AMENDMENT NO. 1 TO PRIMARY AGREEMENT
This Amendment No. 1 to Primary Agreement (this "Amendment"), dated as
of the 15/th/ day of May, 2002, by and among OPEN JOINT STOCK COMPANY "VIMPEL-
COMMUNICATIONS", an open joint stock company organized and existing under the
laws of the Russian Federation ("VIP"), ECO TELECOM LIMITED, a company organized
and existing under the laws of Gibraltar ("Eco Telecom"), TELENOR EAST INVEST
AS, a company organized and existing under the laws of Norway ("Telenor") and
OPEN JOINT STOCK COMPANY "VIMPELCOM-REGION", an open joint stock company
organized and existing under the laws of the Russian Federation (the "Company").
WHEREAS, VIP, Eco Telecom, Telenor and the Company are parties to that
Primary Agreement, dated as of May 30, 2001 (the "Primary Agreement"); and
WHEREAS, VIP, Eco Telecom, Telenor and the Company desire to amend the
Primary Agreement on the terms set forth herein.
NOW, THEREFORE, to implement the foregoing and in consideration of the
mutual terms and conditions contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. Unless otherwise expressly stated herein to the contrary, all
provisions of the Primary Agreement shall remain valid, binding and in effect as
set forth in the Primary Agreement, except as necessary to give effect to the
matters set forth in this Amendment. Capitalized terms used but not otherwise
defined herein shall have the meanings ascribed to such terms in the Primary
Agreement.
2. The following schedules to the Primary Agreement shall be deleted:
2.03(a)(ii) and 2.03(a)(iii).
3. Exhibit B to the Primary Agreement shall be renamed "EXHIBIT B -
FORM OF SECOND CLOSING DISCLOSURE LETTER". Exhibit C to the Primary Agreement
shall be renamed "EXHIBIT C - FORM OF SECOND CLOSING OPTION WAIVER NOTICE".
4. The word "Board" in Sections 5.05(a) and 5.05(b) of the Primary
Agreement shall be deleted and replaced with the word "GMS".
5. The definitions set forth on Appendix A hereto shall be deleted
from Section 1.01 of the Primary Agreement in their entirety and shall be of no
further force or effect.
6. The following definitions set forth in Section 1.01 of the Primary
Agreement shall each be amended and restated in their entirety to read as
follows:
"Actually known to such Purchaser" shall mean, with respect to each Purchaser,
to the knowledge and belief of the Persons specified immediately below the name
of such Purchaser on
Schedule 1.01(A), except that for purposes of Section 2.04, such phrase shall
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have the meaning set forth in Section 2.04(e)(iii).
"Additional Closings Shares" shall mean the number of shares of Common Stock
that VIP and/or Telenor, as the case may be, may purchase at the Additional
Second Closings.
"Additional Closings Purchase Price" shall mean the aggregate cash amount, if
any, paid by VIP or Telenor, as the case may be, at the Additional Second
Closings.
"Agreement" shall mean this Primary Agreement, the Disclosure Letter, the
Exhibits and the Schedules hereto and the certificates delivered in accordance
with Article VIII and Article IX.
"Charter" shall mean the most recent version of the charter (ustav) of the
Issuer, as registered with the MRC on December 26, 2001 and as may be amended
from time to time.
"Closings" shall mean the First Closing, the Second Closing, the Third Closing,
the Additional Second Closings and the Preferred Stock Closing.
"Disclosure Letter" shall mean the Second Closing Disclosure Letter.
"Per Share Price" shall mean the price per share of Common Stock as set forth in
Schedule 1.01(C); provided, however, if in connection with the Second Closing
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and/or Third Closing, the GMS determines, upon written advice of legal counsel
and an independent licensed appraiser (otsenshik), that the Per Share Price
shall represent an amount less than or greater than set forth in Schedule
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1.01(C), then the parties hereto agree that for purposes of Sections 2.02, 2.03
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and 2.04 of this Agreement, the Per Share Price shall mean such amount as
determined by the GMS.
"Preferred Stock" shall mean, collectively, the shares of type A convertible
preferred stock of the Issuer, as defined in the Charter.
"Purchasers' Shares" shall mean the First Closing VIP Shares, the Second Closing
Shares, the Third Closing Shares, the Additional Closings Shares and the
Additional Second Closing Eco Telecom Shares, collectively.
"Second Closing Contribution Default Percentage" shall mean, in respect of any
Purchaser, the percentage of the issued and outstanding voting capital stock of
the Issuer that such Purchaser would have owned if:
(i) the issuance of the Second Closing VIP Shares and the Second Closing
Telenor Shares (if any) at the Second Closing was effected at the Per Share
Price specified in Schedule 1.01(C) without redistribution of Preferred
Stock as contemplated in Section 2.08;
(ii) (if Telenor has exercised the VIP-R Call Option before the Second
Closing Date) Telenor exercised the VIP-R Call Option, but redistribution
of the Preferred Stock as contemplated in Section 2.10 did not occur; and
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(iii) the Preferred Stock Closing has occurred and the Issuer repurchased
from Eco Telecom and cancelled all the shares of Eco Telecom Preferred
Stock.
"Second Closing Date" shall mean the date on which the Second Closing is
scheduled to occur, which date will be the twelve (12) month anniversary of the
First Closing Date (or, if such date is not a Business Day, then on the first
Business Day following such date), or such other date as the parties hereto may
mutually determine; provided, however, that either Eco Telecom or VIP may extend
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the Second Closing Date by written notice to the Issuer, Telenor, and VIP or Eco
Telecom, respectively, to a date which is a Business Day and which is not more
than seven (7) months following the 12 month anniversary of the First Closing
Date, if Eco Telecom or VIP, respectively, has complied with Section 7.01 and
notwithstanding such compliance, MAMP approval has not yet been obtained by Eco
Telecom or VIP, respectively, on such 12 month anniversary. For the avoidance of
doubt, the parties hereto acknowledge and agree that, in the event either Eco
Telecom or VIP extends the date of the Second Closing Date pursuant to the terms
hereof, the Second Closing contemplated hereby, and the purchase and sale of the
Second Closing VIP Shares and the Second Closing Telenor Shares, if any, shall
be held on the Second Closing Date, as extended.
"Second Closing Implied Percentage" shall mean, in respect of any Purchaser, the
percentage of the issued and outstanding voting capital stock of the Issuer that
such Purchaser would have owned if:
(i) (if Telenor has exercised the VIP-R Call Option before the Second
Closing Date) Telenor exercised the VIP-R Call Option, but redistribution
of the Preferred Stock as contemplated by Section 2.10 did not occur,
(ii) the issuance of the Second Closing Shares at the Second Closing was
effected at the Per Share Price specified in Schedule 1.01(C), without
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redistribution of shares of Eco Telecom Preferred Stock as contemplated by
Section 2.08, and
(iii) the Preferred Stock Closing has occurred and the Issuer repurchased
from Eco Telecom and cancelled all the shares of Eco Telecom Preferred
Stock.
"Second Closing Issuer/Eco Telecom Indemnity Amount" shall mean the sum of (a)
the First Closing Issuer/Eco Telecom Indemnity Amount plus (b) (x) if Eco
Telecom has purchased the Second Closing Eco Telecom Shares, US$58.5 million or
(y) if Eco Telecom has purchased the Second Closing Eco Telecom Shares and the
Additional Second Closing Eco Telecom Shares, the sum of US$58.5 million plus
the Additional Second Closing Eco Telecom Purchase Price or (z) if Eco Telecom
has not purchased the Second Closing Eco Telecom Shares, US$0.
