UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 15)
OPEN JOINT STOCK COMPANY "VIMPEL-COMMUNICATIONS"
------------------------------------------------
(Name of Issuer)
Common Stock, 0.005 rubles nominal value
----------------------------------------
(Title of Class of Securities)
68370R 10 9
-----------
(CUSIP Number)
Bjorn Hogstad, Esq.
Telenor ASA
Snaroyveien 30
N-1331 Fornebu, Norway
47-97-77-8806
-------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
May 15, 2002
------------
(Date of Event which Requires Filing
of this Statement)
Copy to:
Peter S. O'Driscoll, Esq.
Coudert Brothers
60 Cannon Street
London EC4N 6JP
England
44-207-248-3000
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of ss. 240.13d-1(e) or 240.13d-1(f) or 240.13d-1(g), check the
following box. [_]
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See s. 240.13d-7 for other
parties to whom copies are to be sent.
*The remainder of this cover page will be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter disclosure
provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
SCHEDULE 13D
----------------------------- -----------------------------
CUSIP No. 68370R 10 9
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1. NAME OF REPORTING PERSON
S.S. OR I.R.S IDENTIFICATION NO. OF ABOVE PERSON
Telenor East Invest AS
000-00-0000
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_]
(SEE INSTRUCTIONS) (b) [_]
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3. SEC USE ONLY
--------------------------------------------------------------------------------
4. SOURCE OF FUNDS (SEE INSTRUCTIONS)
WC
--------------------------------------------------------------------------------
5. CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [_]
N/A
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
Norway
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7. SOLE VOTING POWER
11,731,363/(1)/
-------------------------------------------------------
NUMBER OF 8. SHARED VOTING POWER
SHARES
BENEFICIALLY -0-
OWNED BY -------------------------------------------------------
EACH 9. SOLE DISPOSITIVE POWER
REPORTING
PERSON WITH 11,731,363/(1)/
-------------------------------------------------------
10. SHARED DISPOSITIVE POWER
-0-
--------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,731,363/(1)/
--------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES (SEE INSTRUCTIONS) [_]
The aggregate amount reported as beneficially owned in row (11)
does not include shares which the Reporting Person discloses in
the report but as to which beneficial ownership is disclaimed
pursuant to Rule 13d-4 [17 CFR 240.13d-4] under the Securities
Exchange Act of 1934.
--------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
28.98% of the outstanding Common Stock (25% plus 13 shares of the
outstanding voting capital stock)
--------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
CO
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/1./ Represents 11,689,713 shares held directly by the Reporting Person and
41,650 shares subject to options granted to Mr. Jo Lunder, an employee of
Telenor ASA seconded to VimpelCom and currently serving as VimpelCom's CEO and
General Director. The Reporting Person disclaims beneficial ownership of the
41,650 shares subject to options granted to Mr. Lunder.
SCHEDULE 13D
----------------------------- -----------------------------
CUSIP No. 68370R 10 9
--------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
I.R.S IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Telenor Mobile Holding AS
000-00-0000
--------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_]
(SEE INSTRUCTIONS) (b) [_]
--------------------------------------------------------------------------------
3. SEC USE ONLY
--------------------------------------------------------------------------------
4. SOURCE OF FUNDS (SEE INSTRUCTIONS)
AF
--------------------------------------------------------------------------------
5. CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [_]
N/A
--------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Norway
--------------------------------------------------------------------------------
7. SOLE VOTING POWER
11,731,363/(2)/
-------------------------------------------------------
NUMBER OF 8. SHARED VOTING POWER
SHARES
BENEFICIALLY -0-
OWNED BY -------------------------------------------------------
EACH 9. SOLE DISPOSITIVE POWER
REPORTING
PERSON WITH 11,731,363/(2)/
-------------------------------------------------------
10. SHARED DISPOSITIVE POWER
-0-
--------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,731,363/(2)/
--------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES (SEE INSTRUCTIONS) [_]
The aggregate amount reported as beneficially owned in row (11)
does not include shares which the Reporting Person discloses in
the report but as to which beneficial ownership is disclaimed
pursuant to Rule 13d-4 [17 CFR 240.13d-4] under the Securities
Exchange Act of 1934.
--------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
28.98% of the outstanding Common Stock (25% Plus 13 shares of the
outstanding voting capital stock)
--------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
CO
--------------------------------------------------------------------------------
/2./ The Reporting Person disclaims beneficial ownership of all shares.
SCHEDULE 13D
----------------------------- -----------------------------
CUSIP No. 68370R 10 9
--------------------------------------------------------------------------------
1. NAME OF REPORTING PERSON
S.S. OR I.R.S IDENTIFICATION NO. OF ABOVE PERSON
Telenor ASA
000-00-0000
--------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_]
(SEE INSTRUCTIONS) (b) [_]
--------------------------------------------------------------------------------
3. SEC USE ONLY
--------------------------------------------------------------------------------
4. SOURCE OF FUNDS (SEE INSTRUCTIONS)
AF
--------------------------------------------------------------------------------
5. CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) [_]
N/A
--------------------------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Norway
--------------------------------------------------------------------------------
7. SOLE VOTING POWER
11,731,363/(3)/
-------------------------------------------------------
NUMBER OF 8. SHARED VOTING POWER
SHARES
BENEFICIALLY -0-
OWNED BY -------------------------------------------------------
EACH 9. SOLE DISPOSITIVE POWER
REPORTING
PERSON WITH 11,731,363/(3)/
-------------------------------------------------------
10. SHARED DISPOSITIVE POWER
-0-
--------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11,731,363/(3)/
--------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES (SEE INSTRUCTIONS) [_]
The aggregate amount reported as beneficially owned in row (11)
does not include shares which the Reporting Person discloses in
the report but as to which beneficial ownership is disclaimed
pursuant to Rule 13d-4 [17 CFR 240.13d-4] under the Securities
Exchange Act of 1934.
--------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
28.98% of the outstanding Common Stock (25% Plus 13 shares of the
outstanding voting capital stock)
--------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
CO
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/3./ The Reporting Person disclaims beneficial ownership of all shares.
SCHEDULE 13D
Item 1. Security and Issuer
The statement on Schedule 13D relating to the common stock, 0.005
rubles nominal value (the "Common Stock"), of Open Joint Stock Company
"Vimpel-Communications," a Russian open joint stock company ("VimpelCom"), as
previously filed by Telenor East Invest AS, Telenor Communication AS and Telenor
ASA (as amended, the "Statement"), is hereby amended and supplemented with
respect to the items set forth below.
Item 2. Identity and Background
This amendment to the statement on Schedule 13D is being filed jointly
by Telenor East Invest AS, Telenor Mobile Holding AS and Telenor ASA.
TELENOR EAST INVEST AS
(a) Telenor East Invest AS, a corporation formed under the laws of
Norway.
(b) Snaroyveien 30
N-1331 Fornebu
Norway
(c) Telenor East Invest AS is engaged principally in the business of
investing in the telecommunications industry outside of Norway.
(d) During the last five years, Telenor East Invest AS has not been
convicted in a criminal proceeding.
(e) During the last five years, Telenor East Invest AS was not a party
to a civil proceeding of a judicial or administrative body as a result of which
Telenor East Invest AS was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities subject
to, federal or state securities laws or finding any violation with respect to
such laws.
