immovable property 1.1 Currency US dollar 13% - if the amount of credit line does not exceed 20% of appraised liquid value of the collateral 1.2 Nominal annual interest 14% - if the amount of credit line does not exceed 40% of appraised liquid value rate of the collateral 15% - if the amount of credit line does not exceed 41-60% of appraised liquid value of the collateral 1.2 Interest rate charged on unused amount of credit 0% line 1.4 Loan/security ratio (is Zone 1 – 60% calculated on assessed Zone 2 – 45% liquid value of the Zone 3 – 35% collateral) 1.5 Period 12 – 84 months 1.6 Type of credit line Partly renewable 1.7 Manner of repayment Uniform monthly repayment of the credit line (monthly uniform reduction of the limit regardless of the use of credit line) and monthly payment of accrued interests 1.8 Maximum amount of credit Zone 1 – USD 100.000 line Zone 2 – USD 50.000 Zone 3 – USD 40.000 Credit lines limits vary depending on the card type, as per Bank tariffs applicable for rendered services 1.9 Manner of lending The credit line is provided on the card account 1.10 Early repayment of credit Permissible, no fines or penalties are applied line 2. Bank Fees 2.1 Fee for application review AMD 5’000 2.2 One-time fee for credit line AMD 15’000 maintenance 2.3 Cashing out credit line As per Bank fees applicable for given type of payment card amounts 3. Security 3.1 Collateral Immovable property If the Borrower and Mortgagor are different persons, the Mortgagor must also be the guarantor 3.2 Location of immovable Zone 1 – Yerevan (еxcept for Nubarashen, Vardashen, Sari Tagh, Kond and property Noragyugh districts, Krivoy street, Firdusi str., Frik street) Zone 2 – Abovyan, Ashtarak, Armavir, Artashat, Gyumri, Gavar, Dilijan, Yeghegnadzor, Echmiadzin, Ijevan, Tsakhadzor, Kapan, Hrazdan, Jermuk, Stepanakert, Vanadzor cities and Arinj, Argavand, Arzni, Garni, Zovuni, Tairov, Dzoraghbyur, Ptghni, Jrvezh, Paraqar, Ohanavan, Oshakan, Parpi, Karpi, Dzorak villages Zone 3 – other cities of Armenia and villages Ayntap, Geganist (Ararat region), Aramus, Balahovit, Proshyan, Kasakh and Argel (former Lusakert) (Kotayk region) 3.3 Collateral requirements A real property with stone, panel or concrete design (except dividing walls and floors ), as well as premises for public use (shops, cafes/restaurants, hairdressing salons, offices) can serve as a collateral The immovable property must have 80% completion degree Apartment houses, which have 2 or more common walls with the property of other owners and do not have separate entrance, are not accepted as a collateral A real property in an apartment building should be on the first floor or higher A real property in the basement is not accepted as a collateral A real property must be provided with necessary infrastructure (water, electricity, sewerage) A real property must be located in the house with no more than the 2nd degree of accident risk Where the real property is owned by individuals on the right of common ownership, all the shares are simultaneously deemed to be collaterals, and all co-owners of the collateral are deemed to be mortgagors If the collateral is comprised of a land lot, the cadastral value of which has not been paid, then while calculating loan/collateral ratio the cadastral value of the land is reduced from the estimated value of the collateral The immovable property may not be accepted as a collateral if the Evaluating company has released unfavorable appraisal relating to its general condition 3.4 Additional term • The Bank may also request a guarantee acceptable to the Bank * While pledging residential real property the Mortgagor presents justification of property rights, and if they were transferred to the Mortgagor under transaction of gift and the property was transferred during five years preceding the submission of the application for credit line: 1. Additional collateral (donor’s surety) is required; inter alia, the amount of credit line may not exceed 50% of appraised liquid value of collateral or 2. Additional collateral (third party surety) is required; inter alia, the amount of credit line may not exceed 25% of appraised liquid value of collateral. * This sub-clause is not applicable if upon submission of a Loan application the donor is dead 4 Collateral Assessment and Insurance 4.1 Assessment of collateral Assessment should be carried out by an independent evaluating company that value cooperates with the Bank 4.2 Insurance Not requested 5. Requirements to Borrower 5.1 Borrower A resident natural person aged at least 21, who is registered in RA or NKR, and whose age does not