"Second Closing Issuer/VIP Indemnity Amount" shall mean the sum of (a) the First
Closing Issuer/VIP Indemnity Amount plus (b) (x) if VIP has purchased the Second
Closing VIP Shares, an amount equal to the Second Closing VIP Purchase Price or
(y) if VIP has not purchased the Second Closing VIP Shares, an amount equal to
US$0.
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"Second Closing Purchase Price" shall mean the aggregate of the Second Closing
Eco Telecom Purchase Price, the Additional Second Closing Eco Telecom Purchase
Price, the Second Closing VIP Purchase Price and the Second Closing Telenor
Purchase Price.
"Second Closing Shares" shall mean the Second Closing Eco Telecom Shares, the
Additional Second Closing Eco Telecom Shares, if any, the Second Closing VIP
Shares and the Second Closing Telenor Shares, if any.
Second Closing Telenor Purchase Price" shall have the meaning specified in
Section 2.04(b).
"Second Closing Telenor Shares" shall mean the Second Closing Telenor Primary
Option Shares.
"Second Closing VIP Primary Shares" shall have the meaning specified in Section
2.04(a).
"Second Closing VIP Secondary Shares" shall have the meaning specified in
Section 2.04(a).
"Second Closing VIP Shares" shall mean the number of shares of Common Stock that
VIP shall purchase at the Second Closing pursuant to Section 2.04(a).
"Third Closing Contribution Default Percentage" shall mean, in respect of any
Purchaser, the percentage of the issued and outstanding voting capital stock of
the Issuer that such Purchaser would have owned if:
(i) the issuance of the Second Closing Shares at the Second Closing was
effected at the Per Share Price specified in Schedule 1.01(C) without
redistribution of Preferred Stock as contemplated in Section 2.08;
(ii) the issuance of the Third Closing Shares at the Third Closing was
effected at the Per Share Price specified in Schedule 1.01(C) without
redistribution of Preferred Stock as contemplated in Section 2.09;
(iii) (if Telenor has exercised the VIP-R Call Option before the Third
Closing Date) Telenor exercised the VIP-R Call Option, but redistribution
of the Preferred Stock as contemplated in Section 2.10 did not occur; and
(iv) the Preferred Stock Closing has occurred and the Issuer repurchased
from Eco Telecom and cancelled all the shares of Preferred Stock.
"Third Closing Eco Telecom Purchase Price" shall mean a cash amount equal to the
amount set forth on Schedule 2.03(b)(i), reduced by the sum of (i) the
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Additional Second Closing Eco Telecom Purchase Price, if any and (ii) the Third
Closing Redirection Amount, if any.
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"Third Closing Implied Percentage" shall mean, in respect of any Purchaser, the
percentage of the issued and outstanding voting capital stock of the Issuer that
such Purchaser would have owned if:
(i) the issuance of the Second Closing Shares at the Second Closing was
effected at the Per Share Price specified in Schedule 1.01(C), without
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redistribution of shares of Eco Telecom Preferred Stock as contemplated by
Section 2.08, and
(ii) the issuance of the Third Closing Shares at the Third Closing was
effected at the Per Share Price specified in Schedule 1.01(C), without
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redistribution of shares of Eco Telecom Preferred Stock as contemplated by
Section 2.09, and
(iii) (if Telenor has exercised the VIP-R Call Option before the Second
Closing Date) Telenor exercised the VIP-R Call Option, without
redistribution of the Preferred Stock as contemplated by Section 2.10, and
(iv) the Preferred Stock Closing has occurred and the Issuer repurchased
from Eco Telecom and cancelled all the shares of Eco Telecom Preferred
Stock which would have been required to have been repurchased and cancelled
for Eco Telecom to own at least twenty-five percent (25%) plus one (1)
share of the issued and outstanding voting capital stock of the Issuer
(after giving effect to the transactions described in clauses (i) through
(iii) hereof).
"Third Closing Purchase Price" shall mean the Third Closing Eco Telecom Purchase
Price.
"Third Closing Shares" shall mean the Third Closing Eco Telecom Shares, if any.
"Total Issuer/Eco Telecom Indemnity Amount" shall mean, (a) from the First
Closing Date to (but excluding) the date on which the Second Closing occurs, the
First Closing Issuer/Eco Telecom Indemnity Amount, (b) from (and including) the
date on which the Second Closing occurs to (but excluding) (i) the date on which
the Third Closing, if applicable, occurs, or (ii) if the Third Closing does not
occur because Eco Telecom purchased its entire allotment of Additional Second
Closing Eco Telecom Shares at the Second Closing (i.e., the Additional Second
Closing Eco Telecom Purchase Price was US$58,500,000), the date on which the
representations, warranties, covenants and agreements of the parties to this
Agreement cease to survive as provided in Article XII herein, the Second Closing
Issuer/Eco Telecom Indemnity Amount, and (c) if applicable, from (and including)
the date on which the Third Closing occurs to the date the representations,
warranties, covenants and agreements of the parties to this Agreement cease to
survive as provided in Article XII herein, the sum of (i) the First Closing
Issuer/Eco Telecom Indemnity Amount, (ii) the Second Closing Issuer/Eco Telecom
Indemnity Amount and (iii) (x) if Eco Telecom has purchased the Third Closing
Eco Telecom Shares, the Third Closing Eco Telecom Purchase Price or (y) if Eco
Telecom has not purchased the Third Closing Eco Telecom Shares, US$0.
"Total Issuer/Telenor Indemnity Amount" shall mean from (and including) the
date on which the Second Closing occurs to (but excluding) the date the
representations, warranties, covenants and agreements of the parties to this
Agreement cease to survive as provided in Article XII herein, the Second Closing
Issuer/Telenor Indemnity Amount.
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"Total Issuer/VIP Indemnity Amount" shall mean (a) from the First Closing Date
to (but excluding) the date on which the Second Closing occurs, the First
Closing Issuer/VIP Indemnity Amount, (b) from (and including) the date on which
the Second Closing occurs to (but excluding) the date the representations,
warranties, covenants and agreements of the parties to this Agreement cease to
survive as provided in Article XII herein, the sum of (i) the First Closing
Issuer/VIP Indemnity Amount, and (ii) the Second Closing Issuer/VIP Indemnity
Amount.
"Trademark Agreements" shall mean the Trademark License Agreements, dated the
date hereof, between the Issuer and VIP, as listed on Schedule 1.01(D), as
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amended.
"VIP-R Registration Rights Agreement" shall mean the Registration Rights
Agreement, dated the date hereof, among the Issuer, VIP, Eco Telecom and
Telenor, as amended.
"VIP-R Shareholders Agreement" shall mean the Shareholders Agreement, dated the
date hereof, among Eco Telecom, Telenor, VIP and the Issuer, as amended.
7. The following definitions shall be added to Section 1.01 of the
Primary Agreement:
"Additional Second Closing Eco Telecom Shares" shall mean the number of shares
of Common Stock determined by dividing the Additional Second Closing Eco Telecom
Purchase Price by the Per Share Price.