EXECUTIVE OFFICERS AND DIRECTORS OF TELENOR EAST INVEST AS
(a), (b), (c) and (f) The following information sets forth the name,
citizenship, business address and present principal occupation of each of the
directors and executive officers of Telenor East Invest AS. Except as otherwise
indicated, the business address of each of such persons is Telenor East Invest
AS, c/o Telenor ASA, Snaroyveien 30, N-1331 Fornebu, Norway.
4
DIRECTORS OF TELENOR EAST INVEST AS
Name and Business Address Citizenship Present Principal Occupation
------------------------- ----------- ----------------------------
Sigmund Ekhougen Norway Vice President of Telenor Mobile Communications AS
(Oslo, Norway)
Torstein Moland Norway Senior Executive Vice President and Chief Financial
(Lier, Norway) Officer of Telenor ASA
Henrik Eidemar Torgersen Norway Chairman and Chief Executive Officer of Telenor
(Oslo, Norway) East Invest AS and Executive Vice President of
Telenor ASA
EXECUTIVE OFFICERS OF TELENOR EAST INVEST AS
Name and Business Address Citizenship Present Principal Occupation
------------------------- ----------- ----------------------------
Henrik Eidemar Torgersen Norway Chairman and Chief Executive Officer of Telenor
(Oslo, Norway) East Invest AS and Executive Vice President of
Telenor ASA
(d) During the last five years, none of the above executive officers
and directors of Telenor East Invest AS has been convicted in a criminal
proceeding.
(e) During the last five years, none of the above executive officers
and directors of Telenor East Invest AS was a party to a civil proceeding of a
judicial or administrative body as a result of which Telenor East Invest AS was
or is subject to a judgment, decree or final order enjoining future violations
of, or prohibiting or mandating activities subject to, federal or state
securities laws or finding any violation with respect to such laws.
TELENOR MOBILE HOLDING AS
(a) Telenor Mobile Holding AS, a corporation formed under the laws of
Norway.
(b) Snaroyveien 30
N-1331 Fornebu
Norway
(c) Telenor Mobile Holding AS is engaged principally in the development
of and investment in the field of telecommunication through direct and indirect
ownership of companies and entering into agreements relating to
telecommunication.
(d) During the last five years, Telenor Mobile Holding AS has not been
convicted in a criminal proceeding.
(e) During the last five years, Telenor Mobile Holding AS was not a
party to a civil proceeding of a judicial or administrative body as a result of
which Telenor Mobile Holding AS was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting or mandating activities
subject to, federal or state securities laws or finding any violation with
respect to such laws.
5
EXECUTIVE OFFICERS AND DIRECTORS OF TELENOR
MOBILE HOLDING AS
(a), (b), (c) and (f) The following information sets forth the name,
citizenship, business address and present principal occupation of each of the
directors and executive officers of Telenor Mobile Holding AS. The address of
the directors and executive officers is Telenor Mobile Holding AS, c/o Telenor
ASA, Snaroyveien 30 N-1331 Fornebu, Norway.
DIRECTORS OF TELENOR MOBILE HOLDING AS
Name and Business Address Citizenship Present Principal Occupation
------------------------- ----------- ----------------------------
Torstein Moland Norway Senior Executive Vice President
(Lier, Norway) and Chief Financial Officer of
Telenor ASA
Jan Edvard Thygesen Norway Executive Vice President of
(Nesbru, Norway) Telenor ASA and Chief Executive
Officer of Telenor Network Services
Stig Eide Sivertsen Norway Executive Vice President of
(Oslo, Norway) Telenor ASA and Chairman of
Telenor Broadband Services AS
Henrik Eidemar Torgersen Norway Chairman and Chief Executive
(Oslo, Norway) Officer of Telenor East Invest AS
and Executive Vice President of
Telenor ASA
Morten Fallstein Norway Employee Representative
(Oslo, Norway)
Tore Haugland Norway Employee Representative
(Bergen, Norway)
Anne Mette Hojem Norway Employee Representative
(Oslo, Norway)
6
EXECUTIVE OFFICERS OF TELENOR MOBILE HOLDING AS
Name and Business Address Citizenship Present Principal Occupation
------------------------- ----------- ----------------------------
Arve Johansen Norway Senior Executive Vice President of Telenor ASA,
(Lier, Norway) Chief Executive Officer of Telenor Mobile
Communication AS and Chief Executive Officer of
Telenor Mobile Holding AS
Tormod Hermansen Norway Chief Executive Officer of Telenor ASA and
(Oslo, Norway) Chairman of the Board of Telenor Mobile Holding
AS
(d) During the last five years, none of the above executive officers
and directors of Telenor Mobile Holding AS has been convicted in a criminal
proceeding.
(e) During the last five years, none of the above executive officers
and directors of Telenor Mobile Holding AS has been a party to a civil
proceeding of a judicial or administrative body as a result of which such
executive officer or director was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting or mandating activities
subject to, federal or state securities laws or finding any violation with
respect to such laws.
TELENOR ASA
(a) Telenor ASA, a corporation formed under the laws of Norway.
(b) Snaroyveien 30
N-1331 Fornebu
(c) Telenor ASA is engaged principally in the business of production
and supply of services in the fields of telecommunications, data services and
media distribution.
(d) During the last five years, Telenor ASA has not been convicted in a
criminal proceeding.
(e) During the last five years, Telenor ASA was not a party to a civil
proceeding of a judicial or administrative body as a result of which Telenor ASA
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
EXECUTIVE OFFICERS AND DIRECTORS OF TELENOR ASA
(a), (b), (c) and (f) The following information sets forth the name,
citizenship, business address and present principal occupation of each of the
directors and executive officers of Telenor ASA. Except as otherwise indicated,
the business address of each of such persons is c/o Telenor ASA, Snaroyveien 30
N-1331 Fornebu, Norway.
7
DIRECTORS OF TELENOR ASA
Name and Business Address Citizenship Present Principal Occupation
------------------------- ----------- ----------------------------
Tom Vidar Rygh Norway Chairman of the Board of Telenor ASA, Executive
(Oslo, Norway) Vice President of Orkla, Vice Chairman of the
Board of Industrikapital and Member of the Board
of Directors of Stepstone ASA
Ashild Marianne Bendiktsen Norway Chief Financial Officer of Entrepenor Bendiktsen
(Salangen, Norway) & Aasen AS
Torleif Enger Norway Executive Vice President of Norsk Hydro ASA
(Ostre Toten, Norway)
Einar Forde Norway Director of Telenor ASA
(Oslo, Norway)
Hanne de Mora Switzerland Principal of A-Connect.