exceed 65 years by the maturity of credit line 5.2 Revenues of borrower Primary income (mandatory) ** – 100% Secondary income (not mandatory) *** - Secondary income (not mandatory) - maximum 60%, and may not exceed the twofold amount of primary income 5.3 Credit history requirements At the moment of loan approval there should not be any overdue or for Borrower /Mortgagor/ classified current credit commitments, Guarantor Total number of days outstanding on all loans (repaid and current) must not exceed 30 calendar days over the last 12 months This sub-clause 5.3 is not applicable if the donor also acts as a guarantor 5.4 Guarantor (if requested by A resident natural person aged 21-63, who is registered in the Republic of Bank as a supplementary Armenia or Nagorno-Karabakh Republic condition) An individual, who is not a member of the borrower’s family (father, mother, sister, brother, spouse, child), has joint and several liability with the Borrower and agrees to be held liable for complete or partial fulfillment of obligations by the Borrower, and whose obligation arises in case of non- fulfillment or partial fulfillment of obligations by the Borrower At the time of credit line approval, the Guarantor may have maximum 2 commitments, issued for the liabilities of other persons. This sub-clause 5.4 is not applicable if the donor also acts as a guarantor 6. Additional terms Customer has failed to provide requested documents The inquiry to "ACRA" credit bureau has reported on a negative credit history of Customer (also on Guarantor(s), if any) Basis for rejecting an The subject of pledge does not meet the requirements of the Bank 6.1 application According to credit rating, the customer is not deemed to be creditworthy Information that came into possession in the course of lending, arouses prejudice with regard to the information provided by the Client or the repayment of credit line For failure to repay interests when due, the Bank shall charge a penalty from Borrower for each day of default equal to 0.2% of the amount past-due, For failure to repay credit line when due as prescribed by contract terms, the calculation of interests under the contract shall be suspended and effective from that day until the actual repayment of the arrears, interests shall be accrued on the overdue amount equal to the threefold of the settlement rate of the bank interest set by the Central Bank of RA In the event of non-fulfillment or improper fulfillment of credit commitments, Failure by borrower to information on indebtedness shall be filed to credit register and "ACRA" credit 6.2 fulfill his/her liabilities bureau. NOTE: BAD CREDIT HISTORY MAY SERVE AS AN IMPEDIMENT TO THE BORROWER IN THE FUTURE FOR ACCESS TO OTHER CREDITS The Bank is entitled to impose a forfeiture on the collateral or sell it out without applying to court Where a claim to mortgaged immovable property is not satisfied in full on the account of amount received from property sale - the difference should be charged from borrower ‘s other assets 6.3 Manner of calculating The interest rate is applied on used amount of credit line interests Plastic card annual maintenance fee (AMD 3,000-30,000) Costs associated with the evaluation of collateral according to the tariffs of Other expenses of 6.4 evaluating companies, which cooperate with the Bank (AMD 12,000-35,000) Customer Notary’s costs (AMD 13,000-20,000) Costs associated with cadastral registration (AMD 36,000) 6.5 Term of application review 7-10 business days 6.6 Place of loan processing Head Office and all branches of the Bank 6.7 * As primary income is accepted: - Income justified by a statement of employment; moreover, the Borrower should be an employee of the organization for at least 3 months, - Pensions confirmed by a statement of competent authority, ** As secondary income is accepted: - Income from rent under lease agreement approved by public notary and registered by State Committee of Real Estate Cadastre, and in addition the lease agreement must be concluded no later than three months before the date loan application has been submitted (except in cases of the renewal of lease agreement) and must be concluded for at least 1 year; - Interests receivable under deposit agreement with the Bank, which must be concluded no later than three months before submission of loan application and must be concluded for at least 1 year; - Regular money transfers received over the last 12 months; Income from paid services, dividends and other revenues, which can be justified by documents. 6.8 Documents requested for loan processing Documents requested from