"Additional Second Closing Eco Telecom Purchase Price" shall mean the cash
amount delivered to the Issuer by Eco Telecom at the Second Closing in respect
of the Additional Second Closing Eco Telecom Shares, in a minimum amount of
US$22,000,000 and a maximum amount of US$58,500,000.
8. Sections 2.02 through 2.11 of the Primary Agreement shall be deleted
and replaced in their entirety with the following:
2.02 Second Closing
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(a) Purchase and Sale.
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(i) Eco Telecom.
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(A) Subject to the terms and conditions contained in this
Agreement and in accordance with the procedures set forth in Schedule 2.02(a)(i)
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attached hereto, on the Second Closing Date, (x) the Issuer shall issue and sell
to Eco Telecom, and (y) Eco Telecom shall purchase from the Issuer, the Second
Closing Eco Telecom Shares. In addition, Eco Telecom shall consider in good
faith, without any legal obligation, the purchase from the Issuer at the Second
Closing of the Additional Second Closing Eco
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Telecom Shares. In the event that, at the Second Closing, Eco Telecom delivers
to the Issuer the Additional Second Closing Eco Telecom Purchase Price then,
subject to the terms and conditions contained in this Agreement and in
accordance with the procedures set forth in Schedule 2.02(a)(i) attached hereto,
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on the Second Closing Date (x) the Issuer shall issue and sell to Eco Telecom,
and (y) Eco Telecom shall purchase from the Issuer, the Additional Second
Closing Eco Telecom Shares. The parties hereto acknowledge and agree that, in
the event Eco Telecom considers in good faith the purchase of the Additional
Second Closing Eco Telecom Shares at the Second Closing but nonetheless does not
make such purchase, Eco Telecom shall not be deemed to have breached its
obligation to purchase the Additional Second Closing Eco Telecom Shares pursuant
to this Section 2.02(a)(i)(A).
(B) For purposes of this Section 2.02(a)(i)(B) only, the Second
Closing Eco Telecom Shares shall be deemed to also include the Additional Second
Closing Eco Telecom Shares, if any, purchased by Eco Telecom at the Second
Closing. Subject to the terms and conditions of this Agreement, solely for the
purpose of Russian Law and solely to the extent Russian Law may be applicable
(i) this Agreement shall be considered a preliminary agreement (predvaritelnyi
dogovor) and not a transaction involving securities (sdelka s tsennymi
bumagami); (ii) by virtue of entering into this Agreement, (x) the Issuer shall
not be obligated to transfer any Second Closing Eco Telecom Shares to Eco
Telecom or be considered to have offered any Second Closing Eco Telecom Shares
to Eco Telecom and (y) Eco Telecom shall not be obligated to purchase any Second
Closing Eco Telecom Shares from the Issuer or to make payment for any Second
Closing Eco Telecom Shares; (iii) the actual transactions contemplated by
Section 2.02(a)(i)(A) shall not constitute transactions involving securities
(sdelki s tsennymi bumagami); and (iv) in no event shall such transactions take
place before the registration of the issuance of the Second Closing Eco Telecom
Shares with the FCSM and payment in full for the Second Closing Eco Telecom
Shares by Eco Telecom, if and to the extent such registration and payment are
required under Russian Law. The placement of the Second Closing Eco Telecom
Shares shall occur on the date on which the Second Closing Eco Telecom Shares
are disposed of (otchuzdeny) by the Issuer in favor of Eco Telecom, by
transferring the title to the Second Closing Eco Telecom Shares to Eco Telecom
at the Second Closing. This Section 2.02(a)(i)(B) shall have no effect on the
interpretation of this Agreement under the laws of the State of New York, by
which this Agreement is expressed to be governed. Subject to the terms and
conditions contained in this Agreement, immediately upon the registration of the
issuance of the Second Closing Eco Telecom Shares with the FCSM and in any event
prior to the Issuer's execution of any other agreement with respect to any of
the Second Closing Eco Telecom Shares, the Issuer and Eco Telecom shall execute
the Individual Share Purchase Agreement (osnovnoi dogovor) attached as Annex A
to Schedule 2.02(a)(i) which shall incorporate by reference the terms and
conditions of this Agreement applicable to Eco Telecom, except that this Section
2.02(a)(i)(B) shall be excluded.
(ii) VIP.
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(A) Subject to the terms and conditions contained in this
Agreement and in accordance with the procedures set forth in Schedule
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2.02(a)(ii) attached hereto, on the Second Closing Date (x) the Issuer shall
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issue and sell to VIP, and (y) VIP shall purchase from the Issuer, the Second
Closing VIP Shares.
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(B) Subject to the terms and conditions of this Agreement, solely
for the purpose of Russian Law and solely to the extent Russian Law may be
applicable (i) this Agreement shall be considered a preliminary agreement
(predvaritelnyi dogovor) and not a transaction involving securities (sdelka s
tsennymi bumagami); (ii) by virtue of entering into this Agreement, (x) the
Issuer shall not be obligated to transfer any Second Closing VIP Shares to VIP
or be considered to have offered any Second Closing VIP Shares to VIP and (y)
VIP shall not be obligated to purchase any Second Closing VIP Shares from the
Issuer or to make payment for any Second Closing VIP Shares; (iii) the actual
transactions contemplated by Section 2.02(a)(ii)(A) shall not constitute
transactions involving securities (sdelki s tsennymi bumagami); and (iv) in no
event shall such transactions take place before the registration of the issuance
of the Second Closing VIP Shares with the FCSM and payment in full for the
Second Closing VIP Shares by VIP, if and to the extent such registration and
payment are required under Russian Law. The placement of the Second Closing VIP
Shares shall occur on the date on which the Second Closing VIP Shares are
disposed of (otchuzdeny) by the Issuer in favor of VIP, by transferring the
title to the Second Closing VIP Shares to VIP at the Second Closing. This
Section 2.02(a)(ii)(B) shall have no effect on interpretation of this Agreement
under the laws of the State of New York, by which this Agreement is expressed to
be governed. Subject to the terms and conditions contained in this Agreement,
immediately upon the registration of the issuance of the Second Closing VIP
Shares with the FCSM and in any event prior to the Issuer's execution of any
other agreement with respect to any of the Second Closing VIP Shares, the Issuer
and VIP shall execute the Individual Share Purchase Agreement (osnovnoi dogovor)
attached as Annex A to Schedule 2.02(a)(ii) which shall incorporate by reference
the terms and conditions of this Agreement applicable to VIP, except that this
Section 2.02(a)(ii)(B) shall be excluded.
(iii) Telenor.
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(A) Subject to the terms and conditions contained in this
Agreement and in accordance with the procedures set forth in Schedule
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2.02(a)(iii) attached hereto, on the Second Closing Date, in the event that
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Telenor exercises the Second Closing Telenor Option pursuant to Section 2.04,
(x) the Issuer shall issue and sell to Telenor, and (y) Telenor shall purchase
from the Issuer, the Second Closing Telenor Shares.