(Erlenbach, Switzerland)
Jorgen Lindegaard Sweden President and Chief Executive Officer of the SAS
(Stockholm, Sweden) Group, Chairman of the Board of Sonofon Holding
AS and member of the Boards of
Finansieringsinstituttet for Industri og
Haandvaerk AS and Superfos AS
Bjorg Ven Norway Partner, Haavind Vislie Law Firm, Chairman of
(Oslo, Norway) the Board of the National Insurance Fund and
Gjensidige NOR Spareforsikring
Per Gunnar Salomonsen Norway Employee Representative
(Skien, Norway)
Harald Stavn Norway Employee Representative
(Kongsberg, Norway)
Irma Ruth Tystad Norway Employee Representative
(Trysil, Norway)
8
EXECUTIVE OFFICERS OF TELENOR ASA
Name and Business Address Citizenship Present Principal Occupation
------------------------- ----------- ----------------------------
Tormod Hermansen Norway Chief Executive Officer of Telenor ASA, Chairman
(Oslo, Norway) of the Board of Directors of Telenor
Communication AS and Chairman of the Board of
Telenor Mobile Holding AS
Arve Johansen Norway Senior Executive Vice President of Telenor ASA,
(Lier, Norway) Chief Executive Officer of Telenor Mobile
Communication AS and Chief Executive Officer of
Telenor Mobile Holding AS
Torstein Moland Norway Senior Executive Vice President and Chief
(Lier, Norway) Financial Officer of Telenor ASA|
Jon Fredrik Baksaas Norway Deputy Chief Executive Officer of Telenor ASA
(Sandvika, Norway) and Chief Executive Officer of Telenor
Communication AS
Gun Bente Johansen Norway Executive Vice President of Telenor ASA
(Oslo, Norway)
Bjorn Formo Norway Executive Vice President of Telenor ASA
(Oslo, Norway)
Jan Edvard Thygesen Norway Executive Vice President of Telenor ASA and
(Nesbru, Norway) Chief Executive Officer of Telenor Network
Services
Morten Lundal Norway Executive Vice President of Telenor ASA, Chief
(Oslo, Norway) Executive Officer of Nextra AS and Chairman of
the Board of Telenor Internett AS
Stig Eide Sivertsen Norway Executive Vice President of Telenor ASA and
(Oslo, Norway) Chairman of the Board of Telenor Broadband
Services AS
Henrik Eidemar Torgersen Norway Executive Vice President of Telenor ASA and
(Oslo, Norway) Chief Executive Officer and Chairman of the
Board of Telenor East Invest AS
Berit Svendsen Norway Executive Vice President of Telenor ASA and
(Oslo, Norway) Chief Technical Officer of Telenor ASA
(d) During the last five years, none of the above executive officers
and directors of Telenor ASA has been convicted in a criminal proceeding.
(e) During the last five years, none of the above executive officers
and directors of Telenor ASA has been a party to a civil proceeding of a
judicial or administrative body as a result of which such executive officer or
director was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such laws.
9
Item 4. Purpose of the Transactions
Amendment No. 1 to the VimpelCom-Region Primary Agreement
On July 27, 2001, VimpelCom's shareholders approved the purchase by
VimpelCom of newly-issued shares of Open Joint Stock Company "VimpelCom-Region"
("VimpelCom-Region") in an aggregate amount of US$220 million. Under the terms
of the transaction documents described in the Statement, VimpelCom-Region will
ultimately raise up to US$337 million (if Telenor East Invest AS ("Telenor") and
VimpelCom exercise the options described in Amendment No. 14 to the Statement
and below). In addition to the US$103 million already contributed by VimpelCom,
approximately US$117 million will be raised directly by VimpelCom-Region through
two capital increases to be subscribed by Eco Telecom Limited ("Eco Telecom") in
November 2002 and November 2003, subject to extension in certain cases, for a
total investment of up to US$220 million. Under the transaction documents (prior
to the amendments described below), VimpelCom and Telenor had options, either
collectively or individually, to invest up to an aggregate of US$117 million
directly in VimpelCom-Region simultaneously with Eco Telecom's second and third
investment tranches. If VimpelCom and Telenor exercised these options in full,
each would have invested US$58.5 million in VimpelCom-Region. If either did not
exercise its respective options in full or at all, any unexercised options could
have been exercised by the other company.
On December 3, 2001, as contemplated by the transaction documents
described in Amenment No. 14 to the Statement, VimpelCom-Region sold to Eco
Telecom newly-issued shares of Type-A convertible voting preferred stock of
VimpelCom-Region and one share of common stock of VimpelCom-Region for a
purchase price of approximately US$40,000, resulting in Eco Telecom owning 25%
plus one share of the outstanding voting capital stock of VimpelCom-Region as of
December 3, 2001. After the closing of Eco Telecom's second tranche investment
in VimpelCom-Region scheduled for November 2002, the preferred stock will be
redistributed among Eco Telecom, Telenor and VimpelCom so that each will own the
same percentage of the voting capital stock of VimpelCom-Region that it would
have owned if (a) its investment in VimpelCom-Region at the second closing had
been applied to purchase common stock of VimpelCom-Region at a price per share
of US$40,000 and (b) VimpelCom-Region repurchased from Eco Telecom and cancelled
all the shares of VimpelCom-Region's preferred stock owned by Eco Telecom. After
the closing of Eco Telecom's third tranche investment in VimpelCom-Region
scheduled for November 2003, the preferred stock will again be redistributed
among Eco Telecom, Telenor and VimpelCom so that each will own the same
percentage of the voting capital stock of VimpelCom-Region that it would have
owned if (i) its investments in VimpelCom-Region at the third closing had been
applied to purchase common stock of VimpelCom-Region at a price per share of
US$40,000 and (ii) VimpelCom-Region repurchased from Eco Telecom and cancelled
such number of shares of VimpelCom-Region's preferred stock owned by Eco Telecom
to the extent necessary for Eco Telecom to own at least 25% plus 1 share of the
issued and outstanding voting capital stock of VimpelCom-Region (subject to
certain adjustments in the event that Eco Telecom defaults on its obligations
under to the transaction documents).
On May 15, 2002, VimpelCom, VimpelCom-Region, Eco Telecom and Telenor
entered into Amendment No. 1 to the VimpelCom-Region Primary Agreement.
Amendment No. 1 to the VimpelCom-Region Primary Agreement requires VimpelCom to
exercise its option to purchase newly-issued shares of common stock of
VimpelCom-Region in November 2002 (subject to extension in certain cases) for an
aggregate purchase price of the ruble equivalent of either (a) US$58.5 million
if Telenor exercises its option to purchase
10
newly-issued shares of VimpelCom-Region for a purchase price of US$58.5 million
or (b) US$117 million if Telenor does not exercise its option to purchase
newly-issued shares of VimpelCom-Region. Eco Telecom will invest in
VimpelCom-Region US$58.5 million in November 2002 and US$58.5 million in
November 2003, subject to extension in certain cases, as required under the
terms of the VimpelCom-Region Primary Agreement, unless it chooses to accelerate
all or a part of the amount it is required to invest in November 2003.
Amendment No. 1 to the VimpelCom-Region Primary Agreement also provides
that Telenor's option to invest US$29.5 million in VimpelCom-Region in November
2002 has been combined with its option to invest US$29.5 million in
VimpelCom-Region in November 2003. After giving effect to Amendment No. 1 to the
VimpelCom-Region Primary Agreement, Telenor now has a single option to invest
US$58.5 million in VimpelCom-Region in November 2002 (subject to extension in
certain cases). Such option cannot be exercised in part.
The description of Amendment No. 1 to the VimpelCom-Region Primary
Agreement contained in this Item 4 is qualified in its entirety by reference to
the complete text of Amendment No. 1 to the VimpelCom-Region Primary Agreement
filed as Exhibit B hereto.
