ADVANCES AND OTHER NON-CURRENT ASSETS continued

PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2014 and for the Year Then Ended Figures in tables are expressedin billions of Rupiah, unless otherwise stated 63

19. TWO-STEP LOANS continued

Interest Interest Payment payment rate Lenders Currency schedule period per annum Overseas banks US Semi-annually Semi-annually 4.00 Rp Semi-annually Semi-annually 8.50 Yen Semi-annually Semi-annually 3.10 The loans were intended for the development of telecommunications infrastructure and supporting telecommunications equipment. The loans are due on various dates through 2024. Since 2008, the Company had used all facilities under the two-step loans program and the drawdown period for the two-step loans had expired. Under the loan covenants, the Company is required to maintain financial ratios as follows: a. Projected net revenue to projected debt service ratio should exceed 1.2:1 for the two-step loans originating from Asian Development Bank “ADB”. b. Internal financing earnings before depreciation and finance costs should exceed 20 compared to annual average capital expenditures for loans originating from the ADB. As of December 31, 2014, the Company has complied with the above-mentioned ratios. Refer to Note 37 for details of related party transactions.

20. BONDS AND NOTES

2014 2013 Outstanding Outstanding Original Original currency Rupiah currency Rupiah Bonds and notes Currency in millions equivalent in millions equivalent Bonds Series A Rp - 1,005 - 1,005 Series B Rp - 1,995 - 1,995 Medium Term Notes “MTN” GSD Series A Rp - 220 - - Promissory Notes PT Huawei US 4 52 18 213 PT ZTE Indonesia “ZTE” US 3 36 11 136 Total 3,308 3,349 Current maturities Note 18a 1,069 276 Long-term portion Note 18b 2,239 3,073 a. Bonds Interest Interest Listed Issuance Maturity payment rate Bonds Principal Issuer on date date period per annum Series A 1,005 The Company IDX June 25, 2010 July 6, 2015 Quarterly 9.60 Series B 1,995 The Company IDX June 25, 2010 July 6, 2020 Quarterly 10.20 Total 3,000 PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2014 and for the Year Then Ended Figures in tables are expressedin billions of Rupiah, unless otherwise stated 64

20. BONDS AND NOTES continued

a. Bonds continued The bonds are secured by all of the Company’s assets, movable or non-movable, either existing or in the future Note 11c.x. The underwriters of the bonds are Bahana, PT Danareksa Sekuritas and PT Mandiri Sekuritas and the trustee is PT CIMB Niaga Tbk. The Company received the proceeds from the issuance of bonds on July 6, 2010. The funds received from the public offering of bonds net of issuance costs, were used to increase capital expenditures which consisted of wave broadband bandwidth, softswitching, datacom, information technology and others, infrastructure backbone, metro network, regional metro junction, internet protocol, and satellite system and to optimize legacy and supporting facilities fixed wireline and wireless. As of December 31, 2014, the rating of the bonds issued by PT Pemeringkat Efek Indonesia Pefindo is idAAA stable outlook. Based on the indenture trusts agreement, the Company is required to comply with all covenants or restrictions, including maintaining financial ratios as follows: 1. Debt to equity ratio should not exceed 2:1. 2. EBITDA to finance costs ratio should not be less than 5:1. 3. Debt service coverage is 125. As of December 31, 2014, the Company has complied with the above mentioned ratios. b. MTN Interest Interest Issuance Maturity payment rate Notes Currency Principal date date period per annum GSD Series A Rp 220 November 14, 2014 November 14, 2019 Semi-annually 11 Based on Agreement of Issuance and Appointment of Monitoring and Insurance Agents of Medium Term Notes MTN PT Graha Sarana Duta year 2014 dated November 13, 2014 as covered by notarial deed No. 30 of Arry Supratno, S.H., GSD will issue MTN with the principle amount up to Rp500 billion in series. PT Mandiri Sekuritas act as the Arranger, Bank Mandiri as the Monitoring and Insurance Agent, and KSEI as Custodian. The Funds obtained from MTN are used for investment projects. Trade receivables, inventories, land and building related with investment development funded by MTN that has owned or will be owned by GSD, have been pledged as collateral for MTN Notes 6, 7 and 11. According to the agreement, GSD is required to comply with all covenants or restrictions including maintaining financial ratios as follows : 1. Debt to equity ratio should not exceed 6.5:1 2. EBITDA to interest ratio should not be less than 1.2:1 3. Minimum current ratio is 120 4. Maximum leverage ratio is 450 On December 31, 2014, GSD has complied with the above mentioned ratios.