(B) Subject to the terms and conditions of this Agreement, solely
for the purpose of Russian Law and solely to the extent Russian Law may be
applicable (i) this Agreement shall be considered a preliminary agreement
(predvaritelnyi dogovor) and not a transaction involving securities (sdelka s
tsennymi bumagami); (ii) by virtue of entering into this Agreement, (x) the
Issuer shall not be obligated to transfer any Second Closing Telenor Shares to
Telenor or be considered to have offered any Second Closing Telenor Shares to
Telenor and (y) Telenor shall not be obligated to purchase any Second Closing
Telenor Shares from the Issuer or to make payment for any Second Closing Telenor
Shares; (iii) the actual transactions contemplated by Section 2.02(a)(iii)(A)
shall not constitute transactions involving securities (sdelki s tsennymi
bumagami); and (iv) in no event shall such transactions take place before the
registration of the issuance of the Second Closing Telenor Shares with the FCSM
and payment in full for the Second Closing Telenor Shares by Telenor, if and to
the extent such registration and payment are required under Russian Law. The
placement of the Second Closing Telenor Shares shall occur on the date on which
the Second Closing Telenor Shares are disposed of (otchuzdeny)
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by the Issuer in favor of Telenor, by transferring the title to the Second
Closing Telenor Shares to Telenor at the Second Closing. This Section
2.02(a)(iii)(B) shall have no effect on the interpretation of this Agreement
under the laws of the State of New York, by which this Agreement is expressed to
be governed. Subject to the terms and conditions contained in this Agreement,
immediately upon the registration of the issuance of the Second Closing Telenor
Shares with the FCSM and in any event prior to the Issuer's execution of any
other agreement with respect to any of the Second Closing Telenor Shares, the
Issuer and Telenor shall execute the Individual Share Purchase Agreement
(osnovnoi dogovor) attached as Annex A to Schedule 2.02(a)(iii) which shall
incorporate by reference the terms and conditions of this Agreement applicable
to Telenor, except that this Section 2.02(a)(iii)(B) shall be excluded.
(b) Purchase Price.
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(i) Eco Telecom. Subject to the terms and conditions hereof and in
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consideration of the sale and transfer to Eco Telecom by the Issuer of the
Second Closing Eco Telecom Shares and the Additional Second Closing Eco Telecom
Shares, if any, on the Second Closing Date, Eco Telecom shall pay to the Issuer
(A) the Second Closing Eco Telecom Purchase Price and (B) if applicable, the
Additional Second Closing Eco Telecom Purchase Price in the manner provided in
Section 2.02(c)(ii), and (1) the Second Closing Eco Telecom Purchase Price shall
be allocable entirely to, and deemed to be in consideration of, the Second
Closing Eco Telecom Shares being purchased hereunder and (2) if applicable, the
Additional Second Closing Eco Telecom Purchase Price shall be allocable entirely
to, and deemed to be in consideration of, the Additional Second Closing Eco
Telecom Shares being purchased hereunder.
(ii) VIP. Subject to the terms and conditions hereof and in
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consideration of the sale and transfer to VIP by the Issuer of the Second
Closing VIP Shares, on the Second Closing Date VIP shall pay to the Issuer the
Second Closing VIP Purchase Price in the manner provided in Section 2.02(c)(ii)
and the Second Closing VIP Purchase Price shall be allocable entirely to, and
deemed to be in consideration of, the Second Closing VIP Shares being purchased
hereunder.
(iii) Telenor. Subject to the terms and conditions hereof and in
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consideration of the sale and transfer to Telenor by the Issuer of the Second
Closing Telenor Shares, on the Second Closing Date, in the event that Telenor
exercises the Second Closing Telenor Option pursuant to Section 2.04, Telenor
shall pay to the Issuer the Second Closing Telenor Purchase Price in the manner
provided in Section 2.02(c)(ii) and the Second Closing Telenor Purchase Price
shall be allocable entirely to, and deemed to be in consideration of, the Second
Closing Telenor Shares being purchased hereunder.
(iv) Fractional Shares. Notwithstanding anything to the contrary
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contained herein, if the number of shares of Common Stock to be issued by the
Issuer to any Purchaser at the Second Closing includes a fractional share of
Common Stock then, in lieu of issuing any such fractional share, the number of
shares of Common Stock issued to such Purchaser shall be rounded down to the
nearest whole share, and the purchase price to be paid by such Purchaser shall
be reduced proportionately.
(c) Pre-Closing; Closing
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(i) Pre-Closing. On a date which is five (5) Business Days prior to
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the Second Closing Date the Issuer, Eco Telecom, VIP and Telenor, if applicable,
shall (i) attend a pre-closing meeting (the "Second Closing Pre-Closing
Meeting") at the offices of VIP's counsel, located at Xxxxx Xxxxx XX, 0 Xxxxxxx
Xxxxxx, Xxxxxx 000000, Russian Federation (or at such other place as Eco Telecom
and the Issuer, and VIP and Telenor if applicable, mutually agree) at 10:00 am
local time, and (ii) review the documents to be delivered at the Second Closing
to determine whether the conditions precedent specified in Article X with
respect to the Second Closing have been, or will on the Second Closing Date be
capable of being, fulfilled. At the Second Closing Pre-Closing Meeting, (A) Eco
Telecom shall inform VIP, Telenor and the Issuer of the number of Additional
Second Closing Eco Telecom Shares, if any, that Eco Telecom shall purchase at
the Second Closing and (B) VIP shall present its calculations concerning the re-
distributions of Preferred Stock required at the Second Closing pursuant to
Section 2.08.
(ii) Closing. The Second Closing will take place at the offices of
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VIP's counsel at the address set out in the immediately preceding paragraph, or
at such other place as Eco Telecom, the Issuer and VIP and Telenor, if
applicable, mutually agree, at 10:00 am local time on the Second Closing Date.
On the Second Closing Date, (A) if the conditions precedent specified in Article
X with respect to the Second Closing have been fulfilled (or properly waived in
writing in accordance with Article X), then (i) Eco Telecom shall pay to the
Issuer the Second Closing Eco Telecom Purchase Price and, if applicable, the
Additional Second Closing Eco Telecom Purchase Price, in US dollars, by wire
transfer of immediately available funds to the account(s) designated by the
Issuer, and (ii) upon receipt by the Issuer of the Second Closing Eco Telecom
Purchase Price and, if applicable, the Additional Second Closing Eco Telecom
Purchase Price, the Issuer shall deliver immediately to Eco Telecom an extract
from the share register of the Issuer issued by the Registrar and showing Eco
Telecom as the owner of the Second Closing Eco Telecom Shares and, if
applicable, the Additional Second Closing Eco Telecom Shares; (B) if the
conditions precedent specified in Article X have been fulfilled (or properly
waived in writing in accordance with Article X), then (i) VIP shall pay to the
Issuer the Second Closing VIP Purchase Price in rubles based on the CBR dollar
to xxxxx exchange rate for the Business Day immediately preceding the Second
Closing Date, by wire transfer of immediately available funds to the account(s)
designated by the Issuer and (ii) upon receipt by the Issuer of the Second
Closing VIP Purchase Price, the Issuer shall deliver immediately to VIP an
extract from the share register of the Issuer issued by the Registrar and
showing VIP as the owner of the Second Closing VIP Shares; and (C) in the event
that Telenor exercises the Second Closing Telenor Option and if the conditions
precedent specified in Article X have been fulfilled (or properly waived in
writing in accordance with Article X), then (i) Telenor shall pay to the Issuer
the Second Closing Telenor Purchase Price in US dollars, by wire transfer of
immediately available funds to the account(s) designated by the Issuer, and (ii)
upon receipt by the Issuer of the Second Closing Telenor Purchase Price, the
Issuer shall deliver immediately to Telenor an extract from the share register
of the Issuer issued by the Registrar and showing Telenor as the owner of the
Second Closing Telenor Shares.