Amendment No. 1 to the VimpelCom-Region Shareholders Agreement
On May 15, 2002, VimpelCom, VimpelCom-Region, Eco Telecom and Telenor
entered into Amendment No. 1 to the VimpelCom-Region Shareholders Agreement
(defined in the Statement as the "VIP-R Shareholders Agreement" and hereinafter
referred to as the "VimpelCom-Region Shareholders Agreement"). Amendment No. 1
to the VimpelCom-Region Shareholders Agreement provides that if external
financing is not obtained by February 2005 in order to meet VimpelCom-Region's
five-year funding plan, VimpelCom-Region will give each of its shareholders the
right to contribute to its capital on a pro rata basis in an amount necessary to
make up the funding shortfall. However, if any shareholder does not exercise its
right to make such a contribution, the other shareholders would have the right
to contribute on a pro rata basis all or a portion of such shareholder's
contribution. As part of Amendment No.1 to the VimpelCom-Region Shareholders
Agreement, the shareholders of VimpelCom-Region also agreed to vote in favor of
and take all actions necessary to affect the issuance of shares in connection
with any such share issuance.
In addition, the parties agreed on certain additional terms relating to
a proposed business combination of VimpelCom and VimpelCom-Region, including
that the review of such a combination may be initiated by any shareholder of
VimpelCom-Region that owns at least twenty-five percent (25%) plus one share of
VimpelCom-Region's voting shares (with respect to Eco Telecom, so long as it has
not failed to pay the purchase price for the shares of VimpelCom-Region at the
second or third closings). Such a review must be initiated prior to November 5,
2007 and may be initiated at any time after November 2003 (subject to extension
in certain cases) and on and after the date on which VimpelCom-Region has equal
to or more than the number of subscribers as VimpelCom's Moscow operations. In
the event such a business combination review is initiated, VimpelCom is required
to negotiate in good faith with VimpelCom-Region to determine the structure and
terms and conditions of the business combination. To consummate any such
business combination, VimpelCom is also required to obtain a fairness opinion
from an international investment bank selected in accordance with the procedures
set forth in the VimpelCom-Region Shareholders Agreement, as amended. If (a)
such international investment bank determines that certain parameters are
satisfied with respect to the fair market value of the equity of VimpelCom as it
relates to the
11
fair market value of the equity of VimpelCom-Region, (b) the ratio of the number
of subscribers of VimpelCom's Moscow operations to the number of subscribers of
VimpelCom-Region is between 1:1 and 1:1.2, and (c) VimpelCom and
VimpelCom-Region have negotiated the structure and terms of the business
combination, then the parties are required to take the following actions in
furtherance of a business combination: (i) subject to relevant fiduciary duties
and obtaining shareholder, regulatory and other necessary approvals, VimpelCom
and VimpelCom-Region are required to negotiate in good faith and use all
commercially reasonable efforts to take all actions necessary to effect the
business combination; (ii) subject to the foregoing, VimpelCom is required to
submit to its shareholders for approval the business combination and issuance of
capital stock by it or one of its wholly-owned subsidiaries (or another entity
as the parties may determine); and (iii) Eco Telecom, Telenor and VimpelCom are
required to take all actions within their respective capacity as shareholders of
VimpelCom-Region to approve and effect the business combination.
Amendment No. 1 to the VimpelCom-Region Shareholders Agreement also
provides for VimpelCom-Region to amend and restate its charter to provide that
the board of directors of VimpelCom-Region will be disbanded to create a unified
management structure under VimpelCom. Issues that would otherwise have been
addressed by the Board of Directors of VimpelCom-Region will now be referred to
the shareholders of VimpelCom-Region. VimpelCom will vote its shares of
VimpelCom-Region in accordance with decisions approved by at least 80% of all of
the members of VimpelCom's Board of Directors. In addition, VimpelCom-Region's
charter will be amended to provide that the General Director of VimpelCom-Region
will be appointed by a simple majority vote of the shareholders of
VimpelCom-Region. The amended and restated charter of VimpelCom-Region also
reflects changes required to bring the charter into compliance with Federal Law
No. 120-FZ dated August 7, 2001, on Amending the Federal Law on Joint Stock
Companies.
The description of Amendment No. 1 to the VimpelCom-Region Shareholders
Agreement contained in this Item 6 is qualified in its entirety by reference to
the complete text of Amendment No. 1 to the VimpelCom-Region Shareholders
Agreement filed as an Exhibit C hereto.
Amendment No. 1 to the VimpelCom-Region Registration Rights Agreement
On May 15, 2002, VimpelCom, VimpelCom-Region, Eco Telecom and Telenor
entered into Amendment No. 1 to the VimpelCom-Region Registration Rights
Agreement (defined as the "VimpelCom-R Registration Rights Agreement" in
Amendment No. 14 to the Statement and hereinafter referred to as the
"VimpelCom-Region Registration Rights Agreement"). The principal effect of
Amendment No. 1 to the VimpelCom-Region Registration Rights Agreement is to
amend the VimpelCom-Region Registration Rights Agreement to reflect the
amendment to VimpelCom-Region's charter which eliminated VimpelCom-Region's
Board of Directors and refers issues that would otherwise have been decided by
the Board of Directors of VimpelCom-Region to VimpelCom-Region's shareholders.
The description of Amendment No. 1 to the VimpelCom-Region Registration
Rights Agreement contained in this Item 6 is qualified in its entirety by
reference to the complete text of the Amendment No. 1 to the VimpelCom-Region
Registration Rights Agreement filed as Exhibit D hereto.
12
Item 5. Interest in Securities of the Issuer
On April 12, 2002, as part of a restructuring of Telenor ASA and its
subsidiaries, Telenor Communication AS ("Telenor Communication") transferred all
of the issued and outstanding shares of Telenor East Invest AS to a newly
created holding company, Telenor Mobile Holding AS ("Telenor Mobile Holding").
The restructuring was carried out through a transfer by Telenor ASA
of fifty-eight point ten percent (58.10%) of Telenor Communication's outstanding
share capital back to Telenor Communication in exchange for one hundred percent
(100%) of the share capital of Telenor East Invest AS and the shares of certain
other subsidiaries of Telenor Communication. Telenor ASA then transferred such
other shares to Telenor Mobile Holding in exchange for shares of Telenor Mobile
Holding equal to the value of the share capital of Telenor East Invest AS and
such other shares. After giving effect to such transfer, Telenor Mobile Holding
owns 100% of all of the issued and outstanding shares in Telenor East Invest AS.
Mr. Jo Lunder, an employee of Telenor ASA seconded to VimpelCom and
currently serving as VimpelCom's CEO and General Director, holds options to
purchase 41,650 shares of Common Stock of VimpelCom. As a result, Telenor East
Invest AS, Telenor Mobile Holding and/or Telenor ASA may be deemed to be
indirect beneficial owners of the shares of Common Stock of VimpelCom subject to
the options held by Mr. Lunder. Neither the filing of this Amendment No. 15 nor
any of its contents shall be deemed to constitute an admission that Telenor East
Invest AS, Telenor Mobile Holding or Telenor ASA is the beneficial owner of the
shares of VimpelCom subject to the options held by Mr. Lunder for the purposes
of Section 13(d) of the Securities Exchange Act of 1934, as amended, or for any
other purposes, and such beneficial ownership is expressly disclaimed.
Telenor Mobile Holding is a direct wholly owned subsidiary of
Telenor ASA. As a result, Telenor Mobile Holding and/or Telenor ASA may be
deemed to be indirect beneficial owners of the shares of Common Stock of
VimpelCom owned by Telenor East Invest AS. Neither the filing of this Amendment
No. 15 nor any of its contents shall be deemed to constitute an admission that
Telenor Mobile Holding or Telenor ASA is the beneficial owner of the shares of
VimpelCom held by Telenor East Invest AS for the purposes of Section 13(d) of
the Securities Exchange Act of 1934, as amended, or for any other purposes, and
such beneficial ownership is expressly disclaimed.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer
Except as provided in Amendment No. 1 to the VimpelCom-Region
Primary Agreement, Amendment No. 1 to the VimpelCom Region Shareholders
Agreement and Amendment No. 1 VimpelCom-Region Registration Rights Agreement or
as set forth herein, neither Telenor East Invest AS, Telenor Mobile Holding or
Telenor ASA, nor to the best of Telenor East Invest AS's, Telenor Mobile
Holdings' or Telenor ASA's knowledge, none of the individuals named in Item 2
hereof, has entered into any contract, arrangement, understanding or
relationship (legal or otherwise) with any person with respect to any securities
of VimpelCom, including, but not limited to, transfer or voting of any
securities, finder's fees, joint ventures, loan or option arrangements, puts or
calls, guarantees of profits, division of profits or losses, or the giving or
withholding of proxies.
Item 7. Material to be Filed as Exhibits
1. Attached hereto as Exhibit "A" is a conformed copy of the Joint Filing
Agreement dated June 21, 2002 (the "Joint Filing Agreement") between
and among Telenor East Invest AS, Telenor Mobile Holding AS, Telenor
Communication AS and Telenor ASA relating to the filing of amendments
to the Joint Statement on Schedule 13D.
2. Attached hereto as Exhibit "B" is a copy of Amendment No. 1 to the
VimpelCom-Region Primary Agreement dated as of May 15, 2002 between
and among VimpelCom, VimpelCom-Region, Eco Telecom and Telenor East
Invest AS.
13
3. Attached hereto as Exhibit "C" is a copy of Amendment No. 1 to the
VimpelCom-Region Shareholders Agreement dated as of May 15, 2002
between and among VimpelCom, VimpelCom-Region, Eco Telecom and Telenor
East Invest AS.
4. Attached hereto as Exhibit "D" is a copy of Amendment No. 1 to the
VimpelCom-Region Registration Rights Agreement dated as of May 15,
2002 between and among VimpelCom, VimpelCom-Region, Eco Telecom and
Telenor East Invest AS.
14
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this amendment to the statement on
Schedule 13D is true, complete and correct and that such statement, as amended
hereby, is true, complete and correct.
Dated: June 21, 2002 TELENOR EAST INVEST AS
By /s/ Henrik Eidemar Torgersen
-------------------------------
Henrik Eidemar Torgersen
Chief Executive Officer
TELENOR MOBILE HOLDING AS
By /s/ Arve Johansen
-------------------------------
Arve Johansen
Chief Executive Officer
TELENOR ASA
By /s/ Tormod Hermansen
-------------------------------
Tormod Hermansen
Chief Executive Officer
15
Index to Exhibits
Exhibit A Attached hereto as Exhibit "A" is a conformed copy of the
Joint Filing Agreement dated June 21, 2002 (the "Joint Filing
Agreement") between and among Telenor East Invest AS, Telenor
Mobile Holding AS, Telenor Communication AS and Telenor ASA
relating to the filing of amendments to the Joint Statement on
Schedule 13D.
Exhibit B Attached hereto as Exhibit "B" is a copy of Amendment No. 1
to the VimpelCom-Region Primary Agreement dated as of May 15,
2002 between and among VimpelCom, VimpelCom-Region, Eco
Telecom and Telenor East Invest AS.
Exhibit C Attached hereto as Exhibit "C" is a copy of Amendment No. 1
to the VimpelCom-Region Shareholders Agreement dated as of May
15, 2002 between and among VimpelCom, VimpelCom-Region, Eco
Telecom and Telenor East Invest AS.
Exhibit D Attached hereto as Exhibit "D" is a copy of Amendment No. 1
to the VimpelCom-Region Registration Rights Agreement dated as
of May 15, 2002 between and among VimpelCom, VimpelCom-Region,
Eco Telecom and Telenor East Invest AS.
16
EXHIBIT A
Conformed Copy
JOINT FILING AGREEMENT
We, Telenor East Invest AS, Telenor Mobile Holding AS and Telenor ASA, the
signatories of the amendment to the statement on Schedule 13D to which this
Agreement is attached, hereby agree that such amendment is filed jointly on
behalf of Telenor East Invest AS, Telenor Mobile Holding AS and Telenor ASA. Any
subsequent amendments thereto filed by any of us will be filed jointly on behalf
of Telenor East Invest AS, Telenor Mobile Holding AS and Telenor ASA. Telenor
East Invest AS, Telenor Communication AS and Telenor ASA hereby agree that the
joint filing agreement dated October 12, 2000 between them is hereby terminated
and that such Agreement shall be replaced by this Joint Filing Agreement.
Dated: June 21, 2002
TELENOR EAST INVEST AS
By /s/ Henrik Eidemar Torgersen
-------------------------------
Henrik Eidemar Torgersen
Chief Executive Officer
TELENOR MOBILE HOLDING AS
By /s/ Arve Johansen
-------------------------------
Arve Johansen
Chief Executive Officer
TELENOR ASA
By /s/ Tormod Hermansen
-------------------------------
Tormod Hermansen
Chief Executive Officer
TELENOR COMMUNICATION AS
By /s/ Jon Fredrik Baksaas
-------------------------------
Jon Fredrik Baksaas
Chief Executive Officer
Exhibit B
AMENDMENT NO. 1 TO PRIMARY AGREEMENT
This Amendment No. 1 to Primary Agreement (this "Amendment"), dated as
of the 15th 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
-----------------
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
---------------- --------- --------
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
--------
1.01(C), then the parties hereto agree that for purposes of Sections 2.02, 2.03
--------
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
2
(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
--------- --------
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 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.
3
"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
--------------------
Additional Second Closing Eco Telecom Purchase Price, if any and (ii) the Third
Closing Redirection Amount, if any.
4
"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
-----------------
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
-----------------
redistribution of shares of Eco Telecom Preferred Stock as contemplated
by Section 2.09, and
(iiii) (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.
5
"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
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
--------------
(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 2.02(a)(i) 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 Telecom Shares. In the event that, at the
Second Closing, Eco Telecom delivers to the Issuer the Additional Second Closing
Eco
6
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, 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
---
(A) Subject to the terms and conditions contained in this Agreement and
in accordance with the procedures set forth in Schedule 2.02(a)(ii) attached
--------------------
hereto, on the Second Closing Date (x) the Issuer shall issue and sell to VIP,
and (y) VIP shall purchase from the Issuer, the Second Closing VIP Shares.
7
(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.
-------
(A) Subject to the terms and conditions contained in this Agreement and
in accordance with the procedures set forth in Schedule 2.02(a)(iii) attached
---------------------
hereto, on the Second Closing Date, in the event that 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)
8
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.