10
2.03 Third Closing
-------------
(a) Purchase and Sale.
------------------
(i) Eco Telecom.
-----------
(A) Subject to the terms and conditions contained in this Agreement
and in accordance with the procedures set forth in Schedule 2.03(a)(i) attached
-------------------
hereto, if the number of Third Closing Eco Telecom Shares is greater than zero,
on the Third Closing Date, (x) the Issuer shall issue and sell to Eco Telecom,
and (y) Eco Telecom shall purchase from the Issuer, the Third Closing Eco
Telecom Shares.
(B) Subject to the terms and conditions of this Agreement, solely
for the purpose of Russian Law and solely to the extent Russian Law may be
applicable (i) this Agreement shall be considered a preliminary agreement
(predvaritelnyi dogovor) and not a transaction involving securities (sdelka s
tsennymi bumagami); (ii) by virtue of entering into this Agreement, (x) the
Issuer shall not be obligated to transfer any Third Closing Eco Telecom Shares
to Eco Telecom or be considered to have offered any Third Closing Eco Telecom
Shares to Eco Telecom and (y) Eco Telecom shall not be obligated to purchase any
Third Closing Eco Telecom Shares from the Issuer or to make payment for any
Third Closing Eco Telecom Shares; (iii) the actual transactions contemplated by
Section 2.03(a)(i)(A) shall not constitute transactions involving securities
(sdelki s tsennymi bumagami); and (iv) in no event shall such transactions take
place before the registration of the issuance of the Third Closing Eco Telecom
Shares with the FCSM and payment in full for the Third Closing Eco Telecom
Shares by Eco Telecom, if and to the extent such registration and payment are
required under Russian Law. The placement of the Third Closing Eco Telecom
Shares, if any, shall occur on the date on which the Third Closing Eco Telecom
Shares are disposed of (otchuzdeny) by the Issuer in favor of Eco Telecom, by
transferring the title to the Third Closing Eco Telecom Shares to Eco Telecom at
the Third Closing, if applicable. This Section 2.03(a)(i)(B) shall have no
effect on the interpretation of this Agreement under the laws of the State of
New York, by which this Agreement is expressed to be governed. Subject to the
terms and conditions contained in this Agreement, immediately upon the
registration of the issuance of the Third Closing Eco Telecom Shares, if any,
with the FCSM and in any event prior to the Issuer's execution of any other
agreement with respect to any of the Third Closing Eco Telecom Shares, the
Issuer and Eco Telecom shall execute the Individual Share Purchase Agreement
(osnovnoi dogovor) attached as Annex A to Schedule 2.03(a)(i) which shall
incorporate by reference the terms and conditions of this Agreement applicable
to Eco Telecom, except that this Section 2.03(a)(i)(B) shall be excluded.
(ii) Intentionally omitted.
(iii) Intentionally omitted.
11
(b) Purchase Price.
---------------
(i) Eco Telecom. Subject to the terms and conditions hereof and in
-----------
consideration of the sale and transfer to Eco Telecom by the Issuer of the Third
Closing Eco Telecom Shares, if any, on the Third Closing Date, Eco Telecom shall
pay to the Issuer the Third Closing Eco Telecom Purchase Price in the manner
provided in Section 2.03(c)(ii) and, if applicable, the Third Closing Eco
Telecom Purchase Price shall be allocable entirely to, and deemed to be in
consideration of, the Third Closing Eco Telecom Shares being purchased
hereunder.
(ii) Fractional Shares. Notwithstanding anything to the contrary
-----------------
contained herein, if the number of Third Closing Eco Telecom Shares includes a
fractional share of Common Stock then, in lieu of issuing any such fractional
share, the number of Third Closing Eco Telecom Shares shall be rounded up to the
nearest whole share, and the Third Closing Eco Telecom Purchase Price shall be
increased proportionately.
(iii) Intentionally omitted.
(c) Pre-Closing; Closing.
---------------------
(i) Pre-Closing. If the number of Third Closing Eco Telecom Shares is
-----------
greater than zero then, on a date which is five (5) Business Days prior to the
Third Closing Date the Issuer, Eco Telecom VIP and Telenor (if Telenor is a
shareholder of the Issuer as of such date), shall (i) attend a pre-closing
meeting ("the Third Closing Pre-Closing Meeting") at the offices of the VIP's
counsel, located at Xxxxx Xxxxx XX, 0 Xxxxxxx Xxxxxx, Xxxxxx 000000, Russian
Federation (or at such other place as Eco Telecom and the Issuer, and VIP and
Telenor, if applicable, mutually agree) at 10:00 am local time, and (ii) review
the documents to be delivered at the Third Closing to determine whether the
conditions precedent specified in Article XI with respect to the Third Closing
have been, or will on the Third Closing Date be capable of being, fulfilled. At
the Third Closing Pre-Closing Meeting, VIP shall present its calculations
concerning the re-distributions of Preferred Stock required at the Third Closing
pursuant to Section 2.09.
(ii) Closing. If applicable, the Third Closing will take place at the
-------
offices of VIP's counsel at the address set out in the immediately preceding
paragraph, or at such other place as Eco Telecom, the Issuer, and VIP, and
Telenor, if applicable, mutually agree, at 10:00 am local time on the Third
Closing Date. If applicable, on the Third Closing Date, if the conditions
precedent specified in Article XI with respect to the Third Closing have been
fulfilled (or properly waived in writing in accordance with Article XI), then
(i) Eco Telecom shall pay to the Issuer the Third Closing Eco Telecom Purchase
Price in US dollars, by wire transfer of immediately available funds to the
account(s) designated by the Issuer, and (ii) upon receipt by the Issuer of the
Third Closing Eco Telecom Purchase Price, the Issuer shall deliver immediately
to Eco Telecom an extract from the share register of the Issuer issued by the
Registrar and showing Eco Telecom as the owner of the Third Closing Eco Telecom
Shares. Upon payment by Eco Telecom of the Third Closing Eco Telecom Purchase
Price in accordance with this Section 2.03, the Issuer shall cause to be
delivered to each party to this Agreement a certificate of the bank to which the
Third Closing Eco Telecom Purchase Price is paid confirming that the Third
Closing Eco Telecom Purchase Price has been received by the Issuer into its
account.
12
2.04 Second Closing Purchase by VIP and Second Closing Option of Telenor
-------------------------------------------------------------------
(a) VIP Purchase Obligation. Subject to the terms and conditions hereof,
-----------------------
including without limitation Section 2.02(a)(ii), on but not later than the
Second Closing Date, VIP shall:
(i) in the event Telenor exercises the Second Closing Telenor Option
at the Second Closing, purchase from the Issuer newly-issued shares of Common
Stock in the amount (but not less than the amount) equal to fifty percent (50%)
of the number of shares of Common Stock determined by dividing US$117,000,000 by
the Per Share Price as of the Second Closing Date (the "Second Closing VIP
Primary Shares") for a purchase price in an amount equal to the product of the
Second Closing VIP Primary Shares and the Per Share Price; or
(ii) in the event Telenor does not exercise the Second Closing
Telenor Option at the Second Closing, purchase from the Issuer newly-issued
shares of Common Stock in the amount (but not less than the amount) equal to one
hundred percent (100%) of the number of shares of Common Stock determined by
dividing US$117,000,000 by the Per Share Price as of the Second Closing Date
(the "Second Closing VIP Secondary Shares") for a purchase price in an amount
equal to the product of the Second Closing VIP Secondary Shares and the Per
Share Price.
(b) Telenor Option. Subject to the terms and conditions hereof, including
--------------
without limitation Section 2.02(a)(iii), on but not later than the Second
Closing Date, Telenor shall have the option, exercisable by written notice to
the Issuer and VIP (the "Second Closing Telenor Option") to purchase from the
Issuer newly-issued shares of Common Stock in the amount (but not less than the
amount) equal to fifty percent (50%) of the number of shares of Common Stock
determined by dividing US$117,000,000 by the Per Share Price as of the Second
Closing Date (the "Second Closing Telenor Primary Option Shares") for a purchase
price in an amount equal to the product of the Second Closing Telenor Primary
Option Shares and the Per Share Price (the "Second Closing Telenor Purchase
Price").
(c) Second Closing Due Diligence Review.
-----------------------------------
(i) During the period commencing ninety (90) calendar days prior to
the Second Closing Date and ending on the Second Closing Date, the Issuer shall
grant Telenor (and their respective authorized Representatives) reasonable
access during normal business hours to its, and its Subsidiaries', premises,
Books and Records and employees in order for Telenor to perform a due diligence
review of the Issuer's business and operations.
(ii) The Issuer shall, no later than thirty (30) Business Days prior
to the Second Closing Date, deliver to Telenor in writing all information
reasonably requested in writing by Telenor (provided that such written request
by Telenor was delivered to the Issuer no later than forty (40) Business Days
prior to the Second Closing Date).
13
(iii) Between such fortieth (40/th/) Business Day prior to the Second
Closing Date and the Second Closing Date, the Issuer shall use reasonable
efforts to promptly supply in writing all other information reasonably requested
by Telenor in writing.
(d) Notice of Intention. At the Second Closing Pre-Closing Meeting,
-------------------
Telenor shall deliver written notice to VIP (the "Second Closing Notice of
Intention") and the Issuer stating whether (and to what extent) it intends to
exercise its option pursuant to Section 2.04(b) ( the "Second Closing Option").
The Second Closing Notice of Intention shall be for the sole purpose of
providing reasonable notice to the Issuer and VIP of Telenor's intention to
exercise its Second Closing Option and shall in no way obligate Telenor to
exercise its Second Closing Option on the Second Closing Date in the manner
indicated in the Second Closing Notice of Intention or otherwise; provided,
--------
however, that Telenor shall be deemed to have elected not to exercise its Second
-------
Closing Option if it fails to attend the Second Closing Pre-Closing Meeting and
deliver a Second Closing Notice of Intention as provided herein.
(e) Disclosure Letter.
-----------------
(i) Ten (10) Business Days prior to the Second Closing Date, the
Issuer shall deliver to Telenor the Disclosure Letter in the form attached
hereto as Exhibit B with the information contemplated to be included in the
---------
schedules thereto to be provided as of the date of delivery of such letter (the
"Second Closing Disclosure Letter").
(ii) By no later than 10:00 a.m. (Moscow time) on the Business Day
immediately preceding the Second Closing Date, the Issuer shall re-deliver to
Telenor the Second Closing Disclosure Letter with the information included in
the letter and the schedules thereto updated as of the date of delivery of such
letter (the "Updated Second Closing Disclosure Letter"). The Updated Second
Closing Disclosure Letter (including the schedules thereto) shall be clearly
marked to show all changes from the Second Closing Disclosure Letter. If
notwithstanding the foregoing, the Updated Second Closing Disclosure Letter
shall be delivered after 10:00 a.m. (Moscow time) on such date, then, upon the
request of Telenor, the closing date with respect to the Second Closing VIP
Shares and the Second Closing Telenor Shares only shall be postponed to (A) one
(1) Business Day following the date of delivery of such Updated Second Closing
Disclosure Letter (if such letter is delivered by 10:00 a.m. (Moscow time) on
the date of delivery) or (B) two (2) Business Days following the date of
delivery of such Updated Second Closing Disclosure Letter (if such letter is
delivered after 10:00 a.m. (Moscow time) on the date of delivery). At such
later closing date, (i) VIP shall purchase (and the Issuer shall have the
obligation to sell to VIP) the Second Closing VIP Shares, at the same price and
in the same manner as VIP was obligated to purchase such shares at the Second
Closing and (ii) Telenor shall have the right, but not the obligation, to
purchase (and the Issuer shall have the obligation to sell to Telenor) the
Second Closing Telenor Shares, at the same price and in the same manner as
Telenor was entitled to purchase such shares at the Second Closing. The Second
Closing Disclosure Letter and the Updated Second Closing Disclosure Letter shall
be considered delivered to Telenor for purposes of this Agreement if such
letters are delivered to the Moscow offices of both Telenor and Telenor's legal
counsel, respectively, as indicated in Section 15.01.
14
(iii) Provided that the Issuer has complied with its obligations
under Section 2.04(c), on the Second Closing Date (or such later closing date as
contemplated in clause (ii) above or Section 2.04(g)), Telenor (if Telenor
exercises its Second Closing Option) shall represent to the Issuer in writing
(by a certificate signed by the President or member of the board of directors of
Telenor) as to whether there is any breach by the Issuer actually known to
Telenor of any representation or warranty made by the Issuer in the Updated
Second Closing Disclosure Letter. "Actually known" for purposes of this clause
(iii) shall mean that Telenor has been informed in writing, whether in the form
of written responses or any written materials or documentation provided to
Telenor by the Issuer or its counsel, independent accountants or financial
advisor.
(f) Waiver of Option Exercise. In the event that Telenor elects not to
-------------------------
exercise its Second Closing Option, Telenor shall (not later than the Second
Closing Date or such later date, if applicable, to which the closing date with
respect to the Second Closing Telenor Shares has been postponed in accordance
with Section 2.04(e) or Section 2.04(g)) deliver an option waiver notice to the
Issuer in the form attached hereto as Exhibit C.
(g) Consequences of Failure to Consummate Second Closing; Additional
----------------------------------------------------------------
Second Closing.
--------------
(i) Notwithstanding any provision of this Agreement to the contrary,
if Eco Telecom for whatever reason does not pay the Second Closing Eco Telecom
Purchase Price to the Issuer on the Second Closing Date, all rights and
obligations of Eco Telecom under Section 2.03 shall terminate; provided,
--------
however, that Eco Telecom will be deemed to have breached its obligations under
-------
this Agreement to pay the Second Closing Eco Telecom Purchase Price and the
Third Closing Eco Telecom Purchase Price, respectively, if Eco Telecom does not
pay the Second Closing Eco Telecom Purchase Price to the Issuer on the Second
Closing Date for any reason other than due to non-fulfillment on the Second
Closing Date of the conditions precedent contained in paragraphs (b) through (g)
of Section 10.01.
(ii) Notwithstanding any provision of this Agreement to the contrary,
following an Eco Telecom Second Closing Contribution Default and provided that
at the Second Closing VIP is obligated pursuant to Section 2.04(a) to purchase
the Second Closing VIP Shares, VIP may, in its sole discretion by written notice
to the Issuer and Telenor delivered on the Second Closing Date, elect to
postpone the closing date with respect to its purchase of the aggregate amount
of shares of Common Stock which VIP is obligated to purchase pursuant to Section
2.04(a) to a date which is no later than five (5) Business Days following the
Second Closing Date. At such later closing date VIP shall have the right, but
not the obligation, to purchase (and the Issuer shall have the obligation to
sell to VIP) such shares, at the same purchase price and in the same manner as
VIP was entitled to purchase such shares at the Second Closing, provided that no
additional Disclosure Letter need be delivered.
(iii) Notwithstanding any provision of this Agreement to the
contrary, following an Eco Telecom Second Closing Contribution Default and
provided that at the Second Closing Telenor has the right pursuant to Section
2.04(b) to purchase the Second Closing Telenor Shares, Telenor may, in its sole
discretion by written notice to the Issuer and VIP
15
delivered on the Second Closing Date, elect to postpone the closing date with
respect to its purchase of the aggregate amount of shares of Common Stock which
Telenor has the right to purchase pursuant to Section 2.04(b) to a date which is
no later than five (5) Business Days following the Second Closing Date. At such
later closing date Telenor shall have the right, but not the obligation, to
purchase (and the Issuer shall have the obligation to sell to Telenor) such
shares, at the same purchase price and in the same manner as Telenor was
entitled to purchase such shares at the Second Closing, provided that no
additional Disclosure Letter need be delivered.
2.05 Intentionally omitted.
2.06 Effect of Eco Telecom Contribution Default on Purchase Options; Deemed
----------------------------------------------------------------------
Breach
------
(a) Subject to Section 2.04(g), upon the occurrence of an Eco Telecom
Second Closing Contribution Default, the obligation of VIP under Section 2.04(a)
shall be considered to be a right, but not an obligation, of VIP. Subject to
Section 2.04(g), the rights of Telenor under Section 2.04 above shall not be
affected by the occurrence of an Eco Telecom Second Closing Contribution
Default.
(b) Eco Telecom will be deemed to have breached its obligations under this
Agreement to pay the Third Closing Eco Telecom Purchase Price if Eco Telecom
does not pay the Third Closing Eco Telecom Purchase Price, if any, to the Issuer
on the Third Closing Date, if applicable, for any reason other than due to non-
fulfillment on the Third Closing Date of the conditions precedent contained in
paragraphs (a)(ii) through (a)(vii) of Section 11.01.
2.07 Intentionally omitted.
2.08 Redistribution of Preferred Stock at the Second Closing
--------------------------------------------------------
(a) The parties hereto agree that simultaneously with the Second Closing
(or on the Second Closing Date in the event of an Eco Telecom Second Closing
Contribution Default), Eco Telecom will sell at nominal value to each other
Purchaser such number of shares of Preferred Stock, and each other Purchaser
will purchase at nominal value from Eco Telecom such number of shares of
Preferred Stock, so that after taking into account all shares of Common Stock
actually issued in the Second Closing and the transfers of the Preferred Stock
pursuant to this Section 2.08(a), each of the Purchasers will own the Second
Closing Implied Percentage (or the Second Closing Contribution Default
Percentage in the event of a Second Closing Eco Telecom Contribution Default)
(the Second Closing Implied Percentage or the Second Closing Contribution
Default Percentage, as the case may be, the "Second Closing Applicable
Percentage").
(b) If shares of Common Stock are purchased at any Additional Second
Closing following the Second Closing Date, then, simultaneously with such
Additional Second Closing, each Purchaser will sell at nominal value to each
other Purchaser such number of shares of Preferred Stock, and/or each Purchaser
will purchase at nominal value from each other Purchaser, such number of shares
of Preferred Stock, so that each of the Purchasers will own the Second Closing
Applicable Percentage as if the Additional Second Closing occurred
simultaneously with the Second Closing.
16
2.09 Redistribution of Preferred Stock at the Third Closing
------------------------------------------------------
The parties hereto agree that simultaneously with the Third Closing, if
any, or on the Third Closing Date in the event of an Eco Telecom Third Closing
Contribution Default, each Purchaser will sell at nominal value to each other
Purchaser such number of shares of Preferred Stock, and/or each Purchaser will
purchase at nominal value from each other Purchaser such number of shares of
Preferred Stock, so that after taking into account all shares of Common Stock
actually issued in the Third Closing and the transfers of the shares of the
Preferred Stock pursuant to this Section 2.09(a), each of the Purchasers will
own the Third Closing Implied Percentage (or the Third Closing Contribution
Default Percentage in the event of a Third Closing Eco Telecom Contribution
Default).
2.10 Redistribution of Preferred Stock Upon Exercise of VIP-R Call Option
--------------------------------------------------------------------
The parties hereto agree that on any date prior to the Conversion when Eco
Telecom transfers to Telenor any shares of Common Stock of the Issuer as a
result of Telenor's exercise of the VIP-R Call Option (the "Exercise Transfer")
the following shall occur (and shall be deemed to occur simultaneously): each
Purchaser will sell at nominal value to each other Purchaser such number of
shares of Preferred Stock and/or each Purchaser will purchase at nominal value
from the other Purchasers such number of shares of Preferred Stock, so that
after taking into account the Exercise Transfer and the transfers of the
Preferred Stock pursuant to this Section 2.10 each of the Purchasers will own
the Telenor Option Exercise Percentage.
2.11 Conversion of Preferred Stock; Further Assurances
-------------------------------------------------
(a) Immediately following the later of (x) (i) if Eco Telecom purchases
the Additional Second Closing Eco Telecom Shares for a purchase price of
US$58,500,000, the Second Closing or (ii) if Eco Telecom does not purchase the
Additional Second Closing Eco Telecom Shares for a purchase price of
US$58,500,000, the Third Closing and the completion of all regulatory steps in
connection therewith, or (y) the exercise by VIP (through VIP Sub) of the right
to repurchase shares of Preferred Stock as specified in Section 2.12, the Issuer
shall approve a decision on the issuance of the shares of Common Stock (the
"Convertible Decision on Issuance"). The Convertible Decision on Issuance shall
provide (x) for the issuance of an amount of shares of Common Stock equal to the
amount of shares of Preferred Stock then outstanding and held by all Purchasers
and (y) that such shares of Common Stock shall be issued only in exchange for
such shares of Preferred Stock without any additional payments or premium. As
soon as practicable following such approval the Issuer will effect the
registration of the Convertible Decision on Issuance with the FCSM and shall
take all measures necessary to effect the conversion of such shares of the
Preferred Stock into shares of Common Stock (the "Conversion").
(b) In the event that the magnitude of (i) any redistribution of shares of
Preferred Stock at the Second Closing and/or the Third Closing and/or Exercise
Transfer as set forth in Sections 2.08, 2.09 or 2.10 or (ii) the exercise by VIP
(through VIP Sub) of the right to repurchase shares of Preferred Stock as
specified in Section 2.12, results in any Purchaser having
17
fewer shares of Preferred Stock than such Purchaser is required to sell to the
other Purchasers (or VIP Sub) to comply fully with the provisions of Sections
2.08, 2.09 or 2.10 (as applicable for such particular Closing or Exercise
Transfer) or Section 2.12, then such Second Closing, Third Closing or Exercise
Transfer (as applicable) shall be effected and shall be completed but the
provisions of Sections 2.08, 2.09 or 2.10 (as applicable for such particular
Closing or Exercise Transfer) shall not apply and the parties agree to negotiate
in good faith and use reasonable efforts to reach an alternative arrangement
which will allow the parties to attain the results contemplated in Sections
2.08, 2.09, 2.10, 2.11(a) and 2.12.