--------------
(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
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
----
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
--------
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
------------------
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
--------------------
9
(i) Pre-Closing. On a date which is five (5) Business Days prior to 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 Ducat Place II, 7 Gasheka
Street, Moscow 123056, 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
--------
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 ruble 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 Ducat Place II, 7 Gasheka Street, Moscow 123056,
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 (40th) 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 J.P. Morgan 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 J.P. Morgan
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/ Jo Lunder
--------------------------------------------
Name: Jo Lunder
Title: CEO/General Director
By: /s/ Dmitriy Steshchenko
--------------------------------------------
Name: Dmitriy Steshchenko
Title: Chief Accountant
ECO TELECOM LIMITED
By: /s/ Pavel Kulikov
--------------------------------------------
Name: Pavel Kulikov
Title: Attorney-in-Fact
TELENOR EAST INVEST AS
By: /s/ Henrik Torgersen
--------------------------------------------
Name: Henrik Torgersen
Title: Attorney-in-Fact
OPEN JOINT STOCK COMPANY "VIMPELCOM-REGION"
By: /s/ Alexei Mishchenko
--------------------------------------------
Name: Alexei Mishchenko
Title: General Director
By: /s/ Galina V. Nesterova
--------------------------------------------
Name: Galina V. Nesterova
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
21
Exhibit C
AMENDMENT NO. 1 TO SHAREHOLDERS AGREEMENT
Amendment No. 1 to Shareholders Agreement (this "Amendment"), dated as
of the 15th 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
Shareholders Agreement, dated as of May 30, 2001 (the "Shareholders Agreement");
and
WHEREAS, VIP, Eco Telecom, Telenor and the Company desire to amend the
Shareholders Agreement on the terms set forth herein.
NOW, THEREFORE, to implement the foregoing and in consideration of the
mutual terms, conditions and covenants 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 Shareholders Agreement shall remain valid, binding and in
effect as set forth in the Shareholders 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 Shareholders Agreement.
2. The following definitions set forth in Section 1.01 of the
Shareholders Agreement shall be deleted and shall be of no further force or
effect:
"Board"
"CEO"
"Director"
The definition of "Management Regulations" shall be amended and
restated in its entirety to read as follows: "Management Regulations" shall mean
the Management Regulations on the Procedure for the Company to Conclude
Transactions with Interested Parties (Rukovodstvo o sdelkakh, v sovershenii
kotorykh imeetsya zainteresovannost) adopted by the Shareholders in accordance
with Section 6.03 hereof, as a supplement to the provisions set forth in the
Charter which are applicable to such transactions, as the same may be amended by
decisions of the Shareholders."
3. The provisions of Article II of the Shareholders Agreement shall be
deleted in their entirety and shall be replaced with the phrase: "Intentionally
omitted."
4. (A) The phrase "From and after the date hereof through the second
(2nd) anniversary of the First Closing" in the first sentence of Section 5.02(a)
shall be deleted and replaced with the phrase "From and after the date hereof
through the earlier of (a) the second anniversary of the First Closing and (b)
the Third Closing".
(B) The following provision shall be added to the Shareholders
Agreement as Section 5.02(c):
"(c) The Company's five year funding plan, as approved by the General
Meeting of the Shareholders, is annexed hereto as Exhibit E, and may be amended
from time to time by a decision of the General Meeting of the Shareholders of
the Company (the "Five-Year Plan").
The Shareholders hereby acknowledge and agree that the Company and the
Shareholders shall seek external financing for the "Additional Paid-In Capital"
indicated in the Five-Year Plan. In the event that such external financing is
not obtained by February, 2005 the Company hereby agrees that it shall give the
Shareholders the opportunity to contribute to the Company the amount of cash
necessary to make up such funding shortfall for such "Additional Paid-In
Capital" by providing the Shareholders with written notice of the funding
shortfall and the amount the Company intends to raise through capital
contributions. Each Shareholder shall have the right to make a capital
contribution on a pro rata basis, based on the respective percentage of the
Company's Securities then owned by each such contributing Shareholder and its
Affiliates (provided, that for the purposes hereof, the Company will not be
deemed an Affiliate of VIP) relative to the respective percentage of the
Company's securities then owned by all other contributing Shareholders. In
exchange for and simultaneously with any such contribution, each contributing
Shareholder will be issued shares of Common Stock, based on the amount of cash
contributed by such contributing Shareholder divided by the then applicable Fair
Market Value of each such share of Common Stock determined immediately prior,
and without giving effect, to such contribution (such per share Fair Market
Value, the "Contribution Price").
In the event that a Shareholder does not exercise its option to
contribute its pro rata contribution in full pursuant to the previous paragraph
of this Section 5.02(c) (each such Shareholder, a "Non-contributing
Shareholder"), the Shareholders that make their cash contribution in full (each,
a "Contributing Shareholder") shall have the right to contribute up to the
Non-contributing Shareholder's funding shortfall (the "Additional Contribution")
within ninety (90) days of such non-performance by the Non-contributing
Shareholder. The right to make the Additional Contribution shall be allocated
among the Contributing Shareholders pro rata, based on the respective percentage
of the Company's Securities then owned by each Contributing Shareholder relative
to the number of the Company's Securities then owned by all Contributing
Shareholders, or in such other proportion as the Contributing Shareholders may
agree among themselves. In exchange for and simultaneously with such Additional
Contribution, the Company will issue to each Contributing Shareholder shares of
its Common Stock, such number of shares to be based on the amount of the
Additional Contribution made by each Contributing Shareholder divided by the
Contribution Price.
Each Shareholder and its Affiliates, if applicable, hereby agrees to
take all actions necessary to effect the issuance of such shares of Common Stock
in connection herewith
2
including, but not limited to, voting (or causing to be voted) all of such
Shareholder's and Affiliates' (if applicable) respective voting securities at
any meeting of shareholders (in person or by ballot) of the Company in favor of
any action necessary to effect or fund the foregoing, and each Shareholder
further agrees to waive any rights under Articles 30 and 75 of the Federal Law
"On Joint Stock Companies" dated December 26, 1996, as amended, or similar
rights under Russian Laws"; provided, however, that such obligation shall not
-------- -------
apply if the aggregate amount of such additional funds raised by the Company
through capital increases (excluding the capital increases in connection with
the Second Closing and Third Closing) exceeds Three Hundred Million U.S. Dollars
(US$300,000,000).
5. (A) From and after the date hereof until November 5, 2007, unless an
Eco Telecom Contribution Default has occurred, Section 6.01 and Schedules 1 and
3 of the Shareholders Agreement shall not apply to any proposed Business
Combination and the following provisions, which shall be incorporated into the
Shareholders Agreement as Section 6.01(A), shall govern any proposed Business
Combination initiated and effected during such period:
"6.01(A) Business Combination.
--------------------
(a) At any time following the Third Closing, on and after the date on
which the Company has equal to or more than the number of Subscribers (as
defined below) of VIP's Moscow operations ("VIP-M"), as determined pursuant to
periodic reports publicly released by VIP (the "Reports"), each Shareholder
which owns the Specified Percentage (and, with respect to Eco Telecom only, so
long as there has not occurred an Eco Telecom Contribution Default) shall have
the right to initiate a review of a Business Combination in accordance with the
procedures set forth below and in Schedule I annexed hereto (such initiating
Shareholder, the "Initiating Shareholder" and such review, a "Business
Combination Review"). For the purposes hereof, "Subscribers" of each of VIP-M
and the Company shall be defined in accordance with VIP's policy in effect at
the time of the Business Combination Review. VIP hereby agrees that it will
publicly release the Reports on a quarterly basis, and that such Reports will
contain subscriber figures of both VIP and the Company.
(b) In the event of a Business Combination Review, if (i) the
Subscriber Ratio (as defined in Section 6.01(A)(g) hereof) meets the
requirements set forth in Schedule I, (ii) VIP and the Company have negotiated
the structure and terms of the Business Combination (including, without
limitation, the applicable share exchange ratio) and (iii) the Appraiser
selected by VIP, Eco Telecom and Telenor in accordance with Schedule I provides
VIP (with copies to Eco Telecom and Telenor) with a Fairness Opinion (as defined
in Schedule I) with respect to the 6.01(A) Combination Ratio (as defined and
determined in accordance with Schedule I) acceptable to VIP's board of
directors, in their sole discretion, then each of Eco Telecom, Telenor, VIP and
the Company agree to take the following actions in furtherance of a Business
Combination:
(i) Subject to each party's relevant fiduciary duties and
obtaining shareholder, regulatory and other customary and necessary
approvals, each of VIP and the Company agrees to negotiate in good
faith and use all commercially reasonable efforts to take all
3
actions necessary to effect the Business Combination, including but not
limited to entering into such agreements (subject to usual and
customary terms and conditions) as are necessary to effect the Business
Combination;
(ii) Subject to the foregoing, VIP agrees to submit to its
shareholders for approval (a) the Business Combination and (b) if
applicable, the issuance of common stock by VIP, or a wholly owned
subsidiary of VIP, or such other entity as the Parties may determine in
accordance with the provisions hereof, in connection therewith;
provided, that nothing hereunder shall be deemed to require the board
of directors of VIP to recommend the Business Combination or such stock
issuance in any such submission to its shareholders; and
(iii) Each of Eco Telecom, VIP and Telenor and their
respective Permitted Transferees, if any, agrees to take all actions
within the power of such Shareholder (solely in their respective
capacity as a shareholder of the Company) to approve and effect the
Business Combination, including but not limited to voting any
securities of the Company held by such Shareholder, or any of its
Controlled Affiliates, in favor of the Business Combination.
(c) If the requirements set forth in the first paragraph of Section
6.01(A)(b) are not met, then such proposed Business Combination shall not be
effected pursuant to this Section 6.01(A).
(d) In the event that the Initiating Shareholder commences a Business
Combination Review, all fees and expenses of the Initiating Shareholder, the
non-Initiating Shareholder, the Appraisers and the Company incurred in
connection with the Business Combination Review including, in each case, any
legal, banking, accounting, and regulatory fees and expenses (collectively, the
"Business Combination Fees") shall be paid in accordance with the provisions of
Schedule I; provided, however, that each party shall be responsible for its own
--------- --------
fees and expenses in connection with carrying out the provisions set forth in
Section 6.01(A)(b)(i) hereof.
(e) The Parties acknowledge and agree it is their intent that if Eco
Telecom and/or Telenor, individually, own at least the Specified Percentage of
VIP immediately prior to the consummation of a Business Combination, Eco Telecom
and/or Telenor, as the case may be, should have the right to individually own at
least the Specified Percentage of VIP following such Business Combination.
Accordingly, if Eco Telecom and/or Telenor, individually, own at least the
Specified Percentage of VIP immediately prior to a Business Combination, the
Parties shall use all commercially reasonable efforts to provide Eco Telecom
and/or Telenor, as the case may be, with the opportunity to own individually at
least the Specified Percentage of VIP following such Business Combination. If
the Parties are unable to provide Eco Telecom and/or Telenor, as the case may
be, with such opportunity, Eco Telecom and/or Telenor, as the case may be, shall
not be required to take any action in accordance with this Section 6.01(A) or
Schedule I annexed hereto, including, without limitation, the actions specified
in Section 6.01(A)(b)(iii), in connection with any such Business Combination.
4
(f) For the purposes hereof the term "Subscriber Ratio" shall mean the
ratio of the number of Subscribers of VIP-M to the number of Subscribers of the
Company, which shall be expressed as a ratio of x:y."
(B) From and after the date hereof until November 5, 2007 (or
the consummation of a Business Combination initiated prior to such date, if
applicable), Schedule I annexed hereto shall be incorporated into, and shall be
deemed a part of, the Shareholders Agreement.
(C) From and after the earlier of (a) an Eco Telecom
Contribution Default and (b) November 5, 2007, if a Business Combination has not
been initiated under Section 6.01(A), (i) the foregoing Section 6.01(A) shall be
deleted in its entirety and the provisions of Section 6.01 of the Shareholders
Agreement shall thereafter govern any proposed Business Combination and (ii)
Schedule I annexed hereto shall be deleted in its entirety.
6. Each reference to "the Board of the Company" in Sections
6.02(c)(ii), (iii) and (iv) of the Shareholders Agreement shall be replaced with
the phase "the Shareholders". The phrase "as the Board may determine" in Section
8.01 of the Shareholders Agreement shall be replaced with the phrase "as the
Shareholders may determine". The phrase "as selected by the Board" in Section
8.03(b) of the Shareholders Agreement shall be replaced with the phrase "as
selected by the Shareholders".
7. The following provision shall be added after the last sentence in
Section 6.03 of the Shareholders Agreement.
"The Company shall file and cause to be registered with the Moscow
Registration Chamber and State Registration Chamber, as promptly as practicable
after the effective date hereof (determined in accordance with clause 11 of
Amendment No. 1 to Shareholders Agreement), an amended and restated charter
substantially in the form of Exhibit F annexed hereto. The Company, VIP, Eco
Telecom and Telenor each agree to take all actions within their respective
powers to approve the Charter."
8. Schedules 2 and 2.01(e) to the Shareholders Agreement shall be
deleted in their entirety.
9. The phrase "the board of directors of each of the Company and VIP"
in Section 3(b) of Schedule 3 to the Shareholders Agreement shall be deleted and
replaced with the phrase "the board of directors of VIP and the Shareholders of
the Company". The phrase "If the boards of the Company and VIP" in Section 3(b)
of Schedule 3 to the Shareholders Agreement shall be deleted and replaced with
the phrase "If the board of directors of VIP and the Shareholders of the
Company".
10. Exhibit E and Exhibit F annexed hereto shall be incorporated into,
and shall be deemed a part of, the Shareholders Agreement.
5
11. 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 J.P. Morgan AG, as lender or (Y) at least 80% of all members of
the VIP Board approve the waiver of clause 11(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 J.P. Morgan
AG, as lender, and (Y) at least 80% of all members of the VIP Board do not
approve the waiver of clause 11(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.
12. This Amendment shall become effective only upon its execution by
all parties hereto.
6
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/ Jo Lunder
--------------------------------------------
Name: Jo Lunder
Title: CEO/General Director
By: /s/ Dmitriy Steshchenko
-----------------------------------
Name: Dmitriy Steshchenko
Title: Chief Accountant
ECO TELECOM LIMITED
By: /s/ Pavel Kulikov
-----------------------------------
Name: Pavel Kulikov
Title: Attorney-in-Fact
TELENOR EAST INVEST AS
By: /s/ Henrik Torgersen
--------------------------------------------
Name: Henrik Torgersen
Title: Attorney-in-Fact
OPEN JOINT STOCK COMPANY "VIMPELCOM-REGION"
By: /s/ Alexei Mishchenko
-----------------------------------
Name: Alexei Mishchenko
Title: General Director
By: /s/ Galina V. Nesterova
-----------------------------------
Name: Galina V. Nesterova
Title: Chief Accountant
Schedule I
The following procedures shall be applied for the purpose of assessing a
Business Combination. All capitalized terms used but not otherwise defined
herein shall have the meanings ascribed to such terms in the Shareholders
Agreement, as amended.