(c) Each of the Issuer and each Purchaser agrees to take all actions
reasonably necessary to effect the transactions set forth in, or contemplated
by, Article II of this Agreement, including, but not limited to waiving any
rights under Articles 30 and 75 of the Federal Law of the Russian Federation "On
Joint Stock Companies", dated December 26, 1995, as amended, or similar rights
which may be established by laws and regulations amending or replacing the
provisions of the above-mentioned Articles.
(d) The Parties hereby acknowledge that the general purpose of the
provisions of Sections 2.08, 2.09, 2.10, 2.11(a), 2.11(b) and 2.12 (the
"Compensating Sections") hereof is that after the implementation of the
provisions of the Compensating Sections (and, for the avoidance of doubt, after
the Conversion) each of the Purchasers own the same percentage of the shares of
the Common Stock of the Issuer (which percentage shall then be equal to the
percentage of the voting capital stock of the Issuer) as if (x) all the
Purchasers' Shares, whenever issued by the Issuer to the Purchasers pursuant to
this Agreement, were issued at the Per Share Price specified in Schedule
1.01(C), (y) the Eco Telecom Preferred Stock was never issued, and (z) all
transactions in respect of the shares of Common Stock occurred as they actually
occurred before the Conversion.
9. The phrase "or the GMS, as applicable," shall be inserted after the
phrase "approval of the amendments to the Charter by the Board" in Section
3.03(c) of the Primary Agreement.
10. The phrase "validly authorized by the Board of Directors" in the third
line of Section 4.02 of the Primary Agreement shall be replaced with the phrase
"validly authorized by the board of directors".
11. The phrase "which is approved by the Board or shareholders in
accordance with the Charter or in accordance with the internal documents of the
Company approved by the Board in accordance with Section 10.5.10 of the Charter"
in Section 5.07(b) of the Primary Agreement shall be deleted and replaced with
the phrase "which is approved by the GMS in accordance with the Charter or in
accordance with the internal documents of the Company approved by the GMS in
accordance with Section 9.2.19 of the Charter".
12. The phrase "Article II or" in Sections 10.01(d) and 11.01(a)(iv) of
the Primary Agreement shall be deleted.
18
13. The term "Additional Closings" in the title of Article XI and each
place it appears in Article 11.02 of the Primary Agreement shall be deleted and
replaced by the term "Additional Second Closings".
14. The term "Disclosure Letters" in Sections 12.01, 13.01(b) and 13.01(c)
of the Primary Agreement shall be deleted and replaced by the term "Disclosure
Letter".
15. The phrase "or (ii) any willful misconduct, or bad faith action or
failure to act by the CEO of the Issuer (appointed by the members of the Board
nominated to the Board by Eco Telecom (or by VIP as instructed by Eco Telecom)
pursuant to the VIP-R Shareholders Agreement) and/or any member of the senior
management of the Issuer appointed by such CEO" in Section 13.01(a) of the
Primary Agreement shall be deleted and replaced with the following:
"or (ii) any willful misconduct, or bad faith action or failure to act
prior to February 21, 2002 by (a) the CEO of the Issuer or (b) any member of
the senior management of the Issuer appointed by such CEO, in each case
irrespective of when such willful misconduct, or bad faith action or failure to
act is discovered."
16. Article 15.05 of the Primary Agreement shall be amended by deleting
the phrase "Sections 2.04(c) and 2.05(d)" in the first sentence thereof and
replacing it in its entirety with the phrase "Section 2.04(c)".
17. Paragraph 2 of Exhibit B (Form of Second Closing Disclosure Letter) to
the Primary Agreement shall be amended by deleting the words "the shareholder or
Board of Directors as applicable of the Issuer" and replacing them with the
words "the GMS".
18. The parties hereto acknowledge and agree that this Amendment shall
become effective only if (i) VIP's shareholders approve items 10 and 11 set
forth on the agenda of VIP's 2002 annual GMS, (ii) either (X) at least US$200
million is disbursed to VIP under a loan agreement to be entered into by VIP, as
borrower, with X.X. Xxxxxx AG, as lender or (Y) at least 80% of all members of
the VIP Board approve the waiver of clause 18(ii)(X) and (iii) the Company
obtains all necessary consents and waivers of third parties. In the event that
(i) VIP's shareholders do not approve such items 10 and 11 on the agenda of
VIP's 2002 annual GMS, (ii) (X) at least US$200 million is not disbursed to VIP
under a loan agreement to be entered into by VIP, as borrower, with X.X. Xxxxxx
AG, as lender, and (Y) at least 80% of all members of the VIP Board do not
approve the waiver of clause 18(ii)(X) or (iii) the Company is unable to obtain
all necessary consents and waivers of third parties, this Amendment shall be
null and void and of no force or effect.
19. This Amendment shall become effective only upon its execution by all
parties hereto.
19
IN WITNESS WHEREOF, each of the parties has caused this Amendment to be
duly executed by its duly authorized officer, effective as of the day and year
first above written.
OPEN JOINT STOCK COMPANY "VIMPEL-COMMUNICATIONS"
By: /s/ Xx Xxxxxx
------------------------------------------
Name: Xx Xxxxxx
Title: CEO/General Director
By: /s/ Xxxxxxx Steshchenko
------------------------------------------
Name: Xxxxxxx Steshchenko
Title: Chief Accountant
ECO TELECOM LIMITED
By: /s/ Xxxxx Xxxxxxx
------------------------------------------
Name: Xxxxx Xxxxxxx
Title: Attorney-in-Fact
TELENOR EAST INVEST AS
By: /s/ Xxxxxx Xxxxxxxxx
------------------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Attorney-in-Fact
OPEN JOINT STOCK COMPANY "VIMPELCOM-REGION"
By: /s/ Xxxxxx Xxxxxxxxxx
------------------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: General Director
By: /s/ Xxxxxx X. Xxxxxxxxx
------------------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Chief Accountant
20
Appendix A
----------
Additional Closings
Additional Third Closings
Second Closing Telenor Primary Option Purchase Price
Second Closing Telenor Reduced Shares
Second Closing Telenor Secondary Option Shares
Second Closing VIP Option
Second Closing VIP Primary Option Purchase Price
Telenor Third Closing Notice of Intention
Third Closing Applicable Percentage
Third Closing Disclosure Letter
Third Closing Notice of Intention
Third Closing Telenor Option
Third Closing Telenor Primary Option Shares
Third Closing Telenor Primary Option Purchase Price
Third Closing Telenor Purchase Price
Third Closing Telenor Secondary Option Shares
Third Closing Telenor Secondary Option Purchase Price
Third Closing Telenor Shares
Third Closing Telenor Tertiary Option Shares
Third Closing VIP Option
Third Closing VIP Primary Option Shares
Third Closing VIP Primary Option Purchase Price
Third Closing VIP Purchase Price
Third Closing VIP Secondary Option Purchase Price
Third Closing VIP Secondary Option Shares
Third Closing VIP Shares
Updated Third Closing Disclosure Letter
VIP Third Closing Notice of Intention
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