1. To initiate a Business Combination Review, the Initiating Shareholder shall
deliver a written notice (the "Review Notice") to the non-Initiating
Shareholders and the Company stating that, based upon the quarterly
Reports, the Subscriber Ratio is within a 20% positive variance of 1:1
(i.e., the subscriber ratio is between 1:1 and 1:1.2). If VIP is the
Initiating Shareholder, the Review Notice shall include the name of the
Appraiser selected by VIP from the list of Appraisers set forth in
paragraph 8 hereof. Telenor and Eco Telecom shall have thirty (30) Business
Days following receipt of a Review Notice from VIP to (i) approve the
Appraiser selected by VIP or (ii) agree jointly with VIP on another
Appraiser. If Eco Telecom or Telenor is the Initiating Shareholder, the
Review Notice shall require VIP to select an Appraiser acceptable to Eco
Telecom and Telenor from the list of Appraisers set forth in paragraph 8
hereof within thirty (30) Business Days following VIP's receipt of such
Review Notice.
2. Upon receipt of the Review Notice, VIP and the Company shall negotiate in
good faith to determine the structure and terms and conditions of the
Business Combination, provided, that VIP and the Company shall consider, as
a possible structure, the acquisition by VIP of all of the issued and
outstanding shares of capital stock of the Company in exchange for newly
issued shares of common stock of VIP, or a wholly owned subsidiary of VIP,
based on the 6.01(A) Combination Ratio and the applicable share exchange
ratio. Immediately following agreement by VIP and the Company on the
structure and terms of the proposed Business Combination (including,
without limitation, the applicable share exchange ratio), VIP and the
Company shall engage the Appraiser selected by VIP, Eco Telecom and Telenor
pursuant to paragraph 1 hereof.
3. The "6.01(A) Combination Ratio" for purposes of the Business Combination
under Section 6.01(A) shall be the ratio of the fair market value of the
equity of VIP on the one hand to the fair market value of the equity of the
Company on the other hand (expressed as a ratio of x:y), and shall be set
at 1:1 as of the date of the latest quarterly Report; provided, however,
that at the time of consummation of the Business Combination, the
Subscriber Ratio shall have a positive variance of no more than 20% (i.e.,
the Subscriber Ratio shall be between 1:1 and 1:1.2) as of the date of the
latest quarterly Report.
4. The Appraiser shall have up to thirty (30) calendar days from the date of
its engagement to render an opinion (the "Fairness Opinion") to VIP's board
of directors as to the fairness, from a financial point of view, to VIP and
its minority shareholders of the 6.01(A) Combination Ratio and the
structure and financial terms of the proposed Business Combination
(including, without limitation, the applicable share exchange ratio). VIP
and the Company each agree to provide such information to the Appraiser as
the Appraiser reasonably requests in delivering its Fairness Opinion.
Copies of the Fairness Opinion shall
be provided to Eco Telecom and Telenor simultaneously with the provision of
the same to VIP.
5. If, within thirty (30) calendar days from the date of its engagement, the
Appraiser delivers to VIP (with copies to Eco Telecom and Telenor) a
Fairness Opinion which is acceptable to VIP's board of directors, in its
sole discretion, and the requirements set forth in the first paragraph of
Section 6.01(A)(b) of the Shareholders Agreement have been satisfied, the
Shareholders shall use all commercially reasonable efforts to effect the
Business Combination in accordance with the procedures set forth in Section
6.01(A) of the Shareholders Agreement, and the Company and VIP shall each
be required to pay 50% of the Business Combination Fees.
6. If the Appraiser is unable to deliver to VIP a Fairness Opinion which is
acceptable to VIP's board of directors, in its sole discretion, within
thirty (30) calendar days from the date of such Appraiser's engagement,
either (i) the Business Combination shall not be effected pursuant to
Section 6.01(A) of the Shareholders Agreement and the Initiating
Shareholder shall be required to pay all Business Combination Fees incurred
in connection with the Business Combination Review or (ii) at least 180
calendar days thereafter (but in any event prior to November 5, 2007), VIP,
Eco Telecom and Telenor may jointly select another Appraiser (from the list
of Appraisers set forth in paragraph 8 hereof) to provide VIP with a
Fairness Opinion, within thirty (30) calendar days from the date of
engagement of such Appraiser, in accordance with the procedures of this
Schedule I.
7. In no event may more than one Review Notice be delivered in any twelve (12)
month period.
8. For the purposes of this Schedule I, an Appraiser shall be selected from
among the following five (5) Appraisers (which Appraiser shall be required
to meet the requirements of an "Appraiser", as defined in the Shareholders
Agreement, at the time of its selection):
o UBS Warburg
o Morgan Stanley Dean Witter & Co.
o Goldman Sachs Group, Inc.
o J.P. Morgan Chase & Co.
o Merrill Lynch & Co., Inc.
Exhibit D
AMENDMENT NO. 1 TO REGISTRATION RIGHTS AGREEMENT
This Amendment No. 1 to Registration Rights Agreement (this
"Amendment"), dated as of the 15th 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
Registration Rights Agreement, dated as of May 30, 2001 (the "Registration
Rights Agreement"); and
WHEREAS, VIP, Eco Telecom, Telenor and the Company desire to amend the
Registration Rights 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 Registration Rights Agreement shall remain valid, binding and
in effect as set forth in the Registration Rights 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 Registration Rights Agreement.
2. The phrase "Board of Directors of the Company" in Sections 2.6(a)
and 2.6(b)(iv) shall be replaced with the phrase "general meeting of
shareholders of the Company".
3. The phrase "by vote of its Board of Directors" in Section 5.3 of the
Registration Rights Agreement shall be replaced with the phrase "by vote of the
general meeting of shareholders of the Company".
4. 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 J.P. Morgan AG, as lender or (Y) at least 80% of all members of
the VIP Board approve the waiver of clause 4(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 J.P. Morgan
AG, as lender, and (Y) at least 80% of all members of the VIP Board do not
approve the waiver of clause 4(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.
5. This Amendment shall become effective only upon its execution by all
parties hereto.
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/ Jo Lunder
-----------------------------------
Name: Jo Lunder
Title: CEO/General Director
By: /s/ Dmitriy Steshchenko
-----------------------------------
Name: Dmitriy Steshchenko
Title: Chief Accountant
ECO TELECOM LIMITED
By: /s/ Pavel Kulikov
-----------------------------------
Name: Pavel Kulikov
Title: Attorney-in-Fact
TELENOR EAST INVEST AS
By: /s/ Henrik Torgersen
-----------------------------------
Name: Henrik Torgersen
Title: Attorney-in-Fact
OPEN JOINT STOCK COMPANY "VIMPELCOM-REGION"
By: /s/ Alexei Mishchenko
-----------------------------------
Name: Alexei Mishchenko
Title: General Director
By: /s/ Galina V. Nesterova
-----------------------------------
Name: Galina V. Nesterova
Title: Chief